Property management firm, Mpico Limited after–tax profit in the year ended December 2012, will likely slump 30 percent from the previous year’s results.
The Malawi Stock Exchange (MSE)—listed firm in the trading statement on Thursday said: “The decrease in profits is mainly due to the write down in the value of the Gateway Shopping Mall project in Lilongwe.”
The firm is building a $40 million worth shopping mall whose deadline was extended to March this year from October 2013.
Mpico Limited is developing an 18 000 square metre mall in Lilongwe in the low density suburb of Area 47 with own funds and loans from both local and international financial institutions.
The company has in recent past suffered the twin shortages of fuel and foreign exchange that affected the implementation of the project.
Mpico Limited managing director Gray Nthinda, in an earlier interview with Business News said it has been difficult for the project in view of the foreign exchange problems, but said they managed to weather the storm.
“We are on programme, we are going to finish [the project] next March [2013] or April. We were supposed to finish in October 2012, but we have delayed because of foreign exchange problems,’ he said.
Malawian businesses were in the recent past heavily bruised by the shortage of foreign currency, causing them to scale down on their production, affecting procurement of essential imports such as fuel, medical drugs and fertiliser.
But Nthinda could not indicate the effect the delay will have on the overall project cost, saying that will be known when calculations are done at the end of the project.
The mall is being constructed by Stesanutti Spocks of South Africa and City Building Contractors of Malawi with South African-based Stauch Vorster as architects.
Property analysts argue that the capital city seems to be overtaking Blantyre as the country’s largest city and fastest growing urban region.
Mpico Limited listed on the MSE in 2007 after the Privatisation Commission (PC) now the Public Private Partnership Commission (PPPC) recommended the disposal of Malawi Development Corporation (MDC) shares in Mpico by way of initial public offer (IPO), the issuing of common stocks or shares to the public for the first time.
On Wednesday, the counter with 1.1 billion shares on issue traded at K2.20 (about $0.0064) per share.
