eBusiness Weekly
Business Writer
Despite a challenging economic environment, Khaya Cement, Zimbabwe’s leading cement producer, reported significant growth in key metrics during the period under review.
Revenue Soars: Inflation-adjusted revenues surged by 210 percent to $99.8 billion (USD$17.4 million) compared to $32.2 billion (USD$4.8 million) in the previous year.
This growth was driven by a 117 percent increase in cement volumes following the restoration of the collapsed mill roof and the commissioning of a new Vertical Cement Mill (VCM).
Additionally, aggregates and Dry Mortar (DMO) volumes saw impressive increases of 213 percent and 211 percent respectively.
Foreign Currency Focus: Notably, 89 percent of the company’s revenue was earned in foreign currency, marking a 100 percent increase year-on-year.
This reflects Khaya Cement’s strategic focus on capturing export opportunities and mitigating risks associated with currency fluctuations.
Profit Margins and Losses: While gross profit margin dipped slightly from 37.1 percent to 35.3 percent, the company managed to improve its sales, general and administration expenses as a proportion of revenue, bringing it down from 54 percent to 41 percent.
However, Khaya Cement incurred an inflation-adjusted operating loss of $378.4 billion (US$66.5 million), up from $38.7 billion (US$6,7 million) primarily due to foreign currency exchange losses arising from the depreciation of the Zimbabwean dollar. This resulted in an overall loss of $265.2 billion (US$46.2 million) compared to $48.8 billion (US$7.2 million) in the previous year.
Looking Ahead: Despite the current challenges, Khaya Cement remains optimistic about the future. The company welcomes government efforts to stabilize the economy and maintain industry viability.
It also recognizes the importance of post-election stability and effective solutions for sustainable economic growth. Khaya Cement maintains a positive medium to long-term outlook, expecting growth to be driven by agriculture, individual households, and government infrastructure projects.
