Abridged FinanciaL Statements_31.12.2023

ZCCM Invs.Hldgs PLC
07 June 2024
 

SENS ANNOUNCEMENT

(the "Notice" or "Announcement")

 

ISSUER

ZCCM-IH LOGO _jpeg

ZCCM INVESTMENTS HOLDINGS PLC ("ZCCM-IH")

[Incorporated in the Republic of Zambia]

Company registration number:        119540000771

Share Code:                                           ZCCM-IH

ISIN:                                                       ZM0000000037

Authorized by:                                     Charles Mjumphi - Company Secretary

 

SPONSOR

 

SBZ Logo - Small

Stockbrokers Zambia Limited

[Founder Member of the Lusaka Securities Exchange]

[Regulated and licensed by the Securities and Exchange Commission of Zambia]

Contact Number:                 +260-211-232456

Website:                                                www.sbz.com.zm

 

APPROVAL

 

The captioned Notice or Announcement has been approved by:

i.      the Lusaka Securities Exchange ("LuSE")

ii.    the Securities and Exchange Commission ("SEC")

iii.   ZCCM Investment Holdings Plc ("ZCCM-IH")

 

RISK WARNING

 

The Notice or Announcement contained herein contains information that may be of a price sensitive nature.

 

Investors are advised to seek the advice of their investment advisor, stockbroker, or any professional duly licensed by the Securities and Exchange Commission of Zambia to provide securities advice.

 

ISSUED: 7 June 2024


ZCCM INVESTMENTS HOLDINGS PLC

[Incorporated in the Republic of Zambia]

Company registration number: 771

Share Code: ZCCM-IH

ISIN: ZM0000000037

["ZCCM-IH" or "the Company"]

 

ABRIDGED AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

 

INTRODUCTION

In compliance with the requirements of the Securities Act No. 41 of 2016, ZCCM Investments Holdings PLC ("ZCCM-IH PLC" or "the Company") announces the financial statements results of the Company and its subsidiaries (Collectively referred to as the ''the Group'') for the year ended 31 December 2023.

STRUCTURE OF THE ZCCM-IH GROUP

The ZCCM-IH Group consists of the following Nine (9) companies:

Name

Shareholding

Mopani Copper Mine PLC

100.00%

Ndola Lime Company Limited (In liquidation)

100.00%

Kariba Minerals Limited

100.00%

Misenge Environmental and Technical Services Limited

100.00%

Mushe Milling Limited (In liquidation)

100.00%

Kabundi Resources Limited

100.00%

Limestone Resources Limited

100.00%

Investrust Bank PLC (In possession by the Bank of Zambia))

71.40%

Zambia Gold Company Limited

51.00%

 

The Company also has other interests in the undernoted companies:

Name

Shareholding

Rembrandt Properties

49.00%

Central African Cement Limited

49.00%

Maamba Collieries Limited

35.00%

Copperbelt Energy Corporation PLC

31.07%

Konkola Copper Mines PLC

20.60%

Kansanshi Mining PLC

20.00%

CNMC Luanshya Copper Mines PLC

20.00%

Lubambe Copper Mines PLC

20.00%

Mingomba Mining Limited

20.00%

NFCA Africa Mining PLC

15.00%

Chibuluma Mines PLC

15.00%

Chambishi Metals PLC

15.00%

Copper Tree Mineral Limited

15.58%

Oranto Petroleum Limited

10.00%

Nkana Alloy Smelting Company Limited

10.00%

 

ABRIDGED GROUP STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME



Audited

 

Audited



31 Dec

2023

 

31 Dec

2022



ZMW'000

 

ZMW'000



 

 

 

Revenue

 

 

11,747,105

 

 

11,920,429

Gross loss

 

(3,559,228)

 

(2,749,922

Operating loss

 

       (2,104,964)

 

(3,314,561)

Net finance cost


            (2,267,838)


         (1,807,093)

Share of profit of equity accounted investees


2,261,209


1,603,143

Loss before tax

 

(2,111,593)

 

(3,518,511)

Income tax expense


        (1,206,049)


(248,019)

Loss for the year from continuous operations

 

(3,317,642)

 

(3,766,530

 

 

 

