Transcript of Q&A Session at the 24th Annual General Meeting of Copperbelt Energy Corporation Plc

By Published On: May 10th, 2022Categories: Corporate announcement, Transcripts

Disclaimer:
The following transcript of proceedings of the 24th Annual General Meeting (AGM) held on 27 April 2022 is being delivered uncertified by Copperbelt Energy Corporation Plc (CEC).

The information in this transcript is for general information only. It should not be used as a substitute for specific and professional advice. Responsibility is disclaimed for any inaccuracies, errors or omissions. All expressions of opinion or advice are published on the basis that they are not to be regarded as expressing the official opinion of Copperbelt Energy Corporation Plc unless expressly stated. CEC accepts no responsibility for the accuracy of the opinions of information contained in this transcript.


London Mwafulilwa: Thank you for that presentation from the external auditors. I now invite questions from the shareholders on the reports received from the CEO, CFO and the auditors.

The Director of Programmes will assist with the question and answer process. Director of Programmes.

Gilbert Simakoloyi: Thank you very much, Chair. As we enter into the question and answer session, dear members, please note the following guidelines. In the interest of time and in order to accommodate wide participation, members, we advise that you limit your questions, or indeed comments, to a maximum of two per person. With respect to the questions, these should be clear and concise. Please note also that you are required to give your full name and your status as to whether you are a shareholder or not before you ask your question.

In terms of the modality, you will note that on your screen – notwithstanding the device that you are using – you will see an icon of a hand. All you need to do when you have a question or a comment to make, is to please put your cursor there and activate that particular icon and your hand will show on our screen, and we will be able to give you the opportunity to ask or indeed to make a comment in relation to this meeting. After your question or comment has been addressed, we will ask that you deactivate that icon so that your hand then drops from your screen to signify that you are no longer asking or commenting. We hope that is clear. Just for good measure, for purposes of good order for the meeting, we request that you address all your questions and comments to the Chairman.

We will also take note of the questions that you have dropped in the chat. Those will be given consideration and responded to as well. We will take a set of three people at each given time, who then will have the opportunity to ask a maximum of two questions. Once that is done, then we will refer to the Chairman to answer that set of questions. If that is clear we will now proceed into that particular process.

I see the first hand of Professor Prem Jain. I also see the second hand of Mwila Chansa. We have the third hand of Mukuka Mapemba. We have the first set of three that are going to ask questions or to make comments related to the deliberations of this meeting.

Let's go first with Professor Prem Jain. Kindly unmute your mic and you can ask your question.

Professor Prem Jain: Thank you very much. Good morning everyone. I would like to start by appreciating and congratulating the senior Management for the brilliant performance of CEC once again and steering the Company through difficult times. I have two questions, which I think are quite critical for the Company. First, is the new BSA. I do not know how much confidentiality is needed so far because it has not been signed yet, but is there any indication whether it is to the happiness, to the satisfaction of CEC? And the second question is about the KCM debt: how likely it looks that the Company will be able to recover the CEC debt. Thank you very much.

Mwila Chansa: Good morning everyone. I wanted to find out how long the new BSA will run. The previous one ran for about 20 years. Is Management in a position to tell us how long this new BSA will run, notwithstanding that the regulators have not yet concluded the issue? And then I also have a question pertaining to the supply of power to Konkola Copper Mines. I know at the height of the misunderstandings between ZESCO and CEC, ZESCO began supplying power to KCM directly. Now with the new BSA in place, how will we proceed going forward? Will ZESCO continue supplying and paying CEC for using the infrastructure or will CEC negotiate a new agreement with KCM? I thank you.

Mukuka Mapemba: Good morning and thank you, once again, to Management and the Board for the efforts made towards continuing to steer the Company towards greater heights. I would like to ask a question regarding what the CEO highlighted on modernising the power network and adopting new technology to optimise performance. Are you able to just shed more light on what that technology is and how exactly CEC is aiming to modernise its power network? Secondly, I'd also like to find out how CEC expects the impact of KCM's debt to be on dividend payments and its 10-year Capex plan, assuming that it isn't able to recover the debt in the short to medium term.

Thank you.

Gilbert Simakoloyi:Thank you. Over to you, Chair. Those are the three people that have asked.

London Mwafulilwa: Thank you. Professor Prem Jain. On behalf of the Board, Management and the entire CEC family, we thank you for having appreciated and congratulated the team for the performance in the previous year. I will proceed to talk of the new BSA as asked by Professor Jain and Mwila Chansa. Unfortunately, this is a work in progress and until the regulators do revert to us, we are unable to provide any further details, but rest assured that the two managements of ZESCO and CEC, including their Boards, did work together to a mutual understanding and, therefore, we request that the shareholders hold back for now as these terms are subject to ratification by the regulators. Thereafter, we'll proceed to advise the shareholders of the contents of the agreement.

KCM debt, how likely to recover? I will ask the Management team to come in on that. With regards to KCM power supply under the new BSA, I've already addressed the issue of the new BSA but for now, ZESCO continues to supply power to KCM.

The impact of the KCM debt on dividends: obviously you saw that the previous year's dividends were hampered by the non-collection of the KCM debt, but Management will respond to that, including the modernisation of the technology in the infrastructure. CEO.

Thank you, Chair. Commenting on the KCM debt: this is a very important matter to CEC. The Company is owed money and the right thing is that KCM gets to pay this money fully to CEC, so we are proceeding on that basis. As I said, there are two actions at the moment – we have taken the matter to arbitration and that arbitration process is underway. When there's an opportunity to do any negotiations outside that arbitration, it is obviously the usual business practice that you remain open to finding a settlement if possible outside those processes.

So as a business, we remain very open to having any conversations that can bring this matter to a close. So, if KCM requires that we have a conversation on that, we are very open, and we will seek avenues to