ZECO Q3 revenues plummet as perennial losses persist

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  • ZECO’s revenue declines -58% Q3
  • Revenue growth thwarted by inflation
  • ZECO plagued by perennial losses

ZECO Holdings Limited’s revenue for the third quarter to 30 September of 2020 declined by 58% in inflation adjusted terms from ZWL7.08 million in the second quarter to ZLW2.8 million in the third quarter.

According to the most recent trading update, ZECO’s revenue for the prior third quarter was ZWL0.8 million compared to the current quarter of ZWL2.8million representing an increase of 250% in historical terms. However, this was not enough to offset the raging inflation which came in at 659% in the month of September. 

In the trading update, the Company secretary J Mwinjilo lamented a harsh macroeconomic environment prevailing in Zimbabwe:

“{The performance of the group is largely dependent on the economic environment which affects cost of production and operating costs.”

ZECO has been going through a series of difficulties underpinned by negative bottom line recorded over the previous periods and suspension from the local bourse in November 2016 over reasons of failing to comply with listing requirements.

Listed on the Zimbabwe Stock Exchange (ZSE), ZECO Holdings builds rail wagons and locomotives through its subsidiaries for utilities in Zambia, Tanzania, Mozambique, Ethiopia and Kenya.

The company also manufactures roller shutters, electronic garage doors, steel windows and door frames, burglar bars, filing cabinets and agricultural implements for the Zimbabwe building and construction sector and export to countries in sub-Saharan Africa.

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