shloboe boe
Nokuthaba Brita Ncube, ncubenokuthababrita@gmail.com
LISTED brick-making firm, Willdale Limited is actively fundraising for the acquisition of a modern rotary kiln plant to enhance its competitiveness in the common brick segment.
The company, known for producing and selling clay bricks—including common, face, semi-faced and paving bricks—highlighted the need for technological upgrades in a statement accompanying its abridged financial results for the year ended September 30, 2024.
Willdale chairperson, Mr Cleopas Makoni, stressed the importance of improving production efficiency to address growing competition that threatens both volumes and profit margins.
“Production costs remained relatively higher than competitors who were using better technology, hence fundraising for the acquisition of a modern and more efficient rotary kiln plant is ongoing. This plant will improve competitiveness, particularly in the common brick segment,” he said.
“We expect to raise the required funding for the upgrading of the production plant from the various initiatives that are already in motion.”
Despite stable electricity supply throughout the review period, production volume growth was hindered by working capital shortages. Mr Makoni attributed this to the firm’s evolving business model and the tight liquidity conditions prevailing in the economy.
“There was constant electricity supply during the year. However, production volume growth was hampered by working capital shortages, which emanated from the changing business model and tight liquidity conditions that prevailed,” he said.
The period under review saw significant demand for bricks driven by cluster home developments and the construction of shopping malls in major cities. However, inadequate stock levels led to a seven percent decline in volumes compared to the prior year.
“Cluster home development together with the development of shopping malls in major cities contributed significantly to revenue, however, lack of adequate stocks affected volume growth, with volumes declining by seven percent compared to the prior year,” said Mr Makoni.
Earlier this year, Willdale announced plans to convert its land banks into residential developments to raise capital for acquiring new machinery to enhance production. The company has approximately 165,6 hectares in Mt Hampden, an area experiencing rapid development due to its proximity to the new Parliament Building and the emerging city.
Looking ahead, Mr Makoni acknowledged the challenging operating environment, marked by constrained liquidity and stiff competition as existing players and new entrants vie for available projects. “Competition will continue to stiffen as existing players and new entrants jostle for available projects,” he noted.
However, the ongoing construction boom is expected to persist, providing opportunities for volume growth.
Despite the hurdles, Mr Makoni expressed confidence in the company’s resilience and its ability to remain a going concern.
He said the board remains confident that the company will continue to operate as a going concern for the foreseeable future.
Siphakeme .Mnindwa
