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Hwange Colliery Company Limited - Restated Unaudited Condensed Financial Results Of The Company For The Six (6) Months Ended 30 June 2015.

Release Date: 29/02/2016 10:10:00      Code(s): HWA     
HWANGE COLLIERY COMPANY LIMITED
(Incorporated in Zimbabwe under registration number 381/1954)
ZSE Share Code: HWA ISIN: ZW0009011934
JSE Share Code: HWA ISIN: ZW0009011934
LSE Share Code: HWA ISIN: ZW0009011934


UNAUDITED CONDENSED INTERIM FINANCIAL RESULTS (RE-PUBLICATION)
For the half year ended 30 June 2015


STATEMENT TO SHAREHOLDERS

On behalf of the Board of Directors, I present the restated unaudited condensed
financial results of the Company for the six (6) months ended 30 June 2015.

RE-PUBLICATION

The re-publication of the interim financial results for the half year ended 30 June
2015 has been necessitated by materiality of the final Zimbabwe Revenue Authority
(ZIMRA) liability concluded on 27 November 2015. There was a recognition of an
additional tax liability of US$28.5 million resulting in a ZIMRA liability of
US$69.1 million following finalisation of a special exercise covering the period
2009 to 2015. The amount had previously been reported as a contigent liability.

The re-publication has been done after engagements and in compliance with the
Zimbabwe Stock Exchange listing regulations.

FINANCIAL RESULTS

The sales revenue for the six (6) months under review was US$35.4 million compared
to the US$39.9 million revenue recorded during the same period last year. The
operating loss was US$48 million compared to an operating loss of US$7.6 million
for the comparative period last year. The Company incurred a loss after taxation of
US$44.1 million compared to the US$7.9 million loss recorded for the same period in
2014.

There was a notable decrease in administrative costs because of the cost containment
measures adopted by the Company. Finance costs for the period amounted to US$1.1
million compared to US$1.0 million for the same period last year. The burden of
servicing the legacy debts continued to strain the Company`s cash flows and this
presented working capital challenges.

Total non-current assets increased by 18% from US$161.8 million to US$191.2 million.

PERFORMANCE

For the six (6) month period under review, the Company sold a total of 685 759
tonnes of coal and coke products compared to 764 813 tonnes sold during the same
period last year representing a decline of 10%.

HPS coal deliveries to Hwange Power Station for the period under review were 409
843 tonnes compared to 394 451 tonnes for the same period last year representing an
increase of 4%.

HCC/HIC coal sales increased by 14% from 197 342 tonnes to 225 396 tonnes.
There was a decrease in the sales of coal fines and breeze from 154 657 tonnes to
45 045 tonnes for the comparative periods.
Coke sales volume decreased from 18 363 tonnes achieved in the first half of 2014
to 5 475 tonnes for the period under review. This was attributed to the low
production performance of the toll coking arrangements.

DIVIDEND

The Board of Directors resolved not to declare an interim dividend for the half
year ended 30 June 2015.

OUTLOOK

The Company?s strategy adopted in 2014 and currently being implemented is anchored
on the following;

-   Recapitalisation of the mining operations;
-   Contract mining;
-   Conversion of Government debt to equity;
-   Divisionalisation of the organisation;
-   Customer diversification; and
-   Acquisition of new coal concessions.

During the period under review, the Company successfully took delivery and
commissioned mining equipment from BELAZ of Belarus worth US$18.2 million through
a facility with PTA Bank which was subsequently ceded to the Reserve Bank of Zimbabwe
(RBZ).

Delivery and commissioning of additional mining equipment worth US$13 million from
BEML of India through a line of credit from the Export and Import Bank of India was
successfully done during the period under review. The enabling borrowing was
securitised by a sovereign guarantee.

The Board and management are diligently sourcing working capital from the local
money market to inject into the operations in order to achieve maximum utilisation
of the newly acquired equipment. In order to mitigate the creditors and litigation
risks, the Company has approached the Government for a short to long term debt
instrument. This will enable the Company to clear most of the legacy debt and
reverse the negative working capital position.

The mining contractor`s contribution to coal production was satisfactory for the
period under revew.

