RioZim bounces back to profitability

Listed diversified miner RioZim Limited returned to profitability in the full year ended December 31, 2016 after recording a $2,5 million after tax net profit compared to a loss of $8,8 million reported the previous year.

The year under review was “satisfactory” for RioZim Limited with the principal highlight being the commissioning of the new Cam and Motor gold processing plant in October last year.

Group chairman Lovemore Chihota said the miner embarked on a number of initiatives targeted at returning it to sustainable profitability and growth underpinned by its drive to invest in exploration and accelerated development.

“The group benefited from the relief provided by the debt restructuring carried out in 2016 which resulted in net finance costs reducing by 20 percent to $5,4 million compared to the $6,7 million in 2015,” he said.

“In October 2016, the company continued to haul ore from Cam & Motor Mine for processing at a rented nearby plant and its gold out almost doubled, increasing by 90 percent to 856 kg from 450 kg in the prior year,” he said.

Mr Chihota said the group’s revenue sprung up in 2016 compared to the prior year despite challenges with Empress Nickel Refinery (ENR).

“The group’s revenue grew by 15 percent to $65,2 million up from $56,5 million in 2015 despite ENR remaining under care and maintenance,” he said.

“ENR remained under care and maintenance due to the unavailability of matte supplies from its sole supplier which was subsequently placed under provisional liquidation during the year,” he added.

He said in September last year, the group, through its wholly owned subsidiary RioGold (Private) Limited, entered into an agreement with Falcon Gold Zimbabwe Limited to acquire 100 percent of the issued share capital of its subsidiary, Palatial Gold Investments (Private) Limited which houses the Dalny Mine Complex in Chakari.

Mr Chihota said the group’s associate, Murowa Diamonds (Private) Limited was recovering on the back of a number of initiatives implemented in 2016.

In an outlook, Mr Chihota said the company was applying both internal and global expertise to devise an economic solution for the recovery of gold from the sulphurised ore at its Cam & Motor Mine. – New Ziana.