- Debt Reduction: Decreased by 32% to USD1.3 million, resulting in a low gearing ratio of 4%
- Operating Profit Surge: 165% increase in operating profit to USD5.04 million, with expanded margin of 16.0%
- Revenue Growth: 30% revenue increase to USD31.5 million
Harare- Masimba Holdings has achieved significant milestones in the first half of 2024, despite operating in a tough environment characterized by liquidity constraints and heightened exchange rate volatility.
The company's total borrowings decreased by 32% to USD1.3 million, down from USD1.9 million in the same period last year, resulting in a low gearing ratio of 4%.
The company's operating profit surged from USD1.90 million to USD5.04 million, leading to an improvement in after-tax profit to USD3.62 million from USD3.44 million.
According to Chairperson Gregory Sebborn, "The operating environment has remained challenging, with financial capital becoming scarce and infrastructure development failing to meet required levels."
Operating profit witnessed a 165% surge, highlighting the company's enhanced efficiency, achieved through improved operational processes, reduced costs, and better resource utilization.
As a result, operating profit margin expanded, rising to 16.0% (USD5.04 million/USD31.5 million) from 6.1% (USD1.90 million/USD31.1 million) in the prior-year period. This improved margin highlights the company's ability to generate higher profitability from its revenue.
Meanwhile, borrowing rates, which remained at 20% for four consecutive times during the reporting period, were increased to 35% in September 2024. This change may impact future borrowing costs. Fortunately, Masimba Holdings' reduced debt and low gearing ratio provide a cushion against economic uncertainty.
During the reporting period, the company's contracting business delivered good results, albeit with below-projection order book conversion due to liquidity challenges.
Quarry mining operations recorded an impressive 100% growth in volumes, supporting the Contracting business. The Property segment contributed positively, achieving 100% occupancy.
Revenue increased by 30% to USD31.5 million, driven by infrastructure development projects. However, the proportion of United States dollar-denominated revenues reduced to 63%, primarily due to government-funded projects.
Masimba Holdings' financial position remained robust, with total assets at USD79.6 million and improved liquidity ratios.
Looking ahead, the Group has adopted a disciplined approach to capital allocation, ensuring value-driven investments underpinned by a robust financial position. This strategic discipline enables the Group to fund growth initiatives and deliver sustainable returns to shareholders.
The Group's order book grew to USD254 million, primarily driven by public sector-funded projects. This growth, combined with the Group's disciplined approach, positions it for long-term resilience and sustainable growth.
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