Online Reporter
Nqobile Bhebhe
Zimpapers Business Hub
Nampak Zimbabwe recorded a solid improvement in sales and volumes for the nine months to June 30, 2026, with stronger tobacco packaging demand and a recovery in plastics underpinning the group’s performance despite persistent cost and pricing pressures.
Group revenue rose by 9 percent to US$67,8 million during the period, while total volumes increased by 16 percent compared with the prior year, reflecting stronger activity across key segments and the benefit of tobacco-related orders carried over from the previous financial year.
“Group revenue for the nine months to 30 June 2026 reached US$67,8 million, representing growth of 9 percent compared to the prior year,” the company said in its latest trading update.
The packaging manufacturer said the volume growth was largely driven by the paper segment, where late-season tobacco case orders from the local tobacco industry carried over into the first quarter.
“Group volumes for the nine months ended 30 June 2026 were 16 percent above the prior year mainly through a substantial carryover from the prior year of late-season tobacco case orders from the local tobacco industry in the first quarter.”
The positive momentum was also seen in the third quarter, with group volumes 4 percent above the comparable period, supported by improved demand in plastics and tobacco packaging.
“Group volumes for the third quarter were 4 percent higher than the prior year, driven by improved demand across the plastic and tobacco packaging categories.”
The performance, however, was partly weighed down by subdued demand for metal packaging, supply-chain disruptions affecting raw materials and continued pressure on commercial carton volumes as some customers increasingly manufacture packaging in-house.
“While overall sales performance improved, metal packaging volumes remained below prior-year levels, and commercial carton volumes continued to be impacted by certain customers transitioning to in-house manufacturing capabilities.”
The Hunyani Corrugated Products division was among the key performers, with nine-month volumes 26 percent above the prior year, supported by a larger tobacco crop and stronger demand for cartons during the opening quarter.
“Volumes at Hunyani Corrugated Products division for the nine months ended 30 June 2026 were 26 percent above the prior year, supported by a larger tobacco crop that increased carton volume demand in the first quarter.”
Third-quarter volumes at Hunyani were consistent with the prior year, while tobacco-sector sales increased 3 percent, buoyed by higher carry-over demand.
“Volumes for the third quarter were consistent with the prior year. Sales volumes in the tobacco sector increased by 3 percent compared to the same period last year, supported by higher carry-over demand.”
The company expects tobacco demand to remain resilient through the end of the season, although commercial carton volumes declined 9 percent during the quarter as some customers transitioned to internal manufacturing.
At Mega Pak, nine-month volumes increased 8 percent, while third-quarter volumes surged 14 percent, signalling a meaningful recovery across its product categories.
“Mega Pak Volumes for the nine months ended 30 June 2026 were 8 percent above the prior year, reflecting the positive impact of increased demand in the quarter under review.”
The third-quarter recovery was achieved despite margin compression as the business sought to remain competitive.
“Third quarter sales volumes increased by 14 percent compared to the prior year. The benefit of volume recoveries across all the product categories was partly offset by margin compression to remain competitive.”
Nampak Zimbabwe expects volumes to improve modestly across all business units during the final quarter of the financial year.
The outlook remains cautiously positive, particularly on the back of the larger tobacco crop and continued recovery in plastics.
“Despite these challenges, the Group expects to benefit from the larger tobacco crop, within the paper segment, as well as continued volume recovery in the plastics segment.”
The group, however, expects heightened geopolitical tensions in the Gulf region and the Russia-Ukraine conflict to continue exerting pressure on operating costs.
“In addition, the recent anti-immigrant demonstrations in South Africa may negatively affect regional economic activity through increased repatriation of foreign nationals and disruption to diaspora remittance flows.”
Despite the external headwinds, management said it remained focused on strengthening operational efficiency, controlling costs and improving cash generation.
The group remains ungeared, providing balance-sheet resilience as management navigates the prevailing operating environment.
“Management remains focused on strengthening operational efficiency, optimising costs and enhancing cash generation to support sustainable business performance and profitable growth.”
