Annual Report Summaries

Annual Report Summaries, Investee Companies

Copperbelt Energy Corporation Plc (CEC) Extract from 2020 Annual Report

The Bulk Supply Agreement between CEC and ZESCO expired on 31st March 2020. A new agreement was not signed as the two parties could not agree on terms and conditions that were acceptable to both. This is likely to impact CEC negatively especially when it comes to planning for CAPEX.  

ZCCM-IH is monitoring the impact of the new Energy Regulation Board (ERB) and Electricity Acts are going to have on the operations of CEC with the key one being the increased powers granted to the ERB and the government to have more oversight in important dynamics such as tariff rates and Power Purchase Agreements (PPA’s) with end users including the mines.  

During the year under review CEC reported total revenue of ZMW6,910.59 million (US$370.93 million), [ 2019: ZMW4,101.92 million (US$307.93 million)] and profit after tax of ZMW104.5 million (US$5.61 million), [December 2019: ZMW26.90 million (US$2.02 million) loss]. 

During the year, the CEC share price opened at ZMW 1.25 per share closing at ZMW 1.10.  

Dividends declared and paid during the year amounted to ZMW164.9 million (US$8.2 million) (December 2019: nil).  
Annual Report Summaries, Investee Companies

Zambia Gold Company Limited (ZGC) Extract from 2020 Annual Report

Zambia Gold Company (ZGC) commenced operations in the year 2020 and reported revenue of ZMW59.70 million for the period ended 31 December 2020. The revenue was generated from the first sale of 47.96Kg of gold to the Bank of Zambia. The net profit recorded for the year was ZMW32.02 million. Since production commenced in July 2020, ZGC has been conducting exploration activities to determine the available resource. ZGC continued with the second phase of hiring key staff including a Procurement Officer, Company Accountant, Metallurgist and Technical Officer, as well as establishing a corporate office in Lusaka. No dividend was declared or paid during the year.  
Annual Report Summaries, Investee Companies

CNMC Luanshya Copper Mines Plc (CLM) Extract from 2020 Annual Report

CLM increased its production volumes in 2020 with total copper output of 55,976 tonnes, up from 55,000 tonnes in 2019. This was due to increased mining activities and increased slag reclamation at Muliashi and Baluba.  

During the year, revenue increased to ZMW6,435.79 million (US$345.45 million) from ZMW2,992.91 million (U$S 224.67 million) as at December 2019 with net profit increasing to ZMW784.97 million (US$42.13 million) from ZMW 274.91 million (US$20.64 million).  

In the quarter under review, ZCCM-IH signed a loan facility with CLM. With a positive equity position, the company shall continue to explore the possibility of dividend payments in 2021 so as to reduce this loan amount.  

No dividends were declared during the year (31 December 2019: nil).
Annual Report Summaries, Investee Companies

Consolidated Gold Company of Zambia Limited (CGCZ) Extract from 2020 Annual Report

Consolidated Gold Company of Zambia Limited 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 will be undertaken in Rufunsa District and will require ZCCM-IH to invest US$1.4 million towards the total set-up cost of US$3.5 million.  
Annual Report Summaries, Investee Companies

Mopani Copper Mines plc (MCM) Extract from 2020 Annual Report

During the financial year to 31 December 2020, Mopani Copper Mines (MCM) recorded net revenue of ZMW4.93 billion (US$ 714.44 million) [December 2019: ZMW4.93 billion (US$369.84 million)]. The net loss for the period under review was ZMW9.31 billion (US$ 474.56 million) [December 2019: ZMW9.31 billion (US$ 698.92 million net loss)].  

During the year ended 31 December 2020, MCM produced a total of 90,050 tonnes of copper (2019: 21,554 tonnes).  On 31st March 2021, ZCCM-IH and Glencore signed an agreement in which ZCCM-IH would purchase the 90% interest in Mopani held by Carlisa Investments Corp. (“Carlisa”), in which Glencore holds 81.2% of the shares for a US$1 consideration and US$1.50 billion in Transaction Debt. 