The Company is currently at advanced stages of the conversion of Government debt,
mainly the Zimbabwe Revenue Authority (ZIMRA) liability, into equity. This will be
structured through a fully underwritten rights issue and a private placement. This
matter would be brought to an Extra Ordinary General Meeting (EGM) for Shareholders`
approval in due course.

The Company?s divisionalisation strategy has started to bear fruits. There is now
undivided management focus on the mining division. The thrust being to improve on
efficiencies and cost leadership in order to realize optimum margins in the backdrop
of declining commodity prices on the local and international markets.

The Company was awarded new coal concessions in the Western Areas, Lubimbi East and
Lubimbi West. The new coal concessions will increase the life of mine of Hwange
Colliery Company Limited by at least fifty (50) years. The Company has advertised
for expressions of interest for field exploration work. The evaluation and
adjudication is expected to be completed in early 2016. The new concessions are
strategic to the growth of the Company. The new coal resources also enhance Hwange
Colliery Company Limited`s capacity to fully support power generation projects,
including the expansion projects like Hwange Power Station Stage 3.

The target market for the Company?s coal and coke products is the local and regional
markets. However the thrust for the second half of the year is to diversify the
markets for coal and coke products. The major growth opportunities lie in the
regional markets in South Africa, Zambia and the Democratic Republic of Congo.

The synergies for the increased usage of coal for tobacco curing is being finalised
with the Tobacco Industry Marketing Board (TIMB). This will reduce the current
deforestation challenges.

In the processing of coal, the Company generates significant quantities of coal
fines. A briquetting project is being inestigated jointly with TIMB, for the the
beneficiation of coal fines into briquettes for sale to the tobacco industry.

The Company has introduced cost cutting measures that will reduce the cost of coal.
The infrastructure costs of maintaning the town and utilities will be shared with
other coal mining companies and stakeholders around Hwange. The reduction of
overheads through management salaries and benefits cut is being finalised.

The Company has resuscitated the conveyor belt that delivers coal to Hwange Power
Station. The conveyor belt that delivers coal to No 2 processing plant is undergoing
refurbishment. These measures will reduce the cost of transporting coal currently
being done by road haulage.

APPRECIATION

I would like to express my gratitude to my fellow Directors, Management and Staff
for their collective efforts and dedication to Hwange Colliery Company Limited
despite all the challenges. I also count on all the support as we turn around the
Company. I also appreciate the support we continue to receive from all our
stakeholders.

J CHININGA
ACTING CHAIRMAN

12 February 2016

Registered Office
7th Floor, Coal House
17 Nelson Mandela Avenue
P 0 Box 2870, Harare



Condensed statement of profit or loss and other comprehensive income
for the six (6) months ended 30 June 2015

                                          Re-published     Restated        Restated
                                          30 June          30 June         31 December
                                          2015             2014            2014
                                          USD              USD             USD
                                   Note   Unaudited        Unaudited       Audited
  Revenue                          6         35 349 513     39 868 795      83 918 846
  Cost of sales                            (47 591 594)   (36 389 027)    (92 873 146)
  Gross (loss)/profit                      (12 242 081)      3 479 768     (8 954 300)
  Other income                                                  269 129         694 761
                                                 212 560
 Other gains and losses (net)                   (18 452)      (172 201)     (5 425 101)
 Marketing costs                               (673 169)      (754 564)     (1 486 861)
 Administrative costs
(restated)                                  (35 277 577)   (10 454 481)    (27   862   294)
 Redundancy costs                                      -              -     (5   053   909)
 Impairment loss                                       -              -     (3   452   516)
 Operating loss                             (47 998 719)    (7 632 349)    (51   540   220)
 Finance costs                               (1 110 496)    (1 004 825)     (3   701   723)
Share of loss from equity
accounted investments                          (110 348)       (77 558)     (1 123 788)
LOSS BEFORE TAX                             (49 219 563)    (8 714 732)    (56 365 731)
Income tax                         7      5 113 418             834 339      18 499 846
LOSS FOR THE PERIOD/ YEAR                   (44 106 145)    (7 880 393)    (37 865 885)
Other comprehensive income:
Other comprehensive income for
the period/ year,
net of tax                                             -               -                 -
TOTAL COMPREHENSIVE LOSS FOR THE
PERIOD/YEAR                                 (44 106 145)    (7 880 393)    (37 865 885)
Attributable loss per share
- basic                            8             (0.24)         (0.04)            (0.21)
- diluted                          8             (0.24)         (0.04)            (0.21)
Headline loss per share            8             (0.24)         (0.04)            (0.21)
- basic
- diluted                          8             (0.24)         (0.04)             (0.21



