The Achilles Heel in the ZCCM IH Armory
Finance, ZCCM-Investment Holdings Plc
IDC and ZCCM IH CEOs. Photo from

Recently, I was in attendance at the President’s Luncheon held at Lusaka’s up market restaurant, The Horse Shoe (“a stylish restaurant located in a cool and calm environment at the former Polo Grill premises” according to, hosted by ZCCM IH and Stanbic Bank. This was the first event that I would have the chance to hear from the CEO of ZCCM IH following the ‘delicious’ Cheque of K81.4 million (total dividend paid to all shareholders was K135 m) he handed over to IDC’s CEO Mateyo Kaluba in addition to the USD 19 million loan given to IDC to finance investment projects a few weeks prior.

ZCCM IH CEO Dr Pius Kasolo gave a vibrant speech (his fourth to the current president according to him) and he made sure he reminded all of us about his company’s recent accomplishments. I personally was excited that he also committed to continuing to sponsor and host the annual gala event for more years to come. The wine does flow at these events.

However, reading the past two annual reports off the ZCCM IH, it is clear that one notable investment has been a thorn in Pius Kasolo’s heel. In the 2012 AR, ZCCM IH reported that it had recapitalized Ndola Lime Company through a shareholder loan of K28.7 million (US2.82 million) for the NLC Recapitalization Project. At the time of publishing the 2016 AR, the Second Vertical Kiln (VK-2) was still undergoing hot commissioning.

Fast forward to the 2017 AR, it appears that the hot commissioning phase of the Recapitalization Project was met with a series of technical hurdles which affected the performance of the company. Small wonder why in the 2017 AR this particular update appeared under the “Strategic New Investments” section of the report? We asked the question because according to the 2017 AR, the Board is undertaking a review of the entire operation of the Ndola Lime to determine an appropriate option that will result in improving operations of NLC as well as the performance of the Group. CEO of Ndola Lime Moses Chilambe  must be having some interesting conversations with the ZCCM IH board.

Another thorn is Pius’ heel is ZCCM IH’s investment in CEC Africa (CEC Africa Investment Ltd). According to the 2017 AR, “the Company incurred a net loss for the year ended 31 December 2016 of K2, 656.58 million (US$269.21 million) (2015: K6.15 million (US$0.945 million)) and, at that date the Company’s total liabilities exceeded total assets by K1, 630.08 million (US$158.85 million (2015: total assets exceeded total liabilities by K805.73 million (US$106.36 million)) and the current liabilities exceeded its current assets by K1, 808.36 million (US$176.22 million) (2015: K284.41 million (US$37.54 million)). All this was a result of the debacle in the Nigerian investment that lead to substantial impairments.

From this particular investment, the ZCCM IH Board have been advised that CEC Africa is refocusing its efforts on consolidation and stabilizing the Nigerian operating assets in the immediate to medium term and positioning themselves for growth in the longer term. Some of the efforts mentioned include the offloading of the CECA stake in Sierra Leone and divestment of some early stage development given the bankability challenges and limited resources. However, the Board may need to be cautious with optimism as the dynamic Nigerian economy is fraught with fiscal and macro elements that make sustainability in the energy economy more challenging.

ZCCM IH possess a plethora of investments. It is expected that these investments pay a dividend as this ties in to Shareholder ratios such as Return on Investment and Return on Capital Employed (rate of return). Therefore, we anticipate the Board will scrutinize their numerous investments (with the aforementioned being no exception).


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