Gulliver Consolidated joined the bandwagon of Zimbabwean companies lamenting poor trading conditions but at the same time making hefty profits. But its report underlines the major problem that the country is facing, that of increasing paper money from a shrinking industrial base.
The heavy engineering company saw its sales increase by 261 percent in the six months to March. It rose from $664.8 million to $2.2 billion with operating profit increasing from $123 million to $504.3 million and net profit more than trebling from $87.4 million to $275.8 million. Its net profit for the year ending September was $213.3 million.
The company says all its operating units traded profitably. Industrial Galvanising and Fabricating improved trading results though volumes were down. It had problems with exports to Zambia because of punitive tariffs imposed by the Lusaka government.
Lysaght Steel Merchants in Harare and Megasteel in Bulawayo had reduced steel sales but had improved results because of productivity gains and cost savings. More Wear Industries improved its trading position and is now showing good profits. Its focus is now on improved exports and railway related work.
Moresteel in Bulawayo had improved volumes largely from transport and general engineering work. There was no development in Residential Suburbs the company’s property arm. Transport and Crane Hire improve its performance and picked up some outside general transport work to complement its specialist abnormal load business.