METS Extract from 2017 Annual Report

Misenge Environmental and Technical Services Limited (METS) earned a total of K8.80 million as revenue for the year ended 31st March 2017 (2016: K6.22 million).

K2.63 million of the total revenue, was realised from recurring services to ZCCM-IH (2016: K5.15 million) and K6.17 million was from non-ZCCM-IH sources (2016: K1.10 million). METS recorded a loss before tax of K1.25 million (2016: K2.90 million loss).

During the year under review, ZCCM-IH advertised for the purchase of Fume extractors and Dust extractors to be installed at the Kabwe Analytical Laboratory. When the remaining works at the laboratory are complete, METS will be in a position to provide more analytical services at the laboratory and increase revenue.

There were no dividends declared during the year under review (2016: Nil).

Investrust Plc Extract from 2017 Annual Report

Investrust Bank Plc (Investrust) recorded an 8.22% decrease in net interest income to K40.82 million during the year ended 31st December 2016 (2015: K37.72 million). Interest rates on loans and advances were adjusted upwards following the removal on the lending rate caps for commercial banks. Nonetheless, the growth in net interest income remained constrained due to the high cost of funds on term deposits which form a significant part of Investrust’s deposit base.

Total operating expenses reduced by 19% to K148 million (2015: K183 million). This was mainly attributed to a non-recurring expense in respect of redundancy and severance booked the previous financial period. Salaries and staff benefit costs declined by 4% to K65 million (2015: K67 million). During the year under review, the bank recorded a loss of K48 million (2015: K51 million).

During the financial period, Investrust embarked on a capital raising exercise through a Clawback Rights Offer to meet the minimum capital requirement set by Bank of Zambia. ZCCM-IH fully underwrote the offer. Subsequent to the completion of the Rights Offer, ZCCM-IH’s shareholding increased from 10.6% to 48.6%. In the latter part of the financial period, Investrust undertook another capital raise through the issuance of non-voting preference shares, which saw the bank’s primary capital increase beyond the minimum capital requirement.

The bank’s share price on the LuSE closed the period under review at K13.50 (2014: K13.50).

There were no dividends declared during the financial year ended 31st December 2015 (2014: Nil).

CEC Extract from 2017 Annual Report

The Company continued to be listed on the LuSE and has 50% direct shareholding in CEC Liquid Telecommunications Limited, a joint venture company registered and domiciled in Zambia. CEC Liquid Telecom wholly owns Hai Telecommunications Limited.

During the financial year ending 31st December 2016, adjusted EBITDA was K888.12 million (US$90 million) compared to K520.35 million (US$80 million) the previous period posting an increase of 12.5% average. The increase in adjusted EBITDA is attributed to increased power trading income and the aggressive cost management initiatives, which impacted positively on the results.

Revenue at K3,503.14 million (US$355 million) was equivalent to the revenue in 2015 despite a drop of about 15% in domestic power supplies which had an equivalent reduction in domestic power sales from K2,743.3 million (US$278 million) to K2,180.83 (US$221 million.)

The increase in power trading supplies resulted in an overall increase of 86% in power trading revenue, which compensated for the drop in domestic power sales. Overall, domestic power sales remain the prime revenue source contributing 62% of the total revenue down from 78% the previous year, with power trading revenue increasing from 18% the previous year to 34% of total revenue.

The demand for electricity is expected to increase following plans to ramp up production on account of NFCA’s South East body project, MCM’s Synclinorium and KCM’s Konkola Deep Mining Project.

CEC Liquid Telecom continues to outperform past financial and operational results. Revenue at K207.23 (US$21 million) grew at 17% while gross margin and EBITDA increased by 10% and 33% respectively. The above financials are based on consolidated results of CEC Liquid Telecom incorporating Hai. The company, during the year, secured long term funding to support its expansion projects; mainly new backhaul bandwidth fibre connecting Zambia to Botswana and Namibia. This enables the creation of a robust network, reinforcing the strategy of operating the Zambian network as a regional hub. Further, the business commissioned its first investment in LTE spectrum, a wireless solution for provision of connectivity solutions as an alternative to fibre solution. Further investments are planned in this area to grow the business and realize the expected market disruption.

Effective 30th December 2016, CEC Africa was separated from the CEC Group and is now a sister company to CEC Plc rather than its wholly owned subsidiary. At an EGM held on 9th December 2016, the shareholders, on the proposal of the board, resolved to dividend out CEC Africa as a distribution to the shareholders of CEC. Hence, a dividend in specie of CEC Africa from CEC Plc to its shareholders was made. The effect of that transaction is that both CEC Plc and CEC Africa are now held by the same shareholders. The action was premised on the assumption that shareholders must be allowed to measure the performance of the two entities separate from each other as they face very different risks, and to enable the shareholders retain any upside that may occur in CEC Africa in the future.

