Willdale Limited defies challenges with 26pc sales growth

Leafias Mazviro

Willdale Limited, a prominent brick supplier in the country, has experienced a noteworthy 26 percent growth in sales for the period ending June 30, despite harsh business conditions.

The company’s sales volumes surpassed those of the previous period due to the rebound in the construction industry after the rainy season shutdown.
“Year-to-date volumes for the 9 months were, however, 4 percent below the prior year, still affected by the low production experienced earlier in the year due to electricity shortages,” the company said.

Willdale mentioned that year-to-date revenue grew by 83 percent to ZWL $20 billion in hyperinflation terms and by 704 percent to ZWL $10 billion in historical terms compared to the prior year.

However, the company noted that revenue continued to be impacted by exchange rate distortions.

“The sustained growth in demand for higher-margin brick types has contributed to an improved product mix and margins. Our focus remains on efficient production and cost containment given the prevailing economic environment,” the company added.

Furthermore, the company highlighted that the operating environment remains uncertain, with monetary authorities making efforts to stabilise the economy.

“Short-term business plans will continue to be reviewed to ensure viability. Appropriate strategies will be deployed to generate sufficient business in the face of low aggregate demand.”

Willdale emphasised that Statutory Instrument 134A of 2023, issued on July 25, 2023, had significantly resolved the impasse with ZIMRA regarding Value Added Tax (VAT) on bricks.

“Clay bricks were classified as exempt from VAT as of August 1, 2022. However, this classification implies that the VAT portion on purchases will no longer be claimable as input tax, thereby increasing operational costs. Unfortunately, this will also escalate construction expenses,” the company said.

The company asserts that its business model remains viable and is generating sufficient resources to support operations in the foreseeable future.
“However, the stringent monetary measures implemented to stabilise the economy will impact cash flow generation and operations,” the company added.

Moreover, the company expressed its belief that the liquidity situation will improve after general elections.
“Tight liquidity conditions will intensify market competitiveness.

“Nevertheless, it is expected that the liquidity situation will improve following the general elections. Leveraging our brand, superior quality, and capacity, the company aims to dominate the market and sustain margins, contingent on a sufficient supply of electricity,” stated the company.

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