CAFCA anticipates spike in volume
Listed cables manufacturing firm, CAFCA, is upbeat about achieving a spike in volume performance for the second quarter of its 2024 financial year, subsequently recovering from a depressed performance experience during the first quarter to December 2023.
In a trading update for the first quarter period, management has expressed optimism in surpassing the first quarter performance.
“We anticipate an increase in volumes in the next three months against the current quarter’s volume,” said company secretary Caroline Kangara.
Already, the group is seeing significant gains in terms of turnover and profitability since the beginning of the year.
Kangara revealed that on a year to date basis, CAFCA’s turnover rose by 718 percent compared to the same period in the prior year. According to the group, profitability was 503 percent ahead of the same period last year and the group anticipates to maintain this growth momentum.
For the first quarter period, CAFCA revealed that export volumes were 32 tonnes ahead in the current quarter compared to the same quarter last year.
“The foreign currency situation in Malawi has improved resulting in more direct sales to that country. All the other markets have remained steady,” said Kangara.
However, local volumes for the quarter were 3 percent down compared to the same quarter last year with the drop being mainly in the Industry and factory cash sales. The decline in factory cash sales was offset by an increase in the retail sector.
The group is, however, concerned about the increase in energy cost as its energy intensity rose 16 percent in the year ending September 30, 2023 compared to full year 2022, owing to the installation of an electrolysis plant.
Energy intensity is defined as the amount of energy used to produce a given level of output or activity. Using less energy to produce a product or provide a service results in reduced energy intensity.
Energy in the form of electricity, liquid petroleum gas, diesel and petrol is necessary for all CAFCA operations to run continuously.
About 92 percent of the total energy needed is in the form of electricity, with the remaining 8 percent coming from other sources.
CAFCA;’s full year performance saw the group record inflation adjusted value of acquisitions of property, plants, and equipment jump 346,41 percent to $1,16 billion from $260,15 million in full year 2022.
Revenue went up by 118 percent to $164 billion in full year 2023 from $75 billion in full year 2022, reflecting the volatility in exchange rates, sales mix changes and copper price movements.
Most of CAFCA’s topline comes from the domestic market.
The group’s profit after tax went up by 558,20 percent to $51,3 billion during the period under review from $7,8 billion previously.-ebusinessweekly
