Brickmaker Willdale says individual home builders drove a 12% growth in annual sales in 2020, and the company is looking to government infrastructure and housing projects to sustain demand this year.
Willdale sold more bricks than it did in 2019 despite the company losing two months’ worth of production due to the COVID-19 lockdown.
Production for the year declined by 20% compared to the prior year, Willdale said in its annual financials to September.
“About two months’ production was lost due to the COVID-19 induced lockdown,” Willdale says.
Willdale hopes to ride on an expected increase in government infrastructure spending for 2021.
“The relaxation of lockdown conditions from Q4 witnessed a steady increase in orders especially from individual home developers. The continued opening up of economic activity coupled with the RBZ introduced foreign currency auction system resulted in a stable currency and inflation rate. This will present opportunities from dormant and new projects including government infrastructure and housing development programs.”
The forex auction, Willdale says, has brought some stability that it hopes will lay the ground for more property investments.
The company says: “We are encouraged by the prevailing stability in the economy underpinned by a stable currency and declining inflation. We expect this to stimulate property and infrastructure development in the short to medium term.”
Willdale: Dividends and lockdowns
The company declared a final dividend of 1.35 cents per share for the year to 30 September 2020.
Willdale’s optimism, based on easing of lockdowns in the last half of the year, may yet be dampened by fresh lockdown measures that have been taken to contain a spike in COVID-19 cases. However, Willdale had already scheduled its annual shutdown for this quarter, a traditionally slow period.
“Annual maintenance of the plant will be carried out during the seasonal shutdown to ensure efficient production that delivers sufficient bricks for projects during the ensuing year in line with approved budgets for the new financial year.”
