Zimbabwe: Hunyani Suffers 15 Percent Decline in 2005 Volumes

Source from:  The Herald (Harare) March 29, 2006 03/30/2006

HUNYANI Holdings Limited suffered a 15 percent decline in volumes in 2005's first interim, mirroring the poor performance of its key customers, namely Delta and Cairns. The company said it expects the trend to persist throughout 2006 as disposable incomes decline in the face of high inflation expected to breach the 1 000 percent barrier this month. Weak volume growth knocked off a substantial portion of the paper manufacturer's profits that rose marginally to $147,5 billion from $21,3 billion on prior year. But at full year, volumes increased by 12 percent over 2004 spurred by a 31 percent rise in export volumes while domestic volumes surged by 6 percent. "Continued decline in the national tobacco crop will also lead to reduced volumes of corrugated packaging products," said the company. Export demand had, however, remained strong, particularly from Malawi and Mozambique. "The company has orders worth around US$8 million for tobacco packaging cartons. An offshore loan to the tune of US$1,3 million has been accessed but 75 percent of this has been already paid off and the remainder should be paid off by May," said the company. In the review period, turnover at $1 trillion, up 368 percent, lagged behind annual inflation, which stood at 586 percent as at December 31 2005. Hunyani says revenue had been depressed due to unfavourable exchange rates experienced throughout the entire trading period last year. Earnings per share rose by 600 percent to $521,91 from $78,91 while a final dividend of $42 was declared bringing the total for the year to $53,75. Going forward, Hunyani says it plans to increase exports to earn foreign currency for the importation of critical raw materials. Enditem