RNS Number:4725J
ZCCM Invs.Hldgs PLC
08 March 2005
ZCCM INVESTMENTS HOLDINGS PLC
NOTICE OF THE ANNUAL GENERAL MEETING
Notice is hereby given that the 5th Annual
General Meeting of members of ZCCM
Investments Holdings Plc will be held at
Mukuba Pension, 5309 Dedan Kimathi Road,
on 30 March 2005 at 13.00 hours.
(a) To receive and consider for the
12 month period ended 30 June 2004 the
accounts and reports of the Directors
and the Auditors for the period ended on
that date; and
(b) To fix the remuneration of the Auditors
for the 12 month period ended 30 June 2004
and appoint Auditors for the ensuing year.
A member entitled to attend and vote at the meeting
is entitled to appoint one or more proxies to attend
and, on a poll, to vote in his stead. The proxy need
not be a member of the Company. A suitable form
of proxy is enclosed.
By Order of the Board
W S Musama, Company Secretary
Lusaka, Zambia
03 March 2004
ZCCM INVESTMENTS HOLDINGS PLC
CHAIRMAN'S STATEMENT
It is my pleasure to present the ZCCM Investments Holdings Plc Annual Report for
the year ended 30th June 2004.
Following a slow start to the year both in terms of global commodity prices and
domestic production, strong copper and cobalt prices coupled with improved
output in the second half of the year enabled a satisfactory ending to the year
with over ninety percent of the assets in our portfolio having achieved varying
levels of profitability.
We are confident that the ongoing rehabilitation of existing assets and
commencement of high value projects, such as the Kansanshi Copper Mining
Project, will raise profitability further.
During the year under review, London Metal Exchange copper inventories witnessed
a decline mainly attributed to an influx of demand for commodity metals fuelled
by growth in Asia and more particularly China. As a result, the cash copper
price improved to an average of US$1.10/lb and was sustained at these high
levels throughout the year.
Cobalt whilst comprising a smaller proportion of our mining activity, also
registered a significant upswing in price to the benefit of the industry and
country as a whole.
It is noteworthy to state that the challenge of our present investment portfolio
is hinged on the continued reduction of unit operating costs and continued
realization of favourable selling prices. To this end, it is noted that efforts
being made at the various units within our portfolio have recorded notable
successes. At one of the units, improvements undertaken have as at year end
succeeded in reducing the cash operating costs to US$0.53 per lb of copper
produced.
A total of approximately 280 000 metric tonnes of copper was produced by the
mining industry in 1999, a year before complete privatisation of the industry.
Though metals prices were depressed during much of the privatisation era to end
of December 2003, the introduction of new investors has enabled the mining
industry to re-capitalise and also record an increase in production from 336 385
tonnes and 353 594 metric tonnes in 2002 and 2003 respectively. The increase is
in part attributed to improvements in techniques and additional production
facilities.
Subsequent to the year end, Vedanta Resources Plc acquired 51 percent equity
stake in our largest operating investment, Konkola Copper Mines plc thereby
reducing our shareholding interest from 42 percent to 20.6 percent. This change
should facilitate certainty of production through the inflow of additional
management expertise and pledged standby funding of US$220 million for future
operations.
During the year, the closed Ramcoz plc (in Receivership) was sold to J & W and
the Agreements were signed on 19 December 2003, upon conclusion of the
negotiations between GRZ/Ramcoz Negotiating Team and J & W representatives. At
year end completion of the sale was awaiting finalisation of some outstanding
items.
The coming on stream of new mines such as Kansanshi, the reopening of Luanshya
Mines, the entry of a strategic partner at KCM and the implementation of
projects intended to increase output at Mopani, should see production figures
rise further in future.
The Company during the year under review associated with Maamba Collieries
Limited, by way of providing technical assistance with significant strides
having been achieved resulting in improved coal production and increased supply
to the Zambian market. Subsequent to the year end, the Company has rendered
support to Maamba Collieries' by facilitating the sourcing of short term
funding amounting to US$300,000. The funds are for the rehabilitation of the
Coal Processing Plant (CPP.
