Categories: Stories

CAFCA issues profit warning as turnover tumbles

Cables manufacturer CAFCA has warned that it expects a 30 percent drop in turnover in the half-year to March with profits hit by poor sales.

CAFCA primarily operates in Zimbabwe but is listed on both the Johannesburg and Zimbabwe Stock Exchanges. Last week managing director Rob Webster told the annual general meeting that sales in the first quarter were 31 percent down year on year.

Profit for the same period was down 84 percent although volumes were 25 percent lower. The poor performance of regional currencies, particularly the South African rand had hit export earning, Webster said at the AGM.

Apart from supplying the local market, the company exports its product to South Africa, Mozambique and Zambia.

“Profitability has been adversely affected by the anticipated 30 percent drop in turnover from both a drop in local sales due to lack of liquidity in the market and a drop in export sales due to foreign exchange shortages and devaluation in our primary export markets currencies to the US$,” CAFCA said in a statutory trading update yesterday.

In terms of the JSE listings requirements, companies are required to publish a trading statement as soon as they are satisfied that a reasonable degree of certainty exists that the financial results for the period to be reported upon next will differ by at least 20 percent from those of the previous corresponding period.

“Basic earnings per share and headline earnings per share for HI FY 15/16 will be approximately 0.6 US$ cents per share which is 75% lower than the 2.59 US$ cents per share of HI FY 14/15,” Cafca said.

In the six months to March last year, the firm revenue grew by 41 percent to $14 million while operating profit stood at $1,1 million.-The Source

(24 VIEWS)

Charles Rukuni

The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

Recent Posts

ZiG loses steam, falls against US dollar for five consecutive days

The Zimbabwe Gold fell against the United States dollar for five consecutive days from Monday…

November 22, 2024

Indian think tank says Starlink is a wolf in sheep’s clothing

An Indian think tank has described Starlink, a satellite internet service provider which recently entered…

November 18, 2024

ZiG firms against US dollar for 10 days running but people still do not have confidence in the currency

Zimbabwe’s new currency, the Zimbabwe Gold (ZiG), firmed against the United States dollars for 10…

November 16, 2024

Zimbabwe among the top countries with the widest gap between the rich and poor

Zimbabwe is among the top 30 countries in the world with the widest gap between…

November 14, 2024

Can the ZiG sustain its rally against the US dollar?

Zimbabwe’s battered currency, the Zimbabwe Gold, which was under attack until the central bank devalued…

November 10, 2024

Will Mnangagwa go against the trend in the region?

Plans by the ruling Zimbabwe African National Union-Patriotic Front to push President Emmerson Mnangagwa to…

October 22, 2024