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Investee Company News

Chibuluma mines confirms 263 jobs are to go

Chibuluma Mines Plc, majority owned by Metorex of South Africa has confirmed that it is sacking off 236 workers as part of its restructuring process.

The firm says the restructuring plan is scheduled to be carried out within the first quarter of 2016.

The company says the restructuring process is inevitable as its Chibuluma South Mine is fast approaching its end of life.

This is contained in a statement released by Chibuluma Mines Plc – Board Chairman Jackson Sikamo.

‘The mining and geotechnical conditions have become more challenging with the costs of mining continuously rising. Chibuluma Mines Plc’s performance in the financial year 2015 has been characterized by low production volumes and this coupled with the continuously falling copper prices has put severe pressure on the Company’s cash-flow,’ Mr. Sikamo said.

‘The Company is in a loss making situation which, if left unaddressed may force the Company to suspend its operations permanently. Management has therefore resolved to restructure the business, in order to ensure the survival of the Company.’

Mr. Sikamo added that the restructuring places focus on reducing mining rates, substantially outsourcing mining and ore transfer activities and significantly reducing overhead expenditure.

‘Through this process, various mine operating survival options have been considered and though the available options are not economically viable, the Company through its majority shareholder Metorex (Pty) Limited has made a strategic long term decision and selected the survival option with the least losses over the life of the mine,’ he said.

Mr. Sikamo outlined the measures such as the continued development of the Chifupu Copper development project to ensure prolonged Mine life from 2018 to 2022.

He also revealed that management has decided to reduce mining output from Chibuluma South to approximately 27,000 tons per month from 45,000 tons and outsource mining and processing plant ore transfer activities as part of the restructuring plan.

Chibuluma Mines Plc was incorporated in October 1997 following the privatization of the then Zambia Consolidated Copper Mines Limited.

The Company’s copper mining operations are located in Lufwanyama district.

ZCCM-IH News

ZCCM-IH shares snubbed

ABANDA CHULU, Lusaka
ABOUT 28 million Government shares in ZCCM- Investment Holdings (ZCCM-IH) that were offered for sale to Zambians have been shunned. Only 0.1 percentage point shares being bought when the offer closed on November 30, 2015.

ZCCM-IH has attributed the poor response to the preferential secondary market offer to the challenges facing the global copper mining industry.

On July 30, 2015, Government offered Zambian citizens 27,961,237 shares, represents 17.4 percent of its shareholding in the mining conglomerate.

In a statement released by Stock Brokers Zambia last week, only 805 applications were received and processed, representing a total of 226,064 shares (0.1 percent shareholding in ZCCM-IH) that were subscribed.

This means the residual shares amounting to 27,735,173 representing 17.3 percent shareholding in ZCCM-IH will still be retained by Government.

Commenting on the development, ZCCM-IH chief executive officer Pius Kasolo said the results of the preferential offer to Zambian citizens signify the challenges facing the global copper mining industry, and particularly the holding company’s significant portfolio concentration in the industry.

Despite the interim concerns, primarily driven by slower than historical Chinese demand for commodities, we are confident that the long-term prospects of the company remain overwhelmingly strong, and that the present difficulties offer a chance to learn, adapt, diversify, and realise benefits from opportunities that would not otherwise be possible under ‘normal’ market conditions,

he said.

Dr Kasolo said ZCCM-IH will remain committed to enhancing long-term shareholder value by continually seeking viable and sensible investment opportunities, while navigating prudently through challenging times.

ZCCM-IH will engage Government on the need to continually approach both Zambian and foreign investors to maximise their participation in the mining sector,

he said.

The shareholding structure subsequent to allotment will now be 60.3 percent which translates into 96,926,669 shares for Industrial Development Corporation, 17.3 percent (27,735,173 shares) for Government but held directly through the Minister of Finance.

National Pension Scheme Authority holds 15 percent, translating into 24,120,043 shares and other shareholders owns 7.4 percent which is 12,018,401 shares.

ZCCM-IH News

1,000 get house offers

KWETO MFULA, Chingola
CHINGOLA residents have been offered to buy 1,000 former ZCCM-Investment Holding (ZCCM-IH) housing units at a cost of K1,337 per unit.

