admin
yesterday.
The special grant allows the group to prospect for various minerals, including iron ore and chrome.
Meikles said it also had opportunities relating to gold and tantalite. “We plan to have at least one mine in operation in 2014,” the statement said.
“We have signed a Memorandum of Understanding, which will shortly become a full shareholders’ agreement, with a substantial technical partner to pursue these opportunities, including the provision of necessary capital, skills and expertise in mining.”
The Zimbabwe Stock Exchange-listed firm could not say how much investment is needed to start the mine but indicated “the division will raise its own capital and will not be dependent on the group’s financial resources”.
During the year end to March 31, 2013, the group reported a revenue increase of 11 percent from US$354,1 million to US$391,3 million, boosted by supermarket sales. But the group managed to make an operating profit of US$5,1 million compared with a loss of US$8,3 million in the same period last year.
Supermarket division contributed US$335,9 million compared with US$296,4 million last year, followed by the agriculture division which contributed US$24,2 million from US$20 million in the prior year.
Hotel contribution to revenue was overall constrained due to renovations at the Meikles Hotel in Harare and Victoria Falls. The Victoria Falls Hotel’s revenue increased relative to the previous year due to improved room rates.
A deliberate decision to curtail credit saw revenue from Thomas Meikles Stores declining from US$24 million to US$18,5 million.
Cash flow from operations increased by 243 percent from US$6,1 million to US$21 million. About US$18,3 million was spent on refurbishments at the hotels and supermarkets. Net borrowings rose by US$14,3 million to US$59 million, including a long-term debt of US$7,4 million.
Total assets grew by 7 percent to US$275,5 million with current assets declining by 32 percent to US$69,6 million due to the disposal of US$38 million worth of assets which were held for sale in the prior year.
Current liabilities grew by 23 percent due to an increase in short-term debt, trade and other payables. Thus, the current ratio deteriorated from 1,2 to 0,66 as short-term obligations increased.
Meikles highlighted the challenge the company is facing in accessing its Initial Public Offer funds deposited with the Reserve Bank of Zimbabwe, amounting to US$26 million and the impact it is having on the gearing position of the company.
The funds on deposit with the central bank originated from the listing of the group on both the Zimbabwe and London stock exchanges and the raising of funds from a number of substantial international investors for the benefit of the group.
The funds were remitted to Zimbabwe and ultimately placed on the deposit to be used for balance of payments support.
“We have without success engaged both the RBZ and the Ministry of Finance in an attempt to negotiate arrangement whereby access to these funds may be facilitated,” said the group. “In the circumstances, we deem it appropriate to further escalate our efforts to access these funds.”
The management said believed if it had had an opportunity to utilise this money, the interest burden on the financial statement would be much less than the current situation. Going forward, the company said “the group’s fortunes will be affected if the funds held on deposits at the RBZ are not made available”.
Online Reporter