In a week that saw ZCCM IH Group CEO Mabvuto Chipata declare a profit for the year of K448 million and a K53 million dividend for the financial year ending March 2019 at their Annual General Meeting, it was the announcement of the group’s gold intentions that were the limelight and focus that the group intended to communicate to shareholders and keen investors.
Weeks before the AGM, Mabvuto’s Public Relations Division had sent two signals to the market that set the tone of the meeting that was held on 14th January 2020.
“On 23 December 2019, the Board of Directors of ZCCM-IH approved the proposal to enter into a Joint Venture (JV) partnership with Karma Mining Services and Rural Development Company (“Karma”)”, read a statement issued by the group’s Company Secretary, Chabby Chabala on Friday 27th December 2019 and issued on SENS. The announcement of the Joint Venture would see the investment group join forces with a company that had expertise in gold processing.
“In line with one of its strategic objectives in mining, ZCCM Investments Holdings Plc (‘ZCCM-IH’) wishes to announce the incorporation of ZCCM Gold Company Limited (ZCCM Gold)”, read a statement issued on 14th January 2019 by Company Secretary, Chabby Chabala on the same day that the Board Chairman, Eric Silwamba hosted shareholders of the company at their Annual General Meeting at Southern Sun Hotel.
The aforementioned announcements were a clear indication that under Mabvuto stewardship, the Group’s intention was to re-write history in terms of how Zambian investments in mining can be structured for a win-win ultimate outcome.
“The venture into gold was always to produce more profit and value for our consumers and stakeholders”, said the CEO when asked the question why gold was so important by Financial Insight Analyst, Joshua Mwangu at media briefing that was held after the AGM on 14th January 2019. “Currently, there’s a gold processing plant in Rufunsa to produce gold bullion to sell to the Central Bank”.
In his presentation during the AGM, Mabvuto explained that in order to develop new revenue streams from the current portfolio of investments, they would be entering into royalty or revenue-sharing deals that would allow the Group’s participation in the mining supply chain with gold mentioned as one of the focus areas.
During his interview with the founder of Financial Insight prior to taking over as acting CEO in January 2019, Mabvuto had indicated that through their Strategic Plan for 2018 to 2023, aptly themed “Taking Giant Steps“, the Group saw itself moving away from traditional sources of income and diversifying commodity focus from Copper to reduce risk and enhance returns.
Without a doubt, bringing structure to the Gold mining value chain in Zambia that will see ZCCM IH partner with small scale miners, cooperatives and experts in the field is a noble agenda that will open a new less acrimonious mining chapter for the Group. With its investee companies Konkola Copper Mine Plc and Kansanshi Mining Plc currently embroiled in litigation and arbitration respectively, Mabvuto Chipata’s Golden era reassures shareholders and investors that the ZCCM IH investments division is razor-focused on continued creation of value for them.