ATTACHMENT REPORT OF NGONIDZASHE SIMBABURE B0923808 AT HUNYANI FORESTS LTD

ATTACHMENT REPORT OF SIMBABURE.A.NGONIDZASHE (B0923808)

AT HUNYANI FOREST LTD

ATTACHMENT REPORT OF SIMBABURE. love and legacy I will always cherish. I pray that their souls rest in internal peace.A.Dedication This report is dedicated to my fiancé and not forgetting my late mother Sophia and father Moses.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD . whose inspiration.

The report seeks to provide a more detailed and analytical view of Hunyani Forests limited and my understanding of the company. Chakupa for having afforded time with me regardless of the pressing nature of his work.A. the attachment period opened new avenues for me as I have managed to close the gap between theory and practice. Stocks controller Mr. I also want to extent my sincere gratitude to the following people who helped me throughout my attachment period: Creditors controller Mr. Mabhiza. Besides facilitating the fulfillment of the requirements of my degree program. Wisi. ATTACHMENT REPORT OF SIMBABURE.Acknowledgement Many thanks go to Hunyani Forest Limited’s Management especially the Finance Manager Mr. Kapungu and the entire staff members at large.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD . Cashier Mr. I really appreciate it. Debtors and Salaries Administrator Mr. its adaptability to the Zimbabwean economy and the operations of the company in relation to the Bachelor of Commerce. Chidukutse.

NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD .A.Executive Summary It was a one year of work related learning which was spent at Hunyani Forest Limited a division of Hunyani Paper and Packaging Limited with special emphasis being ATTACHMENT REPORT OF SIMBABURE.

ATTACHMENT REPORT OF SIMBABURE. objective.OVERVIEW This report is organized in the following order. mission. scope and limitation of the attachment. weakness and failure at the same time providing remedy to negative issues. Chapter five: KEY ORGANIZATIONAL ISSUES This chapter aims in providing a summarized bird’s eye view of the company in terms of its success.A. Chapter three: OPERATIONS AND PROCEDURES This chapter starts by providing a review of the timber industry and then discusses principal products with regards to their production. Chapter two: STRUCTURE OF THE COMPANY This chapter provides the company structure and also went on further in discussing the vision. and values. Chapter six: CONCLUSION Major discrepancies between the attachment and the requirements of the degree and cited together with the recommendations. Chapter one: INTRODUCTION This chapter explains the purpose. Chapter four: THE FINANCE DEPARTMENT These chapters focus much in the Finance department providing finer details of its structure and the accounting system. It also provides an in-depth introduction of the company (Hunyani Forest Limited Division) and that of the Holding Company including the historical background. sales and distribution.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD .

Chapter seven: APPENDIX AND REFERENCE This chapter aims to make an appreciation to the information source provider cited in the report. Mission.2. Objectives and Values 2.2 Hunyani forest limited structure 2.2.3 Departmental structures CHAPTER 3: Operations and procedures Timber industry review General overview and cycle of procedures Principal product and services ATTACHMENT REPORT OF SIMBABURE.2.NGONIDZASHE (B0923808) i ii iii iv v vi vii AT HUNYANI FOREST LTD .2.A. TABLE OF CONTENTS Dedication Acknowledgement Executive summary Overview Table of contents Table of figures Abstract Chapter one: INTRODUCTION 1 1.1 Holding company structure 2.2.1Purpose and scope of the attachment 1.2.2Historical background 1.2 Hunyani forest limited 1.1 Hunyani holding company 1.3 Other divisions Chapter two: STRUCTURE OF THE COMPANY 2.1Vision.2 Company structure 2.

Recommendations ATTACHMENT REPORT OF SIMBABURE. and distribution Competition and survival Chapter 4: The finance department and the accounting systems Book keeping Debtors section Creditors section Salaries and wages section Chapter 5: Key organizational issues Threats and weakness Success vs failure Market client perspective Threats. sales.Principal products Inputs and suppliers Production procedures Main markets.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD . Chapter 6.A. Conclusion Discrepancies.

Two divisions: Hunyani paper and packaging and Hunyani forest limited (then Hunyani ATTACHMENT REPORT OF SIMBABURE. and boxes. Amalgamated Packaging comprised: Corrugated container division which manufactured corrugated paper. books.A.CHAPTER 1 1. In 1981 a restructuring was done and the main reason was to:• Create management information systems and control along products lines. • Identify clearly the divisions with their product names. Selukwe Timbers Limited which grew timber. board. about 45kms west of Harare. HISTORICAL BACKGROUND Hunyani Holding Company Hunyani holdings was formed in 1951 known as Rhopulp and listed on the stock exchange in 1952. 1979 that Rhopulp was renamed Hunyani Pulp and Paper Industries Limited with Amalgamated packaging industries and Rhodesia Packaging as subsidiaries. Liquid packaging division which manufactured conical container or opaque beer packaging and Paper sack division which manufactured paper sacks and self opening bags. Rhodesia packaging (pvt) subsidiary comprised Carton and paper division which manufactured litho carton packaging. and brown paper for conversion into Kraft. In January 1979 Rhopulp acquired Amalgamated Packaging industries (Rhodesia) Limited and Rhodesia Packaging (pvt) Limited. The company managed to grow both in size and strength through acquisitions and mergers. Rhopulp was located in Norton. It produced suitcases. and paper bags. file covers. books and magazines and the Tissue products division which manufactured toilet rolls and hand towels. It had a subsidiary.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD . • Establish a company corporate identity under the Hunyani banner. labels. It was then a foreign controlled company. The restructuring resulted in the company being renamed Hunyani Holdings. It was also in this year. test liner.