The houses will be offered to sitting tenants in line with Government’s home empowerment policy.

This came to light when Nchanga member of Parliament Wilbur Simuusa and Chingola town clerk George Mulenga met prospective beneficiaries at Banda Market in Nchanga-North yesterday.

Mr Mulenga told sitting tenants that the Ministry of Lands has since prepared letters of invitation of treaty to 500 of them, while the other 500 letters will be done at a later stage.

He said beneficiaries have been given 90 days in which to pay the required amount in full.
Investee Company News

Nationwide power outage impacts KCM operations

HINGOLA, 11TH December 2015, Konkola Copper Mines (KCM) operations and production have been affected by a countrywide power blackout which occurred from about 10:35 PM on Thursday, 10th December, 2015.

Following the power outage, KCM was able to bring on line 16MW of power using its own emergency diesel generator set at Konkola mine supported by another 40MW in emergency power supplied by the CEC from its gas turbines. This power allowed KCM to continue to pump water and withdraw its employees in a planned and disciplined manner. All employees at both the Nchanga and Konkola underground mines were withdrawn without injury or incident.

However, around 04:30 AM on Friday, KCM lost the emergency power supply after the national power system tripped as attempts were being made to reconnect the company to the national grid. Full supply of power was finally restored to KCM at about 09:40AM today. Production was suspended during the power outage.

Consequently, it will take KCM about 16 hours to restart operations at its Nchanga smelter in Chingola. The company will also suffer some slight loss of production at Konkola while pumping out of water continues from the deeper sections of the mine.

The rest of the operations are being systematically returned to production following full safety and environmental checks.

Shapi Shachinda

Manager Public Relations & Communications

Mobile: 0978 871958
Investee Company News

First lady says KCM is trusted development partner

Zambia’s First Lady Esther Lungu has said Konkola Copper Mines (KCM) is a trusted development partner for the country following its expansive social investments in the last 11 years.

The first lady said this when she addressed hundreds of residents of Shimulala, Helen and Kakosa settlements on the outskirts of Chingola, where the company’s corporate head office is located. She visited sites of KCM’s corporate social responsibility (CSR) programmes.

Mrs Lungu commissioned the new Helen Bridge which was constructed by KCM at a cost of Zk877,635.00 (US$82,640.00). She also laid a foundation stone for an Out-Grower project seeking to empower local farmers and toured other KCM-funded CSR projects.

The newly constructed Helen Bridge has eased movements of over 4,000 people living in the area as they carry produce and other goods to markets in Chingola and beyond. It also connects people to health and education facilities outside of their settlements.

The Nabona out-growers programme targets to provide about 500 small and medium scale farmers with access to markets in an organised way to ensure quality and planned production.

I want to urge the community to continue to work closely with Konkola Copper Mines (KCM) because this is your trusted partner. KCMhas stood by you in good and difficult times,

she said.

“I must commend KCM for providing 22 hectares of land on lease to proprietors of Nabona as this will create employment for farmers and the young people,” Mrs Lungu said.

Mrs Lungu also paid glowing tribute to KCM for empowering women with life-saving skills in cattle rearing, tailoring and farming.

“I want to attest that it is evident that KCM has spent US$160 million in communities over the last 11 years,” Mrs Lungu told residents after touring some CSR projects, including the cattle restocking project.

I have seen some of the key projects where these funds have been spent.

She said it was heartening that the company was focusing on four corporate social responsibility pillars, namely education, health, sustainable livelihoods and sport.

The first lady encouraged KCM to continue uplifting the lives of people in its areas of operations. KCM has given out over 596 cattle in Chingola, Chililabombwe and Nampundwe and also provided 2,327 goats to 26 self-help groups.

Mrs Lungu said social investments by KCM fitted into President Edgar Chagwa Lungu’s vision for a public private partnership models for diversifying the economy and shoring up growth.
Investee Company News

Konkola Copper Mines here to stay

hingola, 4th November 2015 – Konkola Copper Mines (KCM)has reaffirmed its commitment towards Zambia’s development agenda despite the current challenges it is facing that have affected its operations.

KCM Chief Executive Officer Steven Din says the company’s investment in the mines amounting to $3 billion dollars over the last eleven (11 years) is a clear demonstration of its commitment to this development agenda.

Mr. Din has said this in a statement in commemoration of the company’s 11th anniversary which falls today.

Mr. Din notes that despite the current challenges KCM is facing such as low copper prices and power deficits, the company’s 50 year vision will ensure that KCM still remains in operation for a long time to come through enhanced sustainable operations of its mines.

He adds that to achieve this agenda KCM is examining local economic development opportunities aimed building up the economic capacity of the communities around KCM’s operations to improve their economic futures and the quality of life for all.

He also highlighted the company’s commitment to its CSR programmes in the areas of rural livelihoods, education, health and sports. KCM has spent more than $160million on its CSR projects since Vedanta acquired its interests in the company.

Hesays the company aspires to use the KCM assets as a catalyst to secure economic activity in the Copperbelt and surrounding areas for the next fifty years and beyond, long after KCM has ceased mining.

KCM is working a 50 year vision but this vision depends on the Copperbelt realizing its potential as an economic hub. Mining alone will not achieve this. Agriculture, tourism, logistics, services and trade will all need to make a contribution,

Mr. Din said.

The CEO is confident that with the right strategy, carefully executed in partnership with government, donors and civil society groups, KCM can add substantially to additional economic activity per year in non-mining sectors and create many jobs.

He further notes that generating employment beyond the life of the mines will be the single greatest economic legacy of KCM in the Copperbelt.

ZCCM-IH News

Copper mining will rebound – ZCCM-IH

KOMBO KACHEMBA, Kitwe
THE Zambia Consolidated Copper Mines-Investment Holdings (ZCCM-IH) says the challenges facing the mining sector are temporary and they arise from changes in the supply and demand chain on the international market.

ZCCM-IH chief executive officer Pius Kasolo said the slump in copper prices on the international market is a routine economic trait which is not permanent but comes as a result of changes in the demand and supply chain.

What happens is that if China is not buying our copper, the mines reduce on production. At a certain point, when all the copper on the market is consumed, there will be high demand for the commodity and the prices will definitely go up. So what is happening in the mining sector in Zambia is temporary,

Dr Kasolo said.

He was speaking in an interview in Kitwe on Tuesday during a ZCCM-IH discussion forum dubbed ‘Share sale down promotion’.

ZCCM-IH is selling shares to members of the public at a share price of K38 per capital share.

Dr Kasolo projected that the price of copper on the international market is likely to improve in the next six months and appealed to Zambians to have confidence in the mining sector.

He said the mining sector still remains viable with mining activities still taking place in the North-Western Province.

Dr Kasolo said Zambia has plenty of copper ore deposits which are yet to be explored by investors willing to invest in the mining sector.

The North-Western Province will soon become the Copperbelt of Zambia. There are exploration works that are currently taking place here in Zambia for other minerals as well including gold, so our mines are still viable,

he said.

Dr Kasolo also said ZCCM-IH is capable of managing the mining sector should Government decide to take ownership of the mines.

He, however, said if ZCCM-IH has to take over the operations of the mines, it means the investment holding has to also inherit the huge debts accrued by the mine owners.

If President Lungu today tells me to be in charge of the mines, I can manage to run them, after all these mines are managed by Zambians,

he said.
Dr Kasolo said ZCCM-IH has the skills and expertise required to operate the mines effectively for the Zambian people.

And speaking during the forum, Dr Kasolo appealed to Zambians to buy shares in ZCCM-IH because it is diversifying its activities to include the agriculture and energy sectors.

He also assured Zambians that their investments will be protected should they choose to buy shares in ZCCM-IH.

Dr Kasolo said priority in buying shares has been given to Zambians for ZCCM-IH to be locally owned.
He appealed to Zambians to quickly buy ZCCM-IH shares before the promotion ends on November 30 this year.

And KELVIN CHONGO reports that mining expert Matheus Mphande has urged Government to consider value addition to copper as a way of protecting jobs in the mining sector.

