Hwange making strides with turnaround plans
JSE-listed Hwange Colliery Company achieved an improved financial performance for the half-year ended June 30.
The company’s principal activities include the exploration for, mining and processing of coal and the production of coke and related by-products in the north-western part of Zimbabwe.
Its revenue increased by 128% year-on-year to ZWL$69.8-million. It also posted a profit of ZWL$3.5-million, compared with the loss of ZWL$23-million reported for the first six months of 2018.
The company on Thursday said its contract miner had stopped mining in December and only resumed operations in August; and the company only resumed opencast mining in March. As a result, production declined by 52% year-on-year to 394 704 t for the interim period.
The company noted that it had achieved some improvements in the last three months of the interim period owing to targeted interventions, which it will continue to pursue.
These include increasing production; stabilising the opencast mining operation and the underground mine operations; resuscitating the processing plants; acquiring its own coke oven battery while it continues takeover discussions with Hwange Coal Gasification Company which were delayed; cost reductions; engaging contractors for pillar mining on old M block underground mine working; and improving efficiencies and competitiveness.
Looking ahead, the operating plan for the second half of the year will continue to focus on increased production and improved efficiencies. However, the former requires the allocation of more funding to the company’s operation, meaning it will have to focus on its core business of mining and reduce non-mining costs.
The company will explore options to deal with legacy debt, while the production of high-margin and high-value coking coal will be increased.
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