Zimbabwe: BNC Sinks U.S.$3 Million in Capital Projects As Profits Surge 47 Percent

9 December 2019

BINDURA Nickel Corporation Limited (BNCL) sunk US$3 million in capital expenditure after posting 47 % profits increase during the year's first half as the mining giant pursues projects aimed at maximising productivity output.

Presenting the financial results for BNC's first six months ended September 30 2019, BNC chairman Muchadeyi Masunda said the mining giant has remained focused on undertaking projects that will increase capacity.

"Total capital expenditure for the 6 months was US$3.0 million, mainly in respect of the following projects: shaft re-deepening US$1.2 million, New LHDs: US$ 700 000, New Dump Trucks US$700 000. The Smelter Restart Project is still at 83% complete while the Refinery and Shangani Mine remained under care and maintenance," he said.

During the first half, the company sold 3 002 tonnes of Nickel in concentrate, compared to 2 980 tonnes sold in the comparative period last year. An average nickel price of US$9 052 per tonne was realised for the sale of Nickel in concentrate, compared to US$9 001 per tonne achieved in the same period last year.

Masunda said the figure translates to a turnover for the half-year of US$28 million compared to US$26.2 million realised in the prior year.

The cost of sales of US$16.3 million was 10% lower than the comparative figure in the prior year. Gross profit improved by 47% to US$12 million versus the prior year's achievement of US$8.2 million. The company realised a profit and total comprehensive income of US$7 million, compared to US$3 million in the prior year.

"The improvement of 136% was anchored on exchange gains and a decrease in the cost of sales which, in turn, was attributable to the ongoing efforts to contain costs as demonstrated by the decrease in cash costs, year on year," Masunda said.

BNC sold concentrate containing 3,002 tonnes of nickel compared to 2,980 tonnes for the same period (six months) in 2018/19, an increase of 1%. The sales for the second half of last year were 3,430 tonnes.

The Company maintained a number of overdraft facilities secured from local financial institutions in order to finance its working capital requirements.

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