Masimba upbeat on growth
CLOUDINE MATOLA
Publicly traded construction and engineering group Masimba Holdings says it is on course to outperform last year’s financial performance, underpinned by a US$300m order book, an expanding pipeline of infrastructure projects and increased private sector activity, Business Times can report.
Speaking on the sidelines of the company’s annual general meeting, chief executive officer Fungai Matahwa said the group was confident of delivering higher revenue this year despite a more competitive operating environment.
“Our outlook is positive. We are going to surpass last year in terms of revenue. Our order book remains solid and there are a number of projects in the pipeline that we are confident of securing and executing, enabling us to exceed last year’s turnover,” Matahwa said.
He said the group’s US$300m order book is supported by a healthy pipeline of opportunities spanning mining infrastructure, roads, housing and commercial developments.
To support future growth, Masimba plans to invest a total of US$6.4m in capital expenditure this year, having already deployed US$1.8m during the first quarter.
“We invested about US$1.8m in the first quarter, while our planned capital expenditure for the full year is approximately US$6.4m,” Matahwa said.
The group reported an 8% increase in first-quarter revenue to US$8.7m, up from US$8m in the comparable period last year, reflecting sustained activity across its project portfolio.
However, gross profit margin eased to 26% from 29% as the company increasingly shifted its focus towards private sector contracts, where competition is more intense.
“Our strategy is to increase the contribution of private sector projects. Naturally, that market is more competitive, which has placed some pressure on margins,” Matahwa said.
“However, as we continue investing in technology and improving execution efficiencies, we expect our margins to recover and remain broadly in line with historical levels. The current decline is temporary and reflects the upfront investment required to compete effectively in this segment.”
Despite the softer margins, Masimba’s first-quarter profit rose 1% to US$400,000, underlining the resilience of its business model, disciplined cost management and operational efficiency.
The company is currently executing several flagship projects, including the Northgate housing development, which is scheduled for completion this year, ongoing works at Unki and Blanket mines, and preparations for the Harare-Chirundu Highway rehabilitation project, which is expected to commence shortly.
