RYAN CHIGOCHE
Listed diversified conglomerate, Amalgamated Regional Trading (ART) has narrowed down its loss to ZWL$65m in the six months to March 31, 2022 from ZWL$783m incurred on the back of a growth in revenue and other income.
Revenue from contracting customers was up 18% to ZWL$3.6bn from ZWL$3bn in comparable period last year while other income nearly trebled to ZWL$54,151,000.
In a statement accompanying the company’s financial results, board chairman Thomas Wushe bemoaned the challenging and uncertain macro-economic environment saying the continued shortages of foreign currency, depreciation of the local currency and the inflationary upcycle dampened market improvements which followed the easing of Covid-19 restrictions.
Wushe said the 60% retention threshold was threatening the export business.
He said the company has engaged the government with the view to get a viable retention threshold.
“The group continued to engage the monetary authorities on the unfavourable export proceeds retention threshold which poses a significant risk to the viability of exports,’’ Wushe said.
Overall volumes for the period grew by 9%, with strong performance from the battery export market and volume recovery in all the paper units.
Wushe said the battery business performance in the local market was subdued during the period due to the cumulative impact of the pandemic which exacerbated already high levels of pressure on consumers from inflation and currency instability. Total battery volumes increased by 6% compared to prior year.
The paper business volumes increased by 1% attributable to the foreign currency auction market induced pricing distortions which reduced in the second quarter, the company reported.
Eversharp volumes increased by 39% as a result of strong demand driven by the year end national examinations and back to school preparations while for Mutare timber volumes also increased by 10% compared to the prior year.
The group, Wushe said, has installed a tissue mill and is expected to be complete by year-end.
However, Wushe said the company is aware of looming headwinds in the procurement of raw materials.
But, he remains confident.
“The board is fully aware of the challenges that lie ahead to secure raw materials and sustain production given the prevailing environment. The group believes that this investment puts it at a critical inflection point and will approach the challenges and the new realities of doing business with a positive and proactive mindset,” Wushe said.
ART is confident that their focus on cost containment and cash preservation should enable the business to sustain its positive trajectory.