 

 

Loss from discontinued operations

 

(758,181)

 

(19,003)

Loss for the year

 

(4,075,823)

 

(3,785,533)

Earnings per share (ZMW)

 

          (25.35)

 

 (23.54)

Basic and diluted earnings per share (ZMW)

 

          (25.35)

 

(23.54)


ABRIDGED COMPANY STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME



Audited

 

Audited



31 Dec

2023

 

31 Dec

2022



ZMW'000

 

ZMW'000



 

 

 

Investment income

 

2,128,699

 

4,916,309

Revenue from contracts with customers

 

  23,180

 

778

Operating profit

 

3,067,198

 

4,054,286

Net finance income

 

   2,979,315

 

440,763

Profit before tax


6,046,513


 4,495,049

Income tax expense

 

(1,205,034)

 

      (236,321)

Profit for the year


4,841,479


4,258,728

 


 


 

Earnings per share (ZMW)

 

           30.11

 

                26.48

Basic and diluted earnings per share (ZMW)

 

           30.11

 

                26.48




 

ABRIDGED GROUP STATEMENT OF FINANCIAL POSITION

 

 

Audited

 

Audited

 

 

31 Dec 2023

31 Dec 2022

 

 

ZMW'000

ZMW'000

Assets

 

 

 

Property, plant, and equipment


248,857


12,484,907

Exploration and evaluation asset


51,437


51,437

Intangible assets


14,393,945


3,148,325

Investment property


208,598

      200,751

Investments in associates


10,090,940

15,174,862

Financial assets at fair value through profit or loss


3,019,500

         1,252,400

Trade and other receivables


1,628,837

    2,931,539

Environmental Protection Fund


7,060

94,433

Deferred tax assets


-

122,852

Inventories


38,299

          4,921,366

Trade and other receivables


339,169

762,831

Assets classified as held for sale


23,626,388

2,103,761

Term deposits


4,450,451

5,340,202

Cash and cash equivalents


360,356

          329,173

Total assets

 

58,463,837

 

    48,918,839

 

Equity and liabilities

 



Capital and reserves


(5,690,634)

       7,908,807

Borrowings


-


       27,476,859

Deferred tax liability


751,833

-

Retirement benefits


17,381

182,940

Provisions for environmental rehabilitation


112,751

1,221,068

Borrowings


-

864,411

Overdraft


-

688,120

Trade and other payables


312,756

7,451,177

Provisions


44,243

487,689

Current income tax liabilities


238,553

190,143

Retirement benefits


-

139,131

Liabilities associated with assets classified as held for sale


62,676,954

2,308,494

Total equity and liabilities


58,463,837

48,918,839

 


 

 

 

 

 


 

ABRIDGED COMPANY STATEMENT OF FINANCIAL POSITION

 

 

Audited

 

Audited

 

 

31 Dec 2023

31 Dec 2022

Assets

 

ZMW'000

ZMW'000

 

 

 

 

Property, plant, and equipment


110,624


90,471

Intangible assets


             14,260,690


            3,377

Investment property


208,598

     200,751

Investment in subsidiaries


282,384

405,051

Investments in associates


11,240,080

16,256,411

Financial assets at fair value through profit or loss


3,019,500

1,252,400

Trade and other receivables


4,586,471

      958,162

Deferred tax assets


-

258,966

Inventories


         -

         16,427

Trade and other receivables


288,268

173,829

Term deposits


4,411,330

5,340,202

Cash and cash equivalents


61,137

45,586

Assets classified as held for sale


-

145,700

Total assets

 

38,469,082

 

      25,147,333

 

Equity and liabilities

 



Capital and reserves


37,422,019

24,679,852

Deferred tax liability


618,059

-

Retirement Benefit Obligations


17,381

9,275

Provisions for environmental rehabilitation


54,498

39,357

Borrowings


-

-

Trade and other payables


78,288

121,005

Provisions


41,461

108,686

Current income tax liabilities


237,376

189,158

Total equity and liabilities


38,469,082

      25,147,333

 


 

 

 

 

ABRIDGED GROUP STATEMENT OF CASH FLOWS

 

 

 

Audited

 

Audited

 


31 Dec 2023

 

