ZCDC realises $19,7m gross turnover

Source: ZCDC realises $19,7m gross turnover – NewsDay Zimbabwe May 24, 2016

ZIMBABWE Consolidated Diamond Company (ZCDC) produced 387 551 diamond carats and sold 362 238 of them realising $19,7 million in gross turnover, two months into operation, figures from the Mines ministry show.

BY Fidelity Mhlanga

ZCDC started mining activities in March this year after government failed to renew special grants permits of six companies mining diamonds in the Chiadzwa area.

Figures from Mines and Mining Development ministry permanent secretary, Francis Gudyanga’s presentation at the Chamber of Mines in Victoria Falls show that in March ZCDC sold 156 168 carats and 206 010 in April this year at $55 each.

Of the $19,7 million, gross turnover $3,7 million went towards statutory costs, leaving the entity with $16 million net turnover.

Cumulatives for the two months were pegged at $7,7 million.

“ZCDC has so far recorded positive performance in both volume and value for the first two months of its operation. The major driver of performance is the technological transformation of processes through the fifth generation XRT plant. Capacity upgrade is critical to protect both the revenue and margins going,” Gudyanga said.

He said investments made by the operating companies before consolidation were not adequate to go beyond mining alluvial resources, as very little exploration was done for kimberlite resources, which present bigger and more sustainable opportunities.

Gudyanga said Anjin investments has pledged to invest $132,3 million, with no audited accounts to show how much they invested in the business over the years.

Gudyanga said the Diamond Mining Corporation (DMC) pledged to invest $50 million and invested $41 million. Jinan pledged $200 million and yet it invested $137 million. Mbada, which has pledged to invest $100 million invested $48 million.

Gudyanga said the majority of the 28% of the $5,2 million received from ZCDC mining activities in March 2016, went towards the payment of Marange Resources creditors to fend off production interruptions due to writs or execution of productive assets by creditors.

He said 27% went towards arrear employment costs to ensure high staff morale and minimise risk of pilferage, with 20% going towards capitalisation of the business.

Operation Dzorerai Upfumi Kuvanhu had a significant impact on cashflows

Gudyanga said of the $8,4 million April 2016 sale, only $7,86 million was received and the balance is still outstanding from Harvest Way Diamond and Jewellery.

He said the major focus was on the capitalisation of the business and funding the resuscitation of Portal Q (former DMC mining operation).

The company paid deposits of $600 000 and $400 000 for the acquisition of the second and fifth generation XRT plant and the 600TPH Front-End feed preparation system, respectively.

The equipment, according to Gudyanga, is expected by mid June 2016.