Oliver Kazunga, Senior Business Reporter
LISTED mining group, RioZim, says it is set to kick start development of the proposed US$2 billion Sengwa Thermal Power Station project in Gokwe before the end of this year.
In a statement accompanying audited financial results for the year ended December 31, 2018, RioZim chairman Mr Lovemore Chihota yesterday said: “The group made strides in the Sengwa Power Station Project, which entails the development of a 2 800 megawatt power station in phases of 700MW each.
“As the project gained significant traction during the year under review, the company has now set ambitious targets for 2019, which will culminate in the project kick off in the next 12 months”.
Going forward, he said, their objectives remain consistent and well defined in pursuing growth opportunities, generating free cash flows and positive returns.
“In this regard, the group has lined up strategic initiatives, which if successfully implemented will significantly improve the group’s fortunes. The major projects include the construction of the BIOX plant at Cam & Motor Mine and the Sengwa Power Station Project.
“The group is encouraged by engagements made with monetary authorities to mitigate the currency constraints and is confident that the projects will prevail and is, therefore, looking forward to a conclusive operating environment in 2019,” said Mr Chihota.
In February, the Reserve Bank of Zimbabwe introduced the interbank foreign currency market to formalise the selling and buying of the United States dollar and other currencies through banks and bureaux de change essentially bringing sanity to the foreign currency market while at the same time promoting exports, diaspora remittances and investments.
During the period under review, RioZim posted a 15 percent decline in revenue to US$75,4 million from US$88,9 million realised in 2017.
“The group’s performance was due to low production volumes in the second half of the year and the inability to complete planned capital projects due to foreign currency funding constraints, which would have sustained and increased production.
“The group was able to record an operating profit of US$2,4 million which was 71 percent below the prior year’s operating profit of US$8,1 million,” Mr Chihota said.
“Overally, however, the group exited the year with a net loss of US$2,3 million against a net profit US$8,1 million achieved in the prior year, partly attributable to the fixed costs incurred whilst operations were suspended for the gold business.”
He said RioZim remains resolute on building and maintaining a sustainable mining concern in line with its holistic approach to business.