31 Dec 2022

 


ZMW'000

 

ZMW'000

 





Net cash flow generated from operating activities


        (83,727)


1,463,062

Net cash flow used from investing activities


533,274


(1,113,001)

Net cash outflow from financing activities


(207,812)


(698,833)

Decrease in cash and cash equivalents

 

241,735

 

 (348,772)

Effects of translation and exchange rate changes on cash and cash equivalents


(277,193)


(68,389)

Cash and cash equivalents at the beginning of the year


       (81,060)


336,101


 

(116,518)

 

(81,060)

Included in the statement of financial position

 

360,356

 

(358,947)

Included in assets held for sale

 

(476,874)

 

277,887

 

 

      (116,518)

 

(81,060)

 

 



ABRIDGED COMPANY STATEMENT OF CASH FLOWS

 

 

 

Audited

 

Audited

 


31 Dec 2023

 

31 Dec 2022

 


ZMW'000

 

ZMW'000

 





Net cash flows from operating activities


(368,710)


4,766,330

Net cash flows used in investing activities


379,990


       (4,761,256)

Net cash flows used in financing activities


-


   (1,135)

Decreased in cash and cash equivalents

 

    11,280

 

    3,939

Effect of movement in exchange rates on cash held


4,271


(39,851)

Cash and cash equivalents at the beginning of the year


45,586


        81,498

Cash and cash equivalents at the end of the period

 

61,137

 

45,586

 

 

 

 


 

 

  ABRIDGED GROUP STATEMENT OF CHANGES IN EQUITY



Audited

 

Audited

 


31 Dec 2023

 

31 Dec 2022

 


ZMW'000

 

ZMW'000

Balance at 1 Jan

 

7,908,807


12,808,905

Loss for the year


(4,075,823)


(3,785,533)

Other comprehensive income

 

(8,700,010)


(1,029,340)

Dividend paid

 

(723,608)


(85,225)

Balance at 31 Dec

 

(5,590,634)

 

7,908,807

 

 

     ABRIDGED COMPANY STATEMENT OF CHANGES IN EQUITY



Audited

 

Audited

 


31 Dec

2023

 

31 Dec

2022

 


ZMW'000

 

ZMW'000

 





Balance at 1 Jan

 

24,679,852


24,732,194

Profit for the year


4,841,479


4,258,728

Other comprehensive income

 

8,624,296


(3,225,845)

Dividend paid

 

(723,608)


(85,225)

Balance at 31 Dec

 

37,422,019

 

24,679,852







 

1.   FINANCIAL PERFORMANCE

 

In 2023, the Group faced financial challenges, with post-tax losses increasing from ZMW3,786 million (US$222.03 million) in 2022 to ZMW4,076 million (US$198.59 million). This was primarily due to the underperformance of Mopani Copper Mine Plc, which reported a significant loss of ZMW8.97 billion (US$436.94 million). Mopani's lower copper production and operational issues were key contributors to this decline.

 

Despite these difficulties, the Group's total assets grew from ZMW48.92 billion (US$2.81 billion) in 2022 to ZMW58.46 billion (US$2.30 billion) in 2023, though the value in US Dollars decreased due to currency depreciation. Liabilities also increased significantly, primarily due to the interest accrued on Mopani's loan from Glencore and the resulting foreign exchange losses.

 

Retained earnings were in a deficit of ZMW16.462 billion (US$639.40 million) by the end of 2023, worsening from the previous year's deficit of ZMW11.44 billion (US$561.56 million).

 

However, the Company itself reported an increase in profits, rising to ZMW4.84 billion (US$235.90 million) in 2023 from ZMW4.25 billion (US$249.78 million) in 2022, demonstrating resilience amidst broader financial challenges within the ZCCM-IH Group.

