In a statement accompanying its financial results for the year ended December 2010, the company said demand for poles had increased substantially. This was attributed to the fact that regional countries were implementing rural electrification projects.
Increased sales volumes of kiln-dried timber on the local market had also contributed to the positive financial outcome.
“The export market has been recovering with prices firming up in the southern African region,” reads the statement.
“Although demand for Border Timbers products has remained high, the company did not achieve planned production output due to power outages.”
The erratic power supplies by the Zimbabwe Electricity Supply Authority have been blamed by the business community as an impediment to increased productivity and capacity utilisation.
Consequently, Border Timbers said that operating margins have remained under pressure from the high cost of diesel-generated power as well as repairs and maintenance of equipment.
Income for the period under review stood at US$1 679 629 compared to US$789 177 recorded during the same period in 2009.
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Border Timbers’ core business includes growing, milling, manufacturing, and selling of hardwood and softwood timber in Zimbabwe and exporting.The company’s board said business was still in a negative working capital position as a result of capital expenditure related debt, with the situation expected to improve considerably in the second half of this year.
Other challenges included the continued occupation of its estates by illegal settlers who have refused to leave despite efforts by the company to seek the government’s intervention.
