Sable Chemicals weighs down TA Holdings

Sable Chemicals weighs down TA Holdings
Published: 25 April 2014
Zimbabwe Stock Exchange-listed group TA Holdings says it is anticipating a loss for the year ended December 31 2013 following an impairment charge against one of its subsidiaries.

In a statement, the group said the impairment charge was a result of the uncertainty of Sable Chemicals Industries' viability.

"The impairment arose due to the uncertainty over the future returns to be realised by the group from its investment in Sable Chemical Industries Limited. Consequently TA holdings will report a loss for the year ended December 31.

The impairment charge did not have an impact on the group cash flows," reads part of the statement.

The conglomerate's profitability over the past few years has been weighed down by performance of Sable Chemicals and other companies in which it has investment interest. TA has a 51 percent stake in the country's sole manufacturer of ammonium nitrate fertiliser.

But operations at the firm are hanging in the balance as it is struggling to raise more than $750 million capital to establish its coal gasification plant which would eliminate Sable's huge electricity bill associated with the current production method of electrolysis.

Shareholders in Sable had at one time agreed to close the company for viability reasons but the Government ordered them to re-open it due to its strategic importance in the agriculture sector on condition that power would continue to be provided at a subsidised rate.

This has not materialised yet, and the fertiliser manufacturer continues to operate at below 50 percent capacity.
- BH24
Tags: Sable, TAHoldings,


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