LISTED sugar processor, Star Africa Corporation Limited (SACL) has managed to clear 98% its debts and is now targeting to address foreign creditors within the first quarter of next year.
In 2013, SACL survived liquidation by a whisker after the courts approved a scheme of arrangement with a reprieve allowing the company not to pay any creditor inside a period of six months to allow time accumulate growth.
The corporation was saddled with a debt totaling US$19.7 million which once prompted creditors to demand the firm’s liquidation following an unsuccessful scheme of arrangement more than a decade ago.
But presenting financial performance for the half year ended September 30 2020, SACL chairman, Joseph Mutizwa revealed the significant progress made.
“The scheme of arrangement, whose tenure expires in 2022 remains in place with 97.95% of debts being settled,” he said.
Mutizwa highlighted the strategy may result in the debts being extinguished by 31 March 2021 and shareholders will be advised of the outcome thereof in due course.
Market watchers believe that the debt clearance will provide the company with sound leverage to focus on key capital expenditure endeavors.
Meanwhile, during the period under review the corporation’s subsidiary, Gold Star Sugars Harare (GSHH) managed to sell 32 047 tonnes of sugar against 35 791 tonnes sold last year.
The decrease in sales volumes was attributable to Covid-19 related challenges, associated transport restrictions, maintenance shutdown and disruptions to the operations due to a fire that destroyed the raw sugar warehouse.
“Country Choice Food products continued to dominate the market. Volumes were, however, down 11% due to low disposable incomes and depressed business activity experienced by this operational unit’s major industrial customers,” said Mutizwa.
The properties business recorded a 53% increase in turnover from $5,3 million recorded in prior half year to 8.2 million due to increased occupancy levels.
Tongaat Hullet Botswana continued to dominate the Botswana sugar market recording a profit after tax of $99,95 million of which the company share was $33,3 million after converting earnings into Zimbabwean dollars at the prevailing RBZ auction exchange rate.