Condensed statement of financial position
as at 30 June 2015


                                          30 June          30 June         31 December
                                           2015            2014            2014
                                           USD             USD             USD
                                   Note    Unaudited       Unaudited       Audited
ASSETS
Non- current assets
Property, plant and equipment      9         155 104 414    138 760 304     129 078 977
Investment property                10          3 700 000      3 700 000       3 700 000
Investments accounted for using    11         16 484 320     17 640 897      16 594 668
the equity method
Intangible assets                  12          1 483 610      1 696 473      1 590 041
Deferred tax asset                            14 480 975              -      9 367 557
                                             191 253 319    161 797 674    160 331 243
Current assets
Stripping activity asset           13          8 412 361      9 420 040       7 290 468
Inventories                        14         42 156 247     39 731 457      41 446 180
Trade and other receivables        15         27 291 466     37 785 401      37 784 545
Financial assets at fair value     16                  -          4 645               -
through profit or loss
Cash and cash equivalents          17            312 252      1 003 188        956 810
                                              78 172 326     87 944 731     87 478 003
Total assets                                 269 425 645    249 742 405    247 809 246
EQUITY AND LIABILITIES
Capital and reserves
 Share capital                     18          45 962 789       45 962 789         45 962 789
 Non-distributable reserves                     4 358 468        4 358 468          4 358 468
 Share premium                                    577 956          577 956            577 956
 Revaluation reserve                           39 948 518       39 948 518         39 948 518
 Accumulated losses                          (97 731 335)     (23 639 698)       (53 625 190)
                                              (6 883 604)       67 208 033         37 222 541
 Non-current liabilities
 Lease liability                   19.1        15 043 461          850 000            800 000
 Borrowings                        20.1         5 990 629                -                  -
 Deferred tax liability                                 -        8 297 950                  -
                                               21 034 090        9 147 950            800 000
 Current liabilities
 Lease liability                   19.2         6 951   547          103   887        261 570
 Borrowings                        20.2        17 187   926     19   673   043     10 790 113
 Trade and other payables          21         219 680   588    142   686   117    187 482 799
 Provisions                        22          11 051   598      9   846   278     10 848 723
 Current tax liability                            403   500      1   077   097        403 500
                                              255 275   159    173   386   422    209 786 705
 Total equity and liabilities                 269 425   645    249   742   405    247 809 246



Condensed statement of cash flows
for the six (6) months ended 30 June 2015


                                          30 June             30 June            31 December
                                           2015               2014               2014
                                           USD                USD                USD
                                   Note    Unaudited          Unaudited          Audited

 Cash generated form operating
 activities
 Loss before taxation                        (49 219 563)      (8 714 732)       (56 365 731)
 Adjustment for non-cash items                 36 510 712        7 955 512         20 949 227
 Net effect of changes in
 working capital                               12 569 868        7 201 496         53 558 672
 Net cash (utilised in)/
 generated from operations                      (138 983)        6 442 276         18 142 168
 Interest paid                                  (126 274)      (1 004 825)        (3 249 810)
 Tax paid                                               -                -          (673 597)
 Net cash (utilised in)/
 generated from operating
 activities                                     (265 257)        5 437 451         14 218 761
 Cash flows from investing
 activities
 Purchase of property, plant and
 equipment                                  (30 804 938 )      (1 086 072)          (346 840)
 Net cash utilised in investing
 activities                                  (30 804 938)      (1 086 072)          (346 840)
 Cash flows from financing
 activities
 Proceeds from borrowings                      30 804 938          366 910          1 511 204
 Repayment of borrowings                        (410 310)      (1 118 000)       (10 631 690)
 Net    cash   generated   from/
 (utilised in)
           financing activities                                  30 394 628      (751 090)     (9 120 486)
           Net (decrease)/increase in cash
           and cash equivalents                                   (675 567)      3 600 289       4 751 435
           Cash and cash equivalents at
           beginning of the period/year                            761 924     (3 989 511)     (3 989 511)
           Cash and cash equivalents at end
           of period/year                                         17 86 357      (389 222)          761 924


