Listed transport and logistics provider, Unifreight has blamed the introduction of the ZiG currency for reducing business volumes on the back of optimism for performance improvements in the future.
On April 5, the Reserve Bank of Zimbabwe introduced a new "structured currency" ZiG to tackle the ongoing economic crisis in the country. The new currency is backed by gold, and other precious minerals, and will circulate alongside other foreign currencies.
Presenting performance for the period ended December 31 2023, Unifreight chairperson, Peter Annesley blamed the ZiG for low volumes.
"Despite challenging Q1 marked by subdued volumes due to the introduction of ZiG. We remain optimistic about Unifreight's future. Our growth is underpinned by quality contracts we have been able to execute following the completion of the fleet expansion project in 2023," he said.
He observed that the fiscal year 2023 was marked by a challenging economic environment primarily due to the substantial depreciation of the Zimbabwean dollar which eventually led to the introduction of a new currency, the Zimbabwe Gold (ZiG).
Annesley said the significant currency depreciation experienced during the year continued to constrict market liquidity as industries grappled with reduced access to finance in either Zimbabwean dollars or Nostro.
During the period, the group posted a profit of ZWL192 billion largely attributed to improvements in the operating margins, which rose from 0% in 2021 to 2,56% in 2022 and further to 20,6% in 2023.
"The significant improvement in 2023 was driven by the management team's aggressive pursuit of cost containment strategies, coupled with the deployment of additional 50 FAW 380 FT Truck Tractors with Afrit Tautliner trailers into the local and cross border market.
"We successfully renegotiated terms on foreign-denominated loans with major financiers to more favourable local conditions. As of December 31 2023, our loan book stood at ZWL248 bln. Additionally, we transitioned our property plant and equipment policy from a cost most to a revaluation model resulting in a deferred tax liability," added Annesley.
