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Harare – Nampak [JSE:NPK] said it is still committed to investing in Zimbabwe, despite the current and anticipated challenges facing the country's embattled economy.
Management at Nampak Zimbabwe, owned 51.43% by Nampak, said current investments into additional capacity and expanded product range “illustrates the group’s commitment to positioning itself for the future”.
In the period under review, the group spent US$8.6m on the purchase of plant and machinery to increase capacity and product range.
In a statement accompanying Nampak Zimbabwe’s results for the year to end-September 2015, management said the economic outlook remains challenging with little short-term relief in sight for the manufacturing industry.
A drop in aggregate domestic demand saw the company report a 5% revenue drop, with results released on Thursday showing revenue for the period under review at $95.9m.
Operating profit for the period was however much improved, up by 138% to $4.13m.
Nampak Zimbabwe is made up of three companies that were amalgamated into one by Nampak.
One of the companies, CarnaudMetalbox, performed ahead of the prior year with revenue up 13% and returned to a profit after a loss last year.
The other two companies, Hunyani and MegaPak, saw revenues drop by 2% and 13% respectively. Management attributed the performance decline to the drop in aggregate domestic demand in Zimbabwe, with the economy ravaged by job losses and company closures.
Performance for Hunyani, the biggest supplier of tobacco cartons and sacks in Zimbabwe, was negatively affected by a reduced tobacco crop in the 2014/15 season.
MegaPak, which supplies products to the country’s biggest beverages maker Delta Corporation, was affected by reduced demand for sparkling beverages in the country.
