By BUUMBA CHIMBULU
THE Zambia Forestry and Forest Industries Corporation Plc (ZAFFICO) has recorded a reduction in revenue of K90.053 million for the first six months ending in June this year.
Revenue for the current period were lower at K99.05 billion compared with K128.73 million the same period last year, largely due to delay in commencement of the harvesting season.
This is according to the interim results for the year ended June 30, this year posted on Lusaka Securities Exchange (LuSE) yesterday.
In an order to the board, Corporation Secretary Chanza Sikazwe, said the delay arose mainly from the lengthy negotiations between ZAFFICO and the associations representing principal customers for pine and eucalyptus round wood.
Additionally, this year’s allowable cut for pine round wood had been reduced compared to last year in line with the company’s stock levels.
Mr Sikazwe said the gross profit and net income were also lower for the first half of this year compared to the same period last year driven primarily by the lower revenues.
He said ZAFFICO’s balance sheet remained strong with a healthy liquidity position.
“Despite a challenging business environment in the first half of the year, the company continued on a profitable path with positive cash flows generated from operating activities,” Mr Sikazwe said.
He indicated that plantation and other silvicultural activities progressed well during the period under review.
Mr Sikazwe said the effects of Covid-19 would likely continue to challenge many businesses, including ZAFFICO.
However, the company was confident that the backlog of sales experienced in the first quarter of this year would be recovered in the second half of the year.
Mr Sikazwe said ZAFFICO was actively pursuing opportunities to increase its sales of treated poles so as to mitigate the effects of reductions in the annual allowable cut for pine round wood.
“These efforts are on top of the company’s new focus on improving its productivity levels across its business processes so as to remain competitive,” he said.
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