“The only way we can develop the country is to get into processing of copper into copper wires, pipes and manufacturing of motor vehicle parts,” he said.
“With these plans in place even when copper prices fall at the London Metal Exchange, the economy will still remain strong,” he said.

Dr Mphande said many countries have no copper deposits and that Zambia must take advantage by getting into cooperation with countries like China, India or South Africa to set up a copper processing plant.

Dr Mphande said even South Africa, which manufactures cars such as Isuzu and Toyota, has no copper deposits and it would be appropriate for Zambia to enter into an agreement to supply finished copper products specifically for vehicle manufacturing.

Dr Mphande also said mine owners should stop importing lime but buy the locally produced one.

Copper at the London Metal Exchange was trading at US$4,525 per tonne yesterday.

Investee Company News

Zambians urged to buy ZCCM-IH shares

KABANDA CHULU, Lusaka
ZCCM Investments Holdings Plc has engaged the Ministry of Foreign Affairs to ensure that information is circulated to Zambians living in the diaspora participate in the buying of the 28 million government shares being sold on the Lusaka Stock Exchange.

ZCCM-IH chief executive officer Pius Kasolo said President Lungu directed that all Zambians living locally and abroad be engaged to participate in the running of the mining industry through shares, which are being sold at K38 per share.

“We have started working with the Ministry of Foreign Affairs to ensure that information about the sale down is disseminated to Zambians wherever they can be found and use all channels available to reach them.

“Generally, the response was slow at first but there is an improvement, and it is time Zambians get exposed to owning shares. In other countries, people in bars and clubs talk about shares they own and this is the culture which should be embedded in our society,” Dr Kasolo said.

When asked if the response will be good considering the low copper price on the international market, Dr Kasolo said ZCCM-IH is not worried.

“People buy shares when they are down and when things improve, you rise up together”, he said.

Dr Kasolo also urged companies to take advantage of the share offer which ends on November 30.

ZCCM-IH News

Buy shares in ZCCM Holdings, citizens urged

SYLVESTER CHISHIMBA, Lusaka
ZCCM Investments Holding has implored Zambians to take advantage and buy shares floated by the company on the market.

During a ZCCM-IH share sale-down interactive meeting at Mulungushi International Conference Centre on Friday, ZCCM-IH chief financial officer Mabvuto Chipata said his company, through the share sale-down, intends to increase participation of Zambians in economic development.

We want to ensure a broad distribution of shares in order to increase the liquidity and trading of ZCCM-IH shares on the LuSE [Lusaka Stock Exchange]. We want to comply with LuSE listings requirements regarding the minimum percentage of shareholding available to the public, implement GRZ’s initial intention of the second phase of privatisation and also raise revenue for the treasury,

he said.

Mr Chipata said ZCCM-IH has put up 27,961,237 shares for sale at an offer of K38 and K40 as market price.

The preferred applicants, who are Zambian companies or the local people, will not pay any transaction fees but foreign nationals or companies will pay a transaction fee of 1.37 percent,

he said.

Mr Chipata said the share sale-down which has a percentage offer of 17.4 percent, closes on November 30, 2015, adding that the results of offer will be announced on December 14.

“We extended the period of offer for another two months in order to provide more opportunity to every Zambian within the country to know about the offer.We do not want to have at the end of the day people saying they did not hear about the offer,” he said.

ZCCM-IH News

ZCCM-IH share sale deferred

THE sale of ZCCM-IH shares to the public has been extended to November 30, 2015, due to lack of adequate information on the preferential market offer.

This is in compliance with the listing rules of the Lusaka Stock Exchange (LuSE), and an announcement made by ZCCM-IH on Friday August 7, 2015, detailing the salient terms of the preferential secondary market offer.

The investing public has been advised that the period for the preferential offer has been extended to Monday, November 30, 2015.

According to information posted on the Industrial Development Corporation (IDC) website, the preferential offer was targeted to close on Friday, October 2, 2015, but ZCCM-IH has noted that most members of the public have not been able to access adequate information on the preferential offer due to the delayed availability of the information supplement.

“The company has decided to extend the offer period to Monday, November 30, 2015. The revised time line for the offer is shown under the revised salient dates,” the announcement reads.