There were no dividends paid during the financial year ended 31st December 2020 (2019: Nil). 
Annual Report Summaries, Investee Companies

Kabundi Resources Limited Extract from 2020 Annual Report

Kabundi Resources Limited (KRL) appointed a Board and Project Manager to operationalise their manganese mining activity. Manganese mining commenced, and as at 31st December 2020 12,000 tonnes of manganese ore had been stockpiled. A 40 tonne per hour wash plant and 75 tonne per hour crusher were installed on site. The installation of office containers, construction of a community clinic, Project Affected Persons (PAP) houses and school blocks were completed. KRL reported total revenues for the financial year ended 31st December 2020 of ZMW 912 thousand and a loss after tax of ZMW958 thousand.  

There were no dividends declared during the year under review.  
Annual Report Summaries, Investee Companies

Misenge Environmental and Technical Services Limited (METS) Extract from 2020 Annual Report

Misenge Environmental and Technical Services Limited (METS) generated a total of ZMW 24.49 million in revenue for the year ended 31st December 2020 (December 2019: ZMW16.27 million). METS reported a net profit of ZMW3.12 million (2019: ZMW2.6 million).  

During the period under review, METS began forming its Strategic Turnaround and Marketing Plan. The Turnaround Plan is intended to address, among other issues, market expansion through the acquisition of new customers, business development and additional services, improvements in the provision of environmental services, and the formation of strategic alliances and partnerships in the provision of environmental services. No dividends were paid during the year under review (2019: Nil).  
Annual Report Summaries, Investee Companies

Investrust Bank PLC  Extract from 2020 Annual Report

Over the twelve-month financial reporting period ended 31st December 2020, results of the Bank’s performance indicate an improvement as compared to the prior period, with operational losses reducing to ZMW57.58 million (31 December 2019: ZMW74.0 million).  

The Bank’s net interest income increased by 99% to ZMW 94 million (2019: ZMW 47 million) owing to an increase in total interest income by 64 to ZMW192 million (2019: K117 million). The increase in interest income was mainly as a result of the increased investment in Government securities. In April 2019, the ZCCM-IH Board resolved to dispose off the Company’s investments in Investrust Bank Plc through the ZCCM-IH and IDC Group Rationalisation and Restructuring initiative. The Group Restructuring involves ZCCM-IH swapping its stake in Investrust Bank and Mushe Milling for IDC’s stake in Kagem to leverage on the portfolio management competencies of IDC and ZCCM-IH. The group restructuring has been granted approvals from relevant regulatory bodies. The completion of transaction is pending ZCCM-IH shareholder approval which is expected to be sought in 2022.  

No dividends were declared during the financial period ended 31st December 2020 (2019: Nil). 
Annual Report Summaries, Investee Companies

NFC Africa Mining Plc (NFCA) Extract from 2020 Annual Report

For the financial year ended 31st December 2020, NFCA reported revenue of ZMW1.84 billion (US$229.38 million), [December 2019: ZMW1.84 billion (US$138.36 million)] and profit after tax of ZMW171.48 million (US$19.30 million), [December 2019: ZMW171.48 million (US$12.87 million)].  

There were no dividends paid during the year ended 31st December 2020 (2019: Nil).
Annual Report Summaries, Investee Companies

Kansanshi Mining Plc Extract from 2020 Annual Report

Kansanshi Mining reported annual production of 221,488 tonnes of copper (2019: 232,000 tonnes). There was a reduction in total production volumes but also a decline in the copper ore grades from 0.89% in the previous reporting period to 0.99% currently. A total of 128,408 ounces of gold was produced.  

However, despite the reduction in production volumes, total revenue for the year increased to ZMW28,758.45 million (US$1,543.64 million) from ZMW15, 438.19 million (US$1,159 million) reported for the period ended 31 December 2019 due to increased price of copper during the year. The net profit also increased to ZMW4,274.67 million (US$229.45 million) from ZMW1,082.29 million (US$81.2 million) recorded as at 31 December 2019.  

The decline in total production from the previous period was offset by relatively higher realised metal prices which ensured that total revenue over the two periods remained largely flat. The notable increase in net profit was largely driven by an adjustment (write-back) for VAT receivable from ZRA.  

Dividends declared and paid during the year amounted to ZMW48.65 million (US$2.3 million) [(31 December 2019: ZMW131.15 million) (US$9.4 million)].