Cafca posts lukewarm financial results

Revenue  for  the interim period to March was static at US$10,9 million,  while  margins  remained tight  in the  face  of  competition from imports. Operating profit for the  period was flat at US$1,2 million, while   borrowings  declined  by  65,3%. The company said  borrowings  would be  kept to a minimum, with  any cash  generated  appropriately  channelled to  strategic  debtors  or finished   goods  inventory.

Cafca said debtors were being  contained at the expense of revenue  by not selling to companies that had exceeded their credit terms. The company is therefore not anticipating any revenue growth in the short term as it continues to enforce stringent credit limits and  battle tight  liquidity in the market.

Earnings   per  share marginally  improved  to  US2,7 cents,  up from  US2,6 cents  in the  same  period  the  previous  year. The company said exports were currently at 20% of volumes in the last quarter and would be   grown in the traditional markets, while  assistance would be  sought  from major shareholders  to access niche  markets.

Net financing costs significantly improved by 15% to US$63 885, in  the  period from the US$75 300 recorded the  previous  year in the  same period. Inventories improved by 27% to US$6,1 million, up from US$4,4 million in the comparative period.

Cafca said its finished goods inventory had been deliberately  increased to reduce lead times. Finished goods stockholding was increased to around 300 tonnes valued at US$3 million. Purchases from CBI- Electric  African  cables,  which is  a  division of ACT (Pvt)  Limited, increased to US$6,2 million,  up  from   US$3,5 million recorded  in the  previous  year.

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