Listed agribusiness firm, CFI Holdings, says it remains positive on outcomes from engagements with the Zimbabwe Stock Exchange (ZSE) over the lifting of its suspension on the local bourse.
CFI was initially suspended on January 2, 2018 over corporate governance deficiencies and to allow the company to comply with listing requirements.
The ZSE had requested the group to address governance related matters regarding the appointment of a substantive board chair, chief executive officer and finance director.
The company was also requested during the time of suspension of trading of its shares to appoint independent non-executive directors who were not affiliated to or have any association with any of the company’s shareholders.
Indications are that the issues have since been resolved and the firm says is ready to move on.
“The company has maintained efforts to engage the Zimbabwe Stock Exchange (ZSE) to resolve the outstanding issues pertaining to the suspension of trading of its shares on the stock exchange. The board is hopeful that the same may be resolved in due course,” said chairperson Valerie Pasi.
For the year to September 30, 2020 CFI’s inflation-adjusted revenue for the year increased by 30,1 percent, from $2,6 billion in the previous period to $3,4 billion, driven by effect of consolidating Crest Poultry Group’s (CPG) revenues after it came out of judicial management at the beginning of the year.
CPG increased in sales volumes in the last quarter of the year.
Retail operations contributed 99 percent while farming operations contributed 1 percent of the total turnover on the back of a good season.
The Group operating profit inclusive of monetary gain increased by 10,8 percent to $701,7 million, up from $633,1 million earned in the prior period.
“The improvement is attributable to cost containment efforts sustained during the period, increased procurement efficiencies and the positive contribution from CPG’s performance,” said management.
The group incurred higher depreciation expenses at $55,5 million against $31,6 million incurred in the prior period following the asset portfolio’s revaluation at the end of prior year as well as the impact of capital expenditure of $72,5 million in the current year. Interest expenses and mark to market financing costs were $318,9 million compared to $317 million in prior year.
CFI registered a 16.2 percent increase in its profit before tax for the year at $392,2 million, up from $337,4 million for prior year.
Meanwhile the firm said, is pursuing the removal of Victoria Foods from judicial management as the group seeks to bolster its contribution to national food security.
Victoria Foods, a milling subsidiary of CFI together with its sister company, Agrifoods, a stock feeds manufacturer, were placed under provisional judicial management in 2016 before being subsequently placed under judicial management to allow for debt restructuring, re-organisation and recapitalisation. The two business units require US$12 million for recapitalisation. In its 2020 annual report, CFI Holdings said the return of Victoria Foods from judicial was a significant milestone in implementing the group’s turnaround efforts.
“The group continues to pursue the exit of Victoria Foods from judicial management and will give an update in due course,” it said.
“The return of this company to the group’s control after more than four years under judicial management will mark an important milestone in the group’s turnaround efforts and the group’s resurgence as a significant pillar in underpinning food security in the economy,” said the Agro-industrial concern. During the 2021 financial year, the CFI board has committed to further recapitalisation of all the group’s business units.
The firm’s other subsidiaries include Glenara Estates and Crest Poultry Group (CPG), which consists of Habbard Zimbabwe, Crest Breeders, and Suncrest Chickens that are all under care and maintenance.
“The management of a consistent raw material supply line for Agrifoods and Victoria Foods will remain an on-going priority given the current liquidity situation in the economy and long delivery lead times for imported products,” said CFI.