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Michael Tome
NAMPAK Zimbabwe Limited posted a loss of $823,4 million, a 1 874 percent dip for the year ending September 30, 2019, down from a profit of $41,7 million earned in prior year comparative (2018).
Nampak attributed the significant loss to fiscal and monetary policy measures instituted by Government during the financial year under review.
Other material expenses sustained in the period under review included foreign exchange losses that amounted to $686,4 million emanating from legacy debts, while an impairment of the Reserve Bank of Zimbabwe (RBZ) non-current receivable by $733,2 million.
Revenue for the packaging company closed the year at $666,3 million from $529,3 million in the prior comparable period.
A $996,1 million operating loss was recorded in the period from an operating profit of $65,7 million in 2018 as loss before tax of $1,4 billion was incurred attributable mainly to net monetary gain on hyperinflation of $274,7 million.
In terms of operations, Nampak said foreign exchange losses of $686,4 million, which were largely incurred from legacy debts and other material expenses weighed heavy on the company.
To curb the bloating operating expenses Nampak said management worked hard to curtail preventable expenses in the company for the year.
In the statement accompanying the full year results the group indicated that macro-economic transformations instituted by the Government and central bank in 2019, presented operational problems to the company.
“The fiscal and monetary policy measures implemented during the financial year significantly altered the operating economic landscape in Zimbabwe, reportedly the exchange rate has depreciated by over 594 percent since the introduction of the Zimbabwe dollar against the United States dollar in February last year,” said Nampak.
However, going forward the company says it intends to improve their export markets to enhance provision of foreign exchange to ensure sufficient funds for the procurement of materials to sustain day to day operations.
In this regard the company plans to engage with financial institutions to grow capacity in terms of production.
The firm said its board is weighing options to address negative equity position brought about by the material expenses that came from “the failure of the country to have sufficient foreign exchange to meet the requirements of liquidating the blocked funds debt”.
Headline earnings per share closed the year at $30,50 cents up from 5,57 cents in the prior period.
Online Reporter