In accordance with the requirements of the Securities Act No. 41 of 2016 and Lusaka Securities Exchange Listings Rules, ZCCM-IH Plc announces its audited annual financial statements for the year ended 31 March 2017.
Commentary on financial results and performance
- The Group’s performance improved during the year owing to increase in copper production for most major mining companies. The increased production benefited from stability in energy supply and improvement in copper prices on the world market in the last quarter of 2016 and the first quarter of 2017. Copper prices on the London Metal Exchange (LME) increased from US$4,848/ton at 31 March 2016 to US$5,858/ton at 31 March 2017.
- The Group recorded an operating profit of K848 million (2016 Loss: K858 million), largely attributable to the recovery of K1, 923 million impairment from investee
companies whose performance improved during the year.
- The Group’s share of losses from equity accounted investee companies significantly reduced by 91% from K2, 210 million in 2016 to K189 million in 2017
owing to investee companies improved performance.
- The Profit after tax was K729 million (2016: Loss K2,912 million)
- Total assets marginally reduced by 2% from K9, 797 million to K9, 579 million largely on account of impairment of Ndola Lime Company Limited (NLC) plant (the 100% subsidiary of ZCCM-IH). As a result of a continuing loss making position and operational challenges experienced by NLC, assets amounting to K861 million were impaired during the year.
- During the year, ZCCM-IH increased its equity shareholding in Investrust Bank Plc (Investrust) from10.6% to 45.4% through the rights offer and to 71% (subsequent to the year under review through of a mandatory offer to Investrust’s minority shareholders).
- Subsequent to the period under review, ZCCM-IH’s subsidiary Mawe Exploration and Technical Services Limited which was scheduled for dissolution in prior year was formally in dissolved in April 2017.
Copper prices are expected to increase steadily premised on increased demand from high copper consumer countries. ZCCM-IH’s performance is expected to improve as a result of the increase in copper prices which drive the performance of the mining portfolio. Furthermore, as a result of good rains experienced during the 2016/17 season, the generation capacity of hydroelectricity is expected to improve thereby stabilising energy supply.
In response to the positive outlook, ZCCM-IH will implement its new Strategic Plan hinged on expansion of its investment in various sectors of the economy.
The Directors resolved to recommend that a final dividend of K0.84 per share be declared for the year ended 31 March 2017.
By Order of the Board
1 June 2018
First Issued in Lusaka, Zambia on Thursday, 31st May 2018
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First Issued Thursday, 31st May 2018