23 January 2018
Cholera: Angry minister blasts city councils
Mzembi challenges arrest; quits politics
Mudzuri: Amnesty for MDC-T cop murder 3
Mnangagwa: Grace mentally unstable
ZESA gave Chivayo $7m, not $5m: Parly
Botswana cops release Mugabe cars
Grace's luxury cars damaged in accident
Chamisa dares military chief on elections
Govt reduces excise duty on fuel
Filthy 5-Star hotels: Economy blamed
‘Am I African’ explores Zim's race conflict
Gafa’s Epworth concert draws thousands
Billiat might still leave: Sundowns coach
Katsande: Chiefs show championship mentality
Mnangagwa’s ‘New’ Zim merits support
Zhuwao: kleptocracy and EDiots in Davos
Mnangagwa off to Davos empty handed
Economy: the need for a paradigm shift
Hwange Colliery to cull top management, workforce after $115mln FY loss
05/04/2016 00:00:00
by The Source
Hwange Colliery crisis: Time for govt to go
Govt-owned Hwange to sack 1,000 workers
Hwange accounts show losses at $44mln
Min threatens to fire Hwange bosses
Hwange loses property over China loan

HWANGE: Struggling coal miner, Hwange Colliery Company Limited (HCCL) has begun a process of downsizing its workforce in a development that would see top managers losing their jobs with the company cutting labour costs by $15 million.

The company, which reported a net loss of $115 million last year, is seeking to reduce top management posts from 23 to eight.

Acting chairman Jemister Chininga visited the mine on Monday and he met management to discuss the plans.

“We are here to start the process of downsizing. The management has been briefed and the next step will now be to identify the best, lean, structure that is line with the level of our business activity,” said Chininga.

He declined to say how many workers will be affected by the downsizing, although indications are that the process targets mostly top managers.

HCC workers have not been paid for 30 months and Chininga said restructuring would cut costs by $15 million per annum.

“We hope to save up to $15 million a year with a leaner organisation. We will implement the exercise once management identifies the departments that need restructuring,” he said.

Chininga said the company, which requires $10 million working capital, was concerned about the latest financial results where it posted a net loss of $115 million hence the need to cut size of staff which doesn’t correspond with the level of operations.

The poor performance followed another loss of $38 million a year earlier after the company recognised a $69,1 million Zimbabwe Revenue Authority liability covering six years as well as a decline in production.

Production fell from 1,8 million tonnes to 1,55 million tonnes on the backdrop of high fixed overheads as well as challenges experienced with the new equipment which was commissioned in June last year.

The result of this was an increase in direct costs of production without a corresponding rise in output. Chininga said the company is failing to utilise the new equipment acquired from Belarus and India due to working capital shortages.

Revenue declined to $67,6 million from $83,9 million due as sales fell 13 percent and the decline of coal and coke prices.

Borrowings increased to $51 million from $12 million due to long-term loans from Export Import Bank of India and RBZ/PTA Bank. The company is working on a facility from Agribank, which will enable the company to purchase consumables.


HCCL early this year had some of its equipment auctioned over unpaid debts to a Chinese company.

The mining company is facing litigation for claims amounting to $20,6 million while cases worth $20,1 million have been awarded against it.

Email this to a friend Printable Version Discuss This Story
Share this article:

Digg it






Face Book



comments powered by Disqus
RSS NewsTicker