Michael Tome
NATIONAL Tyre Services (NTS) says it is skeptical of 2025 business environment as uncertain currency stability and power outages continue to rear their ugly heads in the economy.
Major of NTS’s concerns is whether the country’s power utility will continue to prioritise the availability of power to industry.
The company, however, hopes that the ongoing rainy season will improve water levels at Kariba Dam and enhance power generation capacity, which will immediately avail electricity and ultimately minimise factory operating costs.
This comes as the economy in 2024 was confronted with steep parallel market exchange rate towards the end of 2024, making it difficult for businesses as inflation emerged, further eroding consumer purchasing power and contributing to economic instability. This also comes as the Government officially devalued the ZiG by 43 percent in line with economic realities and upholding its relevance in the market.
This move wiped out many balance sheets and NTS was not spared.
In a statement accompanying the company’s financial results for the year ended September 30 2024, NTS chairperson Rutenhuro Moyo, said the company had hope that the country’s power utility would continue to prioritise the availability of power to industry.
“Meantime, we hope that the country’s power utility will continue to prioritise availability of power to industry. As above, Zimbabwe hopes that the upcoming rainy season will improve water levels at Kariba Dam and enhance power generation capacity. Availability of electricity will minimise factory operating costs.
“We are cautiously optimistic of a better business operating environment supported by a promising farming season ahead, a development that is expected to significantly boost agricultural production.
However, NTS acknowledged the Government efforts and strategic initiatives towards vision 2030 will drive spate of developments across a number sectors of the economy, consequently, tyre usage will rise.
Operationally the business recorded a slight decline in new tyre volumes owing to supply chain glitches. Although volumes were affected, light truck tyres grew by 67 percent as compared to the same period last year due to strong demand as the company supplied organisations carrying out drought alleviation programmes across the country and companies involved in infrastructure development programmes driven by the Government.
In terms of performance NTS incurred a loss before tax of ZiG 36 million from a loss of ZiG 35 million in the previous year largely due to foreign exchange movements.
Gross profit increased by 2 percent to ZiG 12 million from ZiG 11,9 million realised in the same period in 2023. Sales declined by 36 percent to ZiG 37,6 million from ZiG 58,8 million reported in same period in 2023. Total operating expenses reduced to ZiG 19 million from ZiG 24 million.
NTS indicated that it has a huge customer base and is establishing a model of improved competitiveness to offer satisfactory service through stock availability across all our branches.
