Nampak Zimbabwe Limited reported a sharp decline in profitability for the six months ended 31 March 2026, with profit after tax falling to US$306,024 from US$2.88 million in the prior comparable period, as aggressive competitor pricing and higher raw material costs eroded margins despite a 25% increase in overall sales volumes.
Group revenue rose 10% to US$41.74 million, up from US$38.01 million, driven primarily by carryover orders for tobacco cases from the local tobacco industry. However, trading income dropped 69% to US$1.17 million from US$3.78 million, reflecting pressure on gross margins. Operating profit fell to US$951,299 from US$4.45 million, while profit before tax declined to US$934,490 from US$4.44 million. Earnings per share retreated to 0.04 US cents from 0.38 US cents, and headline earnings per share came in at 0.06 US cents versus 0.30 US cents in 2025.
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Book NowRaw materials and consumables used increased 24% to US$25.13 million, while employee expenses rose to US$6.61 million from US$5.88 million. Depreciation and amortisation increased to US$1.48 million from US$971,602. The Group recorded other expenses of US$215,942 compared to other income of US$668,341 in the prior period, mainly due to net exchange losses on foreign currency. Finance costs increased to US$34,180 from US$24,919, while finance income was US$17,371. Income tax expense for the period was US$628,466, down from US$1.57 million.
Total assets stood at US$48.97 million as at 31 March 2026, down from US$50.32 million at 30 September 2025. Current assets were US$36.40 million, including inventories of US$17.35 million, trade and other receivables of US$12.32 million, and cash and cash equivalents of US$6.41 million. Non-current assets totaled US$12.58 million, led by property, plant and equipment of US$11.23 million.
Total equity was US$36.07 million, with retained earnings of US$36.04 million. Current liabilities were US$11.67 million, with trade and other payables of US$10.42 million. Non-current liabilities totaled US$1.23 million.
Net cash generated from operating activities was US$1.06 million, down from US$1.75 million in 2025, after working capital changes and tax paid of US$720,144. Investing activities utilised US$1.28 million, primarily for plant and equipment purchases of US$1.30 million. After financing activities and exchange rate effects, cash and cash equivalents decreased by US$355,558 to close at US$6.41 million.
The Printing and Converting segment, which includes Hunyani Paper and Packaging, recorded sales of US$20.44 million. Hunyani Corrugated Products Division volumes were 54% ahead of prior year due to strong tobacco case demand, though commercial volumes were 6% lower due to competition. The Cartons, Labels, and Sacks Division saw volumes down 3%, despite improved tobacco paper wrap demand.
The Plastics and Metals segment, comprising Mega Pak and CarnaudMetalbox, posted sales of US$21.55 million. Mega Pak volumes were 5% ahead of the prior year, with PET and preform demand remaining positive. However, HDPE demand fell 15% due to cyclical factors, and Ruwa operations were hampered by persistent power cuts. CarnaudMetalbox volumes were 2% below prior year, with metals impacted by first-quarter supply chain delays and closures down 10% due to plant breakdowns.
The Group noted economic growth supported by improved agricultural output and stronger mining performance, particularly in gold. Diaspora remittances bolstered the services sector, while fiscal and monetary authorities maintained policies aimed at price stability. The US dollar continued to dominate domestic transactions, even as local currency inflation trended toward single digits.
Management flagged rising geopolitical tensions in the Middle East and higher international oil prices as risks that could tighten trading conditions in the second half. Increased cost pressure on resin and fuel is anticipated as conflicts escalate.
Capital expenditure for the period was US$1.30 million, focused on expansion and replacement at Megapak and CMB. To preserve liquidity for critical capex, the Board did not declare an interim dividend.
The board welcomed Peter Mashangu as a non-executive director effective 10 March 2026. He currently serves as Managing Director for Beverage Angola and holds a bachelor’s degree in accountancy and Harvard executive credentials.
Tobacco packaging volumes at Hunyani are expected to remain firm given projections for an improved tobacco crop, while demand in other categories is forecast to be flat. The Group will focus on operational efficiencies, cost optimisation, and selective capital expenditure, while exploring new growth opportunities.
Shareholders were reminded that Nampak Limited, the ultimate parent company, continues to disclose its 51.43% shareholding in Nampak Zimbabwe Limited as an asset held for sale, with discussions ongoing with potential acquirers.
The Directors confirmed the Group has sufficient financial resources to continue as a going concern.
