Almot Maqolo, Staff Writer 
BRICK-making firm, Willdale Limited (Willdale) plans to step up capital raising initiatives next quarter in an attempt to increase plant efficiencies, which should increase its competitiveness in the face of fierce market competition.
The company’s ability to meet brick demand is being hamstrung by failure to replace its antiquated machinery.
Improving plant efficiency will be crucial for sustaining margins and positioning the company for future growth.
In its trading update for the third quarter (Q3) to June 30, 2024, Willdale company secretary Mavuto Munginga expressed concern over increasing competition.
“Efforts to improve competitiveness through investment in modern plant technology will be intensified in the next quarter. Cost containment will be critical going forward to sustain margins, faced with increasing competition,” he said.
“Competition, however, remains stiff. Efforts to raise funding to acquire a modern and more efficient brick making plant are in progress,” said Munginga.
Earlier this year, the company announced plans to sell its idle land in the Mt Hampden area as part of efforts to raise funds to turn around its flagging fortunes.
During the quarter under review, the brick-maker faced significant hurdles, including persistent electricity load shedding, which hampered production efficiency, and limitations in working capital that resulted in a 16 percent decline in production compared to the previous year.
Additionally, the competitive market environment forced prices and margins down, contributing to a five percent decline in sales volumes.
“Strategies are in place to resource the business to meet its working capital requirements from time to time to ensure sustainable viability,” said Munginga.
“The general market acceptance of the ZWG for transacting will ease pressure to generate US$ for local transactions. Liquidity and solvency ratios are at satisfactory levels.”
Accordingly, Willdale’s revenue performance exceeded expectations, coming in five percent above budget. This positive outcome reflects the company’s resilience and strategic focus on managing costs while maintaining a favorable product mix.
The shift towards local currency transactions has also eased some pressure on liquidity, allowing for better operational stability.
Willdale is poised to benefit from the ongoing construction boom. newsdesk@fingaz.co.zw
