BY MISHMA CHAKANYUKA
LISTED manufacturer and distributor of farming implements, Zimplow, says its revenue grew by 86% to $29,8 million in the first five months of 2019, driven by an improvement in volumes across the group’s business units.
Zimplow operates five business units, namely Barzem, Mealie Brand, Powermec, CT Bolts and Farmec.
In a trading update at the company’s annual general meeting, chief executive Vimbayi Nyakudya said the group’s operating profit went up by 784% to $13,4 million during the five months to May, driven by growth in volumes and impact of the exchange rate movement towards the end of May 2019 on the group’s foreign-denominated monetary assets.
The group’s Mealie Brand performed well despite the drought that affected the region, causing a decline in agricultural activity.
“Volumes of implements in the past five months grew by 49%, driven mainly by the export markets. The export sales implement volumes grew by 232%, countering the drop of 36% in the local market. The trust to drive export sales in light of the dip in local sales performance has been a game changer in the current year,” Nyakudya said.
Powermec recorded 106% growth in volumes against prior year.
Nyakudya said the intensifying load shedding that has triggered a rush to alternative power and demand for generators has started scaling up stock holding in
order to meet the demand.
Barzem’s parts uptake through the counter grew by 6% and the sector is currently ramping up stockholding and workshop capacity in light of the projected growth
in fleet maintenance activities by the group’s key customers as they shy away from capital expenditure.
Nyakudya said the Farmec business unit performance was affected by drought, subsequent drop in yields and soft producer prices in the 2018/19 agricultural
season although the performance recorded during the five months was ahead of the group’s projections and budgets.
“Tractor volumes have been 5% ahead of the budget albeit being 43% down on last year. Implements and parts uptake have been 25% and 21% lower than prior year, respectively,” Nyakudya said.
The CT Bolts unit remained profitable as it recorded a 98% growth in sales volumes of high tensile steel bolts.
Nyakudya said going forward, the group will take advantage of opportunities as they come along and expects firm export orders, demand for alternative power and
solid performance from Barzem and Farmec to spur the group’s 2019 financial performance.
