The closure of borders as part of efforts to contain the spread of the deadly COVID-19 has seen exports by the Bulawayo headquartered farm implements manufacturer, Zimplow Holdings Limited, drop by a massive 64 percent.
The Zimbabwe Stock Exchange-listed concern produces and distributes farming implements in sub-Saharan Africa and operates through four divisions, namely, Barzem, Mealie Brand, CT Bolts and Farmec.
In a latest trading update for the first quarter of 2020 ended March 31, Zimplow Company, Secretary Maxwell Chinorwadza, said COVID-19 had severely affected their export volumes during the period under review.
“Furthermore, the export business experienced a 64% drop compared to prior year as a result of measures taken by regional governments to manage the spread of the novel coronavirus (COVID-19),”said Chinorwadza.
“Overall implements volumes have been 54% behind the previous year whilst spares volumes were 47% behind the same period last year. Business and communities have been affected by the pandemic globally and as business we will continue to support industry, the essential services, agriculture and mining, and people to the best we can.”
He said the impact of COVID-19 will even extend to the next quarter, adding they were taking steps to ensure the survival of the business.
“The second quarter is going to be materially affected by the COVID-19 pandemic,” said Chinorwadza.
“We have taken steps to reduce costs and preserve capital. Other than at Mealie Brand demand for our products remains stable.”
Despite a drop in exports, Chinorwadza said the group delivered an encouraging first quarter performance notwithstanding challenges experienced in the operating environment.
“The first quarter of 2020 saw improved volume performance across all our units except for Mealie Brand,” he explained.
“As a result, revenue was 896% ahead of the same period last year, in historical terms.
Operations Barzem had a good start to the beginning of the year. First quarter equipment volumes were ahead of prior year with 8 units sold compared to none last year. Parts sales improved by 24% from last year.”
Chinorwadza said Powermec’s performance continued to improve with generator units sold being 118% ahead of prior year.
“After sales business saw growth in parts by 86%, service hours sold jumped 192% to 2,105 hours,” he said.
“The improved responsiveness to power outages by our Powermec division unlocked our elevated status as the Authorised Perkins dealer in Zimbabwe. Tractor sales at Farmec remained at the same levels as the prior year whilst implements volume grew by 100% to 40 units sold compared to the same period last year. After sales performances were 22% down from the previous year with service hours sold down 19% to 2,090 hours.”
The realignment of the CT Bolts business, Chinorwadza said produced improved results in the first quarter, adding volumes were 34% ahead of the comparative period.
Mild steel bolts, the company secretary said, improved by 39% and high tensile steel bolts grew by 43% during the period under review.
