FMHL | Release of 2016 Annual Financial Report

By Published On: July 25th, 2017Categories: Corporate announcement

Group Chairman’s Statement to Shareholders (Extract)

The Zimbabwe economic environment remained subdued in 2016 with Gross Domestic Product (”GDP”) growth estimated at 0.6% compared to 1.1% in 2015 owing to persistent liquidity constraints, shortage of foreign currency and the negative impact of the 2015-6 drought on agricultural output. Cash shortages and declining nostro account balances had a negative impact on the banking sector.

In November 2016 the adoption of plastic money and the issuance of bond notes alleviated the impact of cash shortages. Bank lending and deposit rates continued to decline during the year. The year-on-year inflation rate stood at a negative 0.9% compared to a negative 2.5% in December 2015. During the nine months to September 2016, the equity market traded in the negative due to liquidity constraints, weak aggregate demand and reduced business confidence.

The introduction of the bond notes led to the rebound of the stock market as investors shifted focus towards real assets amid fears of inflationary pressures. The property market remained constrained during the year 2016 due to low demand for rental space, increasing voids mainly from voluntary space surrenders and evictions, growing arrear levels and downward rental review requests from tenants…

The Group achieved profit for the year of US$9.3 million compared to US$0.1 million in the previous year

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