- Masimba Holdings reported a 43% decrease in revenue to $8.1 million for Q1 2025, down from $14.3 million in Q1 2024
- The drop in revenue was due to unsettled government debts, management of public works exposure, a focus on private sector work, and above-normal rainfall
- The company is shifting towards private contractors for greater flexibility and stability in project execution
Harare-Construction firm Masimba Holdings, listed on the Zimbabwe Stock Exchange (ZSE), has recorded a 43% decrease in revenue to $8.1 million for the first quarter ended March 31, 2025, from $14.3 million in the same period last year.
This decline was attributed to unsettled government debts, initiatives to manage exposure to public works, and a focus on growing private sector work, compounded by above-normal rainfall.
"The prevailing liquidity challenges also negatively impacted the execution of these orders, particularly in the public sector, where we had to suspend works to manage credit risk,’’ the group said.
Consequently, after-tax profit for the period decreased from 18% to 5%.
On a positive note, group borrowings stood at $1.7 million at the end of the quarter, compared to $2 million in 2024.
The group's liquidity position improved to 1:1.25 from 1:1.23 in the comparative period.
The company is shifting its focus to private contractors, which offer greater flexibility and stability.
Unlike government contracts, private contracts allow for more streamlined negotiations, enabling faster project initiation and completion.
Private clients may be willing to pay a premium for customised solutions and high-quality workmanship, unlike government contracts, which come with fixed pricing and budget constraints.
This strategic shift will enable the company to diversify its project portfolio, reducing reliance on government funding and mitigating risks associated with public sector fluctuations.
However, the above-normal rainfall received after the El Niño-induced drought resulted in slow execution and, in some instances, complete suspension of work, as wet conditions made it difficult to work with certain materials.
Looking ahead, the group is optimistic about an improvement in the macroeconomic environment, supported by a favourable agricultural season and an upward trend in mineral prices.
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