          Condensed statement of changes in equity
          for the six (6) months ended 30 June 2015

                                                Non-
                               Share            distributable     Share       Revaluation    Accumulated    Total
                               capital          reserves          premium     reserve        losses
                                                                                                            USD
                               USD              USD               USD         USD            USD
Balance at 1 January 2015          45 962 789        4 358 468      577 956     39 948 518   (53 625 190)      37 222 541
Total comprehensive loss
for the period (unaudited)                 -                -             -              -   (44 106 145)   (44 106 145)
Balance at 30 June 2015
(unaudited)                       45 962 789        4 358 468       577 956     39 948 518   (97 731 335)     (6 883 604)
Balance at 1 January 2014         45 962 789        4 358 468       577 956     39 948 518   (15 759 305)      75 088 426
Total comprehensive loss
for the period (unaudited)                 -                -             -              -    (7 880 393)     (7 880 393)
Balances at 30 June 2014
(unaudited)                       45 962 789        4 358 468       577 956     39 948 518   (23 639 698)      67 208 033
Balance at 1 January 2014         45 962 789        4 358 468       577 956     39 948 518   (15 759 305)      75 088 426
Total comprehensive loss
for the year (audited)                     -                -             -              -   (37 865 885)   (37 865 885)
Balances at 31 December 2014
(audited)                         45 962 789        4 358 468       577 956     39 948 518   (53 625 190)      37 222 541



          Notes to the unaudited condensed financial statements
          for the six (6) months ended 30 June 2015

          1. Nature of operations
          Hwange Colliery Company Limited is a company that extracts, processes and
          distributes coal and coke products. The company operates a coal mine situated at
          Hwange and sells mainly within Zimbabwe and elsewhere in Sub Saharan Africa.

          2. Basis of preparation of the condensed financial statements

          The condensed interim financial statements for the six (6) months ended 30 June
          2015 have been prepared in accordance with IAS 34, ?Interim financial reporting?.
          They do not include all of the information required for full annual financial
          statements and should be read in conjunction with the audited annual financial
          statements for the year ended 31 December 2014, which have been prepared in
          accordance with International Financial Reporting Standards; Companies Act(Chapter
          24:03) and the relevant statutory instruments (SI 33/99 and SI 62/96).
          This condensed interim financial information has been reviewed, not audited.

          3. Significant accounting policies

          The interim financial statements have been prepared in accordance with the
          accounting policies adopted in the Company?s most recent annual financial statements
for the year ended 31 December 2014 except for the change in accounting policy in
note 5 below.

4. Estimates

In preparing the condensed interim financial statements, the significant judgements
made by management in applying the Company?s accounting policies and the key sources
of estimation were the same as those that applied to the audited annual financial
statements for the year ended 31 December 2014.

5. Change in accounting policy

The Company?s business model has been reviewed and a divisionalisation strategy
has been implemented. This has resulted in a change in the revenue recognition
policy in respect of revenue earned from Medical Services and Estates business
units, previously set off against administrative expenses. This change has no
effect on equity. The effect of the change in accounting policy on the financial
results presented is as follows:


