CAFCA acting managing director Austin Zvidzai says export contribution to the total turnover of the electric cables manufacturing group has increased significantly during the first half to Ju
Export contribution to turnover during the last six months increased to 48%, up from a mere 6% during the same period last year.
Last year saw exports contributing 22% to turnover.
In an interview Zvidzai said the company had prioritised export volume growth in the face of a depressed local market.
“The domestic volume has remained at last year’s due to the prevailing economic conditions. Exports therefore now take centre stage in our bid to remain viable,” said Zvidzai who refused to quantify the drop in local sales volume.
The group has a $2,6 billion order book, which translates to two months worth of sales. Orders from the export market are valued at $1,82 billion while the domestic market makes up for the remainder.
“At the current rate of business it means that we are assured of business for the next two months,” Zvidzai said. “Our problem though is that we are unable to meet some delivery deadlines due to the delays in foreign currency procurement for the central bank.”
The company has a two months stocks cover.
Zvidzai said the company had targeted to begin producing the medium voltage cables and aerial bundled conductors during the fourth quarter of this year.
The company expects the introduction of the new products to contribute significantly to volumes growth in the last quarter of this year as there are customers who are lined up for the new products. Zvidzai said the long awaited certification of the products had been granted.
The group continues to benefit from the rural electrification programme with Zesa making up for the bulk of the local orders.
The acting managing director said due to the unstable prices on the market the company was now producing per order.
Commenting on the regional market Zvidzai said that the company was working with its largest shareholder to tackle the region as a combined force.
The company currently exports copper cables to Malawi, Zambia, Botswana, and South Africa. It has made a few sales in Mozambique.
“Kenya is our next target and on a broader platform the regional initiatives are in place,” Zvidzai said.
Cafca’s half-year results are scheduled to be released soon.
“We are confident that our half year results will be in line with analyst and market forecasts,” Zvidzai said. The businessdigest has gathered an earnings per-share range of $62 to $70 and an average of $66 for the upcoming interim results.
Cafca shares traded at $670 on Tuesday.