The future business outlook for CEC Plc is positive, with growth expected to be derived from the increase in local power supply demand arising from the commissioning of new mine projects currently under construction.

The positive outlook in the copper price demand forecast has further ignited mining activities in Zambia and the DRC, creating an opportunity for increased demand. Lastly, growth is expected to come from the strategy around power trading and focus on the DRC mining supplies market in addition to the support for industry-wide cost reflective tariffs.

During the year, the Company paid out two dividends to its ordinary shareholders, the first being a cash dividend of K161.84 million (US$16.4 million) paid in the first quarter of 2016. The second dividend was a dividend in specie of CEC Africa of K9.68 (US$1). This dividend was paid on 30th December 2016.

The CEC Board on Tuesday, 7th February 2017 recommended an interim dividend of US Cents 1.29 per ordinary share, which translates to 12.80 Ngwee (K0.1280) per share, using the Bank of Zambia mid-rate applicable on the date of declaration. The dividend was paid to the shareholders registered in the share register of the Company at the close of business on Friday, 3rd March 2017.

Download Full Report

NFC Africa Mining Plc Extract from 2017 Annual Report

NFC Africa Mining Plc (NFCA) recorded a turnover of K1,716.05 million (US$173.9 million) for the financial year
ending 31st December 2016 (2015: K677.11 million (US$104.1 million) as a result of increased sales volumes.

NFCA recorded a loss after tax of US$31.1 million (2015: K45.8 million loss).

NFCA continues to work on the development of the South East Ore Body project. The company reported project expenditure of K2,666.33 million (US$270.2 million) as at 31st December 2016. Total planned project investment is K8,537.65 (US$832 million). Once completed, the project is expected to extend the life of the mine for 20 years. The design and annual capacity at full production is estimated at 3.3 million tonnes of ore containing 60 000 tonnes of copper.

There were no dividends paid during the year ended 31st December 2016 (2015: Nil).

Ndola Lime Company Ltd Extract from 2017 Annual Report

Ndola Lime Company Limited (NLC) reported total revenues for the financial year ended 31st March 2017 of K89.6 million (2016: K196.6 million) and a loss before tax of K1,163 million (2016: K82.3 million loss).

Major contributors to the loss was lower sales of 75.7% (K279.4 million) below budget, impairment of the plant amounting to K861 million, finance costs and penalties on overdue Zambia Revenue Authority (ZRA) tax obligations totalling K93.7 million.

Ndola Lime Company (“NLC”) has been working on optimizing a second vertical kiln (“VK-2”) to be powered by coal that will result in additional capacity of 500 tonnes per day. The primary objectives of the VK2 is to substitute the inefficient and out-dated operations of the Rotary Kiln and reduce operational expenses attributable to the use of Heavy Fuel Oil (“HFO”) through the use of coal. Following the perennial escalation in costs related to the Recapitalization Project (RP) and adverse financial performance from the latter half of 2013 onwards, owing to a myriad of factors including significant escalations in the price of HFO, loss of market share, ZCCM-IH resolved to finance the completion of the RP which has cost about $105 million to date. The hot commissioning of the project started in December 2015. However, the commissioning of the project has been met with a lot of challenges.

There were no dividends declared during the year under review (2016: Nil).

Mopani Copper Mines Plc Extract from 2017 Annual Report

During the financial year ending 31st December 2016, Mopani Copper Mines (MCM) recorded net revenue of
K2, 519.99 million (US$255.37 million) (2015: K7, 291.43 million (US$1,121 million). The net loss was at K1, 776.14 million (US$179.99 million) (2015: K1, 853.75) US$285 million net loss).

During the year ending 31st December 2016, MCM produced a total of 41,100tonnes of copper from own sources (2015: 92,100 tonnes). The 55% lower production figures in 2016 compared to 2015 were driven by the partial suspension of production, which were aimed at improving MCM’s operations and cost reduction. Progress was made in the upgrading as MCM’s Synclinorium Shaft at Nkana was commissioned and started to hoist ore at the end of 2016.

During the year under review, Mopani produced 41,100 tonnes of copper from own sources and this was 51,000 tonnes (55%) lower than the previous year due to the partial suspension of production while the major upgrade projects are being completed.

There were no dividends paid during the financial year ended 31st December 2016 (2015: Nil).

