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CEC posts 275 million in profits despite challenging business environment

The Copperbelt Energy Corporation has posted a profit of K275 million in the first six months of 2016, up from K225 million record for the previous period.

The increase in profits is mainly attributed to increased power sales to the DRC mines and increased sales at its telecoms unit.

Revenue at half year increased by 40% from K2.252 million to K3.776 million.

This is mainly on account of increased power sales to the DRC mines.

This is according to the company’s half year financial results released yesterday.

CEC however recorded a net loss of K1.669 million compared to a net loss of k571 million the previous period.

“Net loss is mainly attributed to an exchange loss of ZMW1.140 million arising from the devaluation of the Naira on USD borrowing and bad debt provision of K516 million,” it said.

In March 2016, the Company paid a total of K163 million in dividends.

“The macroeconomic environment in Nigeria continued to pose some challenges to the Group’s operations as well as low commodity prices which impact on our customers’ liquidity and ability to meet their financial obligations. The depreciating Naira resulted in increased foreign exchange risk, translating into a loss of K1.140 million,” it said.

“Operationally on the Zambian end, the business continued to operate under the partial force majeure under the Bulk Supply Agreement with our main power supplier and the respective Power Supply Agreements with our mine customers. This entails that we can only access 70% of our power requirements from Zambian sources while the rest of our requirements have to be sourced outside of the country.”

The company said it is expected that this regime will continue until year end.

“The challenges relating to low commodity prices on the global market have led to some of our customers scaling back on their operations with the effect.

Source: Lusaka Times

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