29 Short term/Capital
34%
32%
31%
32%
Debt/Asset ratio
60%
58%
57%
58%
Debt/Equity ratio
1.48 1.39 1.32 1.4 Retained earnings/Equity
18%
20%
30%
23%
From the table above, in 2016, 60% of capital employed was through debt of which 26% was long term whilst 34% was short term debt financed mainly through a bank overdraft facility taken from local financial institution. At an average of 58% debt to equity ratio implies that capital at BNC is largely through debt financing.
SWOT Analysis Strengths:
o Strong Safety, Health, Environment and Quality programmes resulting in strong results o Strong cost cutting measures in place resulting in costs going down by 6%. o Good company employee relations high motivation and skills retention. o Sales growing by 18% Financial Year 2018. o Board diversity and good corporate governance practices. Weaknesses o Poor funding prospects for the shaft re- deepening project o Negative working capital in 2017 o Going concern threatened i) High power costs ii) High dependency on overdraft iii) Delays in completion of smelter project Opportunities o Increased international demand if the Philippines are restricted o Growth in global prices by tonne o London Metal Exchange cash settlement rose by 29% o World decline in the production of ore o High prospects of demand due to i) Growth in the Chinese stainless steel market ii) Growth in the use of nickel in batteries iii) Chinese production cut down o Huge mineral base o Compound minerals Threats o Unclear mining bill or act indigenisation o Existing threats to investment property rights) o General macroeconomic challenges o Currency challenges Given the opportunities According to
the Zimbabwe Geological Survey, the country has got huge potential in komatiite and laterite and more than 30
nickel deposits are knownUsing Electronic copy available at https://ssrn.com/abstract=3521211
30 advanced SWOT model to identify the most significant factors of the analysis from all the items listed. The identified
or highlighted strengths,
weakness, opportunities and threats shall be prioritized. Prioritization The strengths and weaknesses are evaluated on 3
categories as follows
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