3rd Quarter Results

ZCCM Invs.Hldgs PLC 27 July 2002 ZCCM Investments Holdings Plc Incorporated in the Republic of Zambia Directors' Quarterly Summary incorporating Financial Results for the quarter ended 31 March 2002 DIRECTORS Mr S L Shimukowa (Non-Executive) (Up to 4 February 2002) