RioZim Limited, once a cornerstone of Zimbabwe’s mining sector, has reported a sharply deteriorating financial position, with its net loss widening by 81% during the first half of 2025.
The company’s interim financial results reveal an operation in deep distress, unable to capitalise on historically high global gold prices due to crippling production declines and entrenched operational failures. Despite a recent capital injection and a full management restructuring, RioZim faces material uncertainty regarding its ability to continue as a going concern. This concern is amplified by a severe liquidity crisis, with current liabilities exceeding current assets by ZWG 2.9 billion, while total equity has fallen to a ZWG 1.20 billion deficit.
Financial Performance: Losses Soar as Revenue Collapses
RioZim’s net loss increased to ZWG 300.6 million for the six months ended June 2025, up from ZWG 165.7 million in the same period of 2024. This dramatic decline was accompanied by a 92% collapse in revenue, which dropped to ZWG 21.6 million, down from ZWG 282.5 million in the prior comparative period.
Loss per share also worsened significantly, with basic and diluted loss per share rising to 241.00 cents, compared to 135.59 cents in the first half of 2024. The independent auditor’s review explicitly flagged “Material Uncertainty Related to Going Concern,” highlighting the company’s net liability position and recurring losses as serious risks to its future viability.
Operational Collapse Across the Mining Portfolio
The financial crisis stems from a sustained operational breakdown. Gold production had already fallen by 27% to 306 kg in the first half of 2024, and the downward trend continued into 2025.
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Cam & Motor Mine: Production dropped 42% to 130 kg, driven by ore supply shortages and delayed pit development.
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Renco Mine: Output declined 9% to 176 kg.
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Dalny Mine: Remained on full care and maintenance.
These struggles sharply contrast with the performance of competitors such as Padenga and Caledonia, which produced 1,351 kg and 1,072.2 kg of gold respectively during the same period.
RioZim’s failure to benefit from rising gold prices—averaging US$3,075/oz in 2025 compared to US$2,165/oz in 2024—underscores the severity of its operational shortcomings.
Diamond Portfolio Adds to the Pressure
RioZim’s associate, RZM Private Limited, operator of the Murowa Diamonds mine, also contributed to the downturn. The associate swung from a profit to a loss, recording a ZWG 28.0 million share of loss for RioZim, compared to a ZWG 5.6 million profit in the prior period.
This was driven by persistent declines in global diamond prices, which eroded profitability and cash flow. Although Murowa is attempting a recovery strategy—including a shift to in-pit mining to improve ore grades—operational activity during the period remained subdued.
Undercapitalisation: The Root of the Crisis
Chairman Caleb Dengu attributed the company’s collapse to “persistent undercapitalisation over the past three years.” Chronic underfunding prevented essential maintenance, fleet renewal, and investment in critical processing infrastructure.
A pivotal moment occurred in 2019 when ore at Cam & Motor transitioned from oxide to refractory sulphide, requiring a US$35 million processing plant upgrade—a cost RioZim could not meet. The failure to invest at this stage precipitated years of declining production and escalating losses.
Restructuring Efforts and Signs of Stabilisation
In response, RioZim initiated an aggressive restructuring strategy:
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A new Board was appointed in July 2025.
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Renco Mine was successfully reopened, securing more than 1,000 jobs.
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Advanced negotiations with a strategic investor were concluded after the reporting period, resulting in a critical capital injection.
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Restoration work at Cam & Motor Mine is underway, with full-scale production expected before the end of 2025.
Legal Challenges Threaten Recovery
Despite these efforts, RioZim’s path forward remains uncertain. A stakeholder has filed to have the group placed under corporate rescue, creating significant legal and operational instability.
Meanwhile, the Zimbabwe Diamond and Allied Minerals Workers Union rejected RioZim’s US$160,000 settlement offer to withdraw the corporate rescue application, insisting that corporate rescue is the only viable mechanism to prevent total collapse.
This stands in stark contrast to the company’s historic performance—once producing over 2,000 kg of gold annually, RioZim has suffered an estimated 85% decline in production over the past eight years.
Outlook: A Narrow Window for Survival
RioZim stands at a critical crossroads. The 81% widening of losses to ZWG 300.6 million reflects the culmination of years of operational decline, underinvestment, and management instability. While the recent capital injection and board overhaul provide essential lifelines, the company’s deeply negative equity position and active corporate rescue proceedings pose major obstacles.
The success of the turnaround strategy will depend on:
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A sustained ramp-up of production at Renco and Cam & Motor,
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Stabilising the financial position through strategic funding,
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And achieving a favourable legal outcome.
With gold prices expected to remain elevated, RioZim has a narrow but significant opportunity to align restored operational capacity with strong market conditions. Whether the company can achieve a sustainable recovery, however, remains uncertain.