Zimplow swings back to profit

STAFF WRITER

Publicly listed diversified industrial group Zimplow Holdings Limited has returned to profitability in the five months to May 31, 2026, rebounding from a loss recorded in the comparable prior-year period on the back of a strong agricultural season, resilient mining activity and a strategic shift towards higher-margin aftersales services.

Presenting the group’s trading update at the annual general meeting, acting chief executive Charles Chaibva said Zimplow posted a consolidated profit before tax of US$426,267 for the five-month period, compared with a loss before tax of US$708,272 in the corresponding period last year, a turnaround of approximately US$1.13m.

The improved performance reflects the benefits of restructuring initiatives implemented in 2025, stronger operational execution and favourable conditions in the group’s key markets.

Zimplow operates a diversified portfolio comprising Farmec, Mealie Brand, Powermec, Scanlink, TrenTyre and CT Bolts.

Chaibva said Farmec, the group’s mechanised agriculture division, emerged as the largest contributor to profitability during the period.

“Revenue rose 13% to US$14.26m, while gross profit margins improved to 27% from 24%, reflecting stronger operational execution, improved pricing discipline and the benefits of restructuring measures implemented last year,” he said.

He attributed the recovery to an improved 2025/26 summer agricultural season, sustained activity in the gold mining sector, continued growth in higher-margin aftersales services and stronger working capital management.

“The performance also reflects the success of restructuring initiatives undertaken in 2025, including workforce rationalisation, optimisation of the branch network, diversification of revenue streams and tighter cost management. Profit before tax was 51% ahead of the board-approved budget for the period,” Chaibva said.

Farmec strengthened its position during the period after recording a profit before tax of US$291,000, supported by a 29% increase in revenue from whole goods, spare parts and workshop services.

Workshop service hours rose 47%, while parts revenue exceeded budget by 12%, generating margins of more than 60%.

The division has also benefited significantly from Zimplow’s deliberate strategy of expanding its aftersales business, with workshop service hours rising to 5,177, comfortably above the budgeted 4,034 hours and the 3,531 hours recorded during the same period last year.

Management said the performance demonstrates that investments in customer relationships are translating into repeat servicing and parts sales, which continue to generate superior margins compared to equipment sales.

Looking ahead, Chaibva said the group remains cautiously optimistic about the second half of the financial year.

He said the expected inflows from the cereal harvest, improved electricity supply, continued strong activity in the mining sector supported by firm gold prices and customer financing programmes introduced across the group are expected to sustain the recovery.

“We remain committed to consolidating the recovery achieved during these five months and delivering a full-year performance that justifies the confidence shareholders have placed in the group’s long-term strategy,” Chaibva said.