                                         6 months           6 months          Year to
                                         30 June            30 June           31 December
                                         2015               2014              2014
                                         USD                USD               USD
                                         Unaudited          Unaudited         Audited
 Increase in revenue                          5 015 841       6 820 628          11 887 395
 Increase in cost of sales                  (6 690 139)     (4 714 714)        (10 552 883)
 Decrease/(increase) in administrative
 expenses                                     1 674 298     (2 105 914)        (1 334 512)
 Effect on equity                                     -               -                  -
 6. Revenue
                                                 Tonnes            Tonnes             Tonnes
 Coal sales
 HCC/HIC                                        225   396         197   342          393   408
 HPS coal                                       409   843         394   451          924   659
 Coal fines and breeze                           45   045         154   657          201   610
 Total coal sales                               680   284         746   450      1   519   677
 Coke tonnes                                      5   475          18   363           82   510
 Total sales                                    685   759         764   813      1   602   187
 Mining                                      30 333   672    33   048   167     72   031   451
 Estates                                      4 486   687     5   321   896     10   943   432
 Medical services                               529   154     1   498   732      3   644   383
 Total                                       35 349   513    39   868   795     86   619   266
 7. Taxation
 Current tax                                          -                 -                -
 Deferred tax                                 5 113 418           834 339       18 499 846
                                              5 113 418           834 339       18 499 846
 8. Loss per share
 8.1 Basic
 Basic loss per share is calculated by
 dividing the loss attributable to
 shareholders by the weighted average
 number of ordinary shares in issue
 during the period/year.
 Loss attributable to shareholders         (44 106 145)     (7 880 393)       (37 865 885)
 Weighted average number of ordinary
 shares in issue                            183 757 366     183 757 366        183 757 366
 Basic loss per share                             (0.24)         (0.04)           (0.21)



Notes to the unaudited condensed financial statements
for the six (6) months ended 30 June 2015 (continued)

                                           6 months         6 months        Year to
                                           30 June          30 June         31 December
                                           2015             2014            2014
                                           USD              USD             USD
                                           Unaudited        Unaudited       Audited
 8.2 Diluted

 Loss used to determine diluted loss
 per share                                  (44 106 145)    (7 880 393)     (37 865 885)
 The weighted average number of ordinary
 shares for the purpose of diluted loss
 per
 share, reconciles to the weighted
 average
 number of ordinary shares used in the
 calculation of basic loss per share as
 follows:
 Weighted average number of ordinary
 shares in issue                             183 757 366    183 757 366      183 757 366
 Weighted average number of ordinary
 shares for diluted loss per share           183 757 366    183 757 366      183 757 366

 Diluted loss per share                           (0.24)         (0.04)           (0.21)

 8.3 Headline loss per share

 Headline loss per share excludes all
 items   of   a  capital   nature   and
 represents an after tax amount. It is
 calculated by dividing the headline
 loss shown below by the number of
 shares in issue during the period/
 year:

 Reconciliation between headline loss
 and basic loss:

 IAS 33 - Losses                            (44 106 145)    (7 880 393)     (37 865 885)

 Non - recurring items:
 Proceeds on sale of scrap                      (25 108)                -      (352 848)
 Impairment of property, plant and
 equipment                                              -             -        3 452 516
 Loss from sale of assets                               -       139 904                -

 Headline losses                            (44 131 253)    (7 740 489)     (38 218 733)

 Weighted average number of ordinary
 shares in issue                             183 757 366    183 757 366      183 757 366
Headline loss per share                          (0.24)        (0.04)         (0.21)

9. Property, plant and equipment

Carrying amount at the beginning of the
period/year                                  129 078 977   139 129 468   139 129 468
Additions                                     32 311 385     5 459 391     5 638 479
Depreciation charge for the
period/year                                  (6 285 948)   (5 828 555)   (12 236 454)
Impairment                                             -             -    (3 452 516)

Carrying amount   at the    end   of   the
period/year                                  155 104 414   138 760 304   129 078 977

10. Investment property

Fair value                                     3 700 000     3 700 000     3 700 000
Investment property comprises of:
- Land situated at Lot 7 of Stand
2185, Salisbury Township Harare with
an administration building thereon.
- Land situated at Stand 555,
Bulawayo Township Bulawayo with an
administration building thereon.

