The disposal of United Builders Merchants (UBM) and writing off of fire damaged timber weighed down the performance of parent company Radar Holdings group for the half-year ended December 2011.
Loss on the disposal of UBM amounted to $4,5 million, while the company had to write off $2,6 million worth of timber damaged by fire.
The group recorded a loss of $6,6 million compared to $1 million during the same period last year. Radar said revenue on salvaged timber would be realised as the year progressed, adding continuing operations were profitable and the group was on course to meet set targets.
Group revenue for the period under review totaled $17,9 million compared to $17,8 million from last year, with UBM contributing $6 million, which has no contribution to the turnover in the period under review.
“The increase in revenue is attributable to an increase in production at both Boarder Timbers and Macdonald Bricks,” the company said.
“A total of $7,1 million has been taken through the income statement for the first half of the year leading to a reported loss of $6,6 million including discontinued operations.”
Another subsidiary, Border Timbers, recorded an operating loss of $99 865 for the half year under review.
Border Timbers chairperson Randy Breschini said
1 055 hectares were lost in infernos during the fire season.
“This severity of the fire season was mostly a result of adverse weather circumstances,” he said.
The subsidiary’s turnover of $13,6 million was 7% below the target, but 40% above the $9,7 million achieved the previous year. Breschini said planned revenue was achieved in poles, sawn timber and boards.
“The recovery of the poles market as well as increased sales volume on kiln-dried timber on the local market are expected to be major drivers going into the second half of the year,” he said.
But he warned lack of adequate electricity continued to be a major constraint.
“Planned production was not achieved for the six months under review due to the above mentioned and inconsistency of rough-sawn timber,” Breschini said.