ZIMPLOW’s trading patterns have not changed significantly during the first quarter of the current financial year, with group revenues at the same levels as prior year, CEO Zondi Kumwenda told shareholders recently.
At an annual general meeting in Bulawayo, Kumwenda said the economy remained hamstrung by tight liquidity constraints, high interest rates, and subdued performance by key sectors of the economy.
“The low liquidity levels have also resulted in a number of customers delaying settlement of their accounts, thereby inhibiting sales and re-stocking programmes,” Kumwenda said.
He also said the impending elections had seen some customers deferring capital expenditure to the post-election period, thereby negatively impacting on the group’s tractor and earth moving equipment business, Barzem.
Kumwenda said following the loss incurred in the December 2012 year end, the group would probably achieve an operating profit or at least break-even in the half year.
Sales of earthmoving equipment such as lift-trucks as well as of generators were 35% up on last year. The business unit continued to exceed targets.
Tractor volumes from the mechanical agricultural divisions were 46% down on last year although March reflected a significant improvement. The slowdown was a spillover effect of drought from prior years.
Motor vehicle sales at Puzey & Payne were 40% down on prior year, with sales of Toyota units subdued compared to the previous year owing to liquidity constraints and limited asset-based financing facilities.
Mealie Brand local volumes were up by 48% and orders continued to be received for April. Export volumes, however, were down by 86% due to delayed shipments into the regions. Margins have been maintained from last year. Afritrac’s contribution was miniscule for the quarter.