HARARE, September 30 (The Source) – Media group, Zimpapers plunged to a $1,417 million loss after tax in the half-year ended June 30 from a positive out turn of $358,000 the previous year as revenue tumbled due to high finance costs and a worsening economic environment.
Zimpapers operates 12 publications, a commercial printing press, a radio station and two digital platforms.
Revenue declined by six percent to $21 million in the prior year while gross profit also declined to $16,2 million from $16,5 million.
Chairman Charles Utete said the company’s current liabilities stand at $21,7 million, exceeding its current assets by $8,1 million because of internal and external obligations which are difficult to liquidate.
He said the loss position was exacerbated by the huge finance costs after short-term borrowings the company took to recapitalise its operations.
The benefit of the recapitalisation is likely to be felt in the second half, he added.
“The company’s overheads remain relatively fixed despite the decrease in revenues, and both management and the board are seized with the issue of streamlining its cost structures for them to be commensurate with the revenues being generated,” said Utete in a statement.
Zimpapers is restructuring its current internal obligations into long-term liabilities and has agreed payment plans with creditors in line with its revenue inflows.
The newspaper division recorded an operating profit of $1,9 million, down from $3,1 million last year, but all other divisions made losses.
The digital platforms have contributed four percent of total revenue and the company plans to invest more to improve inflows.
The group did not declare any dividends due to the loss in the company.