CAFCA targets to expand footprint
ZIMBABWE’s only cable manufacturer, CAFCA, has hinted at growing its export footprint by establishing at least two additional consignment stock arrangements.
As it stands CAFCA’s primary markets are dotted in Southern, and Central Africa while export inroads have been made to markets as far as Uganda and Russia.
Earlier this year CAFCA expressed hope in the Rwandan market saying it remains a reliable customer while consignment stock arrangements were opened in Tanzania.
It as well highlighted that it expected business from the Democratic Republic of Congo (DRC) starting from the first quarter of 2023, the firm said this earlier this year.
To bolster and meet the thriving export business, earlier last year CAFCA hinted that it had reserved enough capital to meet the growing demands of anticipated surge in production.
As such, the company also intends to increase solar cable offering, with a launch date having been set for anytime this month.
According to CAFCA company secretary, Caroline Kangara, this is to consolidate market share in the region as competitors’ numbers and volumes continue to grow as the pressure continues to mount.
In its quarterly trading update to June 2023, the cable manufacturer’s export volumes grew to 106 tonnes ahead of 91 tonnes which was realised in the same quarter last year.
It, however, decried Malawian’s clientele difficulty in obtaining foreign currency saying the liquidity strain was backtracking stock replacement for the Lilongwe market leading to a slow volumes uptake.
However, sales in the Mozambique, Rwanda, and Tanzania markets remained in line with forecasted numbers.
On the flip side, local sales volumes retreated six percent from the comparable period last year with the largest drop having been recorded in the local utilities sector.
A decline was witnessed across the market towards the end of the quarter, particularly from traditional clientele attributable to liquidity constraints that stemmed from a tight monetary policy.
“We aim to increase our export footprint with at least two more consignment stock arrangements. Locally we have plans to improve our business and initiatives to win over more mining sector customers,” said Kangara in a statement accompanying Cafca’s full-year results to September 2023.
CAFCA’s ability to meet customer orders has been credited to its short production lead time, which provides a competitive advantage in the market.
Operationally in the year to September 2023, Cafca’s turnover grew to $164 billion in inflation adjustment terms from $75 billion in 2022, emanating mainly from the volatility in the exchange rates.
After tax profit stood at $51, 3 billion in inflation-adjusted terms which was a significant increase ahead of last year’s $7, 8 billion.
According to CAFCA copper cable sales experienced a nine percent increase year-on-year.
The company declared a dividend of in US$7, 90 cents per share payable on the 15th of this month.
CAFCA Limited manufactures and supplies cables, allied products for the transmission and distribution of electrical energy and information.
It also recovers decommissioned cables for recycling and supplies telecommunication cables ranging from indoor to underground as well as aerial self-supporting cables.
The company manufactures over 900 cabling products of British and South African standards including 11KV XLPE cables.-ebusinessweekly
