Annual Report Summaries

Annual Report Summaries, Investee Companies

Kariba Minerals Limited(KML) Extract from 2021 Annual Report

For the year ended 31 December 2021, Kariba Minerals Limited (KML) reported total revenues of ZMW26.12 million (2020: ZMW 12.44 million) with a net profit of ZMW1.63 million (2020: ZMW11.19 million net loss). 

During the period under review, ZCCM-IH provided an extension on the US$550,000 cash cover for KML’s US$500,000 working capital facility with Investrust Bank Plc. The facility was set to expire during the period under review, and KML requested the extension of the facility for an additional 12 months. The request was made due to continued challenges caused by the adverse effects of the Covid-19 pandemic. 

During the year, the Company developed a turnaround plan to transform KML from loss making to profitability. The plan is anchored on establishing a resource estimate and mine plan to increase productivity, implementation of a marketing plan, and value addition and beneficiation to the amethyst. 

The projected impact of the implementation of the turnaround plan on mine operations will be an increase in sales revenue which is expected to increase by more than 50% from the Kenneth Kaunda International Airport Retail Shop, Gemstone trading, manufacturing of Amethyst Stone Tops and Gemstone cutting and polishing. 

There were no dividends declared during the financial year under review (2020: Nil). 
Annual Report Summaries, Investee Companies

Consolidated Gold Company of Zambia Limited (CGCZ) Extract from 2021 Annual Report

Consolidated Gold Company of Zambia Limited (CGCZ) is a joint venture partnership between 

ZCCM-IH (45%) and Karma Mining Services and Rural Development (55%). Incorporated in 

the year 2020, this Special Purpose Vehicle is focused on developing a gold processing and 

trading hub in Zambia. Phase 1 of the project was commissioned in Rufunsa District where a gold 

leaching plant has been constructed. CGCZ provides processing support to artisanal and smallscale 

miners in Rufunsa and Mumbwa in exchange for tailings material. 

During the year ended 31 December 2021, the Company produced 46.6kg (2020: nil) of gold 

which was sold to Zambia Gold Company. Income for the year ended 31 December 2021 was 

ZMW44.97 million (2020: ZMW0.61 million). CGCZ recorded a loss for the year of ZMW10.22 million 

(2020: 19.16 million). 
Annual Report Summaries, Investee Companies

Chibuluma Mines Plc Extract from 2021 Annual Report

Following the sale of Chibuluma South Crown Pillar Mine, Chibuluma Mines could not sustain operations with ore from Chifupu Underground Mine alone. Therefore, the Chibuluma Mines Plc Board, resolved to place the operations of Chibuluma Mine Plc under care and maintenance with effect from 1 July 2020. This resulted in the Company getting into a lease agreement with Lian Chao and Yue Ventures Limited (LC&Y) to operate key mining operations for the 2021 financial year. 

The lease between Chibuluma and LC&Y was recognised for the period up to 30 June 2021. The investment of the lease was US$ 6.79 million, and the assets disposed of by Chibuluma was US$ 5.00 million. This resulted in a net gain on the lease investment of US$ 1.79 million as charged to the income statement.

Following the resumption of production under LC&Y a total of 1,069 tonnes of payable Copper was sold to Chambishi Copper Smelter by LC&Y. Chibuluma earned income royalty of US$ 0.88 million. For the period under review, the Company recorded a net profit of US$ 1.69 million against a budget loss of US$ 1.13 million due to favourable prices and increased production under the lease agreement. 

There were no dividends paid during the year ended 31 December 2021 (2020: Nil). 
Annual Report Summaries, Investee Companies

Zambia Gold Company Limited (ZGC) Extract from 2021 Annual Report

Zambia Gold Company Limited (ZGC) reported revenue of ZMW68.29 million (2020: ZMW59.7 million) for the year ended 31 Dec 2021. During the period under review, 62.02 Kg of gold was sold to the Bank of Zambia. Net profit recorded for the period was ZMW5.76 million (2020: ZMW32.02 million). 

