Staff Writer
Nampak Zimbabwe (Nampak) says its Hunyani paper and packaging unit’s sales volumes for the half year ended March 31, 2024 were 14% below the prior year due to the reduced tobacco crop size.
The company, a key player in supplying packaging for tobacco, Zimbabwe’s crucial cash crop, attributed the sales slump to a diminished tobacco harvest.
The decrease is a direct consequence of the severe drought conditions, exacerbated by the El Niño weather phenomenon, gripping the region.
The country’s leading packaging manufacturer said regional demand was lower during the period under view influenced by the drought and loss of volume to competitors,
“The El-Nino induced drought has adversely affected the agricultural season and is expected to dampen the volumes in the paper business as the tobacco crop will be lower in this season, compared to the last,” Nampak’s managing director John van Gend said in a statement accompanying financials.
He said group volumes for the six months to March 31, 2024 were behind the prior year by 5% mainly due to reduced volumes at Hunyani resulting from the smaller tobacco crop and lower tobacco cases orders from the region.
Volumes in the other operations were ahead of the prior year due to improved volumes from Nampak’s customers who benefited from the buoyant consumer spending.
Van Gend said tight liquidity due to policy shifts and the lack of availability of foreign currency from the auction floor in the second quarter has adversely affected the group’s stock replenishment.
Revenue for the half year at ZW$976,2 billion, in hyper-inflationary terms was 8% behind the prior year due to the lower sales volumes when compared to the prior year in which a record tobacco crop was recorded.
