Companies emerge from slumber

Enacy Mapakame

Business Reporter

Zimbabwe Stock Exchange (ZSE)-listed companies are beginning to see business recovery, with sales volumes registering growth as the operating environment continues to improve.

From food manufacturers, furniture retailers, media, construction and related stocks, there is a general improvement in business owing to a stable economic environment, pent-up demand created by improved confidence and the relaxation of lockdown restrictions.

Quarterly earnings reports released for the period to September 30, 2020 are showing year-on-year growth in volumes.


For diversified industrial conglomerate Innscor, volumes began to pick up during the first quarter to September 30, 2020.

“The trading environment for the quarter under review was underpinned by improved business and consumer confidence arising from a relatively stable local currency, a significant decline in local inflation and the easing of Covid-19 lockdown restrictions.

“These factors combined to result in a trading-oriented focus for the group, with solid volume growth being registered across most of the group’s product categories,” said the group in a trading update for that quarter.

It attributed the growth to a more stable foreign currency exchange rate after the Reserve Bank of Zimbabwe (RBZ) introduced the auction system on June 23.

Said Innscor: “The introduction of the foreign currency auction system and Statutory Instrument 185 of 2020 allowed for the implementation of precise pricing strategies, enhanced planning capability, improved capital allocation and value preservation for the group’s business units; these policy measures are extremely encouraging.”

Food manufacturer National Foods Holdings Limited reported a 15 percent growth in overall sales volumes for the three months to September 30, 2020.

As trading hours improved with relaxation of lockdown restrictions, sales similarly jumped.

At Axia Corporation transacting in foreign currency helped mitigate liquidity constraints.

In July, Government allowed the use of foreign currency for local transactions, which has worked well for the specialty retail and distribution group.

“The gradual easing of lockdown restrictions has improved people movement and business trading hours, resulting, to some extent, in a general upswing in recent volumes,” said Axia.


Its flagship TV Sales & Home recorded sales volumes that were 48 percent higher than the comparative quarter, which led to significant growth in turnover.

According to the group, the business was holding reasonably good stock balances, was able to meet demand and has opened its 50th store in Mutare in October.

Cement maker Lafarge’s chairperson Kumbirai Katsande said the easing of lockdown restrictions enhanced demand.

The business recorded solid gross profit margins exceeding targets on the back of cost-containment measures.

“The operating environment showed improvement influenced by easing of the Covid-19 lockdown restrictions.

“As business activity progressively continued to gain momentum into Q3 (third quarter), the demand for cement consequently outstripped supply, causing considerable supply backlog.”

Sales volumes closed the quarter 7 percent above same period last year driven by recovery in the individual home builder market.

Demand for cement in the construction sector jumped 34 percent ahead of the previous quarter following the reopening of the economy after lockdown.

Turnall Holdings Limited similarly highlighted increased demand for its products during the same quarter.

Sales volumes were 11 percent above same period last year and 81 percent above the previous quarter that was adversely affected by the pandemic.


The same can be said of brick making firm, Willdale, which reported sales volumes jumped 49 percent above same quarter prior year, bringing year-to-date volumes to 12 percent above prior year.

Spirits and wines maker African Distillers Limited (Afdis) volumes for the first quarter to September 30, 2020 jumped 28 percent compared to the same period last year on the back of good sales mix.

At Padenga, the easing of lockdown restrictions across the globe is beginning to see the business record more activity in the crocodilan business, which was affected by the pandemic more than the recently acquired gold mining business.

Chairperson Mr Thembinkosi Sibanda said Covid-19-related lockdowns prevented the scheduled skin sales gradings during the second and third quarter.

“The Covid-19 pandemic continued to pose an ongoing threat to business continuity as it impacted traditional markets in those countries that the business trades skins into.

“However, with the easing of lockdowns the two main retailers of high-end leather goods both reported improved sales volumes across all product categories in Q3 in their trading updates.”

According to the group, 22 796 crocodiles had been harvested by end of the quarter under review and the skins were awaiting sales grading to be convened when international travel resumed.

A total of 18 629 skins were graded following lifting of travel restrictions in October, with 6 260 of those already shipped in that same month while the remainder are scheduled for shipping this month.

However, demand for crocodile meat remained depressed during the quarter and the group is looking at growing the local market until the international export market returns.