By Alois Vinga
LISTED-paper and packaging manufacturer NamPak has acknowledged that the Reserve Bank of Zimbabwe (RBZ) foreign currency auction system is the largest source of foreign currency for companies.
This week the RBZ allotted a record US$49, 1 million to companies.
Presenting a trading update for the nine months ended June 30, 2021, NamPak’s managing director, John van Gend said the auction system has turned to be a reliable source for foreign currency.
“Foreign currency, although still inadequate for the group’s operations as a whole, was more available through the auction system and was supplemented by additional amounts sourced from customers,” he said.
He, however, urged for the expeditious reduction of the time between allotments of the foreign currency and disbursements to avoid the possibility of creating imbalances within the supply and customer delivery chain.
The demand for foreign currency on the platform continued to increase, and this week a total 1 276 bids were filed on both the Small to Medium Enterprises and Main platforms.
Raw material, machinery, and equipment imports received US$16 million, and US$8,7 million was allotted to the main auction.
A similar trend was seen on the Small to Medium Enterprise Auction where US$2,6 million and US$2,9 million were allotted for raw materials, machinery, and equipment needs.
As of June 2021, the RBZ had allotted over US$1 billion to more than 3 000 large and Small to Medium Enterprises companies after sustained efficiency since the platform’s inception last year.
Meanwhile, during the period under review, NamPak’s revenue was 37% ahead of the prior-year quarter in inflation-adjusted terms and 234% in historical terms.
The cumulative revenue in inflation-adjusted terms for the nine-month period was 26% ahead of the prior-year period and 336% above the same period in historical terms attributed to growth in sales volumes and adjustment of selling prices in line with economic trends.
“The availability of raw materials remained challenging. The Group units traded profitably in the period under review. Networking capital is positive.
“The group had a cash holding of $528 million at the end of the third quarter and this is being used to reinvest in raw materials and settlement of trade payables,” added Van Gend.