Willdale reports improved operating results

Willdale reports improved operating results
Published: 31 January 2014
Willdale Limited reported an improved operating result as turnover grew 25% mainly driven by a 27% increase in volumes sold. The growth is sales volume was on the back of improved brick availability as a result of the increased production.

Nonetheless, the average revenue per 1,000 bricks declined by 2%. Operating loss reduced by 61% to $0.4m mainly due to the cost reduction measures implemented during the year.

Although the cash flows from operating activities improved it was attributed to delaying settlement of account payables, an unsustainable cash flow measure. On the balance sheet, total assets grew by 79% mainly driven by the 86% increase in non-current assets.

Although the company performed better than the prior year it is in urgent need of recapitalisation in order to refurbish plant, acquire critical mobile equipment and provide sufficient working capital which will result in improved efficiencies and profitability.

The company has taken too long to secure the required funding to turnaround their fortunes thus giving competition room to gain market share.

In a research note by Kudakwashe Mundowozi of Imara Edwards Securities says, "The going concern of the company is questionable as it is depended on a pending transaction which has not been concluded."

The counter is trading under cautionary regarding negotiations with a potential financier.
- businessdaily
Tags: Willdale, Results,

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