Nampak’s HY20 volumes plunge as economic volatility continues

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  • Hunyani paper and packaging sales volumes down by 28%
  • MegaPak registered 30% drop in volumes sold
  • Exports were affected by unfavourable regional economies

Harare- Listed manufacturer and marketer of packaging products, Nampak Zimbabwe Limited registered declines in volumes across all segments in the six months ended 31 March 2020 (HY20).

In a statement accompanying the Group’s half year results, Nampak stated that Hunyani Paper and Packaging registered a 28% dip in sales volumes in the period under review compared to prior year.

According to the Group, the major contributor to this decline at Corrugated Products Division was the tobacco sector which was down 43% due to increased competition from certain European Union countries in the regional tobacco case market.

Volumes sold in the commercial segment were however ahead of prior year by 8% on improved demand while the Cartons, Labels and Sacks division remained profitable despite increased competition.

The Group added that efforts continue to regain effective control of the timber plantations which if properly managed could significantly contribute to the country’s agricultural vision.

MegaPak’s sales volumes in the period declined by 30% due to consumer demand contraction in the beer beverage sector although there was some recovery in cordials.

The unit continued to face challenges in sourcing of raw materials while exports were negatively affected by the stress regional economies are under.

In addition, CarnaudMetalbox recorded a 31% plunge in sales volumes compared to the prior comparative period.

HDPE sales volumes were affected by the decline in the scud and mahewu container offtake while the shortage of tinplate continued to impact negatively on metals volumes.

The Group’s paramount concern in the period was, and remains, the difficulty in sourcing sufficient foreign currency to import raw materials for packaging.

“This applied particularly to paper for conversion into corrugated boxes for the commercial and tobacco sectors, although some exporting customers were able to help in obtaining currency for their raw material requirements”, Nampak said.

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