malvernmugadzikwa
Michael Tome Business Writer
ART Corporation says capitalization and reformation of its paper business succeeded during the 2022 financial year as the company completed installations with full commercial production expected to start this December.
According to the company, the capitalization and reformation programme was achieved albeit global economic challenges which persisted during the 2022 financial year, largely stoked by the Russia–Ukraine conflict.
Some of the challenges met by the business consist of a shortage of wastepaper on the local market, a position that was compounded by insistent power outages that hit the country during the course of the year.
This consequently led to a 15 percent decline in overall paper volumes uptake, while export volumes closed five percent ahead of the prior year.
“Power supply and the unavailability of sufficient local waste paper remain as the major challenges for the business.
“Partnerships concluded during the year with waste paper suppliers in Botswana and South Africa helped to sustain production,” said Dr Thomas Wushe, the ART Corporation chairman in the statement of the financials accompanying the 2022 report.
Economic headwinds also hindered the battery manufacturing segment performance mainly affected by the worldwide supply chain disruptions and power shortage in the first half of the year.
This was despite export market demand for batteries as the business witnessed a 12 percent volume growth in exports.
“Liquidity constraints in the local market and foreign currency shortages in Malawi necessitated changes in trading terms in order to manage credit risk with a resultant impact on volumes,” Dr Wushe added.
The company however decided to temporarily halt capital expenditure meant to widen the product range owing to the obtaining high interest rates and a decline in aggregate demand.
Bongani Ndlovu