The Company has continued implementing the Copperbelt Environment Project (CEP)
which relates to post privatisation environmental clean up obligations. The
Project is sponsored by World Bank/Nordic Development Fund through GRZ and
ZCCM-IH has committed US$3.8 million from a project total of US$50.8m.
Since inception in March 2000, the Company has been involved in the resolution
of historic liabilities arising from the predecessor company ZCCM Limited. It
is now the intention of the Company to refocus on the future and identify new
and viable projects. The Company aims to seek equity partners, both local and
external, possessing appropriate competence and skills to manage the ventures
successfully. This action is intended not only to contribute to national
employment creation but also to expand and provide a sustainable investment
portfolio to meet future challenges as an investment holding Company.
As an investments holding company at the forefront of public-private sector
partnerships, we recognise that we occupy a unique position in Zambia. It is
our view that these partnerships, with the right focus and policies in place,
can promote social and economic development. Indeed, one of our foremost
objectives is to strive to ensure that all stakeholders in our business adhere
to legal and public expectations, particularly with regard to commercial
obligations and the preservation of our environment.
In conclusion, allow me to acknowledge the invaluable contribution of the Board
of Directors and the Management and Staff of ZCCM - IH Plc for their individual
and collective contribution, wise counsel and dedication.
George K Chibuye
Chairman - ZCCM Investments Holdings Plc
Lusaka, Zambia
03 March 2005
FINANCIAL REVIEW
FINANCIAL HIGHLIGHTS FOR YEAR ENDED 30 JUNE 2004
A Company net profit of K24,261 million was recorded during the year compared to
a net profit of K366,315 million reported in the previous year. The reduction
was due to a significant reduction in non operating income to K3,156 million
during this year from K462,417 million. Last year's income was derived largely
from a write off of some of the Company's GRZ debt. Interest income from
treasury management activities also reduced significantly on account of lower
than expected interest rates.
The Company earned revenue of K31,947 million compared to K25,685 million last
year, comprising copper and cobalt price participation income of K14,359 million
as well as dividend income of K17,588 million, generated from the Company's
investments in Chambishi Metals plc and Copperbelt Energy Corporation plc,
respectively.
The impact of the aforementioned reduction in profitability compared to last
year on the Company's cash position was mitigated by the cash receipt of a
deferred purchase consideration from Mopani Copper Mines plc of K19,126 million.
ZCCM Investments Holdings Plc
(Incorporated in the Republic of Zambia)
and its subsidiary companies
Income Statement
for the year ended 30 June,2004
All tabulated figures are stated in Zambian Kwacha Million
Company Group Company Group
2004 2004 2003 2003
Revenue 31,947 150,499 25,685 137,266
--------- --------- --------- ---------
Operating expenses/cost of sales
(16,130) (138,234) (61,012) (190,903)
--------- --------- --------- ---------
Operating profit/(loss) 15,817 12,265 (35,327) (53,637)
Other operating income 7,908 21,283 6,343 17,257
Net financing income/ (costs)
992 1,697 (50,899) (54,014)
Environmental expenses (2,899) (2,899) (10,661) (10,661)
Non operating income 3,156 11,169 462,417 670,837
--------- --------- --------- ---------
Profit before taxation 24,974 43,515 371,873 569,782
Income tax (713) 195 (5,558) (6,725)
--------- ---------
Net profit for the year 24,261 43,710 366,315 563,057
--------- --------- --------- ---------
Earnings per share K271.69 K489.49 K4,102.24 K6,305.48
--------- --------- --------- ---------
ZCCM Investments Holdings Plc
(Incorporated in the Republic of Zambia)
and its subsidiary companies
Balance sheet
as at 30 June,2004
All tabulated figures are stated in Zambian Kwacha Million
Company Group Company Group
2004 2004 2003 2003
Assets
Property, plant and 3,689 80,620 1,956 41,152
equipment
