COPPERBELT ENERGY CORPORATION PLC
                             [Incorporated in the Republic of Zambia]
                  ...
Total assets                                                         274,711                   178,977

 Total equity     ...
Prior year adjustment                        -               -              -           3,700               3,700
 As rest...
Dividends

During the year under review, two interim dividends of US$ 4,000,000 and US$ 6,000,000 were declared
and paid o...
Kabompo Gorge Hydro

CEC was awarded the right to undertake the feasibility study for the development of a medium sized hy...
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CEC: 2009 Full Year Results

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Turnover for the year to 31 December 2009 was 13% lower than the previous corresponding period due to reduced sales to some mining customers who were impacted by the low commodity prices

Earnings increased by 18% compared to the previous financial year, due to a 176% increase in other income, and an 11% reduction in operating expenses compensating for reduced sales to the mines

Value of property, plant and equipment increased by 88% to US$ 236.2m due to asset revaluation and capital expenditure during the year

The feasibility study for the Kabompo Gorge Hydro project was completed and the project will be moving into the implementation stage

CEC was accorded full membership of the Southern Africa Power Pool in November 2009.

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CEC: 2009 Full Year Results

  1. 1. COPPERBELT ENERGY CORPORATION PLC [Incorporated in the Republic of Zambia] Company registration number: 39070 Share Code: CEC ISIN: ZM0000000136 [“CEC”] SUMMARY RESULTS FOR THE YEAR ENDED 31st DECEMBER 2009 In compliance with the requirements of the Securities Act Cap 354 of the Laws of Zambia and the Listings Rules of the Lusaka Stock Exchange, Copperbelt Energy Corporation PLC announces the audited results for the year ended 31st December 2009. Summary Statement of Income for the year ended 31st December 2009 Twelve Months Twelve Months to 31 December to 31 December 2009 2008 US $’000 US $’000 Revenue 154,169 177,486 Profit before interest and tax 19,126 17,222 Net finance costs (750) (1,745) Income tax expense (6,456) (5,334) Profit attributed to shareholders 11,920 10,143 Earnings per share Weighted Basic and diluted earning per share(cents) 1.19 1.01 Summary balance sheet as at 31 December 2009 31 December 31 December 2009 2008 US $’000 US $’000 Restated Total non-current assets 238,211 125,398 Total current assets 36,500 53,579
  2. 2. Total assets 274,711 178,977 Total equity 158,273 43,273 Total Non Current Liabilities 81,591 95,918 Total Current Liabilities 34,847 39,786 Total Equity and Liabilities 274,711 178,977 Summary Statement of cash flows for the year ended 31 December 2009 31 December 31 December 2009 2008 US $’000 US $’000 Net cash inflows from operating activities 11,658 10,372 Net cash outflows used in investing activities (8,341) (6,083) Net cash outflows/inflow(from)/on Financing activities (16,959) (5,179) Net (decrease)/ increase in cash and cash equivalents (13,642) (890) Cash and cash equivalents at 1 January 16,314 17,472 Exchange Loss (373) (268) Cash and cash equivalents at 31 December 2,299 16,314 Statement of changes in equity for the year ended 31 December, 2009 Share Share Revaluation Retained Total Capital premium reserve earnings US$’000 US$’000 US$’000 US$’000 US$’000 Balance at 1 January 2008 As previously stated 100 148 - 45,382 45,630 Prior year adjustment (a) - - - 3,700 3,700 As restated 100 148 - 49,082 49,330 Comprehensive income for the year - - - 10,143 10,143 Dividend paid - - - (16,200) (16,200) Balance at 31 December 2008 100 148 - 43,025 43,273 Balance at 31 December 2008 As previously stated 100 148 - 39,325 39,573
  3. 3. Prior year adjustment - - - 3,700 3,700 As restated 100 148 - 43,025 43,273 Revaluation increase - - 113,080 - 113,080 Comprehensive income for the year - - 11,920 11,920 Dividend paid - - - (10,000) (10,000) Balance at 31 December 2009 100 148 113,080 44,945 158,273 Highlights • Turnover for the year to 31 December 2009 was 13% lower than the previous corresponding period due to reduced sales to some mining customers who were impacted by the low commodity prices. • Earnings increased by 18% compared to the previous financial year, due to a 176% increase in other income, and an 11% reduction in operating expenses compensating for reduced sales to the mines. • Value of property, plant and equipment increased by 88% to US$ 236.2m due to asset revaluation and capital expenditure during the year. • The feasibility study for the Kabompo Gorge Hydro project was completed and the project will be moving into the implementation stage. • CEC was accorded full membership of the Southern Africa Power Pool in November 2009. CEC Profile CEC supplies power to the mines based on the Copperbelt, and owns and operates a network comprising 884km of transmission lines, 38 substations, a system control centre and 80MW of gas turbine generators and 540km of optical fibre providing a communications backbone for the Copperbelt. CEC also wheels power through its network on behalf of ZESCO on the Copperbelt, and operates an interconnector with the Democratic Republic of Congo. Financial Report The summarised financial statements have been prepared in compliance with International Financial Reporting Standards (IFRS) and are consistent with those applied in the previous periods with the exception of the fixed assets policy which was amended. Revenue decreased by 13% to US$ 154.2m for the year to 31st December, 2009 (2008 US$ 177.5m). The decrease is attributed to the reduction in load to some mining customers whose operations were placed under care and maintenance during 2009. Cost of sales, that mainly comprised payments to ZESCO under the Bulk Supply Agreement, decreased by 12.6% to US$111.8m (2007 US$ 127.9m) due to the reduced sales to the mines. Profit before interest and tax increased by 11% to US$19.1. This was achieved through a reduction in operating expenses arising from cost control measures, and a greater contribution to income from sources other than the sale of powet to the mines. The weighted basic and diluted earnings per share increased by 18% to US 1.19 cents for the year, compared to US 1.01 cents per share for the previous year.
