Zimplow interim results defy Covid-19

05 Oct, 2020 - 00:10 0 Views
Zimplow interim results defy Covid-19

The Herald

Business Reporter
LISTED agriculture implements manufacturer, Zimplow, recorded improved profitability in the first half of 2020 as most unit boosted revenues despite the impact of the Covid-19 pandemic to help the group post a 12 percent growth in revenue to $479 million from $428 million the prior year comparative, in inflation-adjusted terms.

Resultantly, profit after tax improved 5 percent from $134 million to $140 million. “In the first half of the year, all business metrics were affected by the Covid-19 pandemic,” said chairman Thomas Chataika.

“The group managed to pull through this difficult and unprecedented trading period.” Linchpin subsidiary, Barzem’s revenues went up 145 percent to $221 million from $90 million.

The unit sold 13 CAT whole goods in the first half compared to 2 in the same period of the prior year.

After sales business parts and service hours were also ahead of the previous year by 3 percent and 19 percent respectively despite losing hours to the Covid-19 induced lockdowns.

CT Bolts was another positive performer, posting a stellar 73 percent growth in revenue to reach $22 million.

The unit also achieved 21 percent volumes growth compared to same period last year. Operating profit for the unit was also up 25 percent to $10,6 million.

The unit will continue to focus on product spread, while realigning its distribution channels.

Powermec revenues, however, remained unchanged at $52,2 million with generator sales at the same level as last year.

The after sales business showed improvement with parts sales 10 percent ahead of prior year in real terms and service hours sold 111 percent ahead of the prior period.

Farmec’s operating profit for the first six months grew to $72 million from $62 million prior year.

“This growth was supported by the implements sales volumes, which were 35 percent ahead of prior year,” said management.

Tractor volumes were 28 percent behind prior year at 33 units sold.

And after sales parts and hours sold dipped 13 percent and 29 percent, respectively.

“We are encouraged by the reception of the MF Global Series range of tractors by the Zimbabwean farmers and the subsequent arrival of lower range horse power tractors just after H1,” added the group.

But the biggest loser during the period under review was the Mealie Brand division, whose performance for the first half declined sharply compared to the same period last year “mainly due to the lingering effects of last years’ drought and limited access to regional markets,” explained management.

Local and export implements volumes were 62 percent and 84 percent down respectively.

“The first two trading months after half-year end are showing a recovery in business revenues,” they added.

The board did not declare a dividend for the half year “due to the loss in trading days and the importance of conserving cash.”

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