• Zimbabwe battery volumes fell 26% in Q3 2026
• Energy Storage remained operating profitable despite 62% capacity utilisation, supported by restructuring, tighter cost management and improved product mix
• Lower-priced imported batteries gained regional market share, adding competitive pressure as ART also faced higher internationally priced battery inputs

Harare - The Zimbabwe Stock Exchange-listed diversified group, Amalgamated Regional Trading Holdings, battery volumes in Zimbabwe fell 26% year on year in the third quarter ended June 2026, as working capital shortages restricted production and weaker replacement demand slowed sales according to the latest trading update.

The Energy Storage division remained in operating profit during the period, supported by restructuring and tighter cost management.

The contraction reversed some of the operating momentum established during the first half. Batteries Zimbabwe had returned to profitability in the second quarter as local volumes increased 3% and exports recovered 10%, although production was already running below management targets because of working capital and supply constraints.

Those constraints became more pronounced in Q3. Battery production operated at approximately 62% capacity, with ART citing limited working capital, lower scrap collections and supply-chain disruptions. The group identifies working capital as its main constraint to increasing production and asset utilisation.

The available capacity leaves ART with room to raise output using its existing manufacturing base. Production recovery currently depends on sufficient funding for raw materials and inventories, alongside more reliable supply chains.

Market demand weakened during the same quarter. The expected seasonal increase in replacement battery sales was below expectations, while stronger activity in agriculture and mining failed to produce a corresponding increase in battery demand. Consumer and business liquidity also remained tight.

Lower-priced imported batteries added another source of pressure. ART said imports gained market share across the region during Q3, while internationally priced battery inputs increased production costs. The combination kept margins under pressure as the company sought to rebuild volumes.

Import competition has persisted into the current quarter from the previous financial year. ART reported local battery volumes 1% lower in FY2025 amid supply disruptions and imported-product competition, while Chloride Zambia volumes fell 25% as competition intensified and customers struggled to meet payment terms.

Zambia remained weak in Q3 2026. Battery volumes declined 16% during the quarter and were 9% lower over the nine months. ART said restructuring and tighter cost management improved the operation’s performance, with management focusing on rebuilding market presence and product availability.

ART also tightened the quality of business passing through its distribution network during the quarter. The group adopted more selective credit terms as collection risk increased in parts of the informal market. Management said this reduced volumes and lowered exposure to potentially poor-quality receivables. Export battery volumes were 24% below the prior year over the nine months as ART prioritised collections and orders offering sustainable margins.

The Q3 volume decline therefore developed through several operating channels. Working capital constrained production, replacement demand undershot expectations, imported batteries gained market share and tighter credit reduced sales into higher-risk channels.

These pressures pulled down the wider group performance. ART’s total sales volumes declined 15% in Q3, leaving nine-month volumes 3% below the prior year. Quarterly turnover fell 9% to US$7.06 million from US$7.79 million, while nine-month turnover remained broadly unchanged at US$21.34 million.

The immediate Q4 test sits in production and market recovery. ART has identified working capital as the principal constraint while its battery plants operated at 62% capacity in Q3. Higher utilisation will require improved raw-material availability and working capital, followed by sufficient demand to absorb additional production at sustainable margins.

Battery volumes, capacity utilisation and product availability in the final quarter will establish whether ART can convert the profitability restored through restructuring into a broader operating recovery.

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