General Beltings to consolidate market position

Audrey Galawu

ASSISTANT EDITOR

General Beltings Holdings Limited expects to consolidate its market positioning in the energy and cement manufacturing sectors in addition to the other non-Platinum Group Mineral to lessen the impacts of geo-political tensions and the EL Nino-induced droughts.

GB chairman, Godfrey Nhemachena said the geopolitical tensions might continue to negatively upset the demand of mineral commodities.

“The geopolitical conflicts in Europe and in the Middle East will continue to impact on demand patterns of mineral commodities in the short to medium terms as there are no signs of cessation to the conflicts.

“Due to geopolitical tensions, mineral reserves will flood the markets and depress demand for minerals that Zimbabwe would ordinarily supply thereby forcing local mines to curtail production or mothball operations.

“The EL Nino induced droughts in the Southern African Region will reduce aggregate demand in in the economy as national resources will be directed towards alleviation of hunger and diseases.

“These developments would in turn negatively affect the company’s downstream demand of its products,” he said.

Despite the depressed demand in the economy, total volumes at 921 metric tonnes were 2.5% shy of the prior year’s 944 due to improved throughput at GB Division.

Cernol Chemicals market recovery efforts yielded a lower than expected outcome with volumes marginally lower than the prior year.

A resultant operating profit of ZWL$2 billion was 150% decline on prior year’s profit of ZWL$3 billion on the back of increased dollarisation and inflationary pressure.

Operating costs at ZWL$15 billion were 150% up on prior year’s ZWL$5 billion due to the effects of inflation and dollarised quasi institution costs.

Although price competition intensified in the year, total turnover at ZWL$29 billion increased by 99% when compared with prior year’s ZWL$15 billion due to sustained volumes from prior year at GB and a favourable market mix at Cernol Chemicals.

Gross profit at ZWL$11 billion was 38% higher for the period under review due to the USD imported inflation and a deteriorating exchange rate in an increasingly dollarised environment.

The rubber division commissioned its refurbished its boiler and brought on a steam two presses that improved overhead recovery.

Total volumes at the rubber division at 378 metric tonnes were in line with the prior year’s 379 metric tonnes. The division maintained its market position through improved process efficiencies and timeous deliveries.

Although volumes were in line with the previous year’s turnover, at ZWL$21 billion was 100% higher than the prior year’s ZWL$10 billion.

Cernol Chemicals, on the other hand, continued with its forays into new market niches while defending its traditional markets.

Cernol Chemicals volumes were 36% higher from 397 MT to 543 MT with turnover at ZWL$8 billion was higher than the prior year’s at ZWL$4 billion.