Investments, loans and 449,409 449,393 449,409 449,393
advances
Deferred tax asset - 744 - -
Other long term 92,222 92,222 67,160 68,212
receivables -------- ------- --------- --------
Total non-current assets 545,320 622,979 518,525 558,757
--------- --------
Inventories - 8,184 - 5,808
Accounts receivable and 57,960 84,722 57,002 81,033
prepayments
Government debt securities 29,141 29,141 18,882 18,882
held-to-maturity
Cash and bank 14,312 17,254 49,472 51,978
-------- ------- --------- --------
Total current assets 101,413 139,301 125,356 157,701
-------- ------- --------- --------
Total assets 646,733 762,280 643,881 716,458
-------- ------- --------- --------
Equity
Called up share capital 893 893 893 893
General reserve (1,597,220) (1,588286) (1,621,481) (1,633,985)
Revaluation reserve 870 11,398 870 12,684
Subordinated loan 865,445 865,445 865,445 865,445
-------- ------- --------- --------
Total equity (730,012) (710,550) (754,273) (754,963)
-------- ------- --------- --------
Liabilities
Long term loans 1,293,278 1,330,408 1,308,084 1,319,980
Finance lease - 3,795 - -
Restoration, rehabilitation
and environmental
provision
- 2,451 - 2,435
Grants - 12,008 - 4,678
Deferred tax liabilities - 6,740 - 8,082
--------- --------
Total non-current 1,293,278 1,355,402 1,308,084 1,335,175
liabilities -------- ------- --------- --------
Bank overdraft - 228 - -
Finance lease - 1,898 - -
Accounts payable 1,693 23,684 24,225 60,543
Accruals and provisions 79,855 89,284 61,804 69,188
Taxation 1,919 2,334 4,041 6,515
-------- ------- --------- --------
Total current liabilities 83,467 117,428 90,070 136,246
--------
Total equity and 646,733 762,280 643,881 716,458
liabilities -------- ------- --------- --------
These financial statements were approved by the board of directors on 3 March
2005.
ZCCM Investments Holdings Plc
(Incorporated in the Republic of Zambia)
and its subsidiary companies
Cash flow statement
for the year ended 30 June,2004
All tabulated figures are stated in Zambian Kwacha Million
Group Group Group Group
Operating activities 2004 2004 2003 2003
Profit before tax 43,515 569,782
Adjustments for non-cash items
Depreciation 3,950 3,404
Profit on assets retired and sold (697) (1,719)
Grants amortised (13,714) (10,034)
Dividends income (16,588) (25,685)
Movements on KCM restructuring - (317,223)
ZESCO loan written back - (431,139)
Exchange differences on loans and 215 46,391
investments
Changes in operating assets and
liabilities
(Increase)/decrease non-current (24,010) 314,803
receivables
(Increase)/decrease in inventories (2,376) 22,716
(Increase)/decrease in receivables (3,689) 31,164
Decrease in current payables (16,763) (157,458)
Increase/(decrease) in other long 16 (103,712)
term payables
Income tax paid (3,710) (4,392)
Interest income (6,771) (5,651)
Interest expense 103 13
------- ------- ------- --------
Cash flows used in operating (40,519) (68,740)
activities ------- ------- ------- --------
Investing activities
Purchase of property, plant and (43,422) (15,633)
equipment
Proceeds from sale of equipment and 701 1,974
other assets
Investments, loans and advances (10,259) (18,882)
Interest received 6,771 4,990
Dividends received 14,929 22,697
Disposal of subsidiary, net of cash - (6,532)
disposed of ------- ------- ------- --------
Cash flow from investing activities (31,280)
(11,386)
------- ------- ------- --------
Financing activities
Proceeds from non - current 30,099 65,744
borrowings
Repayment of borrowings (19,886) -
Payment of finance lease (66) -
liabilities
Finance lease received 5,759 -
Grants received 21,044 11,314
Interest paid (103) (13)
------- ------- ------- --------
Cash flow from financing activities 36,847 77,045
------- ------- --------
Net decrease in cash (3,081)
Cash balances at beginning of the
period
Cash and bank balances 51,978 55,428
Bank overdrafts - 51,978 (369) 55,059
------- ------- ------- --------
Cash balances end of the period
Cash and bank balances 17,254 51,978
Bank overdrafts (228) 17,026 - 51,978
------- ------- ------- --------
This information is provided by RNS
The company news service from the London Stock Exchange
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