Strong volumes spur Hwange earnings

from US$66,4 million achieved in the previous year, spurred by strong volumes.
Total volumes were up 49 percent to 2,5 million tonnes. Coking coal and industrial sales were up 24 percent ahead of 429 213 tonnes.
Zesa remains a major consumer of coal as capacity utilisation of most companies that use coal remains low.
Revenues from coking coal and industrial coal were affected by a decline in prices during the later part of 2010.
Coal fines output was down by 23 percent to 151 036 tonnes from 185 726 achieved during the 2009 financial period.
Coke sales at 67 513 tonnes was above 61 018 tonnes sold last year.
Output was affected by the annual routine maintenance of coke oven battery.
Some repairs are still ongoing.
The demand was also affected by low demand in regional markets.
Exports contributed about 12 percent of the total turnover.
Hwange exports to Zambia, South Africa, Mozambique and Botswana.
Profits for the year was up 142 percent at US$6,3 million. The property, plant and equipment increased from US$71 million to US$88,2 million because of new capital projects.
Current liabilities increased from US$58,3 million to US$88,2 million and these include trade creditors and borrowings.
Hwange said it was financing recapitalisation initiatives through short-term facilities.
Going forward, the company is projecting to increase output this year.
Already, the company has secured US$20 million from local and regional financial institutions to fund recapitalisation.
The projected increase in capacity utilisation in industry coupled with the prospect of a good agriculture season will spur domestic sales.
Hwange says it is working on securing additional coal concessions in order to boost its resource and reserve base.
The company is optimistic that its current funding initiatives will materialise during the year and products will also firm in the second half of the year. Yesterday, HCCL traded at US75c on the Zimbabwe Stock Exchange.