On Friday, the 6th of March 2020, Zambia’s two-decade old mining company, ZCCM Investments Holdings, 77.7 per cent owned by the Zambian Government, had issued a statement saying that the Zambia’s investment wing had begun to purchase gold from unofficial traders or miners alongside small-scale unregulated miners aimed at formalizing the largely unregulated sector, demand of which has inflated by many folds over the recent past in line with a soaring gold futures’ prices reigning near their nearly seven-year peak.

In point of fact, latest announcement from ZCCM came against a chaotic backdrop in the informal gold mining industry in Africa, while a number of Government across the African continent had been scuffling to deal with unofficial mining of golds, which has also been triggering a number of tormenting issues such as a significant level of environmental risk and health hazards to the miners alongside an en masse flow of illicit money that has been curbing out critical revenues of the nations after having smuggled for sales.

Meanwhile, as Ethiopian artisanal gold buying market has been purchasing the precious metal at a higher price than the markets are offering to lure miners away from black markets, adding that the artisanal gold miners could bring in illegal or unofficially mined gold in to its Lusaka office, ZCCM-IH said in an advertisement on Friday (March 6th), “ZCCM-IH is providing an open market and competitive prices for gold. Looking forward to doing business with you! It is cash on delivery, spread the word! ”

Source: Financial Word

Angola’s new diamond trading policy generated an average annual growth of gross revenue of about 8.5% in the past two years.

According to a media statement issued by Sodiam – the National Diamond Trading Company of Angola-, while in the 2016-2017 period gross revenue grew by 2.3%, in 2017-2018 it grew 10.8%, totalling $1.22 billion, and in 2018-2019 it grew by 6.2%, totalling $1.29 billion.

The positive results follow a 2018 decree that eliminated the figure of ‘preferred customer’ and implemented new ways of selling diamonds.

Before, preferential customers who were chosen by the head of state were the only ones who could buy diamonds from Sodiam at discounted prices and within specific quotas. This led to monopoly practices and corruption.

“In this period from 2012 to 2017, eight companies operated exclusively in Angola, under the status of preferential customer, and from 2013 to 2017, the companies Iaxon, Relactant and Odyssey, together, acquired more than 50% of the diamond production,” the media brief states.

To put a halt on such practices, the 2018 decree proposed a new sale modality that involves contracts or sights, auctions/tenders and spot. To take part in this, Sodiam clients register online on the state company’s website and undergo financial and security checks.

The base sales reference price is defined through an agreement between the producer, Sodiam and an independent evaluator. The purchase is only effective if its offer is equal to or higher than the base sales reference price.

According to the National Diamond Trading Company of Angola, besides the rise in revenues, the new set of measures has sparked interest with more than 120 companies registered in Sodiam’s customer portfolio and three new polishing factories opened in the country.

Source: Mining.Com

In the first week of March 2020 trading on the LuSE, we see hope for the equities market as it was not completely dominated by the Bond market. Opening the market with a score of 98% to 2% as compared to week one of February with the bond market which scored 100% of sales.

 Equity Market Update

In the week ended 06th March 2020, a total of 5,087,040 shares were transacted in 67 trades, yielding a market turnover of K4,360,121. Trading activity was recorded in AIRTEL, COPPERBELT ENERGY CORPORATION, LAFARGE, STANDARD CHARTERED BANK LIMITED, ZAMBEEF, ZANACO and ZAMBIA SUGAR.

During the week, the company with the highest Market Capitalisation on the LuSE was AIRTEL which also had a high Price to Earnings ratio signaling continued overvaluation of the telecoms company

However, of the traded companies during the week, ZAMBEEF had the highest earnings per share despite having one of the lowest share prices.

The LASI closed the first week at 4260.56, which was a point higher than the previous week (last Friday of February) which was at 4250.48.

The LuSE All Share Index (LASI) closed at 4,260.56 points. The market closed on a capitalization of K57,363,640,096 including Shoprite Holdings and K23,124,434,116 excluding Shoprite Holdings.

The equities market opened on a low as compared to the first week of February, which recorded a total of 51,550,940 shares transacted in 109 trades, yielding a market turnover of K32,059,252.

Bond Market Update 6^th March 2020

During the week, bonds of a total face value of K487,260,000 were transacted in 13 trades, yielding a market value sales of K242,792,000. Sales in the opening week of March were almost 10 times stronger than the previous week which positions the current month well should sales continue to be strong in comparison to the dipped performance of February 2020.

Important announcements                           

PUMA ENERGY ZAMBIA PLC

Pursuant to section 3.59 of the LuSE Listing Requirements, the Board of Directors of Puma Energy Zambia Plc (“the Board”) wishes to announce the resignation of Mr Sidy Bane as Director of the Board effective 28 February 2020. Furthermore, the Board would like to announce the appointment of Mr Mike Baker and Mr Patricio Chababo as Directors of the Board effective 2 March 2020.

ZAMBIAN BREWERIES PLC

The Board of Directors of Zambian Breweries Plc (“the Board”) wishes to advise Shareholders that for the period ended 31st December 2019, the earnings per share is expected to be 81% lower than that of the corresponding period last year for the Company. Earnings for the same period based on profit from continuing operations and adjusted for once-off are expected to be 27% higher.

ZAMBIAN BREWERIES PLC

NOTICE IS HEREBY GIVEN that the 26th Annual General Meeting (AGM) of the members of Zambian Breweries. Plc will be held at the Southern Sun Ridgeway Hotel, Lusaka, Zambia, on Thursday, 26th March 2020, commencing at 09:00 hours, for purposes of transacting the following business:

STANDARD CHARTERED BANK ZAMBIA PLC

In accordance with the Lusaka Securities Exchange (“LuSE”) Listings Requirements, the Board of Directors of Standard Chartered Bank Zambia PLC (“the Bank”) hereby advises the Shareholders of the Company that the Earnings per Share for the financial year ended 31 December 2019 is approximately 95% lower than for the financial year ended 31 December 2018.

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