Online Reporter
Nelson Gahadza
Zimpapers Business Hub
CAFCA Limited’s sales volumes for the third quarter to June 30, 2025, grew by 31 percent compared to the previous quarter (Q2), but were 14 percent lower than the same quarter last year, largely as a result of constrained uptake from the utilities sector.
The company, in a trading update, said year-to-date volumes were 16 percent behind the prior year, with copper cables 6 percent down and aluminium conductors and cables 37 percent down against the prior year.
“Liquidity constraints affected the utility sector’s uptake, which declined by 49 percent during the quarter under review compared to the prior year. CAFCA is actively engaging the related stakeholders to improve terms and conditions that facilitate increased uptake,” said company secretary Mrs Caroline Kangara in a trading update.
She said commercial activity during the quarter under review was buoyed by the construction sector, which was 19 percent up and the manufacturing sector, which was 11 percent up compared to the same period last year.
“However, mining sector volumes declined by 62 percent, impacted by a slowdown in commodity prices, while retail and distribution volumes for the quarter rose by 23 percent year-on-year, reflecting successful engagement with distributors and end consumers,” said Mrs Kangara.
She noted that during the quarter under review, CAFCA also enhanced customer experience by upgrading the factory shop’s sales reception.
CAFCA is a leading manufacturer and supplier of cables for the transmission and distribution of electrical energy and information.
The company’s export volumes for the quarter under review remained flat due to persistent liquidity challenges in key markets affecting payment remittances.
Kangara said management continued to pursue manufacturing excellence through equipment upgrades to eliminate bottlenecks, moving to a 2-shift system from a 3-shift system and the introduction of a new production planning philosophy.
“The commissioning of a new stranding machine notably boosted aluminium conductor and cable capacity,” she said.
She added that despite a 4 percent decline in production compared to the prior year, aligned with reduced demand, sales hit rates exceeded expectations, and stock levels remain sufficient to meet market needs.
Mrs Kangara said CAFCA will continue exploring partnerships with utilities and export markets to optimise factory utilisation.
In terms of financial performance, Mrs Kangara said revenue performance tracked volume performance, with year-to-date revenue 5 percent lower than the prior year.
The group’s margins were affected by increases in average material costs for copper, which were 15 percent up, and aluminium, 28 percent up, on a year-to-date basis.
“Due to heightened competition, increased material costs were absorbed into margins. Other operating costs remained largely unchanged,” she said.
Mrs Kangara noted that management is focused on expanding earnings before interest, tax, depreciation and amortisation (EBITDA) margins through supply chain optimisation, conversion cost efficiency and administrative modernisation.
The company indicated that the stable trading environment is expected to continue, with gross domestic product (GDP) projected to grow by 6 percent, driven by agricultural recovery.
“While CAFCA anticipates a rebound in sales volumes, margin pressure will persist as the company defends its market share,” Mrs Kangara said.
She indicated that going forward, the company’s priorities include strengthening engagement with utilities, mines, distributors, and contractors; enhancing internal efficiencies to improve margins; pursuing manufacturing excellence and safety; and increasing communications to reinforce brand strength.
