Solid order book buoys Masimba
BUSINESS REPORTER
Construction firm, Masimba Holdings, reported solid financial results for the six months to June 30, 2021, owing to a solid order book across sectors and improved debt collections, Business Times can report.
Masimba is undertaking a number of government and private sector projects across the country.
“The group has a strong order book that is evenly balanced between the private and public sectors,” the board chairman, Gregory Sebborn said.
Revenue for group in the period under review jumped 58% to ZWL$2.2bn from ZWL$1.4bn.
Sebborn said revenue earned in US$ as a proportion to total revenue for the period improved to 35% from 20% during the same period in 2020 owing to a diversified project portfolio.
Profit after tax grew 15% to ZWL$292m from ZWL$252.9m, mainly due to inclement weather in the first quarter, which negatively affected productivity, particularly in the roads segment.
The financial position strengthened to ZWL$6.71bn from ZWL$5.5bn on the back of acquisitions of investment property, plant, and equipment, in line with the value preservation strategy.
The capital expenditure was financed by a combination of internal and external resources.
Resultantly, borrowings increased to ZWL$255m from ZWL$156m representing a sustainable debt-to-equity position of 10% from 8% at the close of the reporting period.
Contracts in progress, contracts receivables, and other receivables at ZWL$3,6bn from ZWL$3,3bn grew by 9% compared to a 39% growth in revenue volumes.
Cash generated by operating activities improved to ZWL$266m from ZWL$264m and this was largely expended on capital expenditure of ZWL$114m and investment property of ZWL$162m to support the growing order book and preserve value, respectively.
Sebborn said in line with the business strategy of managing credit risk, accounts payable increased to ZWL$3.4bn from ZWL$3.05bn, mostly due to advance payments received from clients
In the outlook, Masimba expects the operating environment to remain stable in the short term based on interventions being implemented by the government.
Sebborn said the Dutch auction system was providing a sustainable source of foreign currency, urging the Reserve Bank of Zimbabwe to address the backlogs in foreign currency settlement.
