Zimbabwe: Turnall bounces back, daily output up 25% as exports growth expected in the Q1 of 2020
BULAWAYO – Zimbabwe Stock Exchange-listed Turnall Holdings Limited has seen its per-day production volumes increase from the initial 80,000 tonnes to 100,000 tonnes at its non-asbestos plant in Bulawayo, in sync with the firms’ target to increase exports by nearly 10% next year.
In 2017, the company narrowed its loss position to $689,401 from $1.2 million in 2016, but after years of being a perennial loss entity – as of last year the company bounced back to profitability after reporting an after tax surplus of $3.83 million from a loss position.
This was on the back of the balance sheet which improved from $34 million to $36 million. The group is now solvent with net current assets of $2.2 million compared to net current liabilities of $11.8 million in 2017 archived through the debt restructuring as well as the improved profit before tax of about $6 million.
Analysts say this will help the company perform better after many years of financial distress. Speaking on the sidelines of the company’s analyst briefing held in the capital, managing director Roselline Chisveto said the newly installed equipment has started bearing results as production levels continue to increase. The firm is working tirelessly to meet the 120,000 daily target.
In 2018, the firm’s capital expenditure went up to $910,000 from $200,000 previously.
“We have invested in new machinery that have resulted in the increase in production – hydraulics which speaks on the speed through which our production is processing so if you improve the speed it means you will produce more,” she said.
“Plant upgrades in Bulawayo have already been done – we have moved from 80 tonnes per day to 100 tonnes. Our average capacity utilization it is now at 53% in 2018, but our sheeting plant was at 94% but this is overall capacity utilisation because we have a pipe plant which was not been running and its actually above the 42% recorded by the Confederation of Zimbabwe Industries.”
Chisveto said the company would soon start on the export market where sales had been low over the years. Local sales and export sales stood at 95% and 5% respectively.
“So we want to actually grow to 10% by the first quarter of 2020. Because we need to make sure that we upgrade our new tech plant, the non-asbestos plant which is the new tech plant so we need to make sure that we upgrade it so by next year 2020 we should have done the upgrade,” she said.
“Right now we have been talking about the upgrade on the AC which we just recently done so we need to make sure that we build capacity for us to then do another upgrade.”
On a monthly basis, the company requires about USD200,000 of import cover. On fibre requirement, it uses 100 tonnes per day for both factories and ratios is at 90%:10% in terms of cement and fibre.
The group’s topline increased stood at $32 million, representing a 69% from $19 million reported in the previous period. Of the total revenue, roofing, concrete, pipes products contributed 77%, 21% and 2% respectively. But, pipes contribution declined from 7% in 2017 as the company did not get any projects during the period under review – as they were only selling pipes for maintenance.