CASSAVA Smartech is pursuing robust infrastructure upgrades and income diversification strategies as it rebuilds its tech-based operation into a world-class firm with impetus to respond to market turbulences.
This was a key message delivered to the market last Friday, as the ambitious tech giant revealed that its first full year of operations added ZW$4,6 billion (US$57,5 million) fresh revenues to the business.
Last week’s financial statements represented the group’s first full year of operations following a demerger from Econet Wireless Zimbabwe. Subsequent to its establishment, Cassava traded for only four months of the previous year.
Chairperson Sherree Shereni said her strategy will see the listed outfit review Steward Bank’s systems and capacitate it to respond to customers’ requirements following a difficult year on the digital banking platform.
One of the pioneers in a revolution to build banks that ride on digital platforms to facilitate transactions, Steward Bank has had a fair share of challenges in the past year, with staff working around the clock to explain to enraged customers the driving forces behind regular disruptions.
This could point to Shereni’s urgency to restore the bank’s lost pride as the leader of digital banking in Zimbabwe.
But still, Cassava said Steward, together with Zimbabwe’s biggest mobile money transfer platform, EcoCash, generated the bulk of the revenue during the period with a combined 80%.
An upgrade of Steward’s platform will be the next big phase in Cassava’s ambition to rule the Zimbabwean digital banking space following a similar investment at EcoCash, which gave the business a near 100% success rate.
But after seeing ZW$2 billion (US$25 million) wiped out of the business in currency related risks, Shereni is moving quickly to seal all internal gaps that may erode shareholder value, building up her defences to assure them that the business is well placed to charge into the next 12 months.
“We are operating in a volatile, uncertain, complex and ambiguous environment which calls for new ways of managing risks whilst preserving shareholder value,” Shereni said in a commentary to the financial results.
“We will continue seeking opportunities that grow shareholder value and allow us to build a sustainable, competitive advantage in the market . . . The success of our business is predicated upon the stability, efficiency and effectiveness of our technology platforms. The group is cognisant that our customers entrust their confidence to us based on our continued ability to deliver a consistently high quality of service. In the next financial year, the group has also embarked on a banking system upgrade which will improve customer service whilst enhancing the bank’s operational efficiency. We always aim to have robust, world-class digital infrastructure in line with our corporate vision,” the Cassava boss added.
She spoke as Cassava’s financial statements revealed a huge market switch to the EcoCash mobile money transfer platform, which has outfoxed generally weak competition in Zimbabwe, riding on what she describes as its convenience and availability.
“EcoCash has dramatically improved as measured by speed of transacting and the near 100% rate of successful transaction completion,” she said.
Shereni said revenues rose by 43% to $4,6 billion, compared to ZW$1,1 billion (US$13,7 million) during the four months to February 2019.
Cassava’s gross profit margin rose 68% from 57% in 2019, while the earnings before interest, tax, depreciation and amortisation margin defied Zimbabwe’s economic crisis, rising to 29%, from 27% previously.