In compliance with the requirements of the Securities Act and the Listing Rules of the Lusaka Stock Exchange, CEC Africa Investments Limited announces its audited results for the Year ended 31 December 2020.

Commentary

Despite the recorded net loss of ZMW of 1.1 billion for the year 2020, CECA performance continued to make steady improvement during the year with regard to the number of issues that have affected its performance in previous years, including:

Non-Cost Reflective Tariffs:

In the year 2019, the Nigerian Electricity Regulation Commission issued a minor tariff review which enabled AEDC to make tariff adjustments for prior year tariff short falls. The prior year adjustments enabled the company to make a profit of ZMW 4.2 billion for the year 2019. The minor tariff adjustments have continued for the year 2020 and as a result the company has made a gross profit of ZMW 99million.

Negotiation on the Acquisition Facility from UBA at KANN

CEC Africa acquired its shares in Abuja Electricity Distribution Company Plc through its subsidiary KANN Utility Company Limited. The total amount paid for the 60% share acquisition was US$164million of which US$122million was provided by United Bank of Africa Plc (UBA) of Nigeria through a 7-year acquisition debt facility guaranteed by CEC Africa. In 2019 UBA appointed a Receiver at KANN as result of default on the loan facility. CEC Africa took measures to protect the interest of its shareholders by placing in an injunction against the appointment of a Receiver and engaging UBA in negotiations to restructure the loan.

CEC Africa has made significant progress in the negotiation of a loan restructure with UBA. The restructuring negotiations have been facilitated by the Central Bank of Nigeria and Bureau of Public Enterprises.

As a result of the negotiations, UBA has withdrawn the appointment of a Receiver at KANN through the courts of Nigeria and the Central Bank of Nigeria has provided guidance on the outstanding loan amount. During the year 2020, BP Investments Limited, a company registered in Nigeria, acquired 97% of the shares of CEC Africa.

Dividends proposed and paid

During the period under review, the Company did not declare nor pay any dividend.

By Order of the Board

Clara K Mvula
Head, Corporate Services

info@cecafricazm.com
www.cecafrica.com

Issued in Lusaka, Zambia on 26 August 2021