BUILDINGS and associated industries concern, Turnall Holdings Limited’s restructuring of its balance sheet is expected to be completed this year as the group focuses on reversing earnings declines experienced in the half year to June 2017. As at half year, Turnall had net liabilities averaging $12 million, which posed a working capital challenge for the group during the period under review despite efforts to turnaround the situation and enhance production as well as achieve profitability.
Loans and borrowings were $6,8 million, which is 18 percent below the $8,3 million in the comparative period. Turnall acting managing director Mrs Roseline Chisveto said the restructuring would improve the firm’s performance in the half year and going forward.
“The ongoing balance sheet restructuring process is expected to be completed by the end of the financial year. Positive results are anticipated,” she said during an analysts briefing. The process should result in an “improvement in working capital, production output levels, plant efficiency through machine spares supply as well as cash flows and margins.”
Turnall recorded a 12 percent decline in revenue to $7,7 million on the back of a 17 percent decrease in sales volumes to 15,557 tonnes. Roofing products volumes were 32 percent weaker in the period under review while concrete products’ volumes fell by 10 percent. Further volume declines were, however, weighed down by a 506 percent increase in pipe volumes.
“The period was characterised by low stock availability due to working capital challenges,” said Mrs Chisveto. The group reported a profit from operations of $0,25 million from an operating loss of $1,2 million recorded in the previous year. Finance costs were lower than the previous year but remained at 7 percent of turnover. Operating cash flows before reinvestment in working capital were $0,97 million compared to negative cash flows of $0,31 million in the prior year. Loan repayments were low at $0, 08 million compared to $1,1 million prior year as funds were directed to raw material procurement. Mrs Chisveto said the group’s focus remains on improving the business performance to reposition the firm in the construction industry.–herald