THE Second Republic has scored another major success story after the turnaround of Hwange Colliery Company which has increased output by over 100 percent.
The colliery company which was placed under administration is on a growth trajectory riding on an efficient Business Improvement Plan adopted by the new management.
Hwange Colliery Company, in existence for the last 121 years has been supporting the country’s economic growth in agriculture and mining.
However, financial and operational challenges left the company on the brink of collapse before government took a strategic decision to put it into administration.
In a record two years, the company has been successfully turned around, producing over 4 million tonnes of coal on annually.
The turnaround strategy implemented by the administrator was based on unbundling its operations into six business units through a flexible management team that initiated several value adding projects including the resuscitation of the Coke Oven Battery which was decommissioned in 2017.
“The Coke Battery is a key piece of HCCL and its cash cow. We have engaged a Chinese contractor who is undertaking its refurbishment since it was decommissioned in 2017. It is one of the initiatives and new business approach to revitalize operations and by October we must be producing our first coal. Capacity here stands at 80 000 tonnes per annum,” said HCCL acting CEO, William Gambiza.
A Business Improvement Plan has discarded in-house mining to contract mining with production volumes shooting to nearly 4 million tonnes per annum while its financial position has significantly improved.
“The BIP involved reviewing the entire operations of the company doing away with loss making ventures with low cost and high margins. Resorting to contract mining has seen volumes increasing to nearly 4 million tonnes of coal while value eroding contracts have been terminated. The Company now has a healthy cash position,” he added.
Hwange Colliery Company Limited (HCCL) Administrator Mr Munashe Shava says the company’s dark days are over, with the energy company set to propel the economy and industry further after eearning US$169 million in sales revenue last year.
“HCCL has risen from the dead and we are proud with its cash and profitability position. We now have a strict balance sheet, efficient and robust operations that are based on an ideal business model which has witnessed HCCL becoming an essential player in Zimbabwe’s reindustrialisation,” he said.
Justice, Legal and Parliamentary Affairs Minister Honorable Ziyambi Ziyambi says administration was the best available option to revitalise the colliery company which was on the verge of collapse.
“HCCL was in a severe crisis prior to administration and as government we are satisfied with the course of direction it has taken through reconstruction. This was the best way to protect this important asset while allowing for the application of a new turnaround business strategy which has worked. Jobs have been saved while the company continues to support the Hwange community,” he noted.
The resurgent Hwange Colliery Coal Company is now contributing to keeping Zimbabwe’s lights on as the constant production is supplying new units 7 and 8 of the Hwange Power Station. – (ZBC)
