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Masawara recovers to post $58k profit

Masawara Plc, an investment holding company focused on acquiring interests in Zimbabwe and the southern African region, overturned an after tax loss of $4.7 million in 2015 to achieve an after tax profit of $58 000 in 2016.

According to its financial results for the year ended 31 December 2016, Masawara said throughout the year, it faced continuing headwinds in its core markets, particularly the steadily worsening liquidity conditions within Zimbabwe.

The group’s asset portfolio spans from insurance, agro-chemical and hospitality sectors across sub-Saharan Africa.

It has significant interest in Joina City, a premium, multi-purpose property, located in Harare’s Central Business District, a non-controlling interest in Telerix Communications and iWayAfrica Zimbabwe, a broadband internet service provider.

All its insurance units, except for Lion Assurance Company (Uganda), registered a growth in gross written premiums, with all companies achieving underwriting profits.

The insurance segment includes Botswana Insurance Company Limited, Lion Assurance Company (Uganda), Zimnat Lion Insurance Company Limited (Zimbabwe), Zimnat Life Assurance Company (Zimbabwe) and Grande Reinsurance Company (Zimbabwe).

Hotels in Zimbabwe experienced increased levels of competition which resulted in lower profit being recorded for the current year as pressure was placed on both occupancy levels and rates.

Regional hotels recorded an increase in profitability compared to the prior year in local currency, as a result of an increase in revenue.

Construction of a new hotel in Maun, Botswana that began during 2015 was completed in 2017.

Sable Chemicals, a subsidiary of the group in which it holds a 50.6 percent shareholding, commenced production under the full importation model in November 2016 reported a loss after tax of $4.7 million compared to $2 million in the prior year.

Joina City did not make any payments to the shareholders as a decision was taken to reinvest resources into refurbishing parts of the building.

Despite the decline in occupancy, revenue increased by three percent due to a change in the retail anchor tenant, while the office section occupancies continue to be a challenge, as some companies chose to move out of the city centre.

Management expects a similar trend to obtain going forward. – The Source

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