By Tawanda Musarurwa

HARARE - Listed agro-industrial concern Ariston slid into the red after posting a loss after taxation of $1,7 million for the year ended September 30, 2015 against a profit of $1,4 mil-lion in the prior year.

Revenue for the period under review amounted to $11,8 million versus $12,5 million last year. Operating losses however continue to come down, declining by $3,2 million on prior year to $0,3 million last year. The $1,7 million after tax loss was largely attributable to a $2,2 million bump in finance costs.

According to Ariston, the weighted average cost of borrowings as at the end of the financial year under review was 18,8 percent per annum. Despite the loss, management is convinced

that investments made into the firm will bear fruit going forward:

"The long-term nature of most of the investments made in the group means that returns will take time to

be realised," said chairman Dr Robbie Mupawose.

Ariston is engaged in horticulture, tea, macadamia nut production, fish-ery, poultry production and supply of fresh farm produce, and its key divisions include Southdown Estates, Claremont Estate, Kent Estate, and Fruit and Vegetable Company (FAVCO). It was a mixed performance for the group's entities.

"Certain key crops such as macada-mia have performed very well while others such as tea continue to suffer from low international prices," he said. The group discontinued opera-tions at FAVCO in June last year due to continued losses by the division.

The discontinued operations incurred a loss of $3,4 million due to the poor results of the trading division and the

costs of unwinding the business.

In terms of operations, Macadamia volumes increased to a record yield of 1 385 tonnes from 1 105 tonnes in 2014 nut-in-shell, a 25 percent increase on the prior year.

In the horticulture section, stone fruit sales volumes increased from 143 tonnes in the prior year to 340 tonnes in 2015, while pome fruit production and sales were 50 percent up on the prior year at 1 174 tonnes and 874 tonnes, respectively. Potato sales vol-umes were marginally above the prior year and below expectation overall, reported the company.

Going forward, management expects the business to start generating prof-its in the coming season. The board did not declare a dividend for the period.●

News Update as @ 1530 hours, Thursday 07 January 2016Feedback: bh24admin@zimpapers.co.zwEmail: bh24feedback@zimpapers.co.zw

Ariston slides into the red

Dr Robbie Mupawose.

BH242

By Munesu Nyakudya

HARARE - Local companies are continuing to respond to the call for value addition enunciated in the economic blue print the Zim-babwe Agenda for Sustainable Socio-Economic Transformation with food processor African Pre-serves (Pvt) Ltd recently introduc-ing an assortment of competitively priced tinned vegetable on the market.

The company’s products include tinned peas, beans, green beans and tomatoes that are branded Monty’s Gardens. The tinned foods, which came onto the mar-ket in November are being distrib-uted mainly through TM and Pick n Pay stores.

African Preserves managing direc-tor Mr Lian Philp said that they have managed to supply cans at prices that are lower than imported cans largely due to their small overhead costs.

“We are a small company that employs 300 people and most of our produce comes from the 150

farmers that we work with.

“African Preserves is a subsidiary of Selby Enterprise, which deals with paper. We decided to branch out because we saw an opportu-nity for value addition of agricul-tural products,” said Mr Philp.

He said that they are operating at 55 percent capacity and produc-ing 12 000 cans per day although they have an installed capacity of 20 000 cans.

Mr Philp said this year the com-pany is working on supplying fro-zen chips. He said that currently most frozen chips supplied in super markets are being imported from South Africa and their objective is to ensure the bulk of the products

are locally produced.

Mr Philp added that the biggest challenge that they are facing as a company is the imported prod-uct. He said that most consumers prefer foreign products to those produced locally, not knowing that they are supporting and promoting foreign businesses.

He urged consumers to promote local brands and local producers to supply competitively priced prod-ucts.

“Products should be competitive, but if you see a local product pric-ing slightly higher than the foreign product, just go for the local prod-uct and let us support local busi-ness.●

3 NEws

Local company boosts value addition

BH244

BH24 Reporter

HARARE - Farmers’ Unions have castigated private abattoirs that are taking advantage of farm-ers in drought stricken areas by offering them non-viable prices for their livestock.

Most farmers have taken heed of Government’s call to reduce their herd by selling unproduc-tive livestock.

