admin
Senior Business Reporter
Listed construction materials supplier, Turnall Holdings Limited, says significant investment is being made at its Bulawayo plant aimed at production of New Tech fibre cement sheeting mainly for the export market.
The firm said it has embarked on a major capital expenditure programme aimed at restoring fibre cement production in Harare and introducing production of GRP pipes in order to take advantage of this fast growing local and regional market.
“Production of IBR (Inverted Box Rib) sheeting is to be expanded and the roof tile line will be refurbished. A significant investment is also being made in the Bulawayo plant aimed at production of New Tech fibre cement sheeting mainly for the export market,” said Turnall Holdings in its consolidated financial statements for the year ended 31 December 2022.
“The completely new sheeting line for Harare will utilise the latest technology with the aim of improving production efficiencies and reducing costs.”
However, the entity said although payments for these projects will largely be made during the course of the year, the main production lines are expected to become operational in 2024.
No investment figures were given.
“The Board and management are confident that these investments will deliver substantial benefits including increased revenue and profitability, an increase in exports and a sustainable improvement in quality and production efficiency”.
On financial performance in the period under review, the Group’s turnover was $8,4 billion in inflation-adjusted terms compared to $7,25 billion in the previous year representing a 16 percent growth in spite of a 29 percent reduction in sales volumes.
In historical terms, revenue was $5,8 billion which was a 240 percent growth from last year.
It noted that the sales performance was mainly driven by a deliberate move to focus on the high value but low tonnage products.
However, the liquidity challenges and low aggregate demand prevailing in the economy hampered the Group’s efforts to realise its full potential.
The inflation-adjusted gross profit for the year under review was 31 percent compared to 41 percent achieved last year.
Turnall Holdings said gross profit in historical terms, however, was 50 percent compared to 39 percent reported in the same period last year,
Meanwhile, the inflation-adjusted operating expenses to sales ratio was at 52 percent compared to 23 percent in the prior year and in historical terms was 60 percent compared to 22 percent recorded last year.
“This sharp increase is attributable to substantial non-recurring employee terminal benefits amounting to $1 224 702 099 which were provided for during the year.”
Capital expenditure for the period was $622,5 million compared to $60,2 million spent last year and this was mainly aimed at improving production efficiencies.
It noted that an AC Plant with a value of $798,9 million was impaired during the year and will be replaced by the latest state of the art plant which will be commissioned in Harare in 2024 as part of the company’s recapitalisation programme.
Online Reporter