10.1 The following amount has been
recognised in profit or loss:

Rental income                                   136 298       129 418        301 232

11. Investment    in   equity   accounted
investments

Investments in associates (note 11.1)            335 857       894 401       446 205
Investment in joint venture (note 11.2)       16 148 463    16 746 496    16 148 463
                                              16 484 320    17 640 897    16 594 668

11.1 Investments in associates

Carrying amount as at beginning of
period/year                                      446 205      897 168         897 168
Share of loss                                  (110 348)      (2 767)       (450 963)

Carrying amount at the end of the
period/year                                     335 857       894 401        446 205

The Company holds a 49% voting and equity interest in Clay Products (Private)
Limited. The Company also holds a 44% voting and equity in Zimchem Refineries
(Private) Limited.

The Company did not recognise losses for the period ammounting to USD 374 603
(30 June 2014: USD 234 224) for Zimchem as the cumulative losses exceeded the
carrying

11.2 Investment in joint venture
 Carrying amount as at 1 January             16 148 463    16 821 287      16 821 287
 Share of loss                                        -      (74 791)       (672 824)

 Carrying amount at the end of the
 period/year                                 16 148 463    16 746 496      16 148 463

Hwange Coal Gasification Company (Private) Limited is the only joint venture entity
and the interest is 25%. The investment in the joint venture has been accounted for
using the equity method.

*The financial information for Hwange Coal Gasification Company (Private) Limited
for the six (6) months ended 30 June 2015 was not available for inclusion in these
financial statements.

 12. Intangible assets

 Opening carrying amount                      1 590 041     1 802 904       1 802 904
 Amortisation charge                          (106 431)     (106 431)       (212 863)

 Closing carrying amount                      1 483 610     1 696 473       1 590 041
 13. Stripping activity asset

 Carrying amount at 1 January                 7 290 468     6 774 204       6 774 204
 Pre-stripping costs                          1 012 748     2 596 663       1 796 730
 Costs charged/(credited) to cost of
 sales                                          109 145        49 173     (1 280 466)

 Closing carrying amount                      8 412 361     9 420 040       7 290 468

 14. Inventories

 Raw materials                                5 039 725     5 973 194       4 881 326
 Consumables                                          -             -          72 895

 Finished goods

 Coal and coal fines                         34 129 814    30 086 865      34 282 926
 Coke                                         2 986 708     3 671 398       2 209 033
                                             42 156 247    39 731 457      41 446 180
 15. Trade and other receivables

 Trade                                       12 266 435    19 620 194      15 373 035
 Other                                       15 025 031    18 165 207      22 411 510
                                             27 291 466    37 785 401      37 784 545



                                         6 months         6 months      Year to
                                         30 June          30 June       31 December
                                         2015             2014          2014
                                         USD              USD           USD
                                         Unaudited        Unaudited     Audited
 16. Financial assets at fair value
 through profit or loss
 Carrying amount 1 January                            -          4 645          4 645
 Fair value adjustment                                -              -        (4 645)

 Fair value       at   the   end   of   the
 period/year                                          -          4 645                 -

The fair value of all equity securities is based on their current bid prices on the
Zimbabwe Stock Exchange.

17. Cash and cash equivalents

For the purposes of statement of cash flows, cash and cash equivalents include cash
on hand and in banks and investments in money market instruments, net of outstanding
bank overdrafts. Cash and cash equivalents at the end of the period/year as shown
in the statement of cash flows can be reconciled to the related items in the
statement of financial position as follows:

 Bank and cash balances                          312 252     1 003 188        956 810
 Bank overdraft                                (225 895)   (1 392 410)      (194 886)
                                                  86 357     (389 222)        761 924

 18. Share capital

 Authorised

 204 000 000 ordinary shares of USD0.25
 each                                         51 000 000    51 000 000     51 000 000

 Issued and fully paid
 110 237 432 Ordinary shares of
 USD0.25 each                                 27 559 358    27 559 358     27 559 358
 5 962 366 Ordinary shares issued under
 share option scheme                           1 514 039     1 514 039      1 514 039

                                              29 073 397    29 073 397     29 073 397

 67 557 568 ??A?? Ordinary shares of
 USD0.25 each                                 16 889 392    16 889 392     16 889 392

                                              45 962 789    45 962 789     45 962 789
 19. Lease liability

 19.1 Non current

 Finance lease liabilities due after
 one year                                     15 043 461       850 000        800 000