 

 

 

2.   KEY OPERATIONS AND STRATEGIC DEVELOPMENTS

 

(i)         Mopani Copper Mines PLC ("MCM")

 

Below is a summary of Mopani's financial performance which has been incorporated in the Groups Financial Statements:

 

Statement of Profit and Loss and Other Comprehensive - Mopani Copper Mine Plc

ZMW'000

2023

 

2022

Revenue

11,552,419

 

11,854,038

Gross loss

(3,532,408)

 

(2,711,461)

Operating loss

(4,351,218)

 

    (2,814,464)

Net finance cost

     (4,616,657)


     (2,238,476)

Loss before tax

(8,967,875)

 

 (5,052,940)

Loss for the year

(8,967,875)

 

 (5,052,940)






 

 

Statement of Financial Position - Mopani Copper Mine Plc

2023

 

2022


ZMW'000

 

ZMW'000

Property, plant, and equipment, including intangible assets

 15,646,610


 15,384,497

Inventories

   3,489,128


   4,836,680

Trade and other receivables

2,691,333


   2,616,620

Environmental protection fund

       147,553


        94,433

Cash and cash equivalents

        58,367


        159,584

Total assets

22,032,991

 

23,091,814

 




Equity and liabilities

 

 

 

Capital and reserves

   (40,916,634)


  (14,981,992)

Borrowings

  43,518,156


 28,341,270

Trade and other payables

15,072,870


7,934,977

Bank overdraft

        1,095,462


        678,900

Provisions for environmental rehabilitation

    3,263,137


   1,118,659

Total equity and liabilities

22,032,991

 

23,091,814

 

Mopani Copper Mines plc (MCM) recorded a significant loss of ZMW 8.9 billion (US$436.94 million) in 2023, up from ZMW 5.05 billion (US$296.36 million) the previous year. This was due to decreased copper production, low equipment availability, delayed development, and multiple plant outages. In response, US$35 million was invested in sustaining and expanding projects, with full commissioning of expansion projects expected by 2027. In March 2024, a strategic investment of US$1.2 billion by International Resources Holding Limited (IRH), through its wholly-owned subsidiary Delta Mining Limited, was approved to enhance Mopani's financial and operational resilience.

(ii)        Kansanshi Royalty Right

 

ZCCM-IH converted its 20% dividend rights in Kansanshi Mining Plc into a 3.1% life-of-mine royalty right, resulting in royalty income and VAT refunds totalling ZMW1.2 billion (US$58.48 million) and ZMW170.74 million (US$8.32 million), respectively.

 

(iii)       Copperbelt Energy Corporation Plc (CEC)

 

ZCCM-IH increased its shareholding in Copperbelt Energy Corporation Plc (CEC) from 24.1% to 31.07%, driven by confidence in CEC's growth prospects, particularly in renewable energy.

 

(iv)       Konkola Copper Mines Plc (KCM)

 

ZCCM-IH and Vedanta Resources Group have resolved their disputes by entering into a settlement agreement aimed at resetting their relationship. The necessary steps to withdraw the proceedings related to these disputes are currently being undertaken.

 

(v)        Mingomba Mining Limited (MML)

 

Mingomba Mining Limited, a new partnership formed in 2023, is conducting a drilling program using Artificial Intelligence (AI) techniques in Chililabombwe. This will expedite orebody definition and subsequent mine development.

 

(vi)       Investrust Bank Plc

 

ZCCM-IH holds a 71.4% stake in Investrust Bank Plc. The Bank of Zambia announced a takeover of Investrust on 2 April 2024, and trading of its shares was suspended. ZCCM-IH is monitoring the situation.

 

3.   Outlook

ZCCM-IH remains focused on mining and mining-related investments, seeking partnerships that benefit the Zambian people and positioning itself to capitalize on opportunities in the mining sector.

 

By Order of the Board

 

 

Charles Mjumphi

Company Secretary

Issued in Lusaka, Zambia on 7 June 2024


T     |    +260-211-232456

 

E     |     advisory@sbz.com.zm

 

W   |     www.sbz.com.zm

 

Stockbrokers Zambia Limited (SBZ) is a member of the Lusaka Securities

Exchange and is regulated by the Securities and Exchange Commission of Zambia

First Issued on 7 June 2024

 



 

APPENDICES

US DOLLAR ABRIDGED GROUP STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME



 

 

 



31 Dec

2023

 

31 Dec

2022



 

 

 



US$'000

 

US$'000

Revenue

 

 

572,356

 

 

 699,145

Gross loss

 

(173,416)

 

(161,286)

Operating loss

 

       (102,559)