  4. 4. Dividends During the year under review, two interim dividends of US$ 4,000,000 and US$ 6,000,000 were declared and paid on 3rd April and 25th September 2009 respectively. This represented a dividend of US 0.40 cents and US 0.60 cents per share. This translated to approximately K22.62 and K28.92 per share respectively in kwacha terms. No final dividend is proposed in respect of this financial year. Therefore the total dividend declared for the year was US1.00 cents per share or K51.54 per share which translates to a gross dividend yield of 13 % based on the share price at the close of the year of 430K per share as recorded at the Lusaka Stock Exchange. Review of Operations During the year all purchases of electrical power were from ZESCO Limited under the Bulk Supply Agreement. Electricity supplies from this source accounted for 99.99% of the total requirements. The balance was supplied from the Company’s Gas Turbine Generating plants. Sales of electrical energy to CEC customers totalled 3,339 GWh, a reduction from 3,981 GWh sales the previous year due to reduced customer demand caused by the low commodity prices in the first half of the year. The total energy import into the network was 5,061 GWh of which 3,450 GWh was the Company purchases while 1,611 GWh was wheeled for ZESCO. International wheeling was mainly dictated by the power export requirements from SNEL in DRC to Frontier Mine, ZESA in Zimbabwe and ESKOM in RSA. The operations of the Company’s high-voltage transmission and distribution system were maintained to a satisfactory standard. Further a satisfactory security of supply from ZESCO was generally maintained throughout the year. However, there were two major occurrences resulting in interruptions of supply, one arising from the ZESCO system during the month of June and the other from the DRC/SNEL network in September. Thefts and vandalism of the Company’s installations continued to be a major cause of concern. There was an increase in the number of theft/vandalism cases on CEC’s electrical installations. The Company continued to put in place stringent security measures to ensure that the security of the power system is not compromised The Company was accorded full membership of the Southern Africa Power Pool (SAPP) in November 2009. This membership will enhance the status and influence of the company within the SADC region, and provide a basis for undertaking regional projects. Future Outlook Outlook for the Core Business Sales of power to the main mining companies on the Copperbelt are expected to increase steadily due to new investment by CEC’s mining customers, particularly in the Luanshya and Konkola areas. Second Interconnector Between Zambia and the Democratic Republic of Congo An Infrastructure Development Agreement was signed in October 2009 through which CEC and the Congolese utility SNEL agreed to construct a new dual circuit 220 kV transmission line between DRC and Zambia that will facilitate the transfer of 550MW of firm power from DRC to Zambia. Construction and commissioning are expected to be complete by the second quarter of 2011.
  5. 5. Kabompo Gorge Hydro CEC was awarded the right to undertake the feasibility study for the development of a medium sized hydro station at Kabompo Gorge in North Western Province in the final quarter of 2008 through the Office for Promoting Private Power Investment (OPPPI). The detailed feasibility study report for the design of the hydro station is complete. The Environmental and Social Impact Assessment is underway encompassing a thorough review of the impact of the proposed project on the local community, a review of the project by National Heritage Conservation Commission and consultations with the local Chiefs and Government departments. The terms of reference for the study were approved by the Environmental Council of Zambia, and a number of public hearings were held at the project site and in neighbouring communities It is expected that the tendering process will be undertaken during 2010, with a view to commencing construction during 2011. The pre-feasibility study for the site estimated that the station would comprise a 34MW power station, a dam wall 65m in height, an underground power station and a 4km tunnel. The final design parameters will be confirmed from the detailed design. Telecommunications Joint Venture CEC signed a Joint Venture Agreement with RTAA (Pty) Limited and completed the acquisition of 50% shares in Realtime Technology Alliance Africa Ltd. for US$2.0m in July 2009 following regulatory consent from Zambia Competition Commission to proceed with the transaction. Realtime provides its customers with internet access and Virtual Private Networks, operates a resilient national network and provides radio and VSAT access where fibre has not yet been installed. CEC seconded a number of senior managers into the Joint Venture. Other Developments CEC’s future growth strategy is based on seeking concessions to develop generation and transmission projects that will have a positive impact in the region. The migration towards cost reflective tariffs in the region is expected to ensure that the investments will provide sufficiently attractive investment returns. Annual General Meeting The Annual General Meeting of the Company will be held on Friday 26th March 2010 at Ravens Country Club, corner Central Street/24th Avenue, Nkana East, Kitwe commencing at 10.00 hours. By Order of the Board Julia C Z Chaila (Mrs.) Company Secretary Date : 25 February 2010

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