INDUSTRIAL group Radar Holdings Ltd (Radar) says it has invested well over US$1 million (about $560 million) in fire-fighting equipment in a bid to cut further losses at its timber plantations c
The group, which has vast interests in forestry held through Border Timbers, suffered disruptions at its eastern production plants and sites due to fire outbreaks, which necessitated partial shutdowns last year.
Some 52 wild fires razed a cumulative 260 hectares of commercially exploitable timber worth billions of dollars during the period under review, hence the need to bolster extinguishing equipment.
According to a group report accompanying year-end results to June, “key investment has continued” and up to seven swift reaction vehicles have been purchased, achieving a total of 13-strong fire tenders at the firm.
“This investment has been critical to the ability of the company to protect the forest as fire remains one of the greatest risks to the industry,” said the company, noting most of the attacks involved arson.
It said further investment has been made in forest harvesting equipment, while focus would be given to mill-yield improvement in the coming year.
Following violent farm take-overs by government loyalists and militias since 2000, the larger forestry industry was not spared and some of Radar’s assets have been vandalised.
As well as constant burn-outs and torching, Radar has also fallen victim to wanton mow downs of trees by inexperienced and unappreciative peasants who now occupy tracts of land nationwide.
In the period under review, the company became a target of politically-inspired job actions at its main Chimanimani operations, a factor it alluded to in the group statement although it said this was being resolved amicably.
Radar said the combined effect of contrived fires, lost man-hours and a rise in domestic costs had put pressure on the company’s cash resources.
Meanwhile, the company has bemoaned an unviable export sector regime, saying the realisation of proceeds through the Reserve Bank’s controlled auction system hobbled its revenue flows by as much as 30%.
Radar, along with several manufacturing groups involved in exports, said the $5 600 to one American dollar exchange rate at the bi-weekly auctions should be inflation-linked.
“It should be made very clear that the turmoil surrounding the values attached to all foreign exchange transactions was and remains of deep concern to the company,” it said, adding that managed increments in foreign rates remained frugal to match local costs.
Radar, which successfully sold Commercial and Industrial Holdings so that it could focus on core business, said operations at United Builders Merchant in the second half of last year were also hamstrung by the collapse of the home market as well as perennially-short exchange resources to purchase materials.
Despite a slump in business fundamentals and the difficulties surrounding the five-year old foreign exchange problem, Radar managed some export volume growth at its Border subsidiary.
Zimbabwe is in the midst of a crushing economic downturn marked by high inflation and interest rates, which have been particularly hurtful to productive sectors from agriculture to manufacturing.