PG Industries losses widen by 41 pct

PG Industries losses widen by 41 pct

HARARE, May 30 (The Source) – PG Industries Zimbabwe’s losses widened by 41 percent to $11,3 million in the full year to December due to impairments and rising expenses.

PG, which is suspended from trading on the Zimbabwe Stock Exchange, was unable to publish results for the year by March 31 due to the pending registration of a scheme of arrangement with the High Court of Zimbabwe, the company said.

At its annual general meeting on February 20, the company said the scheme of arrangement with various creditors would save it from liquidation.

Revenue for the year was flat at $33 million while net finance costs rose to $3 million from $2,7 million. It also incurred retrenchment costs of over $867,000.

“Lack of sufficient working capital and generally difficult economic conditions, particularly in the second half of the year, negatively affected the group’s performance,” acting chairman Francis Dzanya said in a statement accompanying the unaudited results.

“Gross margins declined to 25,1 percent due to poor product mix and general increase in competitive pressure at the merchandising division.”

The operating loss of $6,5 million is after making provisions totalling $2,5 million in impairments of: trade and other debtors at $1 million, retrenchment costs at $857,000 and loss on disposal of property $548,000.

In the last quarter of 2013, short-term borrowings and long-term loans were reduced by $934,000 and $2,578 million respectively following the disposal of some properties.

PG also disposed of 18,9 percent of its 27,9 percent investment in Manica Boards and Doors. The transaction also involved the liquidation of an equivalent portion of the loan investment in MBD.

In February, its shareholders approved a bid to raise $3.5 million capital to avert liquidation.