Phoenix Consolidated Industries Limited, a diversified construction and manufacturing company, has disposed its shareholding in Pacprint to raise capital for Scandia Wire, one of its key operations.
The Zimbabwe Stock Exchange-listed company expects demand for Scandia products to firm as agriculture recovery surges back to boom, spurring growth for the whole group.
For the full year ended October 31 2010, the strategic business unit, which produces fencing products, brickforce, drawn wire and netting products, accounted for the largest share of group turnover, despite limited capacity.
“The forecast growth in agriculture will increase demand for fencing and demand for brickforce is in excess of current capacity,” the company said in an abridged financial report.
“Plans are in place to increase both the volume of drawn wire and netting product for implementation toward the end of the 2011 financial year.”
Phoenix disposed its shares in Pacprint at $133 000 and realised a profit of $131 000 from the transaction.
During the review period, the group reported that revenue increased to $10,6 million from 4,3 million the year before.
Pacprint accounted for $2,5 million of the total turnover.
The previous year the discontinued operation contributed $1,5 million.
The disposal reduced the value of fixed assets to $6,4 million from $7,3 million.
Profit from continuing operations before depreciation more than doubled to $680 000 from 302 000 the year before.
Profit after taxation also rose from $135 000 in 2009 to $199 000 in 2010.
“All units achieved profits during the year,” Phoenix said.
“The company is forecasting significant growth in the New Year and has sufficient resources to fiancé this growth.”
Other operations under the group include Phoenix Brushware, William Smith and Gourock and J W Searcy.
William Smith and Gourock is currently the most profitable division.