11 Jun - 3 min read

Abridged audited financial results for the year ended 31 December 2020

Abridged audited financial results for the year ended 31 December 2020

HWANGE COLLIERY COMPANY LIMITED
(Incorporated in Zimbabwe under registration number 381/1954)
ZSE Share Code: HCCL.ZW ISIN: ZW0009011934
JSE Share Code: HWA ISIN: ZW0009011934
LSE Share Code: HWA ISIN: ZW0009011934
(“the Company”)

Abridged audited financial results for the year ended 31 December 2020

Introduction to the Company

The Company’s principal activities are exploration, mining, processing of coal and the production of
coke and related by-products in the north western part of Zimbabwe, Hwange District in the
Matabeleland North Province.

The Company remains under administration in terms of the Reconstruction of State-Indebted
Companies Act (Chapter 24:27). The appeal by the Minister of Justice, Legal and Parliamentary
Affairs to the Supreme Court in the matter of the confirmation of the Reconstruction Order remains
pending, and administration continues as normal.

Owing to the above mining had stopped in August 2018.

Total costs in 2020 were 794% higher than in 2019 at $269,182,079 as a result of the increase in
labour costs, power costs and legacy cost adjustments. Net loss for the year was $4,122,004
compared to a profit of $2,324,748 in the previous year
.
Actions to improve the Division’s performance will include:

• Increasing commercial space by engaging in BOOT arrangements with potential investors;
• Stringent debt collection to boost cashflows;
• Refurbishment of retail facilities to improve customer experience; and
• Diversification of product ranges.

Planned projects were slowed down mainly by Covid19-induced restrictions. The Division undertook
the Zimbabwe Open University Hwange Campus project and undertook major repairs on employee
housing.

Auditor’s Statement

The auditors have issued an adverse audit opinion on the inflation adjusted financial statements with
respect to non-compliance with International Accounting Standard (IAS) 21 - The Effect of Changes
in Foreign Exchange Rates, International Accounting Standard (IAS) 29 – Financial Reporting in
Hyperinflationary Economies, going concern, financial results of equity accounted investments, and
the revenue streams and inventory for some of the divisions in the Company.

The Auditors have included a section on key audit matters. The key audit matters were with respect to
the allowances for credit losses and income taxes. There is an emphasis of matter regarding the
impact of COVID-19 pandemic on the Company’s operations. The auditor’s report on the inflation
adjusted financial statements which form the basis of these financial results is available for inspection
at the Company’s registered office.

The Engagement Partner on the audit resulting in this auditor’s report is Farai Chibisa
(PAAB Number 0547).

The full audit opinion can be downloaded on the following link:

HCCLINDEPENDENTAUDITORSASSEMENTREPORT.pdf (hwangecolliery.co.zw)
Full Announcement

This short-form announcement is the responsibility of the Administrators of the Company and is a
summary of the information in the full announcement which is available for viewing on the following
website:

JSE website: https://senspdf.jse.co.za/documents/2021/jse/isse/hwae/hwa2021.pdf

Any investment decision by investors and/or shareholders should be based on consideration of the full
announcement, copies of which are also available for inspection at our offices (ppfunye@dmh.co.zw) and
our sponsor’s offices (sharon.owens@sasfin.com) on work-days during business hours, at no charge:


On behalf of the Administration Board


Zimbabwe
11 June 2021

Sponsor: Sasfin Capital (a member of the Sasfin Group)

Date: 11-06-2021 04:35:00
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