Good morning. Here’s what you need to know
-
ZCCM-IH hands over K41.6m dividend cheque to MoF
-
Zambia and Ukraine Strengthen Bilateral Ties Amidst Russia-Ukraine Conflict
-
China’s exports miss expectations in July, while imports pick up with growth of 7.2%
In Local Business and Finance News
One of the most pressing issues facing ZESCO is the non-cost-reflective nature of current electricity tariffs. For years, tariffs have been kept artificially low due to socio-political pressures. This pricing strategy has resulted in substantial revenue shortfalls, preventing ZESCO from investing adequately in infrastructure maintenance and upgrades. Aligning electricity tariffs with the actual cost of production and distribution ensures that ZESCO can generate sufficient revenue to cover its operational and capital expenses. This approach not only improves financial stability but also attracts private investments by creating a predictable and stable market environment. Read more on Financial Insight
ZCCM-Investment Holdings (ZCCM-IH) has paid over K1.6 billion in dividends to all stakeholders since 2015, attributing this to the company’s consistent positive performance, resilience and profitability over nearly a decade. The company has also handed over a dividend cheque of K41.6 million to the Ministry of Finance and National Planning, which holds a 17.4 percent stake in the company on behalf of the Zambian government. The cheque was presented by ZCCM-IH Chief Executive Officer, Dr. Ndoba Vibetti, to Finance and National Planning Minister Dr. Situmbeko Musokotwane in Lusaka on Tuesday. Additionally, ZCCM-IH distributed two dividend cheques totaling K182 million to its other stakeholders, the Industrial Development Corporation (IDC) and the National Pension Scheme Authority (NAPSA). Read more: Zambia Monitor
President Hakainde Hichilema held a bilateral meeting with and Ukrainian Foreign Minister Dr. Dmytro Kuleba yesterday. The discussions focused on fortifying the longstanding bilateral relations between Zambia and Ukraine, which have been steadfast since 1993, and addressing the ongoing Russia-Ukraine War, which has resulted in immense human suffering and global economic disruptions. President Hichilema reaffirmed Zambia’s commitment to supporting a comprehensive and lasting peace in Ukraine through dialogue. “Zambia remains committed to supporting a comprehensive and lasting peace in Ukraine through dialogue,” he stated. A notable outcome of the meeting was Ukraine’s proposal to establish Zambia as a regional grain distribution hub. This initiative aims to leverage Zambia’s strategic location, surrounded by nine neighboring countries, and the transportation capabilities of the Lobito and Tazara Corridors. This move is expected to enhance regional food security and economic stability. Read more: Lusaka Times
Mopani Copper Mines says it is in the process of sinking three new shafts at its Kitwe and Mufulira mine sites, which will increase copper production to 225,000 tonnes annually once completed. Speaking at the 96th Agricultural and Commercial Show, Mopani Copper Mines Public Relations Officer Lillian Musenge said one of the challenges the mine faced was its old infrastructure. Read more: News Diggers
In International News
The International Monetary Fund (IMF) has resolved to expand its Executive Board by adding a 25th chair, specifically dedicated to Sub-Saharan Africa. This was resolved by the IMF Board of Governors on Saturday. This resolution, which garnered the necessary 85 percent majority of the Fund’s total voting power, underscored a significant shift towards enhancing the representation of Sub-Saharan Africa within the IMF’s decision-making apparatus. The initiative followed the 2023 Annual Meetings in Marrakech, where the International Monetary and Financial Committee called for increased Sub-Saharan African representation to address regional imbalances. IMF Managing Director, Kristalina Georgieva, in a statement hailed the move as a crucial advancement towards a more inclusive Board that accurately mirrored the global economic landscape. Read more: Zambia Monitor
Fitch Ratings has downgraded Dangote Industries Ltd.’s creditworthiness, citing a “significant deterioration in the group’s liquidity position” among other factors. Fitch Ratings has downgraded Dangote Industries Ltd.’s creditworthiness, citing a “significant deterioration in the group’s liquidity position” among other factors. The National Long-Term Rating of the corporation owned by Africa’s richest man, Aliko Dangote was downgraded from ‘AA(nga)’ to ‘B+(nga)’. The senior unsecured debt rating for Dangote Industries Funding Plc has also been lowered from ‘AA(nga)’ to ‘B+(nga)’. Fitch has placed both ratings on Rating Watch Negative (RWN). Read more: Business Insider
Sony on Wednesday reported a 10% jump in operating profit in the fiscal first quarter, beating analyst expectations after seeing strong growth in its gaming, music and imaging chip businesses. The Japanese technology giant’s music division, in particular, got a boost during the quarter as the release of R&B star Beyonce’s new “Cowboy Carter” album boosted its performance. Here’s how Sony did in the June quarter, versus LSEG consensus estimates: Revenue: 3.01 trillion Japanese yen ($20.5 billion), versus 2.8 trillion yen expected. That marked a 2% rise from the same period a year ago. Operating profit: 279.11 billion yen ($1.9 billion), versus 275.35 billion yen expected. That was up 10% year-over-year. In an earnings release Wednesday, Sony said that its first-quarter sales benefited from “significant increases” in game and network services, music, and imaging and sensing solutions. Gaming, for which Sony is well-known thanks to its popular PlayStation consoles, banked revenues of 864.9 billion yen in the quarter, up 12% from 771.9 billion yen a year ago. Read more: CNBC
Airbnb shares dropped 14% in after-hours trading after the company reported second-quarter earnings that missed analyst expectations and warned that it’s seeing signs of slowing demand from U.S. customers. Here’s how the company did compared to LSEG estimates for the quarter ended June 30: Earnings per share: 86 cents vs. 92 cents expected. Revenue: $2.75 billion vs. $2.74 billion expected Revenue increased 11% year over year. Airbnb reported a net income of $555 million, or 86 cents per share, down 15% from $650 million, or 98 cents per share, in the year-earlier quarter. The vacation rental company guided to third-quarter revenue of $3.67 billion to $3.73 billion, but also warned that it expected moderation in year-over-year growth in its key “Nights and Experiences” category, relative to the current quarter. It also cautioned that it was “seeing shorter booking lead times globally and some signs of slowing demand from U.S. guests.” Read more: CNBC
China’s exports grew at their slowest pace in three months in July, missing expectations and adding to concerns about the outlook for the vast manufacturing sector, while a rush to boost chip supplies before expected U.S. tech curbs bumped up imports. Analysts say China’s factories will likely face stiff pressure in the months ahead, hobbled by Western tariffs and demand woes while volatility in financial markets and U.S. recession fears raise fresh challenges for policymakers trying to bolster a fragile economic recovery. Outbound shipments climbed 7.0% in July from the year earlier, customs data on Wednesday showed, a slower pace of growth than June’s 8.6% rise and missing forecasts of a 9.7% increase. Read more: Reuters
Finally, Capital Markets News
In 117 trades recorded yesterday, 49,325 shares were transacted resulting in a turnover of K382,764.03. The following price changes were recorded yesterday: -K0.07 in Airtel, -K0.01 in CEC Zambia, +K0.35 in PUMA, -K0.01 in Standard Chartered Bank Limited and -K0.01 in ZANACO. Trading activity was also recorded in AECI, Chilanga Cement, ZCCM, Zambia Sugar and CEC Africa on the quoted tier. The LuSE All Share Index (LASI) closed at 14,507.48 points, 0.19% higher than its previous day close at 14,480.57 points. The market closed on a capitalization of K118,686,446,503.86 including Shoprite Holdings and K75,208,089,703.86 excluding Shoprite Holdings.
11 Govt Bond trades with total quantity K169,446,000 and turnover K114,953,600 were processed yesterday.
