RioZim revenues increase 43 percent

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MINING Giant, RioZim Limited’s revenue for the first quarter of the year grow 43 percent to US$22,6 million in this year’s first quarter the company’s CEO Asthton Ndlovu has revealed.
Ndlovu told the company’s recent AGM that RioZim expects to ramp up gold production by 5,2 percent to 715 kilogrammes, nickel output is seen 1,209 percent up at 3 789kg while copper is expected to jump 421 percent to 4,723kg.
“Full year turnover grew by 33 percent. The growth was accelerated in the second half where a turnover growth of 69 percent was achieved in comparison to the same period last year. ENR revenue for the year grew by 40 percent over the same period last year due to the sale of own metals (as opposed to) toll manufacturing,” Ndlovu said.
Operating profit jumped a staggering 415 percent to US$4,6 million while net losses declined 48 percent to 7,4 million.
Things are certainly looking up for a firm that, only 12 months ago, was choking under a US$90 million debt with US$60 million of this owed to banks, as the threat of liquidation hovered above.
Earnings before interest, tax, depreciation and amortisation jumped 124 percent to US$518,000 while operating profit grew by 117 percent to US$390,000.
Hitherto, RioZim had seen turnover jumping 33 percent to US$72,3 million while earnings before interest, tax, depreciation and amortisation skipped 317 percent to US$6,9 million in 2012.
Debts have since decreased by 24 percent due to repayments and restructuring of short-term debt to long-term liability.
The gearing ratio improved by 37 percent in 2012. Against the odds posed by the prevailing liquidity crisis, RioZim successfully raised US$11,6 million through a rights issue and private placement.
However, capital constraints remain the company’s biggest hurdle on planned projects due to the fact new foreign shareholders, GEM Raintree, at the moment cannot commit equity capital without breaching the Indigenisation and Economic Empowerment Act, a poser management is grappling to find a solution.
Government has since been engaged on this issue, Ndlovu said.
Meanwhile, as further evidence of changing fortunes at the company, RioZim has managed to commit slightly over US$28 million towards settling its principal loan and interest obligations to financial institutions.Advertisement

And RioZim directors have noted the progress achieved thus far and will test their resolve this year against more ambitious targets.
Corporate restructuring, which is only part of several strategic initiatives lined up by the group for 2013, is gathering speed with completion expected in the second quarter of the year.
RioZim will hold a majority stake in the 5 new entities (Rio Gold, Rio Base Metals, Rio Diamonds, Rio Energy and Rio Chrome) whilst utilising the remaining 49 percent shareholding to raise capital, acquire assets and or source expertise.