But farmers can only sell the live-stock in their own areas owing to the veterinary restrictions fol-lowing the recent foot and mouth disease (FMD) and anthrax out-breaks after the Department of Veterinary Services banned the movement of cattle from one area to another to reduce the spread of the disease.

Some private buyers have taken advantage of this inability to move cattle to areas where bet-ter prices are available by offer-ing the desperate farmers low prices for the cattle.

Zimbabwe Commercial Farm-

ers Union president Mr Won-der Chabikwa yesterday said de-stocking was delayed and now farmers were facing chal-lenges in selling their cattle.

He said the situation could have been better had the cattle been sold earlier before the outbreak of the diseases.

“We were supposed to have

moved the cattle to areas with pastures," said Mr Chabikwa. "Now farmers are selling their cattle at giveaway prices because they are desperate and cannot watch their livestock suc-cumb to drought.

“It is better for farmers to sell than leave the cattle to die. It is better to get something for their cattle and buy food than watch

them die.”

Mr Chabikwa advised farmers to seek advice from the DVS before selling their cattle.

Department of Veterinary Ser-vices director Dr Josphat Nyika encouraged farmers to approach their provincial veterinary offices for guidance.

“Anthrax and FMD and now under control but the quarantine remains. Farmers cannot move cattle out of their zones and can only sell in their areas," he said.

“We are facilitating risk-based cattle sales to guide farmers. We encourage the auction system so there can be competition and farmers can get better prices for their livestock.”

The situation is becoming dare for livestock in some parts of the country as grazing land is drying up due to lack of rains.

The lack of rains has also resulted in some crops wilting.●

5 NEws

Private abattoirs castigated

BH246

HARARE - Zimbabwe is not yet “popping champagne bottles” after it last year dra-matically managed to improve its ‘ease of doing business’ rankings, to help attract investment, the country’s investment authority said on Wednesday.

The Zimbabwe Investment Author-ity (ZIA) said it was making concerted efforts to make Zimbabwe one of the most investor friendly economies on the continent.

Zimbabwe last year jumped 16 places in the positive to position 155 on the World Bank’s Doing Business Index, which con-siders how easy it is to set up and operate business in 189 countries in the world.

Government, through the Office of the

President and Cabinet, has set up a committee to implement strategies to improve key aspects of doing business in the country.

ZIA’s head of operations, Mr Sichoni Takoleza told a visiting Chinese business delegation Zimbabwe was aiming to become one of the highest ranked Afri-can countries on the World Bank’s Doing Business index. “We managed to move from number 171 to 155 last year but we are not yet popping the champagne bot-tle,” Mr Takoleza said.

The highest ranked African country on the index is Mauritius at position 32.

Mr Takoleza said reforms currently being implemented had seen the time that an

investor takes to start a business drop to 30 days from 90 days.

“We are still looking at further simplifi-cation of procedures and automation of systems,” he said.

He said other committees were looking at easing trade across borders and paying taxes, protecting minority investors and simplifying registration of properties as part of overhauling the doing business environment.

Government, he said, had also further simplified and clarified its position on the indigenisation and economic empow-erment laws as part of efforts to attract investment.

Mr Takoleza said Zimbabwe, blessed with over 40 known minerals, had vast invest-ment opportunities in many sectors of its economy among them infrastructure, agriculture and tourism. He said Gov-ernment would soon establish Special Economic Zones, where investors would enjoy tax holidays, with a law to back their establishment due to be presented to Parliament for approval soon.

Government has already said it is working on a new 100 day plan to improve ease of doing business, and attract more for-eign direct investment which is required to oil the economy, which has over the years been portrayed as an unsafe des-tination by hostile western media. - New Ziana●

7 NEws

Zim still making strides to improve business climate –ZIA

BH248

HARARE -The mainstream indus-trial index’s bearish form continued unabated, making it four losses in a row this year.

Following today's trades, the equi-ties market faltered by 1.88 to close at 112.22 as conglomerate Innscor shed a significant $0,0596

to trade at $0,2400, while bev-erages giant Delta was $0,0148 lower at $0,6802.

Telecoms operator Econet margin-ally dropped $0,0002 to close at $0,2100.

On the other hand, two counters

traded in the positive territory. SeedCo recovered $0,0035 to set-tle at $0,8375 and Turnall added $0,0010 to close at $0,0110.

