HARARE, July 25 (The Source) – Struggling hardware retailer PG Industries Limited has reported a reduced loss after tax position for the year ended December 2015 at $3,9 million from $6,6 million in the prior year, largely on streamlining operations and reduction of interest on debt.
PG which is currently under a scheme of arrangement with secured suppliers, concurrent creditors and debenture holders has been riding on losses for years as the company battles working capital challenges.
Earlier this month it reported that Dewei Investments Limited would purchase its entire share register of 8,6 billion shares for $500,000, setting aside the scheme of arrangement.
Acting chairman Francis Dzanya said the company has been implementing various initiatives to improve company performance.
“The initiatives have resulted in significant reduction in interest bearing debt and operations have been streamlined resulting in cost savings being realised,” he said in a statement accompanying the results at the weekend.
Dzanya said in the year, the company suffered significant reduction in sales volumes due to working capital shortages.
During the year, low retail sales volumes from the group saw its turnover declining 19 percent to $18,9 million while merchandising turnover was 27 percent lower than previous year.
Dzanya said group results for PG Mozambique, which contributed sales of $1,544 million, were not consolidated in 2015 and demand for the company’s products is relatively strong while sales margins remain healthy.
The group’s flagship tile manufacturer, Zimtile recorded a seven percent increase in sales. Concrete roof tiles sales volumes grew by 11 percent while bricks and pavers sales volumes remained flat.
Dzanya said overall margins were maintained despite selling price pressures by improving manufacturing efficiencies at Zimtile.
Looking ahead, Dzanya said the successful take over by Zimtile will revive PG’s past glory as the largest processor and distributor of building materials in Zimbabwe.
The Dewei proposal is set for approval by shareholders at a scheme meeting and extraordinary general meeting on August 5.
The company also expects to commission a new concrete brick making plant in Bulawayo during the third quarter of this year.
PGI’s shares were suspended from trading on the local bourse in 2013, with analysts asserting that the company was technically insolvent.