Audited Abridged Financial Report 31 Mar 2019

RNS Number : 0151X

ZCCM Invs.Hldgs PLC

16 December 2019

 

SENS ANNOUNCEMENT

(the "Notice" or "Announcement")

ISSUER

ZCCM INVESTMENTS HOLDINGS PLC ("ZCCM-IH")

[Incorporated in the Republic of Zambia]

Company registration number:        119540000771

Share Code:                                           ZCCM-IH

ISIN:                                                       ZM0000000037

Authorised by:                                     Chabby Chabala - Company Secretary

SPONSOR

Stockbrokers Zambia Limited

[Founder Member of the Lusaka Securities Exchange]

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

Contact Number:                 [phone]

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.   Stockbrokers Zambia Limited ("SBZ")

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: 16 December 2019

ZCCM INVESTMENTS HOLDINGS PLC

(Incorporated in the Republic of Zambia)

ABRIDGED AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019

INTRODUCTION

In compliance with the requirements of the Securities Act No. 41 of 2016, ZCCM Investments Holdings Plc ("ZCCM-IH Plc") announces the provisional financial statements results of the Company and its subsidiary (Collectively referred to as the ''the Group'') for the year ended 31 March 2019.

STRUCTURE OF THE ZCCM-IH GROUP

The ZCCM-IH Group consist of the following seven (7) subsidiary companies:

Name	Shareholding
ZCCM-IH	Parent Company
Ndola Lime Company Limited	100%
Kariba Minerals Limited	100%
Misenge Environmental and Technical Services Limited	100%
Mushe Milling Limited	100%
Kabundi Resources Limited	100%
Investrust Bank Plc	71.4%

The Company also has other interests in the undernoted companies:

Name	Shareholding
Rembrandt Properties	49.00%
Maamba Collieries Limited	35.00%
Konkola Copper Mines Plc	20.60%
Kansanshi Mining Plc	20.00%
Copperbelt Energy Corporation Plc	24.10%
CEC Africa Investments Limited	20.00%
CNMC Luanshya Copper Mines Plc	20.00%
NFCA Africa Mining Plc	15.00%
Mopani Copper Mines Plc	10.00%
Copper Tree	10.00%
Oranto Oil Block	10.00%
ABRIDGED GROUP STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
		Audited		Audited
		2019		2018
		ZMW'000		ZMW'000
Revenue		155,611		60,982
Gross profit		79,096		(17,487)
Operating (loss)/profit		(614,412)		46,550
Net finance income		39,957		(132,485)
Share of profit of equity accounted investees		973,213		689,207
Profit before tax		398,758		603,272
Income tax (expense)/credit		49,105		241,287
Profit from continuing operations		447,863		844,559
Loss from discontinued operations		-		(1,610)
Profit for the year		447,863		842,949
Earnings per share (k)		2.79		5.25
Basic and diluted earnings per share (k)		2.79		5.25

ABRIDGED COMPANY STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME Audited Audited 2019 2018 ZMW'000 ZMW'000 Revenue  133,323  199,841 Operating (loss)/profit     (366,877)     343,748 Net finance income             96,927     (123,835) (Loss)/profit before tax  (269,950)  219,913 Income tax credit/(expense)       162,426 213,500        (Loss)/ profit for the year  (107,524) 433,413 Earnings per share (k) (0.67) 2.70 Basic and diluted earnings per share (k)         (0.67)         2.70

 

