malvernmugadzikwa
Business Writer
Turnall Holdings Limited’s prospects this year and going forward are bright with the company expected to resume production of roofing sheets in Harare, in a move that will also help reduce costs for the business, an official has said.
Chairman, Bothwell Nyajeka, indicated the plans are underway to invest in a new plant in the capital that will augment the one in Bulawayo in line with the group’s focus in recapitalising its plants and enhance production efficiencies.
“Management is extremely optimistic that the business will continue to grow and maximise shareholder wealth. There will be an increased focus going forward on recapitalising the plants, improving production efficiencies and reducing production costs.
“Plans are underway to invest in a new plant and resume production of roofing sheets in Harare. This will augment the Bulawayo plant in line with increasing demand for the company’s products, while improving customer service and further reducing Turnall’s costs of shipping finished products to its largest market,” said Nyajeka in a performance update for the year to December 31, 2021.
Without giving finer details, Nyajeka added the group was commissioning a Glass Reinforced Plastic (GRP) pipe plant which will bring diversity to its range of pipes.
According to Turnall, this new large diameter pipe plant should also play a critical part in the Government’s plans to both create manufacturing jobs and improve water supplies to the country.
Nyajeka said: “the new plant will also reduce the country’s requirement for scarce foreign currency by replacing imported with local production and provide a solid base for new export opportunities into the region.”
In terms of financial performance for the full year to December 31, 2021, Turnall’s turnover jumped 31 percent to $2,1 billion as sales volumes increased by 2 percent.
Gross profit margin for the year increased to 41 percent against the same period last year of 33 percent as a result of cost containment strategies and business restructuring implemented during the year.
Nyajeka indicated pricing issues have been a major challenge for the business particularly on the export market owing to the depreciation of the currencies within the region against the USD.
“The business switched to pricing exports in USD in order to eliminate this exchange risk,” said Nyajeka.
Profit after tax for the year rose 60 percent to $422 million from $264 million achieved in the previous year.
Total assets came in at $4,2 billion from $3,8 billion recorded in the prior year.
During the course of the year, the business invested $402 million in working capital mainly towards raw materials, an increase from the $261 million invested last year, as the business looks at boosting volume growth.
Turnall declared a dividend of 4 cents a share.
Bongani Ndlovu