Harare – Construction Group, Radar Holding Limited says demand in the new financial year remains strong on the momentum built from last year.
The Group which has been inflicted by heavy losses in the past told Equity Axis that it traded profitably in the period and cash flows were positive and it is finalising financial reports for the year ended June 30 2018.
In 2013, the Group plunged to a US$49 million loss for the year ended June 30 2013 after disposing of its 51 percent controlling interest in Border Timbers Limited to focus on its core business.
Radar Holdings owned 22 005 087 ordinary shares in Zimbabwe Stock Exchange- listed timber group Border Timbers, but distributed its interest in Border Timbers in that year through a dividend in specie.
In 2015, the group’s revenue for the half-year period to December 31, 2015 was down 17 percent to $3 million compared to the previous comparative period mainly because of a 90 percent reduction in sales volumes and sales mix that was skewed towards lower value products experienced during the period.
This followed the Company’s shareholders to authorise directors of the company to apply to the ZSE for the deletion of the company’s shares from the ZSE.
In an abridged information memorandum to shareholders and notice of an extra-ordinary general meeting in February 2016, Radar said its 2014 full year after tax profits declined from $288.006 to a loss of $288.071 in 2015.
Radar said during the 2015 calendar, the Group traded a mere 79.483 shares valued at $2.302, further reiterating the liquidity of the shares.
Subsequently the Group said it felt compelled to delist its shares its shares from the local bourse in view of prolonged underperformance, which has in turn constrained its ability to remain in compliance with the listing requirements of the exchange.
In an emailed response Finance Director, Walter Zimunya said demand in the new financial year remains strong on the momentum built from last year.
“Production volumes are 11 percent above the same period last year. Sales volumes are 19 percent above same period last year and revenue 33 percent above prior year.
Going forward, Zimunya said the company is working on a reinvestment project at Willsgrove plant to increase capacity and modernise operations and the remodelled plant is expected to be in commercial production in Q3.
He said the Group’s focus is on continued cost optimisation to grow profitability and effective treasury management to preserve value of funds held.
Meanwhile, the company said in the past couple of years your company has not been in a position to declare a dividend largely due to debt overhand which saw the performance of the company taking a deep.
It said the board saw it fit suspend dividend declaration in order to focus on expanding the unsustainable debt that the company was exposed to.
The company reduced the cost of borrowing by more than 200 percent from 22 percent in 2013 to 7 percent as at June 30, 2018.
The level of debt has also been reduced to sustainable levels of 834 000 at June 30 2018 from 6.5 million at June 30 2013
Resultantly, the company has started to post positive results leading to your board proposing a special dividend to members whose names appeared in the shareholder register as at 16 July 2018.
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