Lubambe Copper Mines Extract from 2017 Annual Report

Lubambe continued with restructuring through downsizing of output and the reduction of related labour cost.
The largest contributors to the unit cost savings were a reduction in labour cost due to a 66.00% reduction in expatriate labour, a reduction in stoping dilution obtained through an improvement in the mining stoping method, and a 4.00% increase in plant recoveries obtained through plant optimisation initiatives.

This is the first reporting period in which Lubambe operated in accordance with the reduced production target of 80,000 tonnes of ore per month. The reduced target was implemented in March 2016 to curtail operating losses, save cash and preserve the ore body whilst implementing a strategy to upgrade the underground dewatering infrastructure.

During the period under review a labour restructuring programme was successfully concluded which aligned the total labour complement with the revised lower production rate of 80,000 tonnes per month. Ongoing capital expenditure was curtailed to preserve cash with the majority of expenditure being incurred for mine ramp development.

The Lubambe Extension Project was put on hold until an opportune time when conditions are suitable for additional investment. This high-grade area remains an integral part of the future development of the Lubambe ore body.

During the second half of 2016, more than 300% increase in underground pumping capacity was obtained through the successful upgrade of the underground pumping infrastructure. The upgrades enabled Lubambe to dewater all declines that were previously flooded for a period of 10 months. Following the dewatering, substantial progress was made in the development of the declines. During November and December 2016, decline development advance was well in excess of requirements for sustainable production. This achievement will enable Lubambe to obtain access to new ore development areas at a faster rate, which will enhance the ability to ramp-up mining production.

There were no dividends declared during the year under review (2015: Nil).

Chibuluma Mines Extract from 2017 Annual Report

Revenue for the financial year ended 31st December 2016 was K492.41 million (US$49.9 million) (unaudited)
(2015: K432.54 (US$66.5 million)). Net loss over the same period was K29.60 million (US$3.0 million) (2015: K127.49 million (US$19.6 million). Chibuluma Mines Plc’s (CMP) cash position increased to K16.83 million (US$1.64 million) as at 31st December 2016 (2015: K0.42 million (US$0.056 million).

Production continued to be negatively affected by the poor availability of mining production equipment due to frequent breakdowns of machines, a typical feature of an aged fleet, which coupled with depleting ore reserves resulted in reduced volumes and contributed to constrained cash flow at the company.

The Company has been making progress towards commissioning of the Chifupu Mine Project and was awaiting the installation of 220 Kw ventilation fans to service lower production mine levels.

The company continued implementation of various cost saving and cost containment initiatives to ensure it achieved its set Key Performance Indicators and advance from a loss to a profitable position.

Management was also focusing on identifying and progressing viable initiatives which would assist in extending the footprint of the Jinchuan/Metorex Group in Zambia beyond the current Life of Mine.

No dividends were paid for the financial year ended 31st December 2016 (2015: Nil).

Chambishi Metals Extract from 2017 Annual Report

The Company made a profit before tax of K43.42 million (US$4.4 million) (2015: Net loss of K260.83 million
(US$40.1 million) and its current liabilities exceeded its current assets by K2,776.79 million (US$270.6 million) (2015: net current liability position of K1,885.63 million (US$289.9 million). The Company also had a deficit in shareholder funds of K1,232.42 million (US$120.1 million) (2015: Deficit in shareholder funds of K809.80 million (US$124.5 million).

The Eurasian Resources Group has confirmed its intention to continue to provide financial support to the Company to enable it to continue its operations and meet its obligations.

No dividends were paid in 2016 (2015: Nil).

KCM Extract from 2017 Annual Report

Konkola Copper Mines (KCM) reported total revenue of K8,621.47 million (US$874.3 million) for the financial
year ended 31st March 2017 (2016: K9,607.04 million (US$972.5 million). The reduction in revenue was attributed to lower metal prices through a large part of the financial year, with copper prices surging upwards in the latter quarter thereof. The net loss for the year was at K1,367.72 million (US$138.7 million) (2016: K3,685.75 million (US$373.1 million loss).

Total finished copper production during the financial year was marginally down 1.1% to 180 000 tonnes for the year ended March 2017 (2016: 182 000) compared to the previous financial year.

During the year under review, KCM production volumes were constrained due to the Nchanga Underground Mine being placed under care and maintenance on the tail end of the previous financial year and lower equipment availability across other operating units.

Moving forward, KCM’s strategy continues to be underpinned by vigorously pursuing higher operating productivity levels at the Konkola underground mine, more reliable TLP facility with potential to increase recoveries, increased usage of the smelter by processing third-party concentrates from Zambia and DRC, and improved cost cutting measures.

There were no dividends declared during the year under review (2016: Nil).