Management changes at TPH

HARARE - Zimplow chief executive officer Zondi Kumwenda has taken over reigns at Tractive Power Holdings (TPH) as group chief executive following its acquisition of a 57,21 percent controlling stake in the company.

Kumwenda take over from Charles Nyambuya who steps aside having been with the diversified concern for a period spanning 24 years with the last five in capacity as chief executive.

The management changes are part of the restructuring of the two listed concerns that is expected to see the disposal of Puzey & Payne by TPH as it seeks to streamline its businesses.

In its full year results to August TPH’s operating profit was down by 31 percent to $1,3 million compared to $1,9 million in prior year with a significant portion of the decline attributable to the loss making motoring subsidiary.

“Motor vehicle unit sales were 2,2 times the prior year, albeit on a low base, but Puzey and Payne’s overall financial results were disappointing,” said TPH chairperson Zivanayi Rusike.

The coming on board of agricultural implements, bolts and screws manufacturer Zimplow, will complement the group’s other subsidiaries such as Farmec which specialises in agricultural machinery whilst Barzem provides earthmoving machines and lift trucks.

The three operations complement each other unlike Puzey and Payne whose sales have been weighed down heavily owing to the influx of cheaper grey car imports mainly coming from Japan and South Africa.

An average second hand passenger vehicle import cost $6 000 unlike Puzey and Payne’s brand new import unit which averages $40 000.

TPH last week issued a cautionary statement, saying it was involved in negotiations which might have a material impact on the company’s share price with analysts saying that the cautionary points to the disposal of the unit, which has been constantly making losses since dollarisation.

The group achieved revenue of $42,8 million, growing by 16 percent on prior year with the group’s parts and service revenue increasing by 10 percent on last year’s figures.

Lack of clarity on the country’s indigenisation plans adversely affected the group’s earthmoving machines and lift trucks unit sales at Barzem going down by 22 percent as customers deferred capital expenditure owing to uncertainty.

“Despite this, Barzem made significant positive contribution to group results during the year under review,” said Rusike.

“Tractor and generator unit sales at Farmec were 10 percent down on last year due to low winter cropping activities. Northmec Zimbabwe managed to break even, with tractor unit sales growing by 47 percent on a very low comparative base last year,” said Rusike.

The group’s profit after tax of $690 000 was 41 percent of prior year comparative with profit attributable to owners of the company amounted to $250 000 after deducting non-controlling interest of $440 000.

Rusike added that trading volumes are expected to improve due to a number of projects in mining, road and dam construction expected in the new financial period. -
Kudzai Chawafambira

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