Nampak Zim in sound financial position

LISTED paper and packaging group Nampak Zimbabwe Limited has said the level of support received from the Reserve Bank of Zimbabwe, the foreign currency auction market, financial institutions and other trade partners has placed the firm in a position to be operational for the foreseeable future.

Nampak is engaged in the manufacturing of paper, printing and packaging products, leasing biological assets and the timber processing plant. It operates through segments in the printing and converting, plastics and metals and services.

The packaging sector is considered a barometer in terms of economic activity, because sectors such as agriculture, beverages, edible oils, require packaging.

In its 2023 annual report, Nampak said the group’s projections and sensitivity analysis show that it has sufficient capital, liquidity and positive future performance outlook to continue to meet its short term obligations.

The Group reported a Total Comprehensive Profit Attributable to Members of $51,55 billion for the year ended September 30 2023.

The net current assets exceed the net current liabilities by $121,5 billion, with cash and cash equivalents sitting at $10,97 billion, which places the Group in a sound financial position.

Money – Image taken from Pixabay

“Having regard to the foregoing, the Directors believe that the Group has, and will have, access to sufficient foreign exchange and financial resources to continue in existence for the foreseeable future and accordingly believe that the preparation of these consolidated financial statements on a going concern is appropriate.”

The group managing director, Mr John Van Gend said the overall demand for packaging improved during the year, compared to the previous year.

The firm benefitted from the volume growth experienced by customers on the back of increased disposable income of consumers.

“In the year under review, management continued with its focus on cost containment and operational efficiencies, while looking for new opportunities to improve both product offerings and quality.

“We continue to invest in the business where we see opportunity.”

In the period under review, the Group achieved sales for the year in inflation adjusted terms of $573,78 billion (2022: $394,15 billion) and a hyperinflated trading income of $114,51 billion (2022: $83,47 billion).

A profit before tax of $118,32 billion was achieved (2022:$59,37 billion).

The profit before tax takes into account other material income of $71,19 billion and a net monetary loss on hyperinflation of $67,31 billion.

The sales volumes for Hunyani Paper and Packaging for the full year improved by 13,4 percent compared to prior year.

The improvement was due to firm demand for tobacco cartons throughout the year, on the back of a record tobacco crop and improved regional demand.

Demand at Cartons and Labels Division was 1,4 percent ahead of prior year, somewhat curtailed by raw material constraints.

Mega Pak full year sales volumes decreased by 2,5 percent versus prior year mainly due to severe power outages throughout the year in Ruwa, which hampered our ability to produce at full potential.

At CarnaudMetalBox sales volumes for the full year grew by 4,7 percent compared to the prior year.

The improvement was driven by strong growth in the closures and HDPE categories.

Metals volumes were down on prior year. — @SikhulekelaniM1

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