Story of the Day:
Zambeef’s revenue and gross profit increased by 8.5% and 11% respectively in Kwacha. The marginal top line growth was mainly on account of volume pressures in Retail and cold chain food Products. The Group delivered a profit before tax of ZMW55 million (USD3 million), representing a decline of 68% in Kwacha (61% in US dollar terms), compared to ZMW172 million (USD8 million) in the prior year. The above results posted are after the recognition of goodwill impairment amounting to ZMW141.8 million on the fair value of Zamchick Limited’s asset. Adjusting for this non-cash impairment, the Group delivered a profit before tax of ZMW197 million (USD11.5 million) representing a growth of 15%. Read more
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Development Bank of Zambia (DBZ) board chairperson Noel Nkoma says the bank is targeting to secure not less than $50 million for lending next year. In an interview, Nkoma, however, said the bank was currently focusing on attaining optimum recapitalisation of about K1.2 billion, which would help strengthen its balance sheet. “As you know, the bank is under reconstruction meaning that our first assignment as the board working with management was to clean the balance sheet. Because the balance sheet is the heartbeat of the institution. Now, our model going forward is such that we want a bank which leverages what you call lines of credit from partner development financial institutions. Read more: News Diggers
Mines Minister, Paul Kabuswe says government is working on the new local content policy which will enable local mine suppliers and contractors to get quality jobs from the mines. Mr Kabuswe said a team of Ministers working on the policy is yet to arrive on the appropriate figures. Speaking in Kitwe during the Association of Mine Suppliers and Contractors mining symposium, Mr Kabuswe said government is not going to allow local contractors to pick crumbs from the mining sector but will ensure that they become key players. Read more: Lusaka Times
Centre for Trade Policy and Development (CTPD) has urged Government to consider implementing a mineral royalty tax model for shares held in mining companies. CTPD Head Researcher Boyd Muleya says the mineral royalty tax model entered into with Kansanshi in place of a Dividend model for shares should be replicated in other mines. Mr. Muleya says since the Dividend model is based on profit, implementing the mineral royalty tax model on shares will enable the country get revenue from mining operations even when profit has not been made. He says steady revenue from mines will allow ZCCM-IH raise capital to roll out its investment strategy. Read more: ZNBC
Policy Monitoring and Research Centre (PMRC) has urged government to increase funding towards the Artisanal and Small-Scale Mining (ASM) subsector from K50 million allocated in 2023 national budget to slightly above K200 million. Centre Acting Executive Director Sydney Mwamba told Money FM News that the K50 million allocation is seemingly low because the country has about 500,000 people engaged in artisanal and small-scale mining directly or indirectly, and face numerous challenges such as lack of equipment, inadequate finances, and lack of technical skills. Read more: Money FM
Zambia Chamber of Commerce and Industry (ZACCI) says Zambia is a notable destination of choice for Foreign Direct Investments (FDIs) due to its conducive business environment, predictable economic policy, and its central location with readily available market for products and services. Speaking on the sidelines of the on-going 3rd Pakistan Africa Trade Development Trade Expo at the Sandton Convention Centre in Johannesburg, ZACCI President Dr. Chabuka Kawesha was happy that Zambia was given an opportunity to market itself at the Conference. Dr. Kawesha said there are a lot of opportunities that investors coming to Zambia could explore in various sectors of the economy such as agro-processing, agriculture and value addition, mining, manufacturing, and tourism. Read more: Money FM
International Business and Finan
The Swiss-based mining company, Glencore, has said it will pay $180m to the Democratic Republic of Congo to settle corruption claims. The agreement covers an 11-year period from 2007 to 2018. It is the latest in a series of corruption cases which has seen Glencore agree to pay out more than $1.6bn in fines this year. In May it admitted bribing officials in several African nations including DR Congo (DRC). The Congolese government has told the BBC it is not commenting. It followed an investigation by American, British and Brazilian authorities that also covered corruption claims in Latin America. Despite the fines Glencore is expected to make record profits of around $3.2bn this year. Read more: BBC News
Bitcoin could drop to $5,000 next year in a market surprise that investors are under-pricing, according to Standard Chartered. If that level is reached, it would mark a roughly 70% plunge from Monday’s price of just over $17,000 for one bitcoin. In a note entitled “The financial-market surprises of 2023,” Standard Chartered outlined a number of possible scenarios that “we feel are under-priced by the markets.” “Yields plunge along with technology shares, and while the Bitcoin sell-off decelerates, the damage has been done. More and more crypto firms and exchanges find themselves with insufficient liquidity, leading to further bankruptcies and a collapse in investor confidence in digital assets,” Eric Robertsen, global head of research at Standard Chartered Bank, said in the note Sunday. Read more: CNBC
Stocks fell Monday on fears that the Federal Reserve may continue tightening until it tips the economy into a recession. The Dow Jones Industrial Average fell 482.78 points, or 1.4%, to finish at 33,947.10. The S&P 500 slumped 1.79% to settle at 3,998.84. The Nasdaq Composite slid 1.93% to end the session at 11,239.94. Tesla shares shed about 6.4% on reports of an output cut at its Shanghai factory, while tech stocks like Amazon and Netflix slid 3.3% and 2.4%, respectively, on growth concerns. Read more: Read more: CNBC
The United Kingdom faces a “lost decade” of growth if action isn’t taken to address slumping business investment and worker shortages, a leading business lobby group has warned. In a bleak economic forecast published on Monday, the Confederation of British Industry (CBI) said that three quarters of companies are struggling to find the skills and workers they need. It urged changes in government policy, including a more flexible immigration system and tax breaks to boost investment. Read more: CNN
Slower hiring. Weaker spending. And softer growth. That’s what America’s CEOs are bracing for as the economy heads into 2023 facing a series of obstacles. The Business Roundtable said Monday its CEO Economic Outlook Index tumbled during the fourth quarter to the lowest level in more than two years. The index, a composite of CEO plans for business investment, hiring and sales expectations, has declined every quarter this year, plunging from 124 a year ago to 73 now. “The results signal CEOs remain cautious amid persistent domestic and global economic headwinds, including high inflation and the Fed measures required to tame it,” the Business Roundtable said in a news release. Read more: CNN
Capital Markets Report
In 91 trades recorded yesterday, 21,576 shares were transacted resulting in a turnover of K70,136.75. A share price gain of K0.01 was recorded in ZAFFICO. A share price loss of K0.01 in Zanaco. Trading activity was also recorded in AECI, CEC Zambia, Chilanga Cement, PUMA, Standard Chartered Bank Limited and Zambeef. The LuSE All Share Index (LASI) closed at 7,341.92 points, 0.03% downfrom it’s previous close at 7,344.32 points. The market closed on a capitalization of 72,889,737,541.17 including Shoprite Holdings and K37,107,052,101.17 excluding Shoprite Holdings.