Tinashe Makichi Business Reporter
PHOENIX Consolidated Industries has streamlined its operations and is now eyeing a return to profitability while stepping up efforts to settle its $5 million debt, an official has said.
Phoenix Consolidated delisted from the Zimbabwe Stock Exchange this year as part of the company’s strategy to sort out its financial problems away from public scrutiny.
The company has high levels of borrowings and is working on strengthening its balance sheet to attract investors.
In an interview with the Herald Business, Grant Thornton Camelsa advisory manager Mr Bulisa Mbano said the company introduced streamlining measures to ensure that “it comes back to consistent profitability”.
He said Phoenix operations are now centralised in Harare and outside the capital, there is Bulawayo office.
“We have streamlined our operations so much and we now have one office in Bulawayo. We decided that there is need to streamline our operations and operate everything from Harare and Bulawayo only where sales, administration and operations should be operated from these two areas only,” said Mr Mbano.
“Phoenix has managed to cut overheads a move which has for the first time brought back the company to profitability. Our aim is to put the company in a position where it can be able to attract investors on its own.” He said following the introduction of cost-cutting measures, the company posted profits in the past two months.
Phoenix is considering listing again once operations are back to full capacity. The group has also been looking at disposing of some of its unproductive assets to boost revenue.
Its operations have been affected by the soaring debt and the cost of borrowings which also affected the group’s performance especially during the hyperinflation era.
The recapitalisation of the company would enhance the company’s potential to generate enough revenue to repay its debts,” said Mr Mbano.
While focus is currently on ensuring viability, the group would in future look for partners to inject fresh capital.
Apex Pension Fund is Phoenix’s major shareholder with a 46 percent stake.
Phoenix Consolidated is a broad-based group of manufacturing industries.
Phoenix manufactures plastics and allied products as well as steel and allied products in Bulawayo and Harare.
Its subsidiaries are William Smith and Gourock, Phoenix Brushware, Scandia Wire, JW Searcy, Precision Grinders and McMeekan.