Zimbabwe Stock Exchange listed firm Border Timbers says revenue for the 11 months to May 2019 rose 66 percent to $32 million from $19 million in the same period last year.
Border attributed the growth to improved quality hence better average selling prices for its lumber.
Net loss amounted to $9,8 million from a profit before tax of $2,6 million and this was a result of unrealised exchange losses on foreign debts amounting to $10,783 million.
According to Border, the loss before tax for the 11 months under review excludes the effects of the final biological asset valuation which will be conducted at year end.
Cash profit before tax, after adjusting for non-cash items, rose 66 percent to $6,1 million.
Lumber production for the period under review went down 21 percent to 62,584 cubic metres from the prior comparable period’s 79 552 cubic metres on the back low production in the months of December 2018 to April 2019 at one of the sawmills caused mainly by the general power outages and the devastating effects of Cyclone Idai that hit on 15 March 2019.
“The knock-on effect of the cyclone resulted in the Charter sawmill resuming operations in the first week of May 2019, thereby negatively affecting both production and sales into the market as the road infrastructure was decimated,” said judicial manager Peter Lewis Bailey in a trading update.
While electricity supply has been restored to all operations in areas affected by the Cyclone, road infrastructure rehabilitation remains a challenge to the business’ operations as there are problems linking with markets.
There are concerns the situation may get worse if no permanent solution is provided before the next rainy season starts.
However, sales volume is higher due to increased demand on the local and export markets. Higher sales volume was achieved out of sales from buffer stock.
“Treated poles reflect a decline in both production and sales as they are mostly tender based and there has been a general slowdown in the export markets hence low production compared to comparable period May 2018, generally the outcome is now looking positive on the poles market,” said Bailey.
Last November, Border asked for a voluntary suspension of trading in its shares from the Zimbabwe Stock Exchange (ZSE) as it awaited the outcome of the International Centre for the Settlement of Investment Disputes (ICSID) ruling over a land dispute with another stakeholder (Government).
The company was awarded approximately US$125 million (in addition to interest plus legal costs) by an ICSID tribunal.
Although the award is final and binding, Bailey says there is currently no clarity around the Government’s timetable for settlement and how the award will be shared between the company and the other claimants.
As result, the company’s exit from Judicial Management is delayed.