Turnall eyes solar rollout to cut soaring energy costs

LIVINGSTONE MARUFU

Turnall Holdings Limited is planning to invest in a solar energy plant at its factory locations as the building materials manufacturer seeks to improve production reliability and lower electricity costs amid persistent power challenges, Business Times can report.

The company has been grappling with severe electricity outages, which have significantly increased production costs due to heavy reliance on diesel-powered generators.

Newly appointed chairman Kenneth Schofield said the proposed project would focus on transitioning the group’s Harare and Bulawayo factories to solar power as part of a broader long-term strategy to integrate sustainable energy into its roofing and building materials manufacturing operations.

“The group is looking to invest further capital in a solar energy plant that will aim to reduce electricity costs, improve production reliability and allow greater flexibility in the overall energy structure,” Schofield said.

“Turnall has worked on developing specialised roofing products designed to integrate with solar systems. The company’s strategic focus remains on reducing electricity costs and enhancing energy security to sustain its manufacturing operations in Zimbabwe.”

Earlier this year, the group indicated that it was exploring a solar energy project aimed at optimising manufacturing efficiency and reducing exposure to erratic electricity supplies.

Beyond the renewable energy investment, Turnall is also planning to upgrade its Bulawayo sheeting plant in a move expected to support the resumption of export sales into regional markets.

The company said it continues to assess investment opportunities that can mitigate operational risks while positioning the business to take advantage of emerging market opportunities.

In a trading update for the quarter to March 31, 2026, Schofield said the ongoing conflict in the Middle East had disrupted global supply chain logistics, with sectors such as energy, agriculture, remittances and investment particularly vulnerable.

“Fuel prices have already gone up, thereby generating cost-push inflation in the economy. We have the most expensive fuel in the region. This needs to be urgently addressed,” he said.

Despite the difficult operating environment, Turnall recorded strong volume growth during the quarter.

Revenue for the period increased by 19% compared to the same quarter last year, while sales volumes surged by 39% to 7,592 tonnes from 5,464 tonnes, largely driven by strong demand for fascia boards and concrete tiles.

Production volumes also rose by 14% in response to improved market demand.

The company said the power situation remained relatively stable for most of the quarter, allowing production activities to continue with minimal disruptions.

However, gross margins declined to 20% from 22% recorded in the prior year after sharp increases in input costs, particularly during March 2026 following fuel price hikes.

Turnall absorbed the higher operating costs while maintaining existing selling prices.

The operating expenses-to-sales ratio improved significantly to 27% from 37% in the comparable period last year, supported by ongoing cost-containment measures.

The group posted an operating loss of US$208,921 for the quarter, compared to a loss of US$258,524 in the same period last year, representing a 19% improvement.

On March 15, 2026, the company successfully commissioned its new fibre-cement sheeting plant in Harare, marking a major milestone in its capacity expansion strategy.

The new plant is expected to enhance production capacity, improve operational efficiency and broaden the company’s product portfolio.

“As the plant only commenced commercial operations towards the end of the quarter, its contribution to production volumes during the period was limited. The full operational impact is expected to be realised in subsequent quarters as production stabilises,” Schofield said.

Net cash flows generated from operating activities amounted to US$346,321, compared to a net cash outflow of US$235,115 recorded during the comparative period last year.

Working capital movements also contributed positively to liquidity during the quarter.

Trade and other receivables, as well as payables, declined by approximately US$2.2 million each following the offsetting of prepayments against outstanding invoices from the same supplier.

Looking ahead, management expects improved performance as the new fibre-cement sheeting plant in Harare stabilises, tile plant efficiencies improve and market development initiatives begin yielding results.