The mining index was flat at 24.27 points as all four mining counters maintained previous price levels. - BH24 Reporter ●

ZsE9

Industrials remain bearish

Peace of mind is good

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MovERs CHANGE TodAy PRICE UsC sHAKERs CHANGE TodAy PRICE UsC

Turnall 10.00 1.10 INNSCOR -19.89 24.00

SEEDCO 0.41 83.75 DELTA -2.12 68.02

ECONET -0.09 21.00

INdEx PREvIoUs TodAy MovE CHANGE

INDUSTRIAL 114.10 112.22 -1.88 points -1.65%

MINING 24.27 24.27 +0.00 POINTS +0.00%

10 ZsE TABLEs

ZsE

INdICEs

stock Exchange

11 dIARy oF EvENTs

The black arrow indicate level of load shedding across the country.

PowER GENERATIoN sTATs

Gen Station

07 January 2016

Energy

(Megawatts)

Hwange 557 MW

Kariba 709 MW

Harare 0 MW

Munyati 16 MW

Bulawayo 18 MW

Imports 0-100 MW

Total 1321 Mw

THE BH24 dIARy

JoHANNEsBURG - South Africa's rand fell nearly 1 per-cent against the dollar today, sliding towards December's record lows as renewed con-cerns about China's economy spurred an emerging market sell-off.

The rand was also victim to South Africa's weak economic fundamentals, with a survey this week showing private sector activity shrank at a faster pace in December, with output dropping.

At 0704 GMT, the rand traded at 15,9555 to the greenback, down 0,65 percent from yes-terday's close in New York.

It had fallen to 16,0050 ear-lier in the session, close to the all-time low of 16,0485, reached in mid-December after President Jacob Zuma fired finance minister Nhlan-hla Nene.

Thursday's move largely reflected a retreat in emerg-ing Asian currencies as China accelerated the yuan's depre-ciation, heightening concerns over the world's second-larg-

est economy.

The South African bourse was not spared the sell-off, with the Top-40 and broader all-share indices each dropping 2 percent soon after the market

opened at 0700 GMT.

"There seems to be an awful lot of pessimism surround-ing financial markets at the moment," Standard Bank trader Warrick Butler said.

Government bonds followed the weak trend, with the yield on South Africa's benchmark 2026 issue adding 2.5 basis points to 9,58 percent.

- Reuters●

REGIoNAL NEws 12

Rand breaches 16 0000 in emerging market sell-off

Turmoil in China’s markets is pushing oil closer to $30 a barrel.

Futures slid as much as 4,3 per-cent in London on concern the economic slowdown in the world’s biggest commodity consumer is worsening. China’s central bank reduced the onshore yuan’s fix-ing to the lowest since March 2011, triggering a selloff that led to the closure of Chinese stock exchanges. Brent oil will slump to $30 in the next 10 days, accord-ing Nomura Holdings Inc., while UBS Group AG sees an oversupply pushing prices even lower.

“The market trades on greed and fear, and right now fear dominates greed,” said Gordon Kwan, a Hong Kong-based analyst at Nomura. “Commodity futures markets are always forward looking, and they fear that the depreciation of the yuan foreshadows further weak-ness in the Chinese economy.”

Oil in London declined for a third year in 2015 as the Organisation of Petroleum Exporting Countries effectively abandoned output lim-its amid a global glut. Stockpiles at Cushing, Oklahoma, the deliv-ery point for US benchmark crude, rose to a record while nationwide stockpiles remain about 100 mil-

lion barrels above the five-year average, according to Energy Information Administration data.

Brent for February settlement fell as much as $1,48 to $32,75 a barrel on the London-based ICE Futures Europe exchange and was at $32,87 at 2:43 p.m. Hong Kong time. The contract dropped 6 percent to $34,23 on Wednesday, the lowest close since June 2004. The European benchmark was at a premium of 18 cents to West Texas Intermediate.

Chinese demand

WTI for February delivery lost as much as $1,35, or 4 percent, to $32,62 a barrel. The contract slid 8,3 percent the previous three days

to close at $33,97 on Wednesday, the lowest since December 2008. Total volume traded was more than triple the 100-day average.

The global economy will sputter along this year as China’s slow-down prolongs a commodity slump, the World Bank said Wednesday. The Washington-based develop-ment bank lowered its forecast for 2016 growth to 2,9 percent, from a 3,3 percent projection in June, according to its bi-annual Global Economic Prospects report.

