Masimba Holdings, a Zimbabwe Stock Exchange-listed contracting company, expects Zimbabwe’s infrastructure sector to recover strongly in the outlook and drive its contracting business.
BY FIDELITY MHLANGA
CEO Canada Malunga, who briefed analysts on the company’s half-year financial performance last week, said road construction was likely to boom in the short to medium term while some redundant government infrastructure would also be rehabilitated and upgraded.
“The order book in 2019 is full and we have confidence in the new government to spur increased activity,” Malaunga said.
“We are going to see a major shift in areas of infrastructure development, especially on road construction, given the levels of deterioration. There is something that is happening in Harare’s suburbs and we want to start to be visible in urban areas.”
During the half-year period ended June 30 2018, Masimba reported a 55% surge in EBITDA (Earnings before Interest, Tax, Depreciation and Amortisation).
The operating profit jumped to $1,3 million from $$713 649 in the comparative period in 2017.
After-tax profit increased nearly five times to $532 599 from $137,422 over same period last year.
Turnover also soared 55% to $17,9 million, up 55% compared to first-half of 2017.
Masimba chairperson Gregory Sebborn, in the half-year financial report, attributed the strong growth in revenue to a growing project portfolio.
“The growth in turnover was mainly on the back of solid book in the housing infrastructure, building and civil engineering segments,” Sebborn said.
“EBITDA improved to $1,3 million, driven by operating efficiencies and growth in the topline.”
Net working capital improved by 29% to $2,2 million from $1,7 million, mainly due to implementation working capital management strategies, which proved effective.
Cash and cash equivalent balances amounted to $1,1 million as at 30 June 2018, down from $1,2 million at the end of June 2017, as the company built up working capital to finance project requirements.
Capital expenditure grew to $1,19 million from $914 166. The outlays were expended on plant and equipment to strengthen the company’s business capacity in anticipation of contracting opportunities.