and was financed through floating interest rate debt.8% to Zimbabwean investors with the government acquiring 61. thereby forming part of equity. Flexible. The transition of the economy in the 1990. The other subsidiary Hunyani Forest focused mainly on the production and provision of timber and pulp to its sister Subsidiary division. The syndicate of financial institutions who were exposed to debt agreed to a rescue plan in 1993 which saw them being issue with two classes of A and B convertible preference share. Properties. That restructuring saw Hunyani Paper and Packaging Limited being changed to Hunyani paper and packaging (1997) (pvt) ltd [(HPPL) (1997) (PVT) Ltd] division. The warrants traded at stock exchange at market value. The warrants on expiry were out of money and thus the company got rid of the preference shares for free. The company then had a gearing ratio of around 80% and almost went into liquidation. This enabled the company to redeem all its debts which amounted to $ZW 90 000 000 and embarked on a modernization and restructuring process that enabled it to attain a blue chip status. a packaging conglomerate from South Africa injected $ZW 180 000 000 through a private share issue.s from a closed to an open market saw the increased in competition through substitutes and imported better quality.A. In an attempt to prepare for the increased competition the company embarked on an ambitious modernization program in the early 1990s.60. This reclassification improved the gearing to 14%. Paper Sacks. Flexible which had a tax loss os $ZW 50 000 000 was also divisionalized under HPPL (1997) (pvt) ltd. Printopack.85.6% of that. Corrugated Products.85. The main subsidiary : Hunyani paper and packaging carried out its business through eight divisions namely Carton and Print. HPPL (1997) (pvt) ltd now operated under five divisions: Corrugated products. Owing to the need of the holding company Hunyani forest was made one of the divisions and operated under the same umbrella of the five ATTACHMENT REPORT OF SIMBABURE. In 1997. The warrants issued un place of preference A shares were exercisable over a three year period whereby a warrant holder would subscribe for an ordinary share at $1. then this was its main objective In 1988 two major external shareholders sold 79. increase competition from plastic saw Hunyani Holdings acquire a plastic company flexible company through a share issue and a $ZW 30 000 000 cash adjustment. Management Service. In September 1998 a foreign investor Nampak Limited. Pulp and Paper and Tissue Products.The share price soon dropped below the strike price during the period the warrants were valid. The program was not a success as interest rates soared to over 40%. The total acquisition price was $ZW 130 000 000. The profit of HPPL (1997) (pvt) ltd was used to offset the tax loss.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD .At the time of issue the market price was $3.Timbers) came up. Conical containers. Their loans were reclassified as shareholder loan. A further restructuring was done in April 1996 where the share structure was simplified to a single class of ordinary shares and detachable warrants were issued to Preference A shareholders at a strike price of $1. Pulp and Paper and Management services with Hunyani Forest ltd as its sister division.

NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD .A.The generalized diagram below shows the current organogram oh Hunyani Holding after its structuring since 1951. Table 1 HUNYANI HOLDINGS Hunyani Paper and packaging (1997) (pvt) ltd.Divisions. Corruga ted product s Division Flexibl e Divisio n Pulp and Paper Divisi on Managemen Hunyani t Forest servi ce Division Hunyani Forest Limited historical background ATTACHMENT REPORT OF SIMBABURE.

ATTACHMENT REPORT OF SIMBABURE.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD .A.

NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD . Corrugated Division General information Operations ATTACHMENT REPORT OF SIMBABURE.Other divisions of Hunyani holding company 1.A.

Printopak Division General information ATTACHMENT REPORT OF SIMBABURE. Flexible packaging manufactures paper-based packaging products. supplying a diverse market with products that include a variety of sacks and bags. It specialize in the production of specialized packaging covering the tobacco. It is a key supplier of double-wall board cases of tobacco processing companies. The range include multiwall paper sacks. citrus sectors for local and export markets. cement and lime.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD .Corrugated division manufactures containers to suit a wide variety of commercial and industrial packaging requirements. self opening bags and open mouth bags foe packaging agricultural produce. The packaging products are available in a range brown and bleached Kraft paper of various grams and flexographic printing. 3. 2. horticulture.A. Paper sacks and Unipack. Flexible division General information Operations The division is split into 3 Main units which are Flexible packaging. floriculture. pharmaceuticals and basic food stuff.

Towards the end of 1997 the division was restructured and labor was reduced by 50% i.Operations Specialize in printing of calendars. 4. pharmaceutical and beverage industries. +. plastic coated cartons and high quality labels mainly foe cigarette. detergents. waxed cartons. The division has the corrugated products division as its main customer in addition to exports. laminated cartons. foodstuff. Failure of this division to produce paper will ATTACHMENT REPORT OF SIMBABURE.700 to +.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD . Pulp and Paper Division General information Operations It manufactures Kraft paper for corrugated container packaging division industry. The division had a major plant upgrade in 1999 with the aim of improving quality and efficiency.e. Previously it manufactured several grades. The key cost driver in this division is production volume because of the huge fixed and semi-variable overheads.350. fast food. and books.To improve production efficiency the division concentrated in producing two grades of Kraft paper. The division also manufactures folding cartons.A. magazines.

A. 5. Hunyani properties limited General information Operations This is the corporate administration centre. ATTACHMENT REPORT OF SIMBABURE.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD .adversely affect corrugated products and consequently the major portion of the company’s working capital and cash flow.

A.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD . Holding Company Company structure. ATTACHMENT REPORT OF SIMBABURE.CHAPTER 2: COMPANY STRUCTURES A.

Hunyani Forest Limited ATTACHMENT REPORT OF SIMBABURE.B.A.NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD .

NGONIDZASHE (B0923808) AT HUNYANI FOREST LTD . Objectives and Values ATTACHMENT REPORT OF SIMBABURE.C. Vision.A. Mission.