ZIMRE Holdings Limited (ZHL) posted a loss after tax of US$113 627 for the six months ended June 2014 from a profit of US$2,4 million, weighed down by a loss recorded in its agricultural associate.
BY VICTORIA MTOMBA
In a statement accompanying the group’s financial statement, ZHL chairman Benjamin Kumalo said the economy has continued to operate at suboptimal levels, characterised by limited capital inflows, depressed demand, company closures, high cost of funds and underperforming exports.
“The period under review has been very challenging and the group performance was adversely affected by the slowdown in economic growth. A loss after tax for the period to 30 June 2014 of US$0,11million was recorded compared to a profit of US$2,39 million in the same period last year.
“The group’s share of the loss on its agro-industrial associate operation of US$1,01 million had a negative impact on the overall performance of the group,” said Kumalo.
A Gross Premium Written of US$41,23 million was recorded and was in line with what was recorded same period last year while domestic operations contributions stood at 52% during the period under review compared to 60% the same period last year.
“An operating profit of US$1,66 million was achieved compared to US$2,87 million in the same period. The 42% decline in operating profit was mainly attributed to an increase in claims during the period under review,” Kumalo said.
He said comprehensive income declined to US$0,72 million in 2014 from US$1,58 million in 2013, with the financial position growing to US$160,77 million in June 2014 from US$155 million in December 2013.
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He said the macroeconomic environment was expected to remain challenging for the rest of the year and the group will monitor developments in the domestic and regional markets.
“Disposal of non-core investments is still in progress. The group has intensified efforts on capital raising in order to enhance underwriting capacity and liquidity across operations. Cost cutting measures are also being implemented with a view to enhance group profitability,” he said.