For the period under review, ZGC produced a total of 49.99 kg of gold against a budget of 183.56 kg. This variance was largely due to lower production at the Kasenseli mining project due to equipment unavailability in the first 2 quarters of the year and optimization of the processing lines installed in the financial year.

Further, following a review by the Ministry of Mines and Minerals Development (MoMMD), mining operations at the Kasenseli mine were suspended due to safety concerns among other things. Management at ZGC shall continue to engage MoMMD to resolve this matter in order to resume operations. 

ZGC shall continue conducting exploration activities with an estimated resource statement to be completed in 2022. 

There were no dividends declared during the period under review (December 2020: Nil)
Annual Report Summaries, Investee Companies

Mushe Milling Company Limited Extract from 2021 Annual Report

Mushe Milling Limited (MML) earned a total of ZMW38.15 million in revenue for the year ended 31 

December 2021 (2020: ZMW106.46 million). MML recorded a net loss of ZMW48.14 million (2020: 

ZMW19.65 million loss). 

The Company remained undercapitalised with a negative equity position and current liabilities in 

excess of ZMW45 million. Due to its consistent weak financial position, only minimal debt amounts 

could be settled by the Company during the period and operations were temporarily halted 

due to MML’s inability to purchase its own maize stock. ZCCM-IH intervened by entering into a 

maize supply agency agreement with MML in order to revive operations in Q1 of 2021. 

There were no dividends declared during the period under review (2020: Nil). 
Annual Report Summaries, Investee Companies

CNMC Luanshya Copper Mines Plc (CLM) Extract from 2021 Annual Report

For the year ended 31 December 2021, CLM recorded revenue of ZMW 10.17 billion (US$516.69 million), [2020: ZMW6.4 billion (US$345.45 million)] compared to the budget of US$329.40 million for the financial year of 2021. This was due to favourable copper prices for the year. CLM produced a total of 32,369 tonnes of copper cathodes for the year under review compared to copper output of 55,976 tonnes produced in the 2020 financial year. 

For the year ended 31 December 2021, the Company recorded a profit of ZMW2.83 billion (US$143.71 million), [(2020: ZMW7.97 million (US$42.13 million)]. Due to this improved performance and positive equity position, the Company declared an interim dividend of US$40 million with US$8 million payable to ZCCM-IH which went to clear most of the amount due under the Dividend Advance Agreement signed in October 2020. 
Annual Report Summaries, Investee Companies

Kabundi Resources Limited Extract from 2021 Annual Report

For the year ended 31 December 2021, Kabundi Resources Limited (KRL) reported total revenues (royalty charges) of ZMW5.58 million (2020: ZMW0.91 million) with a net loss of ZMW1.95 million (2020: ZMW0.958 million). 

Kabundi Resources Limited (KRL) began washing manganese in September 2020 with a 100tpd wash plant. A total of 8,896 tonnes of manganese was produced during the four months of operations in 2020.

In first quarter of 2021, a second and larger wash plant was constructed with processing capacity of 10,000tpd. Kabundi resources produced and sold 52,443t of manganese yielding ZMW9.45 million of which ZMW3.92 million was paid to ZRA as mineral royalty tax. 

In the period under review, Kabundi made progress with phase 2 and phase 3 of its development which include starting own mining and setting up a ferro-alloy plant respectively. 

During the period under review KRL continued its mining activities on one site namely “Kabundi B” where the first open pit had been established. Total manganese sold for the current year was recorded at 61,339 tonnes (2020: 12,000 tonnes).

During the year under review KRL acquired another mining license in the Ntenge area where mining activities are yet to commence. Going forward in 2022 the Company’s focus will be to undertake its own mining activities on this mining license.

In its 2022 budget the Company plans to acquire additional mining equipment to be able to commence its mining operations at Ntenge. Kabundi paid management fees totalling ZMW31,750 to ZCCM-IH in the period under review. 

