Exchange losses amounting to ZWL 68.932 million in settlement of a foreign loan exerted pressure on struggling forestry and saw milling concern, Border Timbers in the nine months trading period to March 31, 2020 resulting in a net loss of ZWL 877.857.
The company was put under judicial management in 2017 having sunk in debt of around US 20 million.
The exchange losses were too much to offset a strong revenue performance (historical) of ZWL$181.964 million from ZWL$20.747 million same period last year.
“Revenue saw positive improvement compared to prior comparable period mostly driven by better average selling prices. Loss for the year has been caused mainly by unrealized exchange losses primarily from a foreign loan,” company judicial manager, Peter Lewis Bailey said.
A dip in treated poles and lumber production due to low depressed demand have worsened matters for the company despite encouraging performance at its Charter sawmill facility.
The Zimbabwean dollar has been in free-fall since its introduction last year and this has negatively affected many businesses locally that had borrowed externally when the local currency was trading at 1:1 with the USD and are now tasked with mobilizing foreign currency at a much higher rate.
However, negotiations over the company’s future remain under discussion meaning the company will remain under rescue management in the foreseeable future.