Business Reporter
Zimbabwe building materials manufacturer Turnall Holdings posted a 24 percent year-on-year increase in third-quarter sales volumes to 11 354 tonnes, supported by firm public and private sector construction activity.
According to the company’s trading update for the third quarter and nine months ending September 30, 2026, cumulative year-to-date sales volumes grew by 29 percent to 28 161 tonnes, up from 21 824 tonnes during the same period in 2025.
The volume growth was bolstered by ongoing marketing initiatives and strong market demand.
Despite the top-line expansion, profitability remained compressed.
Gross profit for the third quarter dropped sharply to 15 percent, down from 28 percent in the prior-year period, while year-to-date gross margins contracted to 18 percent from 26 percent.
Turnall attributed the margin contraction to higher production costs, specifically surging cement prices and commissioning-related expenses for its new Harare sheeting plant, alongside a shift in the sales mix towards lower-margin concrete products.
Intensified competitive pricing pressures further constrained the group’s ability to pass on rising input costs to consumers.
Production volumes during the third quarter fell 34 percent to 7,082 tonnes, compared to 10,782 tonnes a year earlier, hampered by supply chain disruptions that caused a fibre outage in September.
Management noted that the supply issue has since been resolved, with production returning to normalcy.
The operating environment featured relative macro-economic stability, aided by the Reserve Bank of Zimbabwe’s tight monetary policy stance and the implementation of the International Monetary Fund’s Staff Monitored Programme.
While formal foreign currency availability improved and month-on-month inflation eased, liquidity remained tight and borrowing costs high, although the central bank’s policy rate dipped to 27,5 percent by the end of the quarter from 30 percent in June and 35 percent earlier in the year.
Global energy costs and supply chain snarls driven by the Middle East conflict also weighed on operations.
Cost containment measures yielded improvements, with the expense-to-sales ratio improving to 19 percent in the third quarter from 26 percent last year, although the savings were insufficient to offset the drop in gross profit.
To counter margin pressures, Turnall is advancing several strategic initiatives, including the performance optimisation of its new 210-tonne-per-day Harare fibre-cement plant and the roll-out of a solar power project at its Harare manufacturing site to improve uptime and lower energy costs ahead of commissioning in the fourth quarter.
The group also plans to diversify its portfolio by introducing complementary lines such as timber and solar products, while pursuing an upgrade of its Bulawayo plant to resume regional exports.
