• Zimplow returned to profitability in Q1 FY2026 with a pre-tax profit of US$114,921, delivering a US$711,345 turnaround in one quarter
• Group revenue rose 15% to US$8.44 million, with gross margin improving to 26% from 23%, supported by staff rationalisation, branch optimisation, and working capital discipline
• Mealie Brand led the operating recovery with 160% revenue growth, supported by 81% growth in local implement volumes and 193% growth in spares volumes

Harare- Zimplow Holdings Limited,  Zimbabwe’s largest diversified engineering and agro-industrial groups, has returned to profitability in the first quarter ended 31 March 2026, recording a pre-tax profit of USD 114,921, its first positive bottom line since the company last recorded a profit of USD 880,600 in the full year ended 31 December 2023.

The result marks a significant turnaround for the Victoria Falls Stock Exchange-listed group, which slid into losses in 2024 when the El Niño-induced drought devastated Zimbabwe’s agricultural season and accounted for 96.6% of the group’s operational losses that year. Zimplow posted a loss before tax of USD 3.437 million for the full year ended 31 December 2024,  its worst result, as revenue fell 7.2% to USD 29.78 million and no dividend was declared.

Group revenue for Q1 FY2026 grew 15% to USD 8.44 million from USD 7.36 million in the comparable period of FY2025, while gross margins improved by three percentage points to 26% from 23%. The group swung from a pre-tax loss of USD 596,424 in Q1 FY2025 to the current profit, a turnaround of USD 711,345 in a single quarter.

Group Financial Summary — Q1 FY2026 vs Q1 FY2025

Source: Zimplow Holdings Limited Q1 FY2026 Trading Update

The board attributed the recovery to a combination of structural changes introduced during FY2025, including staff rationalisation, branch optimisation, diversification of revenue streams, and a more disciplined approach to working capital management, as well as the broader recovery in Zimbabwe’s agricultural sector following the prior year’s drought.

The group had already signalled that a turnaround was underway when its half-year results for the period ended 30 June 2025 showed a loss before tax of USD 718,499, an improvement of approximately 35% on the USD 1.1 million loss recorded in the comparable period of FY2024. At the time, Zimplow also sold its Dagenham property in Willowvale, Harare, for USD 3.2 million at an extraordinary general meeting in December 2025, using the proceeds to shore up working capital and fund inventory cycles in its core operating units.

Mealie Brand, the group’s agricultural implements unit, recorded the most dramatic recovery of any business unit, with revenue growing 160% against Q1 FY2025. Local implement volumes grew 81% and spares volumes grew 193%, driven by the restoration of normal to above-normal rainfall patterns in January 2026 that released pent-up demand deferred from the drought-hit 2024 season. The business unit also recorded its first revenues from the mining segment, having entered that market in Q4 FY2025 from a zero base.

Farmec, the group’s tractor and agricultural equipment unit, delivered the strongest individual contribution to group profitability, with total revenue growing 35%. Tractor revenue grew 22% on strong demand for MF200 series models, while workshop service hours increased 58%, supporting gross margin resilience across the group. Farmec returned to a pre-tax profit after posting a pre-tax loss in Q1 FY2025.

Trentyre, the group’s tyre business, achieved total revenue growth of 30%, with new tyre revenue growing 112% driven principally by off-the-road tyre volumes supported by sustained mining sector activity and the successful execution of strategic supply contracts. Parts margins improved to 38% from 35% in the prior year. However, retread sales declined 44% against the prior year, reflecting an 18% reduction in processing volumes, and management has implemented a recovery plan targeting casing collections, inactive account re-engagement, and improved plant turnaround times.

Powermec, the group’s power solutions unit, recorded a subdued performance, with generator set volumes declining 59% and generator revenue falling 52% against Q1 FY2025. The unit was affected by two key factors: improved national electricity grid stability, which reduced the urgency of back-up power investment among commercial and industrial customers, and increasing availability of competitively priced Chinese-manufactured generator sets that displaced demand for the premium Perkins brand. Partially offsetting these headwinds, Powermec’s solar energy business recorded growth of 144 percent as customers sought cost-effective alternatives to grid-dependent and fossil fuel power.

Scanlink, the group’s Scania trucks and buses distribution unit, recorded improved aftersales performance with parts revenue growing 20% and parts margins improving to 38% from 35%. Wholegoods revenue declined 40% against the prior year, reflecting the high base effect of strong vehicle sales in Q1 FY2025. The business unit secured sales of four Scania buses and four trucks during the quarter and cited a healthy order book supported by original equipment manufacturer-backed customer financing structures. CT Bolts, the group’s fasteners manufacturing unit, delivered stable performance with revenue increasing 3% despite tonnage sold being 2% below Q1 FY2025, reflecting a favourable shift in product mix towards higher-margin mild steel and high tensile fasteners.

Looking ahead, the group’s outlook for the remainder of FY2026 would be underpinned by the delivery of the tobacco and cereals crops in the second quarter of 2026, which was expected to release meaningful liquidity into Zimplow’s primary agricultural market. Sustained mining sector activity, supported by elevated gold prices and ongoing investment in Zimbabwe’s gold mining infrastructure, was also expected to support demand across Trentyre’s off-the-road tyre segment, Mealie Brand’s mining consumables offering, and CT Bolts’ customer base.

Zimplow Holdings Limited is listed on the Victoria Falls Stock Exchange under the ticker ZIMW.VX and manufactures and distributes equipment across the agricultural, mining, infrastructure, power solutions, and automotive sectors through its various subsidiaries. The group is headquartered in Harare and operates facilities in both Harare and Bulawayo.

Equity Axis News