Metal Fabricators of Zambia (ZAMEFA) says the financial performance for the next financial year is expected to improve.
The company says provided that the burden placed on the company’s working capital by the current VAT system is relieved by the implementation of the General Sales Tax system and the group can return to a more normal level of operating activity.
In a trading statement posted on Lusaka Stock Exchange (LuSE) authorized by Managing Director Roseta Chabala, the company says it expects its results for the financial year ended 30th September 2018 to be released on SENS and published in the local press on or about 19th November 2018.
Ms Chabala says accordingly, shareholders are advised to exercise caution when dealing in the Company’s securities until publication of the results.
“The Board of Directors of ZAMEFA advice the Shareholders that for the financial year ended 30th September 2018, the basic earnings per share and head line earnings per share are both expected to be between 390 % to 410 % lower than those of the prior year for both the group and for the Company,” read the statement in part.
She says this reduction is primarily due to the ongoing slow settlement of export duty and VAT refunds by the Zambia Revenue Authority and slow payments for product by ZESCO.
“These slow settlements materially increased the borrowing requirements of the company beyond sustainable levels and the group was forced to curtail its operations to remain within its available levels of credit. Due to the extensive dollar borrowing position, unrealised foreign exchange losses were incurred from the re – measurement of the company and group’s net foreign currency denominated liabilities due to the weakening of the Zambian kwacha against the US dollar during the year,” said the statement.