AMALGAMATED Regional Trading (ART) after-tax profit for the full year to September marginally rose to $482 000 from $474 000 in 2012 buoyed by a decrease in finance costs.
Tarisai Mandizha,Business Reporter
Despite recording a decline in revenue and a 4,8% increase in operating costs, finance costs also declined to $1,7 million from $2 million.
Borrowings, the company said, declined from $9,6 million last year to $8,3 million as a result of cash generated from non-core assets disposals and internal cash generation.
Revenue stood at $33,7 million during the period under review from $34,1 million in 2012 while operating expenses increased to $9,4 million.
ART chairperson Passmore Matupire said liquidity conditions in the market continued to deteriorate and consequently turnover achieved by the group remained at the same levels as recorded last year.
“Demand for the group’s products through the operations was constrained by the poor liquidity in the economy as well as the intense competition emanating from imports.
“In addition, the devaluation of the South African rand by 22% in the year rendered locally manufactured products uncompetitive, with tissue being the most affected,” Matupire said.
He said exports were also constrained by competition in the traditional Southern Africa markets of Zambia, Malawi and Mozambique.
“Our product brands, namely Exide Battery, Softex Tissue and Eversharp Pen remained dominant in the local market as well as Zambia in respect of batteries.”
In the period under review, margins remained firm at 33%,with resultant earnings of $399 000 compared to $433 000 achieved last year.
Turnover for the group’s battery manufacturing and distribution division was down 1,14% to $20,3 million due to lower trading volumes on the back of increased competition from cheap imports.
The group reported that the division’s earnings during the period under review firmed to $1,3 million from $1,2 million in the prior year.
“The automotive factory remains behind current technological advances in battery manufacture, and there is need to capitalise the factory and upgrade modern standards,” Matupire said.
“The board will continue with initiatives to find appropriate funding and technology partners for business.
“The initiatives include working with our bankers to restructure the current short-term debt into long term, and reduction in cost of debt.
“The board is also engaged in discussion with other financers for funding of capital projects,” Matupire said.