TURNALL Holdings Ltd managing director Phil Whitehead says the company is sitting on a full order book on piping products in excess of two months’ sales.
He says volumes have increased and the first quarter firm on track buoyed by strong export demand for the company’s products.
Whitehead said: “The first quarter has been sound and we are on track for some positive half-year to June 30 results. The second quarter of the first half appears healthy judging from the seasonality of our business where demand increases from the second quarter of the first half into the last quarter of the year. We believe this to be in line with management thrust to remain focused on expanding export markets and consolidating the dominant local position.”
Whitehead said the trading divisions of Turnall Fibre Cement had been performing above expectation.
Although local margins were down on last year, strong export margins spurred on the company’s overall margins making business much stronger than anticipated.
The demand for piping products particularly in the irrigation sector locally and housing infrastructure development in Namibia and South Africa has made the company buoyant with the managing director confident with the progression of the year.
“The sales margins were supported by aggressive marketing in the neighbouring export territories. The largest of these being the South African market were we continue to see volume growth,” he said.
Whitehead told the company’s maiden annual general meeting that demand for roof sheets had been steadily increasing, as people prefer to stockpile in building materials.
Whitehead said the slow down in the construction sector, which shrunk by between 10% and 15% had a lesser impact on the company’s performance and volumes as business progressed according to plan.
“We have a strong performance culture and the gains in our share price since the day of listing indicates that Turnall is currently a cheap good counter in which investors can safely tap in and stock,” said the managing director.
Turnall Holdings, which was listed on the Zimbabwe Stock Exchange in November last year, emerged from the successful unbundling and subsequent de-listing of TH Zimbabwe. Improvements in productivity and factory efficiencies, selling price opportunities and high export performance have been signaled as being the drivers behind the group’s strong first half performance.
Investment research analysts said Turnall was poised for greater performance arising from the company’s focus on exports.
“The company is set to surpass analysts range of forecasts this first half in light of strong demand from exports if the group takes advantage of housing and infrastructure developments in the region to grow that market,” an analyst said.
If exports grow from the $1,1 billion or 23% of total turnover of $4,8 billion recorded in the six months to December 2002, Turnall is in a position to better the last half performance. “Turnall is a good counter that would be worthy seriously considering,” the analyst said.