There were no dividends declared during the period under review (December 2020: Nil). 
Annual Report Summaries, Investee Companies

Misenge Environmental and Technical Services Limited (METS) Extract from 2021 Annual Report

Misenge Environmental and Technical Services Limited (METS) generated a total of ZMW17.11 million in revenue for the year ended 31st December 2021 (2020: ZMW24.49 million). METS reported a net profit of ZMW2.51 million (2020: ZMW3.12 million). 

During the period under review, METS continued the implementation of its Strategic Turnaround and Marketing Plan. Though the Company remains undercapitalised, METS has maintained profitability over the majority of the 12 months. Management has also made steady efforts to raise capital for equipment and develop non-ZCCM-IH business relationships for the formation of strategic alliances and partnerships in the provision of environmental services. 

There were no dividends declared during the period under review (December 2020: Nil) 
Annual Report Summaries, Investee Companies

Limestone Resources Limited (LRL) Extract from 2021 Annual Report

2021 was the first full calendar year of operations for Limestone Resources Limited (LRL), which only commenced operations on 1 September 2020 after transitioning from Ndola Lime Company Limited (NLC). NLC, remains under liquidation. 

As at December 2021, LRL was yet to be capitalised as ZCCM-IH was still running the process of engaging an equity partner with whom a long-term strategic plan for the Company would be developed. 

The lack of adequate capital posed a challenge and the Company underachieved across all performance metrics as production fell substantially below installed capacity due to reliability issues with the plant and equipment. Total sales revenue for the year was recorded at ZMW119.00 million (2020: ZMW34.76 million). The loss over the same period was ZMW39.78 million (2020: ZMW3.71 million). 

On 17 October 2021, LRL’s only functioning Kiln (VK1) experienced a collapse of its refractory bricks, leading to a halt in quicklime production. Since then, no production has been going on at LRL, pending financial resources for repair and maintenance works. 

ZCCM-IH has prioritized the selection and engagement process of an equity partner and is optimistic of completing the process within the first half of 2022 to ensure full recapitalisation of LRL that will substantially improve operational and financial performance. 

There were no dividends declared during the period under review (December 2020: Nil) 
Annual Report Summaries, Investee Companies

Mopani Copper Mines Plc Extract from 2021 Annual Report

For the year ended 31 December 2021, Mopani Copper Mines (MCM) recorded cumulative net revenue of ZMW17. 263 billion (US$877.38 million) [(2020: ZMW13.54 billion (US$726.61 billion)]. The net profit for the year under review was ZMW76.82 billion (US$3.9 billion) [(2020: ZMW27.57 billion net loss (US$1.48 billion net loss)]. 

During the year under review, MCM produced a total of 87,618 tonnes of copper (2020: 90,050 tonnes). On 30 March 2021, the ZCCM-IH Shareholders approved the ZCCM-IH’s acquisition of the remaining 90% interest in Mopani held by Carlisa Investments Corp (“Carlisa”) for a US$1 consideration and US$1.50 billion in Transaction Debt. 

Post the acquisition, production has increased from a monthly average of 3,412 tonnes during the first three months under Glencore to a monthly average of 8,598 tonnes from April 2021 to December 2021 under ZCCM-IH. MCM continued to meet its target performance in both total production and revenue. Key priority for MCM will be the completion of the expansion projects which are estimated at US$300 million for the Synclinorium shaft (US$100 million), Mindola shaft (US$110 million), Henderson shaft (US$40 million), the new Nkana Concentrator (US$5 million), and the Tailings Storage Facility (US$ 45 million). Mopani, with the help of ZCCM-IH is actively seeking funding options for the completion of the expansion projects. 

The future of the mine relies heavily on completion of the expansion projects, which is expected to increase copper cathode production to 225,000 tonnes by 2025. The Company will also have the capacity to hoist close to 9 million tonnes of copper ore in the long term. 

There were no dividends declared during the period under review (December 2020: Nil).