Published: 05 September 2013

COLCOM Holdings had a disappointing first half after profit plunged 66,2 percent to $1,6 million in the interim to June 2013 weighed down by provisions and impairment of fixed assets.

Chairman Robert Davenport said the factors that weighed down operations were a result of compromised governance environment as well as a number of equipment failures.

Colcom said in addition to the provisions of $1,3 million reported in the first half of the year, a further $1,1 million of cost of provisions were processed in the second half.

The colcom processor said these emanated mainly from stock and retrenchment costs.

A critical review of the group’s assets resulted in impairment and de-cognition of charge of $1,5 million and these factors contributed to profit before tax reflecting a 65 percent decline.

"In spite of the above the group generated $3,7 million from operations and remains cash positive after investing $2,8 million in fixed assets during the year, primarily directed towards backup generator power and new retail space for Colcom operations and those of its subsidiary Associated Meat Packers (Private) Limited," Mr Davenport said.

Going forward, he said the challenges of an aging facility has been address in part by committing to and contracting of $1,4 million of factory equipment to be installed by December. 
- herald

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