On 26 August 2022, CEC released its Unaudited Results for the Half Year Ended 30 June 2022.
Financial Highlights
Total revenue for the 6-month period to 30 June 2022 was USD182.3 million, 12% above the comparative period last year and primarily driven by growth in our regional power supplies which grew by more than 28%, anchored on increase in volume sales of 22% and robust power sourcing arrangements.
The profit for the period was USD30.2 million, which represents growth of 18% from USD25.3 million in 2021. Despite the period under review recording a higher profit, there was a 201% increase in the impairment of receivables to USD9.6 million from USD3.2 million, computed in accordance with International Financial Reporting Standard 9. The Kwacha appreciated against the major currencies and specifically by about 21% against the US dollar when compared to 2021.
The consequence of the strong Kwacha was an effective increase of Kwacha denominated costs by 20% from USD17.2 million to USD20.6 million. The other costs continue to be contained through continuous cost-management initiatives.
Headline earnings for the 6-month period increased by 12% with earnings per share growing from USD0.016 per share to USD0.019 per share.
There was an improvement in cash generation from operations to USD38.4 million (2021: USD33.0 million) and a cash balance of USD103.0 million (2021: USD105.9 million).
The Company dividend policy provides for a pay-out of a minimum of 50% of the earnings, subject to the availability of cash, and reserves and having provided sufficiently for sufficient working capital and any other obligations.
Similar to the financial year 2021 no dividend was declared and paid during the period under review. However, the Company remains committed and will continue to deliver a consistent and reliable dividend to its shareholders on an annual basis.
Cautionary on Forward-looking Information
This summary results announcement contains financial and non-financial forward-looking statements about the Company’s performance and position. We believe that while all forward-looking information contained herein is realistic at the time of publishing this report, actual results in future may differ from those anticipated. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause CEC’s actual results, performance or achievements to differ materially from the anticipated results, performance or achievements expressed or implied by these forward-looking statements. Although CEC believes that the expectations reflected in these forward- looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct.
We take no obligation to revise or update these forward-looking statements to reflect events or circumstances that arise after the statements have been made.
About the Company
CEC’s core business is the supply of power to the copper mines in the Copperbelt Province of Zambia and the DRC. CEC provides the transmission use of system and wheels power through its network on behalf of ZESCO Ltd and other users in Zambia and the Southern Africa Power Pool. The Company operates a transmission interconnection with the DRC.
CEC has five incorporated subsidiaries – CEC-Kabompo Hydro Power Limited (CEC-KHPL), CEC DRC Sarl, CEC-InnoVent South, InnoVent-CEC North and Power Dynamos Sports Limited (PDSL). CEC-KHPL is the special purpose vehicle through which CEC has been pursuing the development of the Kabompo Gorge hydroelectric power project in Mwinilunga District of the North-Western Province of Zambia, while CEC-DRC Sarl is a special purpose vehicle incorporated to secure the power trading segment and grow the Company’s interest in the DRC market. PDSL is a special purpose vehicle which runs Power Dynamos Football Club.