Nampak in $6m capex

HARARE - Packaging firm, Nampak Zimbabwe Limited (Nampak), says it spent $5,9 million on capital expenditure in the full-year to September 30 as its operating profit surged 65 percent to $6,8 million from $4,1 million prior year.

The group’s company secretary, Keith Nicholson, said the money had been spent on advanced closure equipment for Mega Pak, anticipated to displace imports, and a new blow-moulder for its CarnaudMetalbox unit.

“…Cartons, Labels & Sacks benefitted from the acquisition of litho equipment from Nampak Zambia. The total expenditure amounted to $5,9 million compared to $8,6 million spent in 2015,” he said.

Despite the profit surge, sales for the year at $95,2 million were lower than the $96 million recorded prior comparable period.

“This, combined with tight controls over working capital, led to positive cash holding throughout the year.

“The shortage of foreign currency resulted in the accumulation of foreign trade payables. This also contributed to the higher cash balance of $21,1 million compared to $10,1 million,” Nicholson said.

Revenue was largely flat at $95,2 million — compared to $95,9 million last year — but margins improved on production efficiencies.

Pre-tax profit stood at $6,4 million while net profit, at $4,3 million, was higher compared to $2,4 million achieved in the same period last year.

Trade payables increased by 23 percent to $27,4 million on the back of foreign currency scarcity.

CarnaudMetalbox saw its volumes and revenue going down during the year even though it continues to trade profitably as Hunyani volumes and net revenue were on par with 2015.

The new preform equipment commissioned in 2015 improved the performance at Mega Pak, with revenue and operating profit increasing on prior period.

“Operating profit was ahead of the prior year on the back of cost containment and production efficiencies.

“The new preform equipment commissioned in 2015 made a positive contribution and was strategically positioned to meet increased customer demands”, said Nicholson of the unit.

The company secretary said the group was poised for growth on the back of import restrictions imposed by the government through Statutory Instrument 64 of 2016.

Nampak did not declare a dividend for the full year with the secretary saying cash resources were expected to be utilised to fund future capital expenditure projects and to reduce long- term debt.

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