LIVINGSTONE MARUFU
Zimplow Holdings Limited has delivered a stellar performance across units in the first quarter to March 31 2021, buoyed by a stable currency, infrastructure development projects and the prospects of a bumper harvest.
The manufacturer and distributor of agricultural, infrastructure, mining and construction equipment said volumes surged in all but one unit. Zimplow operates five divisions—Barzem, CT Bolts, Mealie Brands, Powermec and Farmec.
A second wave of the Covid-19 during the reviewed period, however, negatively impacted Powermec, the official distributor of Perkins parts and engines in Zimbabwe.
Powermec suffered a 33% decline in volumes during the reviewed period due to reduced activities during the Covid-19 lockdown restrictions.
“The group has had a very positive start to the year with the first quarter operating performance ahead of prior year,” group company secretary, Charles Chaibva said.
Zimplow’s agricultural equipment manufacturer, Mealiebrand, had a strong three months to March with volumes growing 39% in the reviewed period from prior comparative period. Spares uptake, Chaibva said, grew 86% and 68% growth against prior year in the local and export markets respectively.
He said Zimplow was closely engaging the supply chain following the general increase in steel prices experienced in the last six months.
Volumes at Zimplow’s earthmoving and power systems unit, Barzem, grew 13% with the product mix largely skewed towards earth moving equipment for the infrastructure development sector, unlike in the prior year where 50% of the units came from CAT gensets and lift trucks.
Overall aftersales performance, driven by a 34% growth in parts sales, has been ahead of prior year despite workshop volumes losing hours to Covid-19 lockdowns.
After sales performance was 38% ahead of prior year and the unit continues to focus on capital allocation and working capital management to ensure that it meets the customers’ farm equipment needs upon order.
Farmec, which supplies tractors and combine harvesters, saw tractor volumes doubling in the period under review while implements increased 76%.
Volumes at Zimplow’s manufacturer and distributor of steel bolts, nuts and a wide range of other fasteners, CT Bolts, grew 24% as the unit continued to develop new relationships and markets during the quarter.
The group, Chaibva said, took advantage of the encouraging trading conditions to reduce the impact of Covid-19 on the supply chains by securing liquidity and therefore ramp up inventories in preparation of the year ahead. The unit looks forward to improved performance following the easing of lockdown restrictions.
Chaibva said the group will continue to put effort in Covid-19 prevention protocols, the uncertainty and risks brought by the pandemic requires constant review of business models in terms of levels of working capital elements, costs containment and capacity improvement projects.
Chaibva said currently, Zimplow is stable and of a sound going concern.
The group is banking on increased uptake of the Covid-19 vaccination to navigate the pandemic and provide better prospects for Zimplow in 2021.