 19.2 Current

 Finance lease liabilities due
 within one year                               6 951 547       103 887        261 570

 20. Borrowings

 20.1 Non current
 Loans due after one year                      5 990 629             -                 -
 20.2 Current
 Bank overdraft                                 225 895      1 392 410         194 886
 Loans payable within one year               16 962 031     18 280 633      10 595 227

                                             17 187 926     19 673 043      10 790 113

 21. Trade and other payables

 Trade                                       78 944 668    64 200 483      106 604 119
 Other                                      140 735 920    78 485 634       80 878 680
                                            219 680 588   142 686 117      187 482 799

 22. Provisions

 22.1 Provision for rehabilitation

 At the beginning of the period/year          4 893 360      3 893 360       3 893 360
 Additional provisions made during
 the period/year                                500 000        500 000       1 000 000

 At the end of the period/year                5 393 360      4 393 360       4 893 360

 22.2 Other provisions

 Leave pay and other provisions               5 658 238      5 452 918       5 955 363
 Total Provisions                            11 051 598      9 846 278      10 848 723


23. Segment reporting

Management currently identifies the Company?s three business units as its operating
segments. These operating segments are monitored by the Company?s Board of Directors
and strategic decisions are made on the basis of adjusted segment operating results.
Segment information for the reporting periods is as follows.


                                                               Medical
                           Mining         Estates             services   Total
                           USD            USD                      USD   USD
 30 June 2015
 Revenue
 From external customers     30 333 672       4 486 687       529 154       35 349 513
 From other segments                  -         690 730     1 485 529        2 176 259
 Total segment revenues      30 333 672       5 177 417     2 014 683       37 525 772
 Segment operating loss    (17 600 922)       (791 099)   (1 114 782)     (19 506 803)
 Segment assets             253 806 655       7 612 572     8 006 418      269 425 645
 Segment liabilities        215 072 830      16 310 785    16 433 718      247 817 333

 30 June 2014
 Revenue
 From external customers     33 048 167       5 321 856      1 498 772      39 868 795
 From other segments                  -         592 892      1 173 612       1 766 504
 Total segment revenues      33 048 167       5 914 748      2 672 384      41 635 299
 Segment operating loss     (6 675 922)       (279 980)      (676 447)     (7 632 349)
 Segment assets             236 323 323       6 785 315      6 633 767     249 742 405
 Segment liabilities         152 209 475      16 310 785    14 014 112     182 534 372

 31 December 2014
 Revenue
 From external customers      72 031 451      10 847 866     1 039 529      83 918 846
 From other segments                   -          95 566     2 540 564       2 636 130
 Total segment revenues       72 031 451      10 943 432     3 580 093      86 554 976
 Segment operating
 (loss)/profit              (53 381 778)     (1 135 679)       341 107    (54 176 350)

The totals presented for the Company?s operating segments reconcile to the key
financial figures as presented in its financial statements as follows:


                                                               Medical
                            Mining         Estates            services   Total
                            USD            USD                     USD   USD
 30 June 2015
 Revenue
 Total reportable segment
 revenue                      30 333 672       5 177 417     2 014 683      37 525 772
 Elimination of
 intersegment
 revenue                               -       (690 730)   (1 485 529)     (2 176 259)
 Total Company revenue        30 333 672       4 486 687       529 154      35 349 513
 30 June 2014
 Revenue
 Total reportable segment
 revenue                      33 048 167       5 914 748     2 672 384      41 635 299
 Elimination of
 intersegment
 revenue                              -        (592 892)   (1 173 612)     (1 766 504)

 Total Company revenue        33 048 167       5 321 856     1 498 772      39 868 795

 31 December 2014
 Revenue
 Total reportable segment
 revenue                      72 031 451      10 943 432     3 580 093      86 554 976
 Elimination of
 intersegment
 revenue                               -        (95 566)   (2 540 564)     (2 636 130)
 Total Company revenue        72 031 451      10 847 866     1 039 529      83 918 846


