HARARE – Breco International (Breco) subsidiary Fodya (Private) Limited (Fodya) says its going concern status is not threatened by supply chain disruptions in certain markets, a statement reveals.
This comes after reports that the Zimbabwean cigarette-maker has lost quite a significant chunk of its product to contraband syndicates in the region.
“It has, however, been evident in both our production capacities and revenues that Fodya has experienced a visible drop in business over the last 12 months,” Fodya noted on Thursday.
“Whilst we continue to export to many African countries and beyond, the decline in volume can be attributed to many points, inclusive of supply chain disruptions,” it said, adding reports of its possible closure were unfounded.
The reports also come as President Robert Mugabe has implicated multinational company BAT in a “corporate espionage and dirty tricks” scandal to have played out in the region.
However, the Western-backed conglomerate has vehemently denied the use of cloak-and-dagger tactics to smoke out competitors, including Cutrag, Adam Molai’s Savanna and Tradnet.
Fodya says its “market intelligence” shows that “some activities have been undertaken by third parties… to disrupt our operations”.
“These reports, which have been in the media lately, are not unique to us.
At this stage, we can only assume that it would be for anti-competitive reasons as to why these alleged third parties would have embarked on this action,” the company said.
Crucially, the company continues to look for more information on the unfolding saga and phenomenon, with a view of seeking legal recourse on the matter, executives say.
This, it said, would be done via collaborations with the relevant authorities.
Zimbabwe’s police is already investigating the espionage saga against BAT, whose stock has fallen 12 percent.
Fodya is part of a group of companies owned by tycoon John Bredenkamp, whose involvement in the tobacco sector dates back to the 1970’s.
According to industry observers, the disruptions at the Breco subsidiary or unit shows the depth and extent of the unfolding scam on the Zimbabwean tobacco industry. – Business Writer