- ZECO swung to a profit of ZWG 3.17 million in H1 2025, up from a loss of ZWG 1.65 million, driven mainly by a surge in rental income to ZWG 6.06 million
- The profit rests on fragile foundations, with administration costs climbing to ZWG 3.43 million, equity shrinking to ZWG 74.8 million, and operations now heavily reliant on property rather than industry
- Years of losses and mismanagement haunt ZECO, with nepotistic leadership appointments and failed diversification eroding its industrial base
Harare - ZECO Holdings Limited, the investment vehicle controlled by flamboyant businessman and property magnate Philip Chiyangwa, has posted a surprise profit for the first half of 2025, marking a rare break from years of recurring losses that had cast doubt on its survival.
The group reported a profit of ZWG 3.17 million for the six months to June 30, 2025, compared to a loss of ZWG 1.65 million in the prior period.
The rise in profit after tax was mainly driven by the surge in rental income, higher sales revenues, the absence of discontinued operation losses, and small foreign exchange gains.
‘’ Other income from rentals amounted to ZWG 6,058,865 during the same period,’’ Chairperson Ben Rafemoyo said in a statement accompanying the half year financial statement.
Revenue rose to ZWG 2.06 million from ZWG 689,591, while rental income , now the cornerstone of ZECO’s earnings ,surged to ZWG 6.06 million, dwarfing last year’s ZWG 64,136.
The half-year profit is encouraging, but it rests on narrow foundations. Despite higher administration costs of ZWG 3.43 million, rental income lifted the bottom line.
Cash balances more than doubled to ZWG 5.05 million, providing some breathing space.
Debt remains negligible, but equity has shrunk to ZWG 74.8 million from ZWG 139.2 million at end-2023 due to adjustments in revaluation reserves.
ZECO, formerly known as Resco, once held ambitions of being Zimbabwe’s engineering powerhouse. Through its subsidiaries, the group manufactured rail wagons, locomotives, roller shutters, electronic garage doors, steel windows and doorframes, burglar bars, filing cabinets, and agricultural implements.
Its expansion drive peaked in 2008 with the acquisition of Corbett Holdings’ assets and subsidiaries, including Zimplastics.
But the dream unravelled quickly. The collapse of the National Railways of Zimbabwe decimated demand for wagons, while mine closures during the Mugabe era and the rise of cheap Chinese imports hollowed out ZECO’s industrial base.
Despite being in operation for over a decade, the company struggled to achieve profitability. By 2022, it had sold its rolling stock assets for US$4.5 million and shifted focus to property and real estate, a last-ditch effort to stabilise revenues.
Apart from macro economic challenges Zeco was weighed down by nepotism , Chiyangwa appointed his sons to top executive positions, where they allegedly misused company funds instead of implementing turnaround strategies.
In 2019, Edmund and Brian Chiyangwa were sued by Getbucks Microfinance Bank over a debt of up to US$800,000, which was eventually settled using company funds.
The leadership crisis deepened in November 2023 when Edmund, who held an undefined executive role, was removed after fraudulently tampering with property deeds in an attempt to secure a secret mortgage.
Instead of appointing independent professionals, Chiyangwa replaced him with another son, Bruce, whose stewardship has raised similar concerns.
This revolving door of family appointments has entrenched mismanagement and weakened accountability, preventing ZECO from implementing meaningful reforms.
Looking ahead, ZECO is betting on refurbishments and new construction at Dingani Investments to generate additional income, while continuing to expand property leasing.
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