24. ZIMRA liability adjustment

As disclosed under note 26 in the 30 June 2015 financial statements which were
previously published, the Company was under tax investigation with ZIMRA which had
not been finalised at the time of publication. The Company had recognised a ZIMRA
tax liability of USD 40 621 203.13 as at 30 June 2015 with other amounts disclosed
as contingent liabilities. However, on 27 November 2015, ZIMRA confirmed that after
the investigation exercise, Hwange Colliery Company Limited owed ZIMRA an amount of
USD69 113 118.81. The financial statements have been adjusted to reflect the correct
ZIMRA liability as at 30 June 2015 as follows:
 Increase in expenses                                                    (28 491 916)
 Increase in trade and other payables                                      28 491 916



The ZIMRA liability of USD69 113 118.81 is included in trade and other payables in
the statement of financial position whilst the USD28 491 916 is included in
administration expenses in the statement of profit or loss and other comprehensive
income.

25. Going concern
The Company is experiencing matters that may cast significant doubt on its ability
to continue as a going concern. Management has considered the following matters:

Net current liability position
The company?s current liabilities exceeded its current assets by USD 177 102 833 as
at 30 June 2015 (30 June 2014: 85 441 691; 31 December 2014: USD 122 308 702). This
unfavourable position is a result of the delayed realisation of capitalisation
projects as a result of the adverse liquidity situation affecting the economy as a
whole. The market demand currently remains unsatisfied and there are opportunities
for growth of the company. The company has adequate coal reserves and contracted
stocks of coal fines to enable it to continue operating for the forseeable future.
The company has engaged a contractor to provide mining services at its open cast
mine in line with its strategy to expand its mining activity. The company acquired
mining equipment in June 2015 and this is expected to improve production output.
Management, therefore, believes that the company?s ability to continue to operate
is dependent upon future profitability.

Operating loss
The operating loss of USD 47 998 719 (30 June 2014: USD 7 632 349; 31 December 2014:
USD 51 540 220) is mainly attributable to the lower revenue recorded in the period
under review. The Company?s current initiatives are expected to reverse the general
poor production and trading performance.

Litigation cases
The company had litigation cases brought against it during the period. The summary
of significant legal cases for Hwange Colliery Company Limited as at 30 June 2015
are as follows:

                                                                                   USD
 Value of cases for which judgement has been passed against the
 company                                                                   20 106 710
 Estimated value of cases pending judgements at the courts                 20 611 536
 Total value of litigation cases                                           40 718 246

26. Financial risk management objectives and policies

The Company?s principal financial liabilities comprise finance lease liabilities,
loans payable, bank overdrafts and trade payables. The main purpose of these
financial liabilities is to raise finance for the Company?s operations. The Company
has various financial assets such as trade receivables and cash and short term
deposits, which arise directly from its operations. Exposure to credit, interest
rate and currency risk arises in the normal course of Company?s business and these
are the main risks arising from the Company`s financial instruments.

26.1 Credit risk Management has a credit policy in place and the exposure to credit
risk is monitored on an ongoing basis. The Company assumes foreign credit risk only
on customers approved by the Board and follows credit review procedures for local
credit customers.

Investments are allowed only in liquid securities and only with approved financial
institutions. At the reporting date there were no significant concentrations of
credit risk. The maximum exposure to credit risk is represented by the carrying
amounts of each financial asset in the statement of financial position.

26.2 Interest rate risk The Company?s exposure to the risk of changes in market
interest rates relates primarily to the Company?s long and short term debt
obligations and bank overdrafts. The Company?s policy is to manage its interest
cost using a mix of fixed and variable rate debts.

26.3 Currency risk
The Company is exposed to foreign currency risk on transactions that are denominated
in a currency other than the United States Dollar. The currency giving rise to this
risk is primarily the South African Rand.

In respect of all monetary assets and liabilities held in currencies other than the
United States Dollar, the Company ensures that the net exposure is kept to an
acceptable level, by buying or selling foreign currencies at spot rates where
necessary to address short-term imbalances.

The Company?s exposure to foreign currency changes for all the other currencies is
not significant.

Johannesburg
29 February 2016

Sponsor: Sasfin Capital (a division of Sasfin Bank Limited)


Date: 29/02/2016 10:10:00 Supplied by www.sharenet.co.za                     
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