Shareholders exit Turnall

BUSINESS REPORTER

 

Turnall Holdings Limited says some of its shareholders are exiting the company after they could not participate in a capital raising initiative to finance the capital expenditure of the materials concern.

In a cautionary statement yesterday, Turnall said it was withdrawing the statement it issued last month on raising capital from existing shareholders.

“As advised in the cautionary statement dated 30 April, 2023, the company has been considering a rights issue. This has caused several significant shareholders to reconsider their long-term commitment to the business. The shareholders have reached an agreement for the disposal of their shareholding to the major shareholder who remains committed to the long term success of the company,” Turnall said.

Last year ZimBrands seized control of Turnall Holdings after acquiring a 32.55% stake that was formerly held by the National Social Security Authority. It added another 10% in July last year. Its associate Mega Market had a 17.04% in Turnall as of July last year.

The coming in of the new shareholder has seen Turnall embarking on senior management and board changes.

MD Zvidzayi Bikwa resigned before the end of his tenure in February. John Mkushi resigned as chairman to take up the position of acting MD for a period of six months.

Company secretary Cynthia Mahari resigned at the end of last month.  Lizzy Samunda replaced her.

In its financial results for the year to December 31, 2022, Turnall reported a 16% growth in turnover to ZWL$8.4bn from ZWL$7.25bn in the previous year in spite of a 29% reduction in sales volumes.

The sales performance was mainly driven by a deliberate move to focus on the high value but low tonnage products.

However, the liquidity challenges and low aggregate demand prevailing in the economy hampered the group’s efforts to realise its full potential.

The group incurred a loss of ZWL$3.8bn in the reviewed period from a profit of ZWL$1.5bn achieved in the previous year.

Cash generated from operating activities was ZWL$592.4m, representing a 2% decrease compared to the same period last year.

Turnall continued to invest in working capital in order to preserve value in this hyperinflationary environment.

The company’s plant with a value of ZWL$798.9m was impaired during the year and will be replaced by the latest state of the art plant which will be commissioned in Harare in 2024 as part of the company’s recapitalisation programme.

The company had no borrowings during the period under review. All capital requirements were funded from internally generated resources.

 

 

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