CEC 2023 Annual Report
Misenge Environmental and Technical Services Limited (METS) Extract from 2023 Annual Report
Misenge Environmental and Technical Services Ltd (METS) is a subsidiary of ZCCM-IH, and its business activities is to provide a wide range of environmental, analytical, radiation safety, and engineering services. METS prides itself on being a multifaceted, full-service company with a strong record in environmental management within Zambia’s mining and mineral processing industry. Its service range includes environmental impact assessments, environmental compliance audits, mineral sample preparation, water supply and sewerage systems design, radiation safety management, and many more. The company operates with a clear vision to lead in providing its specialized services in Zambia, driven by a mission to deliver these services efficiently to maximize shareholder value .
For the fiscal year ended December 31, 2023, METS reported a total of ZMW 14.63 million in revenue for the year ended 31st December 2023 (2022: ZMW10.61 million restated), and net loss of ZMW6.48 million (2022: profit of ZMW1.01 million restated) The company has been actively seeking to increase third-party business by participating in several bids during the year.
There were no dividends declared during the period under review (December 2022: Nil).
Lubambe Copper Mines Limited Extract from 2023 Annual Report
Lubambe Copper Mine Limited (Lubambe) reported total revenue of ZMW2.52 billion (US$ 122.59 million) (2022: ZMW2.38 billion (US$139.72 million)). Over the same period, the Company recorded a loss of ZMW3.06 billion (US$ 148.86 million (2022: loss of ZMW1.83 billion loss (US$107.12 million)). Lubambe’s road to recovery was challenging due to poor ground conditions, dewatering challenges, and high ore dilution. Management changed its mining methods and mine plan following completion of the SRK technical report. In the period under review, the company implemented its 420-pump station to improve flooding and ground conditions for mining. Lubambe produced 14,984 tonnes in payable copper against a budget of 22,979 tonnes.
Lubambe completed the US$150 million investment by Kobold which was for debt restructuring and operations of the business. This also resulted in the separation of the highly promising Extension Project into Mingomba Mining Limited (Mingomba) with ZCCM-IH still retaining 20% in both Lubambe and Mingomba. US$35 million of the funding was committed for Mingomba explorations. This has been on-going throughout the period under review. Lubambe’s existing licence has a remaining life of the mine of less than 7 years and there is need to explore new business opportunities.
There were no dividends paid during the year (2022: Nil).
Consolidated Gold Company of Zambia Limited (CGCZ) Extract from 2023 Annual Report
The Consolidated Gold Company of Zambia Limited (CGCZ) represents a collaborative venture between ZCCM-IH, holding a 45% stake, and Karma Mining Services and Rural Development, with a 55% share. Established in 2020, this Special Purpose Vehicle is dedicated to establishing a central hub for gold processing and trading within Zambia.
During the year ended 31st December 2023, the Company produced 90.6kg (2022: 50.7kg) of gold, the majority of which was sold to Zambia Gold Company. Revenue for the year ended 31st December 2023 was ZMW54.20 million (2022: ZMW 50.81 million). CGCZ recorded a loss for the year of ZMW9.44 million (2022: -ZMW8.76 million)
Due to ongoing profitability challenges stemming from the company’s inability to control the supply of gold feedstock, the ZCCM-IH Board approved a divestiture from CGCZ. The Share Purchase Agreement and the Deed of Mutual Termination were executed during the year, awaiting the fulfilment of the condition’s precedent specified in the agreement. ZCCM-IH is set to recover its initial investment of US$1.568 million over three years. Karma has already paid an upfront fee of US$679,600.
CNMC Luanshya Copper Mines Plc (CLM) Extract from 2023 Annual Report
The principal activity of the Company continued to be the mining of copper and exploration for other base and precious metals.
As at 31st December 2023, CLM recorded revenue of ZMW8.5 billion (US$414.51 million) (2022: ZMW7.95 billion (US$467.47 million). The drop in year-on-year revenue was attributable to a reduction in copper production due to the loss of ore from Baluba underground mine which was decommissioned in December 2022. During the period under review, CLM produced a total of 48,904 tonnes of copper compared to copper output of 53,952 tonnes produced in 2022.
Key developments:
CNMC Luanshya Copper Mines (LCM) is set to revitalize the old Luanshya Mine with a $500 million investment, aiming to create over 3,000 jobs and annually produce 40,000 tonnes of copper concentrate. This initiative comes after the mine was dormant for 22 years due to waterlogging issues. The feasibility study for reopening the mine is underway, with dewatering scheduled to start in April 2024 following the rainy season.
