Strong order book buoys Masimba
Construction firm, Masimba Holdings Limited, is expecting to maintain its growth trajectory with a strong order book, withstanding the volatile environment precipitated by the Covid-19 pandemic.
This comes as revenue for the first quarter to March 31, 2021, jumped 63 percent ahead of same period last year despite the Covid-19 induced challenges that was associated with movements restrictions.
While the country implemented a month long level four lockdown, which affected other businesses, this had minimal impact on Masimba that was classified an essential service provider.
According to the group, its strong order book comprising, roads, housing and mining infrastructure contributed towards the good performance while the business environment also remained stable. Already, the construction firm has recorded growth in its order book since beginning of the year, which is expected to contribute significantly to this year’s anticipated strong performance.
However, Masimba indicated the speed of the execution of the order book will largely depend on the continued stability of the macro economic environment and government policies being consistent.
“The macro environment was generally stable. This was largely attributable to the improved supply of foreign currency on the auction market and a well-managed fiscal policy.
“Year-on-year inflation closed the quarter at 240 percent versus 676 in March in 2020 and a peak of 873 in July 2020,” said company secretary Pearl Mutiti in a trading update for the quarter.
During the quarter under review profitability was maintained at prior year levels of 15 percent, despite the liquidity challenges experienced in the market.
According to the group, financial position remained strong and sufficiently liquid with current and gearing ratios of 1,26 percent from 1,15 percent in the prior year comparable period and 5 percent from 8 percent in 2020.
Notwithstanding the obtaining liquidity challenges, the debtors book performed generally satisfactory during the review period.
Capital expenditure for the period amounted to $25 million while borrowings were at $104 million compared to $129 recorded during the same period last year.
While Covid-19 is posing some uncertainties globally, Masimba continues to pin its hopes on the massive projects lined up such as road infrastructure, water, housing and energy infrastructure in which the firm is a significant player.
The group is one of the few companies that were contracted to work on the multi-billion dollar Harare-Beitbridge highway.
Mutiti added: “Global commodity prices have remained firm post the lockdown proud and will likely spur expansion in the group’s key resource markets.”
The construction season depending with the rainy season, normally starts around April and ends in November and construction companies try to move many projects during that time.-herald.clz.w
