INDUSTRIAL manufacturer GB Holdings Limited (GBH) recorded a 96,21% drop in profit after tax to US$38 950 in its financial year ended December 31, 2025, owing to negative other income driven by exchange losses.
The decline compares with a profit after tax of US$1,02 million in the prior year, when GBH recorded other income of US$1,44 million. In the year under review, the group posted negative other income of US$24 886.
The company, which produces and distributes rubber and chemical products, also said it was constrained by working capital challenges.
“The total volumes at 779 metric tonnes were 19% lower than the comparable period’s 953 due to working capital constraints and reduced aggregate demand in the economy,” GBH chairperson Tichaona Mabeza said in the company’s financial year statement ended December 31, 2025.
“The decline in volumes notwithstanding, total turnover at US$4,284 million increased by 43% when compared with the prior year’s restated US$2,99 million due to a product mix.
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“As a result, gross profit at US$1,756 million was 26% up on the comparable period’s restated US$1,394 million due to a favourable product mix and significant growth at the rubber division.”
He said that despite increased dollarisation and inflationary pressures in the economy, costs were 8% lower than the prior year’s restated US$1,794 million, supported by cost-reduction initiatives.
“An operating profit of US$39 000 was recorded against a prior year restated profit of US$1,029 million,” Mabeza said.
Total volumes in the rubber division at 301 metric tonnes declined by 21% from the comparable period due to reduced demand in the energy sector.
“Despite volume downturn, divisional turnover at US$2,922 million was 81% up on the comparable period’s restated US$1,616 million, due to market recovery in other rubber-related products supplied to the mining sector,” Mabeza said.
Cernol Chemicals volumes at 478 metric tonnes were 17% lower than the comparable period’s 574 tonnes due to working capital constraints. However, turnover at US$1,363 million was broadly in line with the prior year’s restated US$1,373 million.
The company did not utilise any bank facilities or issue equity during the year, instead relying on internally generated US dollar receipts to fund working capital requirements.
The company retains receipts from operating activities in both currencies.
“During the year ended 31 December 2025, the company’s current liabilities exceeded its current assets by US$145 533. The board has assessed the current negative performance of the company and have put in place measures to correct the adverse performance through the 2026 strategic plan,” GBH said.
The measures include strengthening revenue through confirmed orders from key mining-sector customers, improving production efficiency and overhead recovery through machinery repairs, securing and optimising external working facilities, and enhancing operational resilience and risk mitigation.
The balance sheet remained resilient as total assets were US$5,64 million compared to the prior year’s US$5,22 million.
Mabeza said the firm would tap into expected economic growth to pursue new opportunities and sustain growth.
“The deliberate strategy to invest in energy and power infrastructure is expected to drive demand for conveyor belts, while increased activity will favour growth in the Chemicals Division,” he said.
Mabeza said the firm would tap into this year’s economic growth to pursue opportunities to sustain growth.
“The deliberate strategy to invest in energy and power infrastructure is expected to drive demand for conveyor belts, while increased activity will favour volume growth in the Chemicals Division,” he said.
“Agricultural growth momentum is expected to continue in the year, and demand from the dairy sector is expected to rise through market consolidation at Cernol
Chemicals.”
To complement the growth prospects, he said strategic partnerships and critical skills retention programmes would be strengthened.
“Focus on delivering a commensurate value proposition to customers will remain anchored on offering timely solutions to a diverse customer base, while at the same time meeting stakeholder expectations,” Mabeza said.
