BRITISH American Tobacco (BAT) has again scooped the first prize as the best company on the Zimbabwe Stock Exchange (ZSE) in this year’s Zimbabwe Independent’s Quoted Companies Survey.
BY Fidelity Mhlanga
The cigarette manufacturer scored highly on profitability growth, achieving a 159% four-year annual compounded growth rate with a return on equity of 100% and a return of assets of 46%.
Padenga Holdings, an export-focussed business which is insulated from declining aggregate demand issues in the local market, came second.
The company is one of the world’s leading suppliers of premium quality crocodile skins, accounting for nearly 85% of the supply of Nile crocodile skins to high-end luxury brands globally. The company enjoys very high margins which have also been growing in the past years. In FY14, Padenga’s pre-tax profit increased by 77% to $8,7 million, with the profit after tax margin increasing to 23% from 15%.
The operating profit margin for the company grew from 12% to 32% and attributable profit margin surged from 12% to 21%.
However, the company’s share-price growth has not been commensurate with the company’s strong financial performance since its debut on the ZSE in November 2010.
National Foods Ltd moved two steps up the ladder this year to third. It remains the only quintessential basic food processor to make it into the top five, at a time the manufacturing sector has severely declined.
From ninth last year African Distillers rose to fourth and continues to enjoy high sales volume growth benefiting from its recent recapitalisation. In the last two years, the company has been investing in widening its product range. Major capital expenditures include the recent commissioning of a ready-to-drink line and the localisation of cider production.
From outside the top 10, Astra Industries came 5th after the share price moved up by 4,6%, while the average share price return has been 2,7% since 2009. SeedCo came 6th, Delta Beverages (7th) as OK Zimbabwe, Powerspeed Electrical Ltd and Fidelity Life Assurance completed the top 10 in that order.