Zimasco basks in $45 million profit

Kwekwe based chrome smelting company Zimbabwe Mining and Smelting Company (Zimasco), which is under judicial management, has made a turnover of more than $158 million within the past 16 months an official has said.

In an interview, Zimasco Judicial Manager, Mr Reggie Saruchera of Grant Thornton International, said the company, once the largest ferrochrome producer in the country and a force to reckon with in Africa, has posted a profit of more than $45 million over the same period.

Zimasco, which is rising from a debt overhang that had buried the group for years and currently under judicial management, has started making efforts towards liquidating debt owed to various creditors while a scheme of arrangement is in the pipeline.

“We are happy to announce that we have managed to turn around Zimasco during the first 16 months of judicial management. Zimasco has made a turnover of more than $158 million and a profit of more than $45 million,” he said.

Mr Saruchera said the company was now operating on full throttle.

He said the company had also invited its creditors for a scheme of arrangement on November 29 to map the way forward on how to settle the debts.

The scheme of arrangement is expected to reschedule the debt and free up some space for capital and recurrent expenditure.

Zimaso owed a total of $144 936 691 to creditors including $21 780 307 to Sinosteel Singapore (in liquidation), $11 350 142 to Sinosteel International and $3 309 850 to the National Social Security Authority, pension funds and NEC.

Zimasco owes $34 738 364 to financial institutions, $7 295 513 for retrenchment packages, $2 787 316 towards salaries and wages arrears (three months), among other creditors.

For some debts the company considered rescheduling and repaying over 6,5 years with some over 18 months. These negotiations have been going on and the company expects that a scheme of arrangement could be in place later this month.

“The company is now operating on full throttle. We have invited our creditors to a scheme meeting this month to see how best we can stagger the payment over a period of four to five years,” said Mr Saruchera.

Zimasco has paid a dividend to creditors amounting to $26,7 million or 18,7 percent of the total.

Zimasco, an integrated ferrochrome producer with chromite mining locations in Shurugwi, Guinea Fowl, Lalapanzi, Mutorashanga and tributor operations along the Great Dyke, has been in the doldrums for the past decade but is now seeing a turn of fortunes.