Paul Nyakazeya, Group Digital Editor 
A NUMBER of companies listed on the Zimbabwe Stock Exchange say they will invest in assets and strategies that hedge against inflation and exchange rate losses to preserve value and currency disparities during the current reporting period.
According to financial results for the period to December 31, 2021, announced recently, companies’ inflation adjusted revenues and profits were negatively affected by inflation and exchange loss against all major currencies.
The companies said they are however cautiously optimistic about the future of their businesses. One of the companies, Turnall Holdings, said it had lined up a number of projects in a bid to grow its business, market share and net profit.
The company said the strategy was meant to hedge the company’s earnings from the macroeconomic environment, characterised by foreign currency shortages, pricing distortions, high levels of inflation and costs of borrowing.
The construction materials manufacturer’s chairman, Bothwell Nyajeka, said the company was optimistic that the projects would enable the firm to remain in a profit position.
“Plans are underway to invest in a new plant and resume production of roofing sheets in Harare. This will augment the Bulawayo plant in line with the increasing demand for the company’s products, while improving customer service further and reducing Turnall’s cost of shipping finished products to its largest market,” Nyajeka said.
First Capital Bank also said going forward it will target value preservations due to inflation and an unstable exchange rate
In a statement accompanying the bank’s financial results for the year to December 31, 2022, managing director Ciaran McSharry said they will exercise caution in the firm’s balance sheet expansion to ensure that a sufficient cushion was maintained on its liquidity and capital position.
“The tight monetary policy regime is expected to persist in the medium term to stem inflation in the wake of increased infrastructure and social spending by the government. Against this background, the bank will exercise caution in its balance sheet expansion to ensure that a sufficient buffer is maintained on its capital and liquidity position to accommodate stress factors.”
“Quality of assets will remain a focal point whilst opportunity will be taken to participate in the stimulation of activity in growth sectors of the economy,” McSharry said.
Masimba Holdings, on the other hand, said it was exploring investment opportunities in the region to widen its revenue streams and hedge against inflation and exchange rate losses to achieve “real growth”, leveraging on the new market’s improved business environment.
“The group has identified certain opportunities in the region and strategies have been put in place to pursue them, with anticipated close-out in the short to medium term,” the group’s board chairman, Gregory Sebborn, said in a statement accompanying the group’s financial results.
Nampak Zimbabwe also said it will continue to focus on cost control and margin preservation in anticipation of a year characterised by strong economic headwinds.
“Focus remained in cost containment within a difficult trading year. The company continued to invest in the business where there was growth whilst looking at potential new opportunities to improve product offering and quality. There was improvement in accessing foreign exchange through the official foreign currency market,” the company’s managing director, John Van Gend, said.
According to FBC Holdings (FBC), it will continue to invest in assets with hedging utility, while growing interest-earning assets for cash flow generation in line with the group’s value preservation strategy.
Getbucks – a microfinance bank, said the local currencies’ loss of value against major currencies and high inflation had affected its operations.
“As an institution, the microfinance bank will continue to implement capital preservation initiatives to preserve shareholder value,” the bank said in a statement.
Seed Co said its profit margins had been dampened by the growing gap between the official and parallel market exchange rates.
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