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Disposal of assets comes after the group shelved its proposed rights issue of between US$10 million and US$20 million. Shareholders refused to take up the rights offer saying the company shares are under-valued and feared this would negatively affect the company’s net asset value.
This means that most shareholders would not be able to follow their rights and be diluted.
CFI is owned 21,7 percent by Stanlap Investments, 7,14 percent by Messina investments and 6,7 percent by Old Mutual Life.
The Zimbabwe Stock Exchange listed diversified conglomerate traded at US9,5c as of yesterday and is valued at about US$10 million. CFI is disposing its entire shareholding in its irrigation equipment firm Dore & Pitt, 14 percent stake in Windmill and Beira Grain Terminal, and Maitlands Zimbabwe among others.
In a statement accompanying the group’s financials for the half-year ended March 31 2011, the company said it had reviewed its entire structures.
“While the board is pursuing the raising of equity, this has proved to be challenging to date. In the interim the board is reviewing other methods of raising funds.
Over the coming six months this will involve accelerating the disposal of non-core assets. The group is also working towards incorporation of strategic partnering some of its businesses,” said the company.
Last year CFI franchised its Town and Country outlets to fast growing supermarket chain Afro-Foods and the deal is expected to last for three years.
Management at CFI also undertook a raft of structural reforms that included ceasing operations at retail subsidiary Honeydew Farm after the property was returned to its owners early in the year.
Farm & City outlets, which are also controlled by CFI, were repositioned by closing the wholesale dry grocery lines to concentrate on core business.
The group said the US$3,8 million PTA facility drawdown would commence in the third quarter.
During the six months CFI recorded a loss after tax of US$486 901 up from US$268 150 posted in the comparable period. However, CFI’s turnover grew by 26 percent from US$38,2 million to US$48 million and operating profit before depreciation and financing costs by 17,5 percent from US$1,1 million to US$1,3 million.
In its poultry division, Agrifoods recorded a 42 percent volume growth in sales from 22 140 tonnes to 31 543 tonnes due to focus on maintaining consistency on quality.
However, the acute shortage of soya meal and soya beans in the country, particularly in December last year resulted in constraints in the production of all the stockfeed lines.
Hubbard Zimbabwe attained 100 percent capacity utilisation and the decrease in the importation of frozen chicken and chicken products helped sustain volumes of day-old chick sales locally.
Local sales turnover grew by 78 percent from US$2,8 million in the prior year to US$4,9 million in the current year. Export sales grew by 231 percent against the prior year’s first six months performances from US$56 000 to US$188 000.
Online Reporter