Contracting and Industrial group, Masimba Holdings posted a 58 percent growth in revenue during the first half of the year as its diversification strategy paid off, earning the company a strong order book.
The group earnings were mainly derived from the mining, infrastructure and road construction portfolios, the Group said in its half year financial results posted this Friday morning.
The diversification strategy also earned the group a substantial amount in United States dollars constituting 35 percent of total revenue.
“Revenue for the six-months period ended 30 June 2021 improved to ZWL2,168 million (2020: ZWL1,377 million), representing a growth of 58%, mainly attributable to a firm order book in mining, infrastructure, and roads segments,” the Group said.
“Revenue earned in United Sates Dollars as a proportion to total revenue for the period improved to 35% (2020: 20%) owing to a diversified project portfolio.”
However, profit before tax grew at a slower rate of 19 percent to ZWL$ 435 million (2020: ZWL$ 364 million), mainly due to inclement weather in the first quarter, which negatively affected productivity, particularly in the roads segment.
The financial position strengthened to ZWL$ 6,717 million (2020: ZWL5, 597 million) on the back of acquisitions of investment property, plant and equipment, in line with the value preservation strategy.
The capital expenditure was financed by a combination of internal and external resources. Resultantly, borrowings increased to ZWL255 million (2020: ZWL156 million) representing a sustainable debt-to-equity position of 10% (2020: 8%) at close of the reporting period.
Contracts in progress, contracts receivables and other receivables at ZWL3, 618 million (2020: ZWL3, 300 million) grew by 9% compared to a 39% growth in revenue volumes.
“The positive performance was due to improved debt collections in the period under review. In line with the business strategy of managing credit risk, accounts payable increased to ZWL3, 468 million (2020: ZWL3,054 million), mostly due to advance payments received from clients. Generally, the Group’s working capital ratios remained satisfactory,” said the Group.
