Art Corporation rebounds with $2mln FY profit

Art Corporation rebounds with $2mln  FY profit

HARARE, December 9 (The Source) – Art Corporation reported an after tax profit of $1,9 million in the full-year to September from a loss of $590,000 in last year, driven by improved operational efficiencies and lower costs.

Art, is the parent company of the country’s sole battery maker Chloride, Kadoma Paper Mills and Softex. It said a restructuring exercise had driven operating expenses down 13 percent from $9 million last year to $7,879 million.

Operating profit during the year increased by more than 90 percent from $1,9 million to $3,7 million but revenue was largely flat at $29,8 million.

The company managed to reduce its debt from $7 million in the prior year to $5,9 million.

Chloride, which contributes two thirds of the group’s revenue, saw its sales volumes in Zimbabwe increasing by nine percent from the prior period. Its Zambian division,however recorded a 32 percent decline in battery sales.

Chloride’s operating profit was up 142 percent to $2,9 million.

Art’s pen making operation, Eversharp, posted an operating profit of $763,000 compared to $340,000 last year on the back of operating efficiencies arising from the installation of new equipment in the previous year.

Kadoma Paper Mills narrowed its operating loss from $387,000 last year to $227,000. Chairman Thomas Wushe said the group’s focus in the medium-term would be to recapitalise Kadoma Paper Mills in order to improve profitability.

Volumes in the timber unit increased by 11 percent, translating to a 21 percent increase in revenue but profitability was negatively impacted by a fire outbreak which damaged 402 hectares resulting in a fire loss of $452,000 during the period.

Wushe said the group will invest in additional fire fighting equipment to mitigate against the fire risk in Mutare.