Insimbi warns of profit slump from SA lockdown
The metal alloys supplier, who had not operated as an essential service during SA’s initial lockdown, estimates a revenue hit of up to R900m
Small-cap metal alloys supplier Insimbi Industrial Holdings has warned that interim profits have slumped after the Covid-19 pandemic shuttered its operations for the entire month of April.
The group had not operated as an essential service, and operations were effectively closed from March 27, before being reopened in a phased approach from May 4.
“We estimate that Covid-19 and the resultant lockdown levels has had a negative impact on the group’s interim revenue of approximately R800m to R900m and a resultant loss of gross profit of between R65m and R75m,” Insimbi said.
Headline earnings per share is expected to fall by between 84% and 94% in the six months to end-August from the prior period’s 9.42c. The group had reported headline earnings of R37.67m to end-August 2019, and revenue of R2.42bn.
Insimbi supplies alloys to the steel sector, as well as ceramic refractory linings to the cement, paper and pulp, steel and platinum industries.
The group had already been experiencing pressure as a result of US-China trade tensions and Brexit uncertainty before the Covid-19 outbreak in China in December.
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