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Business Reporter
LISTED cabling products maker, CAFCA, has started reaping benefits from its Rwandan foray after export volumes surged 34,55 percent to 74 tonnes in the first quarter of 2022 .
The company said besides the sales in Rwanda, the Zimbabwe Stock Exchange (ZSE) entity also benefited from a large order book from Mozambique market.
“Export volumes were 74 tonnes in the current quarter versus 55 tonnes in the same quarter last year. In addition to a large order to Mozambique we also had our first sales from our consignment stock arrangement in Rwanda,” CAFCA said.
The group said due to the strong demand for its products and new markets, it expected to register an increase in average six months’ sales volume by about 10 percent.
In a trading update the company said, “Accordingly, we are forecasting a six monthly volume increase over the previous year’s six monthly volume of around 10 percent.”
CAFCA said, Covid-19 policies and protocols had now become predictable and no longer a risk to be considered in short term planning and mitigation.
Local volumes were in line with the previous year performance mainly due to no significant changes in the macro economic environment with foreign currency pricing and allocation being the focus of all economic commentary.
CAFCA earlier in the year said it had secured loans and overdraft facilities amounting to $320 million, which have the potential to improve the company’s financial position to execute some of its operations.
Company secretary, Caroline Kangara said the company had put adequate resources in place to match the anticipated volume growth this year. She, however, acknowledged the mounting pressure to consolidate market share in the region as competitors’ numbers and volumes continue to grow.
“The company’s management believes that despite Covid-19 the business will remain in operation for the foreseeable future.
“The company will continue operating as a going concern as demand for cable has remained firm with sales volumes projected to increase to 2 700 tonnes from 2 600 tonnes in the ensuing way.
“We have budgeted for a modest increase in volumes in 2021/22 against a background of uncertainty in the foreign currency availability and pricing as well as the impact of increased competition in our regional markets,” said Ms Kangara.
In spite of the negative effects from the Covid-19 pandemic, the company has promised to take advantage of prospects that may arise in either the local or export markets through the adoption of adequate mitigating strategies against the challenging local economic environment as part of its future strategy.
CAFCA’s primary markets are in Southern and Central Africa, although it has an export footprint that stretches into the European Union (EU) and Russia.
About 95,8 percent of CAFCA’s produce in 2021 was consumed locally while the balance went to export markets.
Despite challenges presented by the Covid-19 induced lockdowns, CAFCA said it was happy critical raw materials were still shipped without much interruption.
The Zimbabwe Stock Exchange-listed company manufactures and supplies cables and allied products for the transmission and distribution of electrical energy and telecommunications. It also manufactures over 900 cabling products to British and South African markets including 11KV XLPE cables.
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