CMED (Private) Limited last week paid US$1 million to Treasury as a dividend from the US$3,4 million profit it made in 2011. The development is part of statutory provisions stipulating that State enterprises should declare dividends of a minimum of 50 percent of their profit after tax.
According to the audited financial report, presented during the CMED first Annual General Meeting since its commercialisation in 2000 yesterday, the company registered a profit after tax of US$3,4 million in 2011.
This was a 431 percent increase from the previous year. The company's turnover for the period was US$52,1 million compared to US$38,5 million for 2010, representing a 35 percent increase.
Board chairman Mr Albert Kamhunga attributed the increase in profits to an improvement in the operations of the organisation's strategic business units which include transport hire, driving schools and a specialised equipment business unit.
Fuel sales grossed US$28,8 million compared to US$19,3 million in 2010 and revenue from transport hire was US$16,2 million up from US$11,1 million the previous year.
Easy Go Travel realised US$1,7 million compared to US$916 000 in 2010 and the specialised equipment business registered an increase of US$1,2 million in 2011 compared to US$1 million in 2010
Mr Kamhunga said the organisation had regained its footing as a result of changes in its priorities.
"The major problem we had at the beginning was that we inherited a depleted fleet. We have, however, managed to fruitfully recapitalise through our earnings," he said.
Mr Kamhunga said the organisation had also diversified its operations by rightsizing to fit their capacity and increasing the number of its customers. He said among the major accomplishments in the period under review, Government had also cleared close to US$10 million that it owed the parastatal before its commercialisation.
"Since 2001, the organisation realised that most of its vehicle units were going down, hence we decided to pull some of the old machinery out.
"We also incentivised our employees to retrenchment and this saw 147 of them, most of whom were of old age, taking up the initiative.
"At the moment we are also not relying on the traditional markets of Government departments but we are also having private sector customers," he said.
The parastatal offers services in vehicle and equipment services, transport hire, reconditioning of vehicle components, driver training and specialised equipment hire.