LISTED contracting and industrial group, Masimba Holdings Limited (MHL) has seen foreign currency earnings growth increasing by 15 % on the back of an improved operating environment.
Presenting the 2021 first half report MHL board chairman, Gregory Sebborn said during the period, the company recorded sound foreign currency growth.
“Revenue earned in United States Dollars as a proportion to total revenue for the period improved to 35% up from 20% recorded in the year 2020attribuable to a diversified project portfolio,” he said.
The inflation rate continued on a downward trend, from 348.6% in December 2020 to 106,6 % as at June 30 2021. Further, the exchange rate remained relatively stable to close at $85,37 to the United States Dollar as at 30 June 2021.
Profit before tax grew at a slower rate of 19% mainly due to inclement weather in the first quarter, which negatively affected productivity, particularly in the roads segment. The financial position strengthened to $6,717 million on the back of acquisitions of investment property, plant and equipment, in line with the value preservation strategy.
The capital expenditure was financed by a combination of internal and external resources. Resultantly, borrowings increased to $255 million representing a sustainable debt-to-equity position of 10% at close of the reporting period.
Contracts in progress, contracts receivables and other receivables at $3,618 million grew by 9% compared to a 39 % growth in revenue volumes. The positive performance was due to improved debt collections in the period under review.
The group strives to improve the well-being of the communities in which it operates, and to that end, as a minimum guideline, general workers are hired from the local communities where projects are carried out and as of the reporting date, the proportion of local employees to total employees was 68 %.
“The operating environment is forecast to remain stable in the short term based on interventions being implemented by the Government of Zimbabwe. The Dutch auction system provides a sustainable source of foreign currency. However, we urge that the responsible authorities address the backlogs in foreign currency settlement,” Sebborn added.