HWANGE Colliery Company Limited has recorded a 50 percent increase in coal production to 175 849 tonnes in the quarter ended March 31, 2020 from 117 165 tonnes achieved in the corresponding period last year.
In a trading update for the quarter under review, Hwange Colliery Company Limited (HCCL) also recorded improved revenue of 860 percent amounting to $219,2 million while gross profit was on a positive growth trajectory rising by 22 percent to $22,8 million.
“In spite of the challenging operating environment, the company recorded an increase in production volumes by 50 percent, a revenue increase of 860 percent, gross profit percent increase of 22 percent and net loss decrease of 65 percent for the three months ended March 31, 2020 compared to the corresponding period in 2019,” said the colliery.
In the quarter under review, HCCL sales volumes, however, decreased by 33 percent for the same period.
The coal producer noted that as a result of Covid-19, local and global economic projections are pointing to a decline in key economic indicators, which may have varying impact on companies, depending on the sector, all of them negative.
“As a provider of coal, which is essential in the provision of electricity to the nation, as well as for processes for manufacturers, who are currently re-opened for production, HCCL’s domestic market, which was the target portion of its client base remains in place and so business remains assured.
“In spite of the challenges, the company has ensured continued production in order to meet customer requirements and ensure business continuity,” said HCCL.
The company said it continues to actively monitor the rapidly evolving situation and an extensive range of business continuity measures are in place.
Such measures include enhanced safety and sanitation protocols at all HCCL’s operating units, as well as making significant adjustments to work practices to ensure social distancing.
It said the uncertainty as to the future impact on the company of the recent Covid-19 outbreak has been considered towards fostering the going concern of the company.
“The extent of the impact of Covid-19 on operations and financial performance will depend on certain developments including the duration and spread of the outbreak, impact on our customers, suppliers and employees and Government interventions all of which are uncertain and cannot be predicted,” said HCCL.
“The operating environment continued to be challenging and has been characterised by high inflation, fuel shortages and shortage of foreign currency.”- Bulawayo Bureau