Unaudited September 2019 Production and Sales Volumes

Lumber production is lower compared to same period prior year due to low production at the Charter sawmill caused mainly by machine breakdown and power outages. The low production had a knock-on effect on sales volume as this resulted in lower sales compared to prior year.

Treated poles reflect a decline in production as focus was placed on specific orders that required re-sizing of stocks on hand. This is reflected in sales being higher than production as these sales were coming out of stock. Demand remains high within the region and an increase in both production and sales is anticipated within the next quarter.

Financial performance

Revenue saw positive improvement compared to prior comparable period mostly driven by improved quality and output from our value addition plants resulting in better average selling prices (ASP) on lumber. Loss for the year is mainly driven by unrealized exchange losses primarily from a foreign loan, the net unrealized exchange loss amounts to ZWL31,425,437.

Update on ICSID claim and Judicial Management

Discussions are continuing with the other party to the claim and with Government, but these have not yet been finalized. Accordingly, the Company will remain under judicial management for the foreseeable future.

Commendation

Management continue to do an excellent job in difficult circumstances.

Peter Lewis Bailey
Judicial Manager