LISTED supplier of electrical, hardware and home improvement products, Powerspeed Electrical Limited, has recorded subdued performance in the third quarter ended June 30, due to the adverse economic climate that has been worsened by the Covid-19 pandemic.
In a trading update for the quarter under review, the ZSE-listed firm noted that the economic difficulties facing Zimbabwe have been exacerbated by Covid-19.
“Travel restrictions have made it difficult for staff to travel to work and in many instances, the group has had to provide contracted transport at a substantial additional cost.
“Despite these challenges, we have been able to keep most operations to maintain customer service.
“Volume throughput during the quarter has been erratic, obviously the national shutdown in April reduced throughput to almost zero for the greater part of the month,” it said.
Subsequently, the company said while volumes have recovered, there have been substantial changes in product mix.
“Overally, volumes were marginally higher than the same quarter last year because of increased market share in a number of product groups.
“While revenue rose substantially both in historical and inflation adjusted terms, profitability remains difficult to assess because of rapidly changing exchange rates and distorted indices.”
It said margins continue to be under pressure while expenses are rising with inflation and devaluation.
Based on assessment of the balance sheet, Powerspeed believes that it will continue to build shareholder value in real terms.
“Zimbabwe has been through periods of extreme uncertainty in the past, however, we are possibly facing even greater uncertainties than ever before, which makes it extremely difficult to predict the future performance of the group,” it said.
The company continues to focus on growth of shareholder value on account of the confidence to survive short term business disruptions.
Last December, Powerspeed announced that it was planning further expansion of product range to attain an impressive market share as part of the group’s plans for the future.
The decision was informed by the fact that a diversified product portfolio helped the group to ensure survival in a constrained operating environment.
A range of products reportedly provided customers with wide choices, while at the same time helped minimise stock outs. -Chronicle.c.zw