Home » Business » Turnall Requires U.S.$2 Million for Working Capital

Turnall Holdings requires $2 million for working capital in the short-term in order to boost operations although there has been a vast improvement in performance following the adoption of a cash trading model.

The tile company used to trade mostly on credit but a new change in strategy at the beginning of the year saw the company enhance its operational efficiencies.

Speaking on the sidelines of the company’s annual general meeting yesterday, Turnall Holdings managing director Mr Caleb Musodza said the company is exploring different strategies to raise working capital and already they have approached different institutions for funding.

“The company currently requires $2 million in the short-term to quicken operations. As a company we have limited security and right now the two key securities that we have is brick and motor and they are with BancABC and FBC bank.

“However, apart from that we have been exploring and talking to a lot of people in terms of raising the money for working capital,” said Mr Musodza.

“The aantages of the cash model are that the company will have liquidity to fund operations because you need to buy your raw materials and other utilities.”

He said the company is also working towards increasing its export capacity. Traditionally the company has a market in South Africa but it has started sending initial loads to Zambia, Mozambique and Malawi. He said export levels for the first quarter of this year are up compared to last year.

“This idea of mixing domestic business and export will take the business to where it should be. We have significantly addressed profitability issues on exports and our expenses are firmly under control,” said Mr Musodza.

He said the company this year embarked on a cost-cutting programme after experiencing a contraction in the local market in April this year.

This saw the company’s management agreeing to salary cuts to balance the wage structure and productivity.

Turnall also reviewed its procurement systems for cost effectiveness, cash-flow effectiveness and logistics efficiency.

The company has started procuring its fibre from Russia at a cost that is 20 percent lower than previous periods.

Source : The Herald