In compliance with the requirements of the Securities Act and the Listing Rules of the Lusaka Stock Exchange, CEC Africa Investments Limited announces its un-audited results for the Half Year ended 30 June 2018.
INTRODUCTION
In Nigeria where the Group has operating companies, challenging conditions in the operating environment continue to affect profitability. Abuja Electricity Distribution Company Plc continues to face high losses, low collections and non-cost reflective tariffs.
In March 2017, the Federal Government of Nigeria (FGN) commenced the Power Sector Recovery Program (PSRP) which aims to improve the financial viability of the power sector as well as reset the sector for long term sustainability. An analysis of the policy paper on the PSRP indicated that there was sufficient recognition of the policy and market shortfalls that had resulted in the losses suffered by the distribution companies in the Nigerian power sector and if properly instituted would turn the distribution companies to profitability.
Short term results of the PSRP have already been evidenced in North South Power Company Limited which under the terms of a Payment Assurance Guarantee under the PSRP now has adequate cashflows to declare and pay a dividend for the year ended 31 December 2017.
FINANCIAL HIGHLIGHTS
- Revenue compared to the same period last year is up 19% mainly due higher energy sales at Abuja Electricity Distribution Company Plc (AEDC).
- North South Power Company Limited contributed a profit of K11million which was down 54% from 2017 mainly due to shut down of the plant caused by flooding in February and March this year. The situation has been managed and NSP is projected to be back on track by year end.
- The Group’s loss for the half year ended 30th June 2018 at K 1,022million is higher by 26% due to higher finance costs. The finance costs are driven by the growth in payables at AEDC which on average pays about 30% of its monthly energy bill and the unpaid balance attracts interest.
COMPANY PROFILE
The Company holds a Category 1 Global Business License under the Mauritius Companies Act and is governed by the Financial Services Act 2007. CEC Africa has shareholding in four companies, 75% shareholding in KANN Utility Company Limited, a Nigerian registered investment holding company which in turn owns 60% equity in Abuja Electricity Distribution Company Limited, and 100% in CEC Africa Hydro Investments Limited, a company incorporated in Mauritius which in turn owns 24.3% equity interest in North South Power Company Limited, a Nigerian registered company which has a 30 year concession to operate the 600MW Shiroro Hydro Power Plant. In 2015, CEC Africa acquired two wholly owned subsidiaries in Zambia and Nigeria: CEC Africa Services Limited and Copperbelt Energy Nigeria Limited to take care of its interest in the two countries.
Dividends proposed and paid
During the period under review, the Company did not declare or pay any dividends.
Health, Safety, Environment and Social
The Group has established a Health and Safety Policy to manage health and safety risks effectively and to ensure that its business activities, services or products do not harm employees, suppliers, customers or the public.
By Order of the Board
Clara K Mvula
Head, Corporate Services
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First issued: 15 August 2018
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