adminSenior Business Reporter
ASA Resource Group has closed down its offices in Harare and Johannesburg as part of a rationalisation exercise.
The former Mwana Africa mining group owns Bindura Nickel Corporation and Freda Rebecca Gold Mine in Mashonaland Central province.
Group chief executive officer Mr Yat Hoi Ning also said the streamlining of their United Kingdom and Hong Kong offices was almost complete.
“The process of rationalising subsidiaries into defined commodity groups is well advanced. Some of these matters are legally quite complex due to entities being registered in different jurisdictions.
“Streamlining the UK and Hong Kong offices is more or less complete and in this quarter we further rationalised our African administrative function by closing Johannesburg and Harare, bringing important duties closer to our operating mines in Bindura,” he said.
Mr Ning said the group’s corporate overhead was now at an all-time historical low of about $3 million per annum (excluding project exploration and licensing fees).
“While I’m pleased with this hard-earned performance, we must be constantly vigilant about controlling costs and to remove unnecessary waste. A low-cost base will benefit us when commodity prices start to rise again.
This re-organisation has also helped drive down costs at mine level and the executive believe that opportunities remain to impact further on C1/C3 costs, especially at Freda Rebecca,” said Mr Ning.
“When one considers that the combined AISC annual costs at our operating mines are in the region of $120 million, any potential savings could be significant.”
For example, he said if a further five to 10 percent reduction could be achieved from operations, and annual savings can also be sufficient to start one of the group’s other assets or help maintain their many valuable exploration licences.
Throughout the year, he noted that the group’s board set out to engage much more with shareholders.
“It recognises it may have cut costs too far in certain areas, such as investor relations and corporate communications, however, in an effort to redress this, part of the savings from restructuring is being re-invested.
“For example, in the coming quarters we will launch a new website and invest in improved investor communications,” he said.
Mr Ning said the benefit of keeping stakeholders informed of the group’s progress is reflected in the much-improved market capitalisation and the positive feedback they continue to receive from many shareholders and advisors. – @okazunga
Bongani Ndlovu
Online Reporter