CAFCA saw its profit after tax surging 78% for the half year ended March 31, 2017 on the back of savings after the elimination of borrowings.
BY TARISAI MANDIZHA
In the same period last year, Cafca’s finance costs on borrowings were $74 785.
Revenue was flat on the comparative period last year.
In a statement accompanying the group’s unaudited abridged financial results, Cafca company secretary, Caroline Kangara, said profit before tax increased by 41% due to savings on interest from the elimination of borrowings and also due to reduced costs.
“The benefit from cost containment has been off set in the period by the release of overheads. Overheads are released against when stocks of finished goods and work in progress reduce. The stock reduction came about from the lack of foreign currency mentioned above to procure raw materials timeously,” she said.
In the outlook, the group anticipates no major increase or decrease in activity provided foreign currency is made available on time.
In the period under review, exports increased 66% to $705 597 in the last six months, compared to the same period last year.
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Kangara said, the statement of financial position remains strong, with cash balances of $2,4 million easily covering total liabilities of $1,1 million.
“The increase in other receivables is mainly due to having to repay some foreign creditors, who are uncomfortable with extending credit due to the foreign currency problem,” she said.
“In April and May, the company received allocations of $1,1 million in foreign currency to pay foreign suppliers, as we had cash balances to the extent of $2,4 million at the banks. This has cleared our backlog and we are now covered to the end of May for supplies.”