 

(194,403)

Net finance income


(110,497)


(105,988)

Share of profit of equity accounted investees


110,173


94,026

Loss before tax

 

(102,883)

 

(206,365)

Income tax expenses


(58,762)


         (14,547)

Loss from continuing operations

 

(161,645)

 

(220,912)

 

 

 

 

 

Loss from discontinued operations

 

(36,941)

 

(1,115)

Loss for the year

 

(198,586)

 

(222,027)

Earnings per share (US$)

 

(1.23)

 

(1.38)

Basic and diluted earnings per share (US$)

 

        (1.23)

 

        (1.38)


US DOLLAR ABRIDGED COMPANY STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME



 

 

 



31 Dec

2023

 

31 Dec

2022



US$'000

 

US$'000

Investment income

 

103,717

 

288,347

Revenue from contracts with customers

 

1,129

 

46

Operating profit

 

149,444

 

237,788

Net finance income


   145,162


  25,851

Profit before tax

 

294,606

 

  263,639

Income tax expenses


          (58,713)


      (13,860)

Profit for the year

 

235,893

 

249,779

 


 



Earnings per share (US$)

 

1.47

 

1.55

Basic and diluted earnings per share (US$)

 

1.47

 

        1.55

 


US DOLLAR ABRIDGED GROUP STATEMENT OF FINANCIAL POSITION

 

 

 

 

 

 

 

31 Dec 2023

 

31 Dec 2022

 

 

US$'000

 

US$'000

Assets





Property, plant, and equipment


9,666


756,962

Exploration and evaluation asset


             1,998


2,767

Intangible assets


559,064


            189,407

Investment property


             8,102


     11,120

Investments in associates


391,934


840,596

Financial assets at fair value through profit or loss


117,278


        69,375

Trade and other receivables


         63,264


162,390

Environmental Protection Fund


             274


5,231

Deferred tax assets


-


6,805

Inventories


         1,488


         295,855

Trade and other receivables


           13,173


   42,256

Term deposits


           172,857


295,815

Cash and cash equivalents


13,996


18,234

Assets classified as held for sale


917,654


116,536

Total assets

 

2,270,748

 

   2,813,349

 

Equity and liabilities

 




Capital and reserves


(221,028)


541,639

Borrowings


-


1,522,053

Deferred tax liabilities


29,201


-

Retirement benefits


             675


10,134

Provisions for environmental rehabilitation


           4,379


67,640

Bank overdraft


           -


38,118

Borrowings


           -


47,883

Trade and other payables


12,148


412,750

Provisions


           1,721


27,015

Current tax liabilities


9,265


         10,533

Retirement benefits


             -


7,707

Liabilities directly associated with assets classified as held for sale


2,434,387


         127,877

Total equity and liabilities


2,270,748

 

   2,813,349

 

 

 

 


 

 

*The Statement of Financial Position has been translated using the rate of  K25.75/US$.

 

 

 

 



US DOLLAR ABRIDGED COMPANY STATEMENT OF FINANCIAL POSITION

 

 

 

 

 

 

31 Dec 2023

31 Dec 2022

 

 

US$'000

US$'000

Assets





Property, plant, and equipment


4,297


7,408

Intangible assets


553,888


            198

Investment property


    8,102

    11,120

Investments in subsidiaries


10,968

22,437

Investments in associates


436,567

900,507

Financial assets at fair value through profit or loss


117,278

69,375

Trade and other receivables


178,140

53,076

Deferred tax assets


-

14,345

Inventory


-

830

Trade and other receivables


11,196

9,629

Term deposits


171,337

295,815

Cash and cash equivalents


2,375

2,525

Assets classified as held for sale


-

8,071

Total assets

 

1,494,148

 

   1,395,336

 

 

 

 

 

Equity and liabilities

 

 

 

 

Capital and reserves


1,453,479

1,369,440

Deferred tax assets


24,006

-

Retirement benefits


675

514

Provisions for environmental rehabilitation


2,117

2,180

Trade and other payables


3,041

6,703

Provisions


1,610

        6,021

Current tax liabilities


9,220

        10,478

Total equity and liabilities


1,494,148

 

   1,395,336

 

 

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