General Beltings seeks $2 million to recapitalise

Published: 08 July 2018

THE country's sole manufacturer of conveyor belts, General Beltings Holdings needs about $2 million to recapitalise its operations to fortify its surge towards profitability and robust growth.

General Beltings general manager Mr Joseph Gunda said there was a need for the company to replace its antiquated machinery with modern technologies so as to improve on production efficiency.

"We need to re-tool to modernise our plants in the various operational stages. The business requires both long-term funding for efficiency improvement and working capital for efficient procurement of imports. A total funding in the region of $1,5 million would be required for the business. Of this amount $1 million will to be allocated towards plant and equipment efficiency improvement and $500 000 towards working capital for importation of raw materials among other products," said Mr Gunda.

The Bulawayo-based company whose fortunes were nose diving over the past few years posted positive results in 2017 with sales turnover increasing by 87 percent to $2,8m from $1,5m in 2016. The growth was attributable to the benefits accrued from technical support and enhanced internal capacity which combined to support a 38 percent price reduction offered to our customers. Mr Gunda said the company's prospect of turning into profitability by the end of the year were high.

"Prospects for the year are high with top line surging up 27 percent year to date to June as reported in the company's AGM (Annual General Meeting) two weeks ago. Year to date overall volume and revenue edged up 27 percent on prior year's comparable period as highlighted in the recent AGM report. The company is looking forward to reaching break-even point and turning into profitability in 2018 from a loss making position," he said.

Mr Gunda said the company has managed to reach an agreement with its creditors for payment of debts.

The company has been dogged by litigations from statutory bodies over legacy and current debts as well as high costs of borrowing that have over the years negatively impacted on margins and business profitability.

"Agreed monthly payment arrangements are in place for legacy debts and the company is appreciative of the patience exhibited by our creditors in ensuring that we "do not destroy the hen that lays the egg". This largely has resulted in the company keeping employment and sustaining its operations, a positive development needed for Bulawayo," said Mr Gunda.

General Beltings is one of those companies that have survived the hard times and is on a positive trajectory.

"The improvement in performance over the last few years, particularly the 2017 performance, has been achieved with a shoe string manpower budget level. As the business streamlines its operations in capacitating itself, building strategic partnerships with key customers for market consolidation, the company is poised to create more capacity for exports and create employment in the city and assist in the restoration of Bulawayo to its original status as the hub of manufacturing in Zimbabwe," said Mr Gunda.
- zimpapers