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Business Reporter
starafrica Corporation remains significantly under pressure due to financial challenges although it is making modest headway on addressing efficiencies.

Revenue for the year to March 2015 was little changed at $9,2 million from $9,3 million in 2014 although the loss after tax eased to $7,5 million from $11,7 million.

Total liabilities for the period under review exceeded assets by $30 million. More was the fact that current liabilities exceeded current assets by $52,2 million. Total assets mismatch worsened from a deficit of $24 million in 2014 while the shortfall in terms of current liabilities further declined from $34,8 million.

In addition, borrowing powers of the group as provided in its memorandum of understanding had been exceeded by $41,3 million as at the March 31 year end.

starafrica said $37 million of the amount borrowed above approved limits had since been ratified at the company’s annual general meeting held last year.

While a scheme of arrangement for reconstruction of the group was approved by the High Court in 2013, unforeseen challenges have halted progress. The restructuring entailed the disposal of two business units, Blue Star Logistics and the group’s 33 percent stake in Tongaat Hullets Botswana Private Limited.

But repayment of debts to creditors, which was approved over period of 24 months has been delayed due to challenges in selling off Blue Star and the Tongaat stake.

“On Bluestar Logistics negotiations are in progress with an identified purchaser. THB continues to be on the market,” chairman Mr Joe Mtizwa said.

Mr Mtizwa said interest in the Botswana market is low mainly due to onerous requirements from stakeholders in the Botswana based sugar producer.

Against this background, the group has embarked on options for scheme debts settlement, which it said will be presented to creditors once it has been firmed up.

If this fails, “the company will not be in a position to service its debts as they fall due.”

Part of the solution to the sugar processors woes lay in upgrading its Gold Star Sugar plant in Harare, with 60 percent of the plant successfully upgraded.