HARARE: Masimba Holdings Limited has seen its revenue dipping by 30% to $9,5 million in the six months ended June 30 attributed to suppressed economic activity. In the same period last year, Masimba recorded revenue of $13,6 million. Loss after tax was $339 517 down from $344 390 in 2014.
Speaking at the company’s analysts briefing in Harare yesterday, Masimba chief executive officer Canada Malunga said the first half of the year had been challenging as a result of the continued decline of the economy.
“Construction revenue is expected to grow marginally in the second half of 2015 and significant growth expected in 2016. Decelerating loss in second half of 2015 and business will return to profitability in first half of 2016,” Malunga said.
Notwithstanding the decline in turnover, gross profit percentage improved to 21% compared to 17% during the comparative period last year.
“While the operating environment is expected to remain depressed in the short to medium term, the board is optimistic that a turn in the economy is imminent. The board believes that Masimba will be able to exploit the anticipated infrastructure development opportunities particularly in housing, mining, roads and transport, communication and water,” he said.
Earnings before interest deductions, taxation and amortisation declined to $535 963 from $759 638 due to the lower order book in the construction unit. The group generated positive cash flow from operations amounting to $725 127 from $688 808.
Investing activities utilised cash flows of $149 150 from $229 501, primarily in the acquisition of property, plant and equipment. “Strategic position into the future: 2016 can only be better and what we have been busy trying to do is to take a strategic position.
Sustained overheads have declined by 17% in 2015 and are expected to come to 15% in 2016. Construction head office and support services have been reduced from 130 to 60 in third quarter of 2015,” he said. During the period under review capital expenditure amounted to $158 107 from $273 426.
“Total equity declined by $8,6 million due to the Proplastic dividend in specie. Stable and strong financial position supported by readily available facilities to fund viable projects,” he said. He, however, said government debts to Masimba were reduced to $1 690 297 as at June 2015 compared to $2 996 338 as at December 2014.
