Nampak volumes down on lower tobacco crop, Covid-19

Nampak suffered a volumes decline at most of its business units for the year ended 30 September 2020.

The volume decline was however compensated probably by price adjustments as inflation adjusted revenue at $5 086 623 was just at par with $5 059 937 recorded prior year comparative.

The group also overturned last year’s operating loss of $7.5 million to an operating profit of $1 million.

This resulted in the company’s year-end loss being reduced to $658 582 from a loss of $6.25 million in 2019.

Meanwhile, a 29 percent drop in the national tobacco crop to 183 million kgs contributed to the 28 percent drop in volumes at Hunyani according to the company in a statement accompanying its results.

The Hunyani Corrugated Division decline was driven by the tobacco case market where the local tobacco crop output was significantly down on the prior year and the delayed start of this year’s tobacco marketing season due to COVID-19 concerns, said Nampak.

“There was also a decline in regional exports.”

The Cartons, Labels and Sacks division remained profitable despite stiff competition and reduced volumes.

At Mega Pak, full year volumes declined by 12 percent against prior year, mainly due to constrained consumer demand in the preforms market in the first half of the year.

“However, local demand increased in the final quarter of the year.”

Regional export demand was depressed, especially in the Democratic Republic of Congo, Nampak said.

At CarnaudMetalbox volumes for the full year declined by 34 percent compared to the prior year.

According to the company, the shortage of foreign exchange and reduced disposable incomes in the first half of the year negatively impacted demand.

However, there was improved product demand in the final quarter, and access to needed foreign exchange improved through the auction system.-ebusiessweekly.c.zw