South African company Barloworld reported a 20.5 per cent drop in operating profit from its main activities in Southern Africa in the first five months of the 2025 financial year, pointing to political and social instability in Mozambique as one of the factors that negatively affected performance in the region.
The company, which operates as a distributor of heavy equipment, highlighted the slow recovery of the mining sector and the impact of the post-election turmoil in Mozambique as obstacles to the recovery of activity in both mining and construction.
During the period under review, Barloworld recorded revenues of 925 million dollars (59.2 billion meticals), down 4.9 per cent year on year.
Operating profit fell from 81.2 million to 68.7 million dollars (from 5.2 billion to 4.4 billion meticals), reflecting the deterioration of the economic environment in several markets in the region.
In the Industrial Equipment and Services division, which includes the company’s operations in Mozambique, adjusted profit fell by 16.4 per cent, from 43.5 million to 36 million dollars (from 2.78 billion to 2.3 billion meticals).
Even so, the order book improved by 13%, totalling 212 million dollars (13.6 billion meticals) by the end of February.
On the other hand, Barloworld’s operation in Mongolia showed positive results, with a 26.7 per cent increase in operating profit, reaching 22.6 million dollars (1.4 billion meticals).
However, the order book in that country fell dramatically, from 117.8 million to 27.8 million dollars (7.54 billion to 1.7 billion meticals), after significant deliveries last year.
Barloworld reaffirmed that it is maintaining its strategy of ‘correcting, optimising and growing’ and is continuing to reassess the position of its Russian subsidiary VT, which is currently limited by international sanctions. The company is also awaiting the conclusion of an ongoing investigation into possible export control violations, the final report of which is due by June.
Source: Engineering News
