Financial results generate excitement

the mining index to a weekly rise of 9,7 percent to 271,21 points.
The jump in the country’s largest coal mining firm reflects a weekly gain of 16,8 percent from US77c on 5 March 2010.
The industrial index marginally advanced 2,1 percent to 163,92, lifted by widespread gains as the financial results released by a few counters have generated excitement on the market.
Weekly turnover was US$7,44 million from a total of 59 245 132 shares traded.
Delta was the most liquid counter with the highest turnover of about US$2,3 million followed by Econet at US$1,02 million and Old Mutual at US$402 694.
Pearl and FBC were at US$376 304 and US$358 282 respectively.
Following the year largely characterised by subdued trading as a result of low capacity utilisation and liquidity constraints, a number of companies are likely to report better numbers which could in turn see a rally in some stocks.
After trades on Friday, Radar led the gainers, advancing US6c to US26c, Econet, the country’s largest cellular company was up US4,10c to US485,1c while ABCH rose US3c to US43c.
Innscor inched up by US1,10c to US66,10c. The company posted a 22 percent increase in revenue to US$255,5 million on high volume growth recorded in most operations.
Profits rose to US$19,2 million from US$11,3 million achieved during the previous comparable period.
Cash generation from continued activities remained string at US$26,7 million.
The group says it intends to implement various expansion and refurbishment programmes. The board has declared an interim dividend of US0,6c per share.
Colcom was US1c higher at US41c after reporting 17 percent increase in full year revenue to US$24,4 million from US$20,9 million the previous year.
Profit slightly increased to US$2,4 million from US$2,3 million.
Earnings per share were up 12 percent to US1,5c. On the downward side was TA, which lost US3c to US17c.
PGI slipped US0,3c to US3,3c after the group issued a loss warning statement. In a note to shareholders, PG said full year earnings to December 31 were expected to show losses higher than previously expected.
This has been driven by a third quarter performance which was lower than forecast.
This is due to the timing of the impact of the capitalisation of operations that were discontinued, together with the impairment of plant and equipment across all operations.
Chemco was flat at US35c. The manufacturer and supplier of agricultural and industrial inputs said it is looking to extinguish its US$1,6 million in borrowings through the sale of assets that are non-core to operations.
The group intends to eliminate a lot of that debt to provide additional working capital.
Chemco had inherited legacy costs from discontinued operations and would now focus on the two remaining operations – Agricura and TS Timbers.
Group chairman Mr Anthony Mandiwanza told analysts the group had made important management changes to restore profitability.
Chemco had divested out of areas where they did not have competence and working capital to run them.
Over the past year, Chemco divested itself of Agpy, while Farm-A-Rama, and Farm-A-Rama Transport were disposed of back to the Orphanides family.
The management expects the group to return to profitability in the second half of the financial year to October.
Within the divisions, the group was looking at toll manufacturing projects at Agricura to come up with a range of animal health products, and was considering opening another branch other than Birmingham Road. However this would depend on the availability of product.
At TS Timbers they would continue to concentrate on increasing timber product through the opening of another sawmill given timber products comprised 60 percent to 70 percent of sales in the branches.
Hunyani was also flat at US4c. The pulp and paper packaging and converting company expects profitability to be significant ahead of last year, with the top line forecast to rise by 33 percent to just under US$50 million.
The group said following the recapitalisation and refurbishment of several of the group’s operations, it is expecting a modest profit in six months to April, noting that Hunyani’s profits were usually in a one third-two thirds split given the seasonal nature of the group’s biggest seller – tobacco cartons.
In the year to October 31, 2010, Hunyani posted an attributable profit of US$111 318 on turnover of US$35,3 million.
During the first quarter to January 31, the group had extended planned annual shutdowns at Corrugated Products and Printopak to facilitate the refurbishment of equipment.
The company said all divisions were ahead of budget with the exception of Printopak where losses have been incurred due to poor plant performance. Losses in the first four months were expected to continue to the half year.
The retrenchment exercise had been completed at Pulp & Paper and recurrent expenditure had been significantly reduced.
Around US$500 000 would be raised from the sale of certain assets and the rest would come through borrowings.
Interest costs were high as tobacco companies insisted the group forward buy paper so there were no potential issues over supply. Borrowings currently stood at US$3,8 million.
Barclays Bank gained US0,5 to US7c on Friday. A US$33,9 million cost base which includes US$6,5 million in retrenchment costs led Barclays to a US$1,2 million loss in its December finals against US$1,5 million in 2009.
Staff had been reduced 43 percent to 696 from 1 205 at the end of 2008 as the group realigned its business to a leaner, sustainable and scalable organisational structure.
The payback period for the exercise is projected at two years.
Net income was US$32,1 million with net interest income of US$2,8 million up 133 percent on 2009 and non-funded income of US$29,6 million up 82 percent on 2009.
Cost to income was 105 percent from 98 percent but should come down this year as a result of the restructuring exercise.
Impairments were at US$329 381 due to an increase in provisions while the loan/loss ratio remained below 1 percent.
Total assets on the statement of financial position amounted to US$228,9 million.
Deposits amounted to US$181,2 million, a 31 percent increase and were predominantly commercial at 70 percent.
Loans and advances were up 112 percent to US$43,1 million.