BETA expands capacity, fixing liquidity challenges
BETA Holdings (BETA), the diversified producer of construction inputs, has admitted that it is in severe distress partly due to prevailing liquidity challenges at a time when its budgets are under pressure from ongoing expansion projects
In a media statement, BETA said it was working on resolving the challenges while assuring stakeholders the completion of the expansion projects would help lift the company out of the distress. BETA is among the country’s largest brick moulders.
It is also involved in quarry stone crushing and the manufacturing of concrete roofing tiles.
Over the past few years, the firm has been failing to meet its delivery schedule commitments, with some customers having to wait for months before receiving their orders.
BETA has also been failing to pay workers and transporters it has contracted on time.
“BETA management acknowledges the operational challenges that the organization has faced over the last few months,” read part of the statement. “The current macroeconomic and liquidity challenges have not spared the company. These challenges come at a time when the organization is, however, in the process of increasing its capacity to address the underlying supply challenges it has faced over the last few years, especially at BETA Bricks,” the company added. BETA is building a brick plant in Melfort, about 40km east of Harare “and is now 85 percent complete with all components now in situ and only electrical works are outstanding,” it said. The target date for commissioning the factory, with an annual production capacity of up to 180 million bricks per year is the end of November this year.
BETA has also installed a new brick in Mount Hampden where it already operates two factories.
The new line will see output increasing by 50 percent to 4,5 million units per week.
“The net effect of these investments is to ensure that the company pivots back to its leadership position in the infrastructural inputs supply sector now and into the future,” said BETA.
On employee salaries, it said the resources have been “stretched” by ongoing projects.
“The challenges currently being faced by the group, coupled with the diversion of resources to fund the expansion program have resulted in a delay on payments to some key stakeholders including staff currently employed at Mount Hampden as well as deliveries to our esteemed customers,” said the company. “The current challenges faced by the organization are unprecedented and have understandably caused some anxiety amongst the employees. The management team has regularly been updating the employees through the Workers Council Committee on the challenges and strategies being pursued to address the situation.”
BETA has assured employees that it had sourced raw materials to enable the kick-starting of a sustainable production process, which should see capacity improving at the Mount Hampden factories while works and the Melfort plant were completed.
“Management is fully confident that as the production levels improve, so will the cash inflows that will address all the legacy creditors, backlogged deliveries, and staff remuneration.
“It is against this background that BETA wishes to inform its stakeholders that efforts are being made to resolve the current impasse with the employees at Mt Hampden who have taken industrial action at the factories citing the backlog on wages.”