ZCCM-IH IN k3 Billion loss
ZCCM-IH posted a second successive loss after tax of nearly K3 billion in the 2016 financial year.
The loss was triggered by depressed copper prices coupled with low production, its latest financial results reveal.
But ZCCM-IH says it continues to explore diversification in order to ensure its survival.
According to an audited statement of comprehensive income for the financial year ending March 31, 2016, ZCCM-IH posted losses of K2.91 billion, mainly induced by low copper prices on the international market, coupled with low production.
This marks its second successive loss from the previous corresponding period of K987 million, which was similarly triggered by depressed copper prices and the kwacha’s depreciation against major currency convertibles in 2015.
“Performance of the group continued to be impacted by low global copper prices coupled with low production. The price of copper on the LME further fell from US$6,052/tonne at 31 March 2015 to US$4,848/tonne at 31 March 2016. As a result, most of the investee companies recorded significant operating losses during the period. Loss after tax was K2,912 million (2015: Loss K987million),” ZCCM-IH stated.
“Further, the kwacha depreciated by 48 percent from K7.5755/US$ as at 31 March 2015 to K11.1800/US$ as at 31 March 2016. This had a significant impact on the group results.”
But the holding company adds that it continues to explore diversification in order to ensure its survival through such as investments in the Ndola Lime Company (NLC), among others.
ZCCM-IH lent the NLC K651 million that was converted into equity, in order, to strengthen the company’s balance sheet during the period under review.
“In order to ensure survival, ZCCM-IH continues to explore diversification. Introducing initiatives to achieve efficiencies at NLC, the completion of the Maamba Thermal Plant, investments in property and agriculture are activities expected to positively impact the group in the medium to long-term,” states ZCCM-IH.
“The copper price has recently shown signs of recovery, and it would appear that beyond 2016 the price will continue to recover. ZCCM-IH’s investee companies that operate mines have been undergoing restructuring in order to contain operating costs in the midst of the global copper price crunch. This should yield positive results going forward, though recovery will be slow.”
The loss was triggered by depressed copper prices coupled with low production, its latest financial results reveal.
But ZCCM-IH says it continues to explore diversification in order to ensure its survival.
According to an audited statement of comprehensive income for the financial year ending March 31, 2016, ZCCM-IH posted losses of K2.91 billion, mainly induced by low copper prices on the international market, coupled with low production.
This marks its second successive loss from the previous corresponding period of K987 million, which was similarly triggered by depressed copper prices and the kwacha’s depreciation against major currency convertibles in 2015.
“Performance of the group continued to be impacted by low global copper prices coupled with low production. The price of copper on the LME further fell from US$6,052/tonne at 31 March 2015 to US$4,848/tonne at 31 March 2016. As a result, most of the investee companies recorded significant operating losses during the period. Loss after tax was K2,912 million (2015: Loss K987million),” ZCCM-IH stated.
“Further, the kwacha depreciated by 48 percent from K7.5755/US$ as at 31 March 2015 to K11.1800/US$ as at 31 March 2016. This had a significant impact on the group results.”
But the holding company adds that it continues to explore diversification in order to ensure its survival through such as investments in the Ndola Lime Company (NLC), among others.
ZCCM-IH lent the NLC K651 million that was converted into equity, in order, to strengthen the company’s balance sheet during the period under review.
“In order to ensure survival, ZCCM-IH continues to explore diversification. Introducing initiatives to achieve efficiencies at NLC, the completion of the Maamba Thermal Plant, investments in property and agriculture are activities expected to positively impact the group in the medium to long-term,” states ZCCM-IH.
“The copper price has recently shown signs of recovery, and it would appear that beyond 2016 the price will continue to recover. ZCCM-IH’s investee companies that operate mines have been undergoing restructuring in order to contain operating costs in the midst of the global copper price crunch. This should yield positive results going forward, though recovery will be slow.”