SELEBI PHIKWE ÔÇô The government of Botswana has converted part of the debt that it was owed by BCL Limited into equity, the copper-nickel producing companies said Thursday. Available figures show that by close of the 2013/14 financial year, BCL owed government at least P3billion.
BCL Limited Managing Director Dan Mahupela confirmed Thursday that his company has since paid a total of P1billion in cash to government while a balance of P2.67 billion has been converted into equity.
“BCL’s balance sheet shows that the company is in sound financial position as it is now debt free following the successful conclusion of a restructuring exercise embarked on in collaboration with the Botswana government,” Mahupela said.
Financial statements of the Selebi Phikwe town based company shows that it recorded a turnover growth of four percent in 2014 compared to the previous as a result of firmer pricing, weaker Pula exchange rates with the US Dollar. The company also attributes the one digit growth to ‘cost containment measurers’ executed during the financial year under review. Throughout 2014, BCL continued to invest in the development and expansion of its business to ensure future sustainability with a majority of its expenditure diverted towards mining capital development as well as other diversification related projects within the sub region.
Mahupela says although BCL remains a marginal operating mine with considerable financial sensitivity to nickel and copper pricing, the various cost containment, productivity and efficiency projects under execution have begun to bear positive results as evidenced by the improved 2014 financial performance.
Polaris II underway
Meanwhile Mahupela said BCL’s corporate strategy, Polaris II, which was adopted a few years ago, is beginning to realize its aims. The strategy was adopted to transform BCL from being just a mine threatened with closure over the years, into a competent and diversified mining and related products enterprise. Polaris II, which is the continuation of the initial strategy started in 2007, will see the company becoming an enterprise that will diversify its product offering, but mindful of the environment.
Previously a debt ridden company, BCL is bullish it can implement the new strategy looking at its track record as a leading underground mine in the country and the region.
“With regards to expand and sustain the nickel circuit, the focus has mainly entailed redesigning and refurbishing the smelter as a strategic asset around which the nickel business is anchored. In order to achieve that it was important to source and secure long term supply of concentrates to fully utilise the capacity of the smelter,” Mahupela said.
He added that the acquisition of the Nkomati nickel mine and negotiations for long term off-take for Nkomati concentrate is aimed at achieving the goal of full smelter capacity utilisation going forward. BCL has also completed acquisition of the Tati Nickel Mine near Francistown and it is in the final stages of completing the 50 percent acquisition on Nkomati mine.