- Category: Stories
- Published on Monday, 06 December 2010 17:25
- Written by Charles Rukuni
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Zimplow continues to make record profits though erratic rains over the past three seasons have changed the spending patterns of rural farmers as they are finding it increasingly difficult to meet the ever-escalating prices of agricultural implements.
In the six months to December, its sales of $1.4 billion surpassed those for the year ending June which stood at $819 million. Sales for the first half of 2001 were $534.6 million.
But the company says though sales on the local market increased by 138 percent from $358 million to $853.4 million, volumes were down by 40 percent.
Exports, however, increased by 230 percent from $176.6 million to $581.8 million. Volumes were up 21 percent. The company says good volumes have been pushed into South Africa, Namibia and East Africa.
Its only concern was the exchange rate which has since been adjusted. Another concern is the supply of raw materials. While in the past it procured 80 percent of its steel locally, it is now getting 60 percent from outside the country.
The company is also worried that local conditions are not likely to improve in the next six months as consumer spending is likely to shift to food and other basic essentials.
Besides, the second half traditionally produces a smaller profit as the selling season will be over.
Net profit for the first half was $640.1 million compared with $153.1 million the previous year and $240.5 million for the year ending June.