Willdale to ramp up capacity to 60% by end of year

 
Willdale is on the verge of realising efforts of the last 5 months under the new strategic plan with the production capacity rising to 20% and is looking at 30% next month as the drier season starts which will be ramped up to 60% by end of year, Consulting CEO Clifford Mushambadzi told the AGM.
 
He said the Willdale board came up with a strategic plan to "turn around the business" in July last year for the entity which has been loss making for the last 10 - 15 years.
 
He noted that Willdale had regained its market share with demand exceeding supply, and customers who had moved on were starting to come back.
 
"Although some business has been lost to the cement brick trade due to lack of supply the preference in this market is for clay bricks. Willdale realises that a survey of the demand for local clay brick is long over due and getting a comprehensive survey done is in the mandate of their strategic plan," Chairman Alex Jongwe added.
 
"The second half of this year will show the full impact of this exercise," Jongwe said.
 
Mushambadzi said the wet season (between Mid November and mid March) had seen reduced production and brick loss due to rains as bricks take too long to dry before firing.
 
In the dry season the company will bump up production to stock pile in an attempt to lessen the impact of the wet season down time, when the market is historically very short of bricks.
 
Commenting on the plant capacity and efficiency Mushambadzi said major maintenance and upgrades have taken place in the last 5 months. Although some of the machines Willdale are using are the same as South African competitors, the production rate at Willdale is 50%.
 
Chairman Alex Jongwe said current production numbers are at between 1 million and 1.5 million bricks a month and the company is working to a dry season high of 12 million. He added that the average production historically is between 3.5 million to 4 million a month while the plant capacity is over 12 million.
 
Under the strategic plan Willdale is also looking at plant rehabilitation and investing in mobile equipment which will lead to a labour reduction by 50% from 500 to 250.
 
Jongwe flagged an $8 million capital raising exercise saying some local financial institutions and banks had shown interest while they are also looking at moving to cheaper long term loans from external lenders. He said the company is hoping to make an announcement to this effect soon.
 
About $2 million is required for the purchase of mobile equipment as they currently hire at rates that are double that of South African suppliers. All weather facilities require $5 million while for general working capital Willdale requires $1 million.

He added that Willdale is currently undertaking a revaluation on all company assets, looking at a $10 million increase in shareholders funds.