The People’s Bank of China on Thursday reduced the yuan’s fix-ing by 0,51 percent to 6,5646, the weakest since March 2011 and a reminder of the August cut that sparked financial-market turmoil. Trading on the CSI 300 Index was suspended after it plunged more than 7 percent.

Cushing Capacity

Energy companies led declines on the MSCI Asia-Pacific Index, which sank to a three-month low Thurs-day. PetroChina Co., the nation’s biggest oil and gas producer, dropped as much as 5,7 percent in Hong Kong, while Woodside Petro-leum Ltd. fell as much as 6 percent in Sydney.

“Clearly the economic concern is a factor, but that doesn’t really explain everything,” said Dominic Schnider, head of commodities and Asia-Pacific foreign exchange at UBS’s wealth-management unit in Hong Kong. “There is a weak backdrop given that the market is oversupplied. If there is continued build in inventory, the market will not be pleased and if the market loses patience then the next step is a bit below $30.”

Supplies at Cushing expanded for a ninth week to 63,9 million bar-rels, the longest run of gains since April, according to the EIA data released Wednesday. The hub has a working capacity of 73 mil-lion barrels. Nationwide stockpiles declined by 5.1 million barrels to 482,3 million.

Spot prices for Western Canadian Select fell as low as $19,81 a bar-rel on Wednesday, the lowest since tracking began in 2008, according to data compiled by Bloomberg. Producers in Canada are being cushioned somewhat by the coun-try’s weak currency, which has seen its value shrink along with crude. Most of the nation’s output is exported and companies are paid in US dollars .- Bloomberg●

INTERNATIoNAL NEws 13

$30 oil just got closer as yuan drop highlights China's turmoil

By Frik Els

Last year was a horrible year for commodities and resources sector, but it appears contrarian investing in the sector is alive and well.

According to a new report by private capital tracker Preqin, fundraising for natural resources investment reached record levels in 2015, with 62 funds raising a total of $63bn. That was up 14 percent compared to 2014 and edged past 2013’s ban-ner year when more than 111 funds were active in the market.

Investors, perhaps anticipating that valuations are close to bottoming, threw money at closed-end fund managers and limited partners who were able to rake in 113 percent of what was targeted for the year. 2015 was the third consecutive year target sizes were exceeded.

Despite plummeting crude oil and natural gas prices, according to Pre-qin energy-focused funds were once again the main driver of growth in 2015, accounting for more than $9 out of every $10 raised during the year. The bulk of the cash will be invested in North America.

Mining and metals made up a paltry 0,6 percent of funds raised (more money were raised for timberland) with just two funds closing on $400 million in 2015. Nearly ten times the amount of money went into invest-ment in agriculture and farmland in 2015.

This year 10 metals and mining focused private closed-end funds are hoping to raise $3,6bn, com-pared to 38 funds in the market targeting $7,7bn for agriculture and farmland investment, mostly out-side North America.

Water has now become enough of a focus for private capital that Preqin, which has tracked the industry since 2003, is breaking out the numbers, identifying six funds in the market which want to attract at least $4bn.

The vast majority of funds are once again raising money for energy investments in 2016, but with oil prices reaching fresh 11-year lows in January it will be interesting to see how close the funds active in the sector come to the more than $114bn targeted.

It’s also telling that one of the

largest energy-focused funds in the market this year is the Green Investment Bank which is targeting over $1.5bn to build offshore wind farms. In October, the UK-based bank announced it’s more than 80 percent there with $1,2bn already in the kitty.

Private capital encompasses a range of investment vehicles and strategies including traditional pri-vate equity such as buyout, venture capital and turnaround funds, pri-vate debt including distressed debt and direct lending, and private real estate, infrastructure and natural resources funds. A total of $550bn were raised by 1,061 funds across all strategies and sectors in 2015 according to Preqin data. - Mining.com

*Frik is editor and writer for MINING.com. Frik has worked as a financial journalist for 15 years appearing in a number of business and consumer publica-tions including British Airways in-flight magazine, Business Insider, Investment.com, Driv-ing.ca, YCharts and Business in Vancouver.●

14 analysis14 ANALysIs

Private capital won't touch mining