eBusiness Weekly
Fradreck Gorwe
Zimbabwe Stock Exchange-listed brick making company, Willdale Bricks Limited, has a long history stretching back to the Federation of Rhodesia and Nyasaland.
Willdale was founded in 1957 in (Salisbury) Harare. It got listed on the Zimbabwe Stock Exchange in 2003 pursuant to the demerger from Mashonaland Holdings Limited, a construction company of renown.
Willdale had become Mashonaland Holdings’ loss making subsidiary prior to the demerger.
The company manufactures a wide range of bricks and related products for pavements, driveways, walkways, patios, swimming pool surrounds and landscaping.
It also manufactures face bricks that include rustic face bricks, smooth face bricks and brushed face bricks. Products come in different colour variations of red multi, plum brown, ash blue, ash blue multi, blue heart and dark harvest.
Major projects for which bricks were supplied include; University of Zimbabwe, Reserve Bank of Zimbabwe, West End Clinic, Office buildings in Harare Central Business District (CBD), Chitungwiza Hospital, Meikles Hotel among many others.
Apparently, the company’s growth is propelled more by Government projects.
In 2009, Willdale recorded negatives in cash flows and production volumes were plummeting. Capacity utilisation averaged 20 percent due to inadequate mobile equipment and that ignited efforts to mobilise funding for increased productivity.
Such efforts actually yielded positive results with the 2014 rights issue.
As preliminaries to the capitalisation drive, the company was in 2009 engaged into dialogue with relevant authorities to put closure on the acquisition of Teneriffe, where operations were based. The land by then fell under Section 5 of the Land Acquisition Act.
In 2010, Willdale secured a CBZ bank facility that went to the refurbishment work on the Teneriffe plant and other equipment, resulting in capacity utilisation going relatively up to 23 percent. Additional funding was sought though to provide sufficient working capital to achieve consistency in production.
The company made headways after undertaking a successful rights issue of preference shares in June 2014. The rights issue raised capital for retooling and working capital. Capital expenditure for the year amounting to $1,7 million then was financed with proceeds of the successful rights issue. Capacity utilisation consequentially went up to 60 percent post recapitalisation from 53 percent in 2013.
Successful recapitalisation gave precedence to sustainability in the company’s future beyond 2014.
In June 2017, the company sought and won shareholder approval for the disposal of 190,1 hectares of land in Mount Hampden, with a view to raise a minimum US$4.75 million to pay off the overdue CBZ Bank facility and accumulated preference share dividends. The company also sought to unlock value the land found to contain no clay reserves.
Willdale aims to capitalise on opportunities presented by the current housing backlog in the country.
In 2017, the backlog was estimated at 2 million houses countrywide and 500 000 for Harare alone.
In 2018, the company applied for the voluntary delisting of its preference shares, which the bourse accorded on April 8, 2019 after full compliance with regulatory listing requirements.
The company currently banks on quoted government projects, cluster housing, shopping malls and university infrastructure as reported in the half year financials to June 30, 2019. Trading position is currently healthy with adequate stocks for pipeline projects.
The group hold a market capitalisation of $88 900 071 and a share price of 5,00 cents as updated on November 11, 2019.
Nyasha Matonda is the group chief executive officer.
