Business Briefs 22-02-07

African Distillers Limited, the manufacturer and distributor of wines and spirits, has seen turnover growing by 2074% well above average inflation of 1112% during the past six months.
In a statement accompanying its financial results, the groups headline earni

ngs per share were up 2664% to Z$37,04 from$1,34 in the comparative period.
A dividend of $2,00 per share was declared, implying a dividend cover of 18 times. The improved set of results was driven by a 22% volume growth, compared to a 34% decline in sales volumes in the six months to December 2005.

The Reserve Bank of Zimbabwe (RBZ) has floated another Z$160 billion tender with a three-year tenure aimed towards funding government capital projects Last month the Reserve bank issued two tenders of the same value, but both met with poor take-up among targeted investors due to the undesirability of long-term investments in the current hyperinflationary environment.
The local registered stock has a variable, but fixed interest rate.  “Variable, but fixed coupon rate of 350% in year 2007; 250% in year 2008 and 100% in year 2009,” the RBZ said in a statement.  The interest is payable half yearly.

National Tyre Services (NTS) has posted a 1680% growth in revenue for the year ended December 31, beating the annual average inflation rate of 1033% over the same period.
The company retreads and retails for the commercial sector of the economy including catering for the farming, mining and the ordinary motoring public.  NTS is one of the few companies in Sub-Saharan Africa that operate the South Africa-based Bandag franchise.
Bandag supplies the company with tyre rubber retreads.  The tyre company has more than 20 branches scattered in both urban areas and rural areas.
NTS said working capital management would continue to play a pivotal role in sustaining the company’s operations in the difficult economic environment, though the balance sheet remained strong.

Gold miners have called for a price review of the precious metal from the current Z$16 000 per gram to Z$80 000 as a prerequisite for an improvement in output this year.
Miners who spoke to The Zimbabwean said the current producer price was uneconomically viable and out of step with the prevailing high production costs.
“We believe that a producer price of between $80 000 and $100 000 would enable us (miners) to carry out our mining activities profitably,” said Zimbabwe Miners Federation chief executive Wellington Takavarasha. 
The Ministry of Mines and Mining Development and the Ministry of Environment and Tourism had already agreed to hold consultations with all relevant stakeholders in order to come up with a new pricing formula that restores viability to the gold sector.
Takavarasha said a viable gold producer price would go a long way in combating rampant illegal dealing and smuggling of the precious metal.  “By increasing the earnings more people will bring their gold to Fidelity (Printers). It will also pull the plug on the parallel market, which has almost become uncontrollable,” he said.

ZIMPLATS Holdings Limited has announced that it injected US$50,2 million into the Ngezi Phase 1 expansion project last year.
In its half-year financial results ended December 31 2006, the company said the project consumed US$15,9 million during the first half of 2006 and US$38,2 million during the final half.
However, the smaller proportion of the funds was directed towards “general capital replacements” at the mining firm.
The Ngezi expansion project, which commenced last year, involves the development of two new underground mines and a new 1,5 mta concentrator.  It is projected that its completion would enable the substitution of the more expensive opencast ore with the lower cost underground ore.  Upon completion, Zimplats production would go up from the current 190 000 ounces per year to 330 000 ounces.
It is expected to be complete by 2010 at a total cost of US$258 million, the company said. Funding of the project, said Zimplats, would be primarily out of the re-investment of funds generated from existing operations supplemented by loans from commercial banks.

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