HARARE – South African packaging firm Nampak said its Zimbabwean unit recorded a 13 percent increase in profits to $4,9 million in the full year to September compared to $4,3 million registered in the prior comparable period.
Nampak Zimbabwe company secretary Keith Nicholson yesterday said sales for the year amounted to $96,3 million from $95,2 million in 2016 while the group’s operating profit came to $7,6million from $6,8 million the previous year.
“Improved profitability, combined with cost containment and tight controls over working capital, gave the group an improved cash holding throughout the year. The inability to settle foreign liabilities timeously resulted in a further accumulation of cash balances to $48,2 million at year end,” he said.
Nampak is Africa’s largest packaging manufacturer with operations in Angola, Botswana, Ethiopia, Kenya, Malawi, Mozambique, Namibia, Nigeria, SA, Swaziland, Tanzania, Zambia and Zimbabwe.
It is also a major supplier of plastic bottles to the dairy industry in the United Kingdom.
Nicholson said the group’s CarnaudMetalbox unit saw its volumes and net revenue declining against the prior year due to reduced demand as a result of a coolsummer. The trading income was marginally down on the prior year.
“Hunyani volumes and net revenue across the operating divisions improved from the prior year with an upturn indemand for commercial packaging arising from import restrictions due to Statutory Instrument 64 anda solid performance in the tobacco carton sector.
“The operating profit was substantially ahead of theprior year, driven by the higher volumes and overhead costs containment,” he said.
Mega Pak, another local unit of Nampak, had its volumes and net revenue substantially decreasing n prior year, severely impacted in the first quarter,again by a cool summer, and a build-up of stock at the major customers, Nicholson said, adding that the operating profit was lowerthan the prior year.
The Nampak boss further indicated that the group’s total expenditure amounted to $2,8 million and was incurred to enhance plantcapacity.
“This included new moulds for both blow and injection moulding at CarnaudMetalbox and Mega Pak and installation of a new rotary HDPE blower for CarnaudMetalbox and some minorequipment at Hunyani.
“Capital commitments are for plant upgrades at Hunyani and new equipment and moulds at Mega Pak with some partial payments included in the current year capital expenditure,” he said.
Nampak does not expect the current economic challenges to subsidise anytime soon, despite the inauguration of a new president last week” Nicholson added.