Our opinion on the current state of CAFCA(CAC)Cafca (CAC) is a cable manufacturer that produces over 900 cable and transmission products. Most of its business is conducted in Southern Africa. The company is 70% owned by Reunert. Cafca is listed on the JSE as well as the London Stock Exchange and the Zimbabwe Stock Exchange. Cafca is also involved in recycling copper and other materials.
In its results for the year to 30th September 2024, the company reported volumes up 10%, but revenue and operating profit in Zimbabwean Gold (ZiG) were lower than the prior year by 5% and 18%. The company said, "The trading environment has been volatile during the year under review. The decline in commodity prices of most metals and alloys, as well as the impact of the drought for the 2023/24 agricultural season, dampened aggregate demand. Currency instability reflected by the inflation rate at 37.5% in September 2024, and exchange rate fluctuations, remain a significant challenge to value preservation."
In a trading update for the 3 months to 31st December 2024, the company reported volumes up 23% and revenue up 29%. The company said, "In the first quarter ended 31 December 2024, we have witnessed industry and commerce adjusting to various changes, including the September 2024 currency devaluation, reduced expansionary spending on road infrastructure, increased power disruptions, and a rise in informal retail."
The enduring problem with this share from a private investor's point of view is the very low volumes traded, which makes it completely impractical as an investment.