	ABRIDGED GROUP STATEMENT OF FINANCIAL POSITION
			Audited				Audited
			2019				2018
	Assets		ZMW'000				ZMW'000
	Property, plant and equipment		187,268				143,164
	Intangible assets		8,532				367
	Investment property		251,230				64,473
	Investments in associates		10,276,405				7,355,864
	Financial assets at fair value through profit or loss		584				336,082
	Inventories		104,681				37,026
	Trade and other receivables		1,153,236				1,022,880
	Deferred tax assets		601,589				497,609
	Term deposits		754,438				535,384
	Cash and cash equivalents		74,480				339,386
	Total assets		13,412,443				10,332,235
	Equity and liabilities
	Capital and reserves		11,124,784				8,940,346
	Borrowings		104,357				133,703
	Deferred tax liabilities		245,455				256,072
	Trade and other payables		1,453,503				488,989
	Provisions		127,590				139,785
	Retirement benefits		34,180				32,422
	Provisions for environmental rehabilitation		145,460				118,081
	Current tax liabilities		177,114				222,837
	Total equity and liabilities		13,412,443				10,332,235
	ABRIDGED COMPANY STATEMENT OF FINANCIAL POSITION
			Audited				Audited
			2019				2018
	Assets		ZMW'000				ZMW'000
	Property, plant and equipment		85,819				71,089
	Intangible assets		671				367
	Investment property		157,606				64,473
	Investments in subsidiaries		69,987				-
	Investments in associates		9,703,369				4,694,323
	Financial assets at fair value through profit or loss		-				336,082
	Trade and other receivables		842,664				1,017,927
	Held-to-maturity investment securities		727,554				535,384
	Cash and cash equivalents		26,276				337,942
	Total assets		11,613,946				7,057,587
	Equity and liabilities
	Capital and reserves		8,661,948				5,790,154
	Borrowings		103,271				-
	Deferred tax liabilities		2,306,727				754,221
	Trade and other payables		77,342				56,223
	Provisions		127,590				139,785
	Retirement benefits		5,513				4,340
	Provisions for environmental rehabilitation		112,905				86,566
	Current tax liabilities		218,650				226,298
	Total equity and liabilities		11,613,946				7,057,587
ABRIDGED GROUP STATEMENT OF CASH FLOWS
				Audited		Audited
				2019		2018
				ZMW'000		ZMW'000
Net cash flow from operating activities				(238,880)		16,323
Net cash used in investing activities				38,181		198,218
Net cash outflow on financing				(64,207)		(54,086)
Increase in cash and cash equivalents				(264,906)		160,455
Cash and cash equivalents at the beginning of the year				339,386		178,931
Cash and cash equivalents at the end of the year				74,480		339,386

ABRIDGED COMPANY STATEMENT OF CASH FLOWS
		Audited		Audited
		2019		2018
		ZMW'000		ZMW'000
Net cash flow from operating activities		(69,732)		160,525
Net cash used in investing activities		(345,205)		(652)
Net cash outflow on financing		103,271		(202)
Increase in cash and cash equivalents		(311,666)		159,671
Cash and cash equivalents at the beginning of the year		337,942		178,271
Cash and cash equivalents at the end of the year		26,276		337,942

ABRIDGED GROUP STATEMENT OF CHANGES IN EQUITY

		Audited		Audited
		2019		2018
		ZMW'000		ZMW'000
Balance at 1 April		8,771,841		8,013,913
Profit for the year		447,863		842,949
Other comprehensive income		2,138,241		83,484
Dividend paid		(233,161)		-
Balance at 31 March		11,124,784		8,940,346
IFRS expected credit loss adjustments		-		(168,505)
Restated balance at 31 March		11,124,784		8,771,841

 ABRIDGED COMPANY STATEMENT OF CHANGES IN EQUITY

			Audited			Audited
			2019			2018
			ZMW'000			ZMW'000
Balance at 1 April			5,790,154				5,491,126
(Loss)/ profit for the year			(107,524)				433,413
Other comprehensive income			3,212,479				(134,385)
Dividend paid			(233,161)				-
Balance at 31 March			8,661,948				5,790,154

1.    FINANCIAL PERFORMANCE

The Group reported a profit for the year of ZMW448 million (2018: ZMW843 million), mainly due to the following:

·       increase in net finance income from a net finance cost of ZMW132.49 million recorded in 2018 to a net finance income of ZMW39.96 million in recorded in 2019; and

·       increase in share of profit from equity accounted investee companies from ZMW689 million recorded in 2018 to ZMW973 million recorded in 2019, mainly on account of improved performance of Kansanshi Mining Plc and Maamba Collieries Limited whose combined share of profit accounted for 84% of the recorded amount for the year.

