Business - Companies & Markets - Featured - Local - December 8, 2020

Chiyangwa’s ZECO Suffers Over $ZWL2,7 Million Loss

By Tariro Chimhanda

Flamboyant businessman Phillip Chiyangwa’s engineering company, Zeco Holdings recorded a loss of over ZWL$$2.7 million, this is contained in its financial statements for the half-year ending on June 30.

The group said despite mitigatory measures to cushion them from losses, it recorded the loss.

“Despite cost containment efforts, the group recorded a loss of ZWL$$2.766 million (Inflation adjusted $7.260m). Non-current assets as at 30 June 2020 amounted to ZWL$$228.657 million (Inflation adjusted $599.697 m).

“During the first half of the year two new independent Directors, Mr G.G.Mpofu and Mr B Sibanda, were added to the board and their appointment was then ratified at the AGM. Engineer Ben Rafemoyo was also appointed the independent Chairman in line with SI 134 of 2019,”said the Group.

However, the company managed to record revenue of ZWL$$2.77 million (inflation-adjusted $3.25m) for the same period under review.

According to Zeco, inflation continued to be its biggest undoing despite the introduction of foreign currency auctions.

”The inflationary operating environment persisted in the first half of the year and continued driving up the cost of production and eroded profitability.

“Reserve Bank introduced the foreign currency auction system in June which saw the exchange rate move from the fixed 1:$25 to close June at 1: $63.7442. This helped reign in the parallel market rate significantly but prices of materials continued to trade at a premium to this rate, ”added the engineering firm.

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