HomeBusiness DigestStock drives Cafca earnings

Stock drives Cafca earnings

A US$1,3 million investment in stock helped cable manufacturer Cafca post a 29% increase in earnings as the company became better placed to reduce lead times and generally meet customers’ demand.

Report by Gamma Mudarikiri

In a statement attached to the Cafca’s financial results, company secretary, Caroline Kangara, said the investment was financed  mainly from the company’s profits and borrowings.

Basic earnings per share improved 29% to US$5,13  compared  to US$3,97.

The company’s total liabilities  and  equity in the period  marginally  increased  to US$13,3 million  compared to US$12,1 million  in the nine months to September 2011.

The company said the  reporting period was 12 months against  a nine  months  comparative  as  the financial year end was changed to coincide with that of the majority shareholder,  CBi Electric African Cables South Africa, for the  purposes of consolidation.
Cafca is listed on the Zimbabwe, Johannesburg and London stock exchanges.

The company’s  net  borrowings position was  US$688 000 of which US$600 000 was  a once-off investment  in aluminium  raw  materials  to overcome  a short-term  market  shortage.

The company, however, said it would maintain borrowings below the current level due  to uncertainty in the economy.

“Due to uncertainty in the economic environment, we are forecasting to at least maintain current  throughput  for  the  next  twelve months with the only downturn  in demand being replaced with recycling copper barter deals”,  said  the company statement.

Turnover in the year surged  25% to US$23,1 million  compared  to US$18,3 million in the comparative period.

Operating profit increased 19% to US$2,3 million, which the company said reflected a stagnant and difficult market.

Finance costs during the year  reduced  to  US$89 780,  against   US$170 776 in the previous year.

The  decrease  was attributed  to  reduced  borrowings  and   cheaper borrowing  costs.

Recent Posts

Stories you will enjoy

Recommended reading