GENERAL Beltings Holdings (GB Holdings) posted a 40 percent decrease in total volumes to 206 metric tonnes for the quarter to March 31, 2023 from 342 metric tonnes recorded in the prior quarter, as the debilitating power outages significantly affected production.
Zimbabwe is facing acute power outages, which are stretching to as long as 12 to 14 hours a day. This is resultantly hurting businesses as they have been pushed to use solar and generators for power for business continuity.
“The quarter was constrained by dampened local aggregate demand, while increased dollarisation encouraged imports at the expense of local industry. Further, the debilitating power shortages significantly affected production and increased cost of production as resources had to be matched with load shedding schedules,” GB Holdings’ company secretary Patrick Munyanyi said in a trading update.
Munyanyi said plant maintenance aimed at improved process efficiencies was on course while the boiler at the rubber plant was refurbished.
Despite the decrease, the company’s performance was boosted by a strong order book carried forward from the prior year into the quarter.
“Total volumes for the quarter at 206 metric tonnes were 40 percent lower than the 342 metric tonnes recorded in the same period the prior year. The rubber division volumes at 113 metric tonnes were five percent shy of the prior year’s corresponding period volumes.
“The chemicals division volumes at 93 metric tonnes were 58 percent lower than the same period prior year volumes which included residual Covid-19 business. As a result, the operating profit is 19 percent lower than the same period the prior year,” Munyanyi said.
On the outlook, GB Holdings said the effort to improve power supply will enable the rubber division to convert its strong order book and further meet new business given the anticipated growth in the mining sector.
GB Holdings also expects the chemicals division to improve performance on the back of expected growth in the tourism and agricultural sectors together with the relaxation of contractionary measures.
Munyanyi further said the company has also maintained its supply chain relationships and endeavours to retain key skills, which are critical to improved results as the year progresses.
GB Holdings manufactures and distributes general-purpose and specialised reinforced conveyor beltings, and rubber and chemical products.
Its product range includes rubber-covered belting, polyvinyl chloride (PVC) belting, light-duty PVC belting, solid-woven belting, transmission belting, and conveyor belt rubber skirting.
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