- October 6, 2020
- Posted in LOCAL
HWANGE Colliery Company Limited (HCCL) is emerging from the woods after the Government placed the firm under administration last year.
Once the country’s largest coal miner, HCCL was last year suspended from the Zimbabwe Stock Exchange in 2019 after it was placed under administration in terms of the Reconstruction of State-Indebted Companies Act (Chapter 24:27).
In a statement, accompanying HCCL interim financial results for the six months ended June 30,2020, the administrator, Mr Bekithemba Moyo, said: “It is interesting to note that prior to the company being placed under administration, it was making losses for a sustained period.
“The company however, had a net loss position of ZWL$992 million for the period under review compared to the net profit of ZWL$3,5 million for the same period in 2019 due to an exchange loss of ZWL$1 billion on legacy foreign creditors.”
Total legacy foreign creditors for the firm presently stands at US$20 million and the challenge is expected to persist until the debts are fully settled, he said.
“Revenue increased by 28 percent from ZWL$827 million in 2019 to ZWL$1 billion for the six months under review on an inflation adjusted basis and on a historical basis it increased by 916 percent from ZWL$70 million to ZWL$709 million.
“This was largely due to a combination of an increase in high value coking coal sales as well as frequent adjustments to product prices in line with changes to the interbank rates,” said Mr Moyo.
HCCL’s total output rose by 84 percent to 596 876 tonnes due to increased production by the contractor from 325 114 tonnes last year. Mr Moyo said their focus was now on increasing output based on own mining activities as that would not be only cheaper but reliable.
“Total production increased by 84 percent from 325 114 tonnes in 2019 to 596 876 tonnes for the period under review.
“This was largely due to an increase in production by the contractor. Our target going forward is to ensure that production is skewed to own mining as it is not only cheaper but more reliable particularly given cash flow challenges that dogged the company in the recent past,” he said.