HARARE – Zimbabwe Stock Exchange (ZSE) listed engineering group Zeco Holdings (Zeco) is banking on the country’s ongoing power generation projects to boost its revenue streams and return to profitability in the near future.
Zeco chairman Philip Chiyangwa on Thursday said the engineering group, which narrowed its losses to $1,6 million from $1,7 million in the year to December 2015, was anchoring its revival and turn around on the country’s $600 million power projects slated for the next two years.
“The harsh economic conditions that Zimbabwe has been experiencing for the past two years are expected to persist through 2016. However, projected activities in the power generation industry are expected to give relief to the group’s flagship subsidiary,” he said.
Chiyangwa noted that in the 12 months under review, Zeco generated depressed revenues of
489 000 compared to $500 000 recorded prior year.
“The financial results under review reflect the challenging macroeconomic environment that was prevailing in the country during the period.
“In spite of the stringent cost containment strategies that were successfully implemented, revenue could not cover operating costs resulting in a negative bottom line of $1,3 million compared to the $2,1 million loss recorded in 2014,” he said.
Zeco’s Delward Engineering, based in Bulawayo, represents the bulk of the group’s asset base but recorded subdued performance which Chiyangwa attributed to lack of significant local infrastructure activity during 2015.
Another unit, Crittall Hope, involved in the production of window and door frames had a flat performance in the year under review on the back of a slowdown in the construction industry
The plastic manufacturing division, Zimplastics, is expected to start contributing to Zeco’s operations as efforts are being made to remodel the discontinued operation by utilising the existing infrastructure.