Nampak optimistic about operating environment
CLOUDINE MATOLA
Zimbabwe’s leading packaging manufacturer, Nampak Zimbabwe Limited, says it is cautiously optimistic about an improved business landscape, contingent on sustained fiscal and monetary stability.
The company’s managing director, John Van Gend, said the operating environment still requires deliberate government action to maintain market confidence and support productive sectors.
“The group is cautiously optimistic about the prospects for an improved operating environment, which requires concerted efforts from the fiscal and monetary authorities to sustain economic conditions that enable the business community to succeed,” Van Gend said.
He noted that the group’s strategic focus will remain anchored on cost optimisation and operational efficiency as it positions for sustainable growth.
“The business will maintain its focus on improving operational efficiencies and implementing cost-optimisation strategies to achieve sustainable growth. This approach includes thoughtful considerations for capital expenditure aimed at enhancing capacity and profitability,” he said.
Nampak recorded a 39% increase in revenue compared to the prior year, largely driven by strong demand linked to the tobacco crop and improved volumes in PET preforms during the previous tobacco marketing season.
Volumes during the period under review also rose ahead of the prior year, supported by the carryover of late-season tobacco case orders from local merchants.
The company reported notable improvements in demand within the PET preforms category. However, commercial corrugated volumes remained subdued due to weak demand amid an increasingly competitive market environment.
Metal packaging volumes declined compared to the prior year, weighed down by delays in the raw material supply chain as well as product rationalisation measures designed to align output with prevailing market demand.
Looking ahead, management expects volumes across most business units to firm in line with steady demand for packaging solutions.
Van Gend added that commercial carton volumes and sales in the cartons, labels and sacks division softened despite pockets of resilience, particularly demand for tobacco paper wrap.
“Commercial carton volumes in the quarter under review were 11% below the prior year, as demand softened amid some customers moving to self-manufacture of their packaging. Cartons, labels, and sacks division sales volumes fell 10% in the first quarter compared to the prior year, despite improved demand for tobacco paper wrap. Commercial packaging volumes were lower due to weak demand and contributed to the overall drop in volumes compared to the prior year,” he said.
