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Business Reporter
THE Zimbabwe Stock Exchange listed firm, Turnall Holdings, has recorded a 41 percent decline in turnover to $16.99 million for the year ended December 31, 2016 compared to $29 million in the prior year.

In a financial statement for the period under review, the firm’s chairperson, Mrs Rita Lukukuma, said the company’s sales during the period under review were negatively affected by liquidity constraints, subdued aggregate demand and uncompetitive pricing in the regional markets.

“Export sales contributed 0.52 percent against the previous year’s contribution of 1.82 percent. Export sales were affected by pricing issues owing to high cost of production in Zimbabwe, a direct consequence of the weakening regional currencies against the United States dollar,” she said.

The group’s chairperson said the current year revenues were predominantly on cash basis in line with the revised business model thereby achieving lower sales but of a higher quality.

“Sales volumes were at 36 791 tonnes against that of the same period in 2015 of 60 451 tonnes representing a 39 percent reduction.

“As a result of the 41 percent and 54 percent drop in turnover and production output respectively, gross profit margin for the year was 11 percent compared to prior year of 23 percent,” said Mrs Lukukuma.

Profit deteriorated because of low production output despite improved buying processes and cost containment initiatives taken during the year.

She said the group incurred a loss from operating activities of $500 000 compared to $1.5 million recorded in the previous year.

“The group incurred impairment losses of $2.9 million arising from plant on care and maintenance, held to maturity investment and intangible asset.

“The group incurred retrenchment costs of $600 000 (2015 $200 000) during the year,” she said, adding that the firm also gained $7.2 million from debt rescheduling and write offs.

During the period under review, finance costs went down to $1.15 million from $1.45 million last year.

“Trade and other receivables reduced by $3,86 million from beginning of the year as a result of collections and impairments of uncollectable amounts.

“In 2016, the business introduced the cash sales model in order to ensure that enough cash resources are harnessed for operations,” said Mrs Lukukuma.