Online Reporter
Nelson Gahadza
Zimbabwean firms are increasingly prioritising cost management and seeking innovative revenue streams to defend their profit margins, according to recent financial publications from selected firms listed on both the Zimbabwe Stock Exchange (ZSE) and Victoria Falls Stock Exchange (VFEX). This strategic shift comes amidst a period of improved macroeconomic stability, largely attributed to the adoption of the Zimbabwe Gold (ZiG) currency.
Companies across various sectors are focusing on strengthening their financial performance through stringent cost control and positive cash generation.
Zimplow Holdings, an agricultural concern, reported in its six-month results to March 31, 2025, that it is extending cost-saving initiatives previously successful at its Farmec and Mealie Brand units to other business segments.
“Administration and operating cost-saving initiatives successfully instituted at Farmec and Mealie Brand are being extended to other business units,” the group said.
The group is also focusing on liquidating high-value and ageing stock and enforcing stronger payment terms. While reporting a 14 percent increase in revenue to US$7,06 million, Zimplow recorded a net loss before tax of US$513 000 for the period.
Similarly, Dairibord Holdings stated its continued commitment to prioritising cost management and positive cash generation. The company anticipates sustained growth momentum into the second quarter, bolstered by consistent product supply resulting from enhanced capacity across key brands.
The Zimbabwean Government believes that the prevailing macroeconomic stability has enabled companies to increase capacity and plan for the long term due to a more predictable operating environment. The economy has shown signs of stability, particularly with the introduction of the ZiG, which has reportedly slowed inflation and brought predictability to exchange rates.
Mr Lloyd Mlotshwa, head of research at broking firm IH Securities, emphasised the need for companies to focus on greater efficiencies, leveraging technology to streamline production processes and reduce costs, and utilising Artificial Intelligence to improve business management.
He also highlighted the importance of strong working capital management, given the high funding costs and challenging liquidity conditions.
“Strong working capital management as funding costs remain high and liquidity remains challenging,” he said.
Mr Mlotshwa noted a significant improvement in stability relative to the past, with greater discipline in the currency and exchange rate framework being a key contributing factor. He added that recent month-on-month inflation figures reflect a slowing in price volatility, which is crucial for long-term planning for both companies and individuals.
“Recent month-on-month inflation figures reflect a slowing in price volatility which is critical in long-term planning both for companies and individuals,” he said.
Tanganda Tea Company acknowledged a challenging operating environment characterised by tight liquidity and policy changes. However, the company highlighted strong demand for its products and is pursuing market diversification strategies. T
anganda is also focused on improving process efficiencies and cost management to enhance performance, with capital raising initiatives currently underway.
“The company is focused on improving process efficiencies and cost management to enhance performance. “Capital raising initiatives are underway,” the company said.
General Beltings reported the commissioning of a second boiler in its rubber division, leading to improved internal process efficiencies. Its chemical division, Cernol Chemicals, experienced volume growth due to market recovery in traditional markets and expansion into niche areas.
The company anticipates increased demand for its products, driven by global economic recovery and improved market conditions. GB Holdings plans to leverage its enhanced production capacity and internally generated working capital to meet this demand, with strategic partnerships and skills retention being key priorities for maintaining competitiveness.
Financial analyst Mr Malone Gwadu affirmed that companies are prioritising cost-cutting to defend their margins. He also noted that seeking new revenue streams through innovation and strategic integrations has become crucial for survival, citing insurance companies tapping into fintech to capture more clients.
“They are also seeking new revenue streams through innovation, and strategic integrations have become an area of survival.
“We have seen these insurance companies tapping into fintech to further capture more clients,” he said.
Mr Gwadu stressed the need for long-term strategic policies that are immune to circumstantial changes to foster certainty and facilitate long-term planning for companies.
