Timber producer, Border Timbers, is continuing on a downward trend recording another drop in poles and lumber production in its trading update of 3 months to 30 September 2019.
Lumber production for the company under judicial management went down to 15,223 up from 17,718 for the same period under review.
“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,” Judicial Manager, Peter Lewis Bailey said.
“The low production had a knock-on effect on sales volume as this resulted in lower sales compared to prior year.”
Production of treated poles for the 3 months to 30 September 2019 went down to 3,750 from 4,011 at the Mutare based company.
“Treated poles reflect a decline in production as focus was placed on specific orders that required re-sizing of stocks on hand,” Bailey said.
“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,” Bailey went on.
In terms of debts with International Centre for Settlement of Investment Disputes (ICSID) for Border Timbers to exit judicial assistance, Bailey said the company will remain under judicial management for the foreseeable future.
Border Timbers went under judicial management after failing to service debts to several financial institutions worth $20 million.
The firm’s dispute with creditors over US$25m awarded to the company by ICSID is holding back its exit from judicial management.
“Discussions are continuing with the other party to the claim and with Government, but these have not yet been finalized,” Bailey said.