Meikles turnover 12pct higher at $347mln for nine months, says deal agreed over government debt

Meikles turnover 12pct higher at $347mln for nine months, says deal agreed over government debt

HARARE, March 8 (The Source) – Hotel and retail group Meikles Africa Limited’s turnover for nine months to December  2015 rose to $347 million compared to $310 million in the previous year, the company said on Tuesday, while it has also reached an agreement with government over an unpaid debt.

In a trading update,  it said operating margins at 21,8 percent were marginally better than the previous period at just over 21,2 percent. Expenses were 19 percent lower compared to 21 percent previously.

Earnings Before Interest Tax Depreciation and Amortisation (EBITDA) increased by $9,5 million relative to the previous period, it added.

Meikles, which claims it is owed $90 million in debt and interest by the central bank, said the government had undertaken to repay outstanding funds in terms of the Reserve Bank of Zimbabwe debt assumption act of July 2015.

“Shareholders are advised that a basis on which the funds are to be recovered has been agreed,” Meikles said, adding that the agreement would allow it to “grow to its potential and develop its strategies, without the specific uncertainties caused in the period when negotiations were still ongoing.”

The Meikles debt accrued in 1998 from transactions related to the group’s dual listing on the Zimbabwe Stock Exchange and the London Stock Exchange. It stood at $25 million in 1998 but shot up to $47 million at the end of 2013 after the inclusion of interest.

Meikles’ half-year results to 30 September 2014 showed the balance with RBZ as $43,738 million and TBs of $38,431 million totalling $82,169 million.