Despite the Group reporting a profit for the year of ZMW448 million, there was a decline of 47% compared to last year mainly due to recorded losses from Ndola Lime Company Limited, and Investrust Bank Plc (Investrust) amounting ZMW246 million (2018: ZMW190 million) and ZMW79 million (2018: no comparison applicable as Investrust was not a subsidiary then), respectively.  

The Company reported a loss for the year of ZMW108 million (2018: Profit ZMW433 million), mainly due to reduction in other income, impairment losses and fair value loss amounting to ZMW360 million, ZMW 373 million and ZMW 336 million respectively.

Group total assets increased by 30% to ZMW13,412 million in 2019 from ZMW10,332 million in 2018. This is attributed to increase in property, plant and equipment, investment property, investments in associate, inventories, trade and other receivables as well as held-to-maturity investment.  The largest contributor to total asset increase was the enhanced values of investments in associates from ZMW 7 355 million in 2018 to ZMW 10,276 million as a result of improved performance of Kansanshi Mining Plc, Maamba Collieries Limited and exchange gains arising from translation of these US Dollar denominated investments. The Zambian Kwacha depreciated from ZMW9.49 per US Dollar as at 31 March 2018 to ZMW12.19 per US Dollar as at 31 March 2019.

2.    SIGNIFICANT DEVELOPMENTS

During the year the Group has invested in several investment projects in line with the Group's   2018-2023 Strategic Plan in a quest to maximize shareholder value.

The significant developments are detailed below:

Investrust Bank Plc

Subsequent to the reporting date, Investrust Bank Plc and ZCCM Investments Holdings Plc entered into a Non-Cumulative, Redeemable Non-Voting Preference Share Subscription Agreement. The agreement would result in ZCCM-IH recapitalizing the Bank with ZMW 286 million. The recapitalization will improve the operations of the bank and strengthen its competitive position. 

Konkola Copper Mines Plc

On 21 May 2019, ZCCM-IH filed a petition in the High Court of Zambia for the winding up of KCM.  ZCCM-IH has filed the said petition pursuant to Section 56(1)(c) of the Corporate Insolvency Act No. 9 of 2017. By Order of the Court, Mr. Milingo Lungu Simwanza & Company has been appointed as provisional liquidator.

Kariba Minerals Limited (KML)

On 9th November 2018, ZCCM-IH and Gemfields signed a Share Purchase Agreement for ZCCM-IH to purchase the additional 50% stake in KML. This acquisition has resulted in ZCCM-IH owning 100% of KML.

Kabundi Resources Limited

In March, 2019, the ZCCM-IH Board resolved to incorporate a Special Purpose Vehicle, Kabundi Resources Limited ("KRL") a wholly owned subsidiary. KRL is located in Chief Muchinda's area in Serenje District, Central Province. KRL is a mining operating company whose main activities include mining, processing and marketing of manganese and other non-ferrous metals.

Others

During the period under review, ZCCM-IH acquired a 49% interest in Rembrandt Properties Ltd (developing a budget hotel and retail outlet) and a further acquisition of a residential complex, all in Lusaka.

3.    OUTLOOK

Looking into the future, the Group will continue to execute the 2018-2023 strategy to reduce dependence on dividend income streams which historically have been unstable and inconsistent. The significant developments highlighted above are expected to have a positive impact on the group's performance in the medium to long term.

By Order of the Board

Chabby Chabala

Company Secretary

Issued in Lusaka, Zambia on Monday, 16^th December 2019

Lusaka Securities Exchange Sponsoring Broker
	T     |     [phone] E     pan class="ll">[e-mail] 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 16 December 2019

Click on, or paste the following link into your web browser, to view the associated PDF document.

http://www.rns-pdf.londonstockexchange.com/rns/0151X_1-2019-12-16.pdf

 

END

 

 

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