Nampak maintains profitability
PACKAGING group Nampak Zimbabwe Limited’s earnings performance for the current financial year has so far remained positive, driven by a volume uptick, a company executive revealed.
According to the group, revenue for the third quarter and nine months to June 30, 2021 were 37 percent and 26 percent, respectively, ahead of prior year period.
Despite the challenges of raw materials availability, Nampak traded profitably during the period.
Group managing director, John Van Gend attributed the positive earnings performance to growth in sales volumes and adjustment of selling prices to reflect the economic trends.
“Net working capital is positive. The group had a cash holding of $528 million at the end of the third quarter and this is being used to reinvest in raw materials and settlement of trade payables,” he said.
At Hunyani Paper and Packaging, volumes were 38 percent up for the quarter and 23 percent ahead for the nine months compared to the prior year period.
Volumes in the commercial sector grew by 63 percent in the prior year nine month period driven by improved demand and ongoing customer recovery. However, the tobacco sector was 4 percent below the prior year nine month period on the back of lower tobacco crop last year and the delayed start to packing this year.
Covid-19 had an adverse impact on regional markets as the business recorded a year to date export market decline of 19 percent.
Volumes at Mega Pak jumped 60 percent in the quarter and 59 percent for the nine months on increased demand across all areas of the business. The improved volumes continued in the beverage manufacturing sector, which contributed to increased preforms volumes while large injection moulding also continued to perform well.
Exports into the region were however affected by the Covid-19 pandemic. Carnaud Metalbox recorded volume growth of 69 percent and 23 percent for the quarter and the nine months respectively, compared to the previous financial periods.
Cumulative metal volumes were up 7 percent with food can and crowns leading the recovery despite a shortage of tinplate. According to the group, plastics performance was mixed, with higher HDPE bottle volumes 52 percent ahead of the previous year being offset by a decline in injection closure volumes, which were 8 percent below the prior period.
Total capex amounted to $128 million mainly for projects carried forward from the previous financial year with various projects still under consideration subject to availability of foreign exchange. Going forward, the group is downbeat about its fourth quarter performance due to the disturbances in neighbouring South Africa, while availability of foreign currency on the official interbank will also be a key factor in the group’s performance.-herald.cl.zw
