Cassava Smartech expects strong recoveries across all its business units during the final quarter if the economy continues on a positive trajectory anchored on exchange rate stability.
The first and second quarters of the financial year saw a slowdown in business performance, which was also witnessed across sectors due to the adverse effects of the Covid-19 pandemic.
However, the third quarter to November 30, 2020 was encouraging for the smart tech group with a general improvement in business performance as the relaxation on lockdown restrictions that time resulted in increased activity.
“Business performance in the third quarter has shown some improvement when compared to what we witnessed during the first and second quarters.
“If the economy continues on this positive trajectory into the fourth quarter, we expect to see recovery across all our business units,” said the group in a trading update for the third quarter.
EcoCash revenue rose 29 percent from second quarter, mainly on the back of a tariff review which became effective in August 2020.
The full impact of the tariff review was felt in the quarter under review although active subscribers went down by 6 percent from second quarter.
“We remain positive about a sustained volume and value recovery in the fourth quarter.”
The banking services also recorded revenue growth of 81 percent above the previous quarter.
This was primarily underpinned by a 166 percent growth in interest earning assets after the bank adopted a more aggressive lending strategy targeting quality borrowers.
Mobile banking customers grew by 5 percent.
For the micro insurance business, revenue increased by 131 percent due to strong growth in the short-term insurance business which registered a 165 percent increase compared to the second quarter.
The other business segments comprising Agritech, Healthtech and On-Demand-Services also performed well.
“The business strategy to provide a digital one-stop-shop experience for farmers across the crop and livestock production value chains has resulted in tremendous growth in the Agritech unit. The drive towards digital transformation for improved efficiencies and enhanced revenue generation remains our goal. The stable macro-economic outlook, and a promising agricultural season are all pointing to a brighter and stronger finish to the financial year,” said Cassava.