FALCON Investment Holdings Societé Anonyme, the holding company for Falcon Gold Zimbabwe Ltd (Falgold), says it is using black market rates when converting its local earnings. <
The mining giant, incorporated in Luxembourg, has operations in Chile, Europe and Zimbabwe.
“Our 57,1% stake in Falcon Gold Zimbabwe Ltd is included at its market value on the Zimbabwe Stock Exchange converted at the implied or parallel exchange rate Z$1 400:US$1 at March 31 2003,” Falcon said.
The company said total operating profits of its Zimbabwean subsidiaries converted at average parallel exchange rates were US$697 000 in the six months to March 31 2003.
This compared to a profit of US$87 000 for the whole of last year and a loss of US$19 000 for the first half of last year.
The company said gold production had nose-dived 18% to 461 kg from 564 kg in the same period last year, and 13% from 529 kg in the second half of last year.
“The operating environment remains difficult in Zimbabwe,” the company said. “We are suffering from regular power cuts despite the imposition of an increase in electricity prices of 1 300% with effect from February 1 2003.”