CEC | FY2016 earnings results
In compliance with the requirements of the Securities Act No. 41 of 2016 and the Listings Requirements of the Lusaka Securities Exchange, CEC announces its audited results for the year ended 31st December 2016.
Financial Highlights
- CEC Plc. paid two dividends during the year being a cash dividend of USD16.4 million in March 2016 and dividend specie of CEC Africa Investments Limited (CEC Africa), paid in December, 2016. The Company remains committed to ensuring that its shareholders derive a return from their investment through dividend and sustained share price growth.
- Revenue increased by 19% in Zambian Kwacha terms compared to the corresponding past period mainly due to increased power trading revenue.
- The Company has recorded a net loss of ZMW1,161 million compared to a profit of ZMW341 million last year. The loss is attributed to the impairment of ZMW 1,559 million on of the CEC Africa investment and receivable.
- Excluding the impairment loss adjusted earnings before interest and tax, depreciation and aromatization was ZMW 934 million compared to ZMW 599 million in the corresponding year. This is an increase of 56%.
- Power trading revenue increased by 124% from ZMW552 million to ZMW1, 237 million in 2016. This increase compensated for the decrease in domestic power sales.
Dividends Proposed and Paid
During the year under review, the Company paid a cash dividend of ZMW169 million (USD16.4 million) and a dividend in specie of CEC Africa.
Outlook
Going into 2017, we forecast that power sales to the mines in Zambia will show some good level of recovery, though full rebound of demand is only expected at the end of 2018 onwards. On the telecoms front, we remain confident that CEC Liquid Telecom will continue with its profitable growth in the coming years as it continues with its infrastructure expansion and enhanced product offering with improved affordability.
A Government-led tariff negotiation commenced in 2016 and is expected to be concluded in quarter one of 2017. The process was driven by the need for cost-reflectivity in power tariffs and once closed, will provide a solution to the upward adjustment attempts of 2014 and 2015 that proved unsuccessful.
By Order of the Board
Julia C Z Chaila (Mrs.)
Company Secretary
Issued in Lusaka, Zambia on 15th March, 2017
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First issued on 15 March, 2017
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