For the year ended 31st December 2023, the Company recorded a profit of ZMW2.93 billion (US$142.71 million) (2022: ZMW1.68 billion (US$98.71 million). Despite a drop in copper production, strong copper price and cost reduction initiatives led to the increase in profitability in 2023.
Due to this improved performance and positive equity position, the Company declared dividends of US$30 million with US$6 million paid to ZCCM-IH (2022: US$70 million was declared).
Kariba Minerals Limited (KML) Extract from 2023 Annual Report
Kariba Minerals Ltd, a subsidiary of ZCCM Investments Holdings (ZCCM-IH), is renowned for producing some of the world’s quality amethyst, a semi-precious gemstone. The company primarily exports to China and India among others and during the year under review, KML produced a total of 1,392.52 tonnes of amethyst which comprised of 374.12 tonnes medium and high grade, and 1,018.40 tonnes commercial grade (2022: 1,503.58 tonnes – 327 tonnes medium and high grade, and 1,175.76 tonnes commercial grade.)
For the year ended 31st December 2023, Kariba Minerals Limited (KML) reported total revenues of ZMW29.87 million (2022: ZMW23.04 million) with a net profit of ZMW0.55 million (2022: net loss of ZMW5.19 million).
The ZCCM-IH Board approved funding amounting of US$4.077 million for the execution of the Kariba Minerals Limited’s Turnaround Plan. This funding aims to improve the company’s production capabilities, fostering market development and expansion, strengthening the balance sheet, enhancing operational efficiency, and improving its overall financial performance going forward. The overarching objective is to transform the company from loss making to profit making.
There were no dividends declared during the year (2022: Nil).
Limestone Resources Limited (LRL) Extract from 2023 Annual Report
Limestone Resources Limited, formerly known as Ndola Lime Company, is specializing in the production and supply of limestone products. Its diverse product line-up includes quicklime, hydrated lime, and other lime product tailored to meet specific customer needs.
The transition from Ndola Lime Company to Limestone Resources Limited represents a strategic move to address past challenges and leverage on new opportunities. This change signals an intent to revitalize the business, possibly by attracting new investment, improving operational efficiencies, and better aligning with market demands. Limestone Resources Limited’s journey reflects a commitment to not only continuing its legacy of quality limestone product supply but also enhancing its operational and financial health for future success.
Limestone Resources Limited has an opportunity to attract fresh capital, revamp the business, and potentially cut the losses experienced by its predecessor, Ndola Limestone.
During 2023, LRL continued to build up on the knowledge and experience of operating the modified VK2 which was fired in October 2022 after nearly 6 years of being idle. The modification and the prolonged idle time presented initial challenges which took time to resolve. VK 2 was the only operational kiln at the company as no restoration repair works were carried out on VK1, while the Rotary kiln remained mothballed.
Production from VK2 was an average of 140 tonnes per day against the kiln’s capacity of 500 tonnes per day due to technical limitations on the kiln’s operating mode. Another key stumbling block to attain nameplate capacity was a lack of reliable mining equipment and a frequently malfunctioning crushing plant.
Revenue for the year was ZMW96.7 million, a notable increase from ZMW26.8 million in 2022. The company made a loss of ZMW180.74 million (2022: ZMW90.81 million).
There were no dividends declared during the year under review (Dec 2022: Nil)
NFC Africa Mining Plc (NFCA) Extract from 2023 Annual Report
For the year ended 31 December 2023, NFCA reported revenue of ZMW12.8 billion (US$619.82 million), (2022: ZMW9.9 billion (US$548.46 million)). The drop in year-on-year revenues were attributable to lower-than-expected production during the year due to a suspension of operations that occurred in November 2023. During the year under review, NFCA produced a total of 68,757 tonnes of copper compared to copper output of 67,626 tonnes produced in 2022.
During the period under review, the Company recorded a profit of ZMW1.5 billion (US$76 million) (2022: ZMW1.01 billion (US$56.01 million)). Despite a drop in copper production, strong copper price and cost reduction initiatives led to the increase in profitability in 2023.
The company currently has a high debt burden and the increase in US Dollar denominated lending rates has significantly increased the company’s interest costs.
There were no dividends paid during the year ended 31 December 2023 (2022: ZMW51.78 (US$3 million)).
Chambishi Metals Plc Extract from 2023 Annual Report
During the period under review, Chambishi continued to be under care and maintenance due to lack of feedstock for the plant and other strategic reasons.
There were no dividends paid during the year under review (2022: Nil).