- Revenue increased by 41%
- At Hunyani, sales increased by 5%
- However, power outages, supply constraints affected other units
Harare- Nampak Zimbabwe Limited, a distinguished entity listed on the Zimbabwe Stock Exchange (ZSE), has maintained profitability in the 9 months to June 2023 despite facing power challenges and supply constraints at Mega Pak and Hunyani.
The company’s revenue grew to ZWL413.2 billion ahead of the prior 9 months in 2022 representing a substantial surge of 41% in inflation-adjusted terms.
Upsurge in revenue was attributed to Nampak's strategic implementation of nuanced strategies, including modest enhancements in sales volumes and the astute deployment of inflationary pricing strategies.
The Company achieved a noteworthy 5% upswing in sales volumes within the Hunyani Corrugated Division while the tobacco market witnessed a remarkable surge of 12% in sales volumes, owing to the fortuitous abundance of a superior tobacco crop during the current year.
“Although demand for commercial carton volumes remains firm, volumes were 12% down on the prior year period due to constrained raw material supplies,” said the company in a trading update.
The Cartons, Labels, and Sacks Division, recorded a 7% upsurge in sales volumes primarily attributed to the robust demand for tobacco paper wrap, which served as a driving force behind this growth.
Conversely, Megapak encountered a challenging scenario, witnessing a 7% decline in sales volumes. This setback was predominantly attributed to the disruptive impact of power cuts, which adversely affected the division's operational capabilities. The Company rolled out generators to mitigate the impact of the power cuts.
Meanwhile, CarnaudMetalbox experience 9% expansion in sales volumes. Plastics led the recovery buoyed by higher HDPE bottle volumes, which were 36% above the prior year period.
However, metals and closures encountered a decline of 17% and 4% respectively when compared to the corresponding period from the previous year.
Capital expenditure of ZWL2.8 billion during the review period mainly focused on acquiring Netstal injection moulders, a chiller, and a generator for Megapak.
Going forward, the company has acknowledged an uncertain operating environment due to the upcoming election season and the persistently high inflation rate.
The Group will continue to focus on cost containment measures in order to improve profitability across all the businesses.
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