Art Corporation Records 30% Growth

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By Alois Vinga

LISTED stationery, paper, and battery manufacturer, Amalgamated Regional Trading (ART) Corporation has recorded significant volume growth across its segments, recording increases of 30%.

Presenting the group’s performance for the period ended September 30, 2021, ART’s chairperson, Thomas Wushe said despite the adverse impact of the Covid-19 pandemic, the group recorded significant growth.

“Sales volumes recovered across all the divisions with an overall increase of 30% compared to the prior year. Revenue increased by 27% in inflation-adjusted terms as demand recovered,” he said.

“The sharp inflation-induced input cost increases could not be aligned to pricing, resulting in a significant decrease of gross margins to 39% from 52% in the prior year,” he said.

He said operating expenses increased by 66% due to general inflationary increases in costs and the initiatives taken to stimulate demand and cushion employees’ salaries.

Losses on assets and investment properties amounting to $191 million and $54 million respectively were also recorded.

“The strategic investments to increase capacity and expand the distribution network in the batteries business were vindicated as the automotive battery demand remained strong. The performance was ahead of recovery expectations, as volumes increased by 39% despite supply chain disruptions,” Wushe said.

Paper sales volumes for Kadoma Paper Mills and National Waste Collections increased by 27% and 13% respectively albeit from a low base.

However, Softex volumes reduced by 9% with the performance of the paper divisions being affected by the intermittent supply of raw materials and spares.

Eversharp volumes increased by 35% as the Covid-19 restrictions were eased and school disruptions minimised.

“The underlying demand for our core products remains robust and our focus on the changing consumer preferences and emerging technologies will be key in sustaining the group’s strong performance in the market.

“The successful completion and settlement of Nampak’s shareholding in Softex, as well as the completion of key factory upgrades in Chloride, will create much-needed liquidity headroom to enable the group to complete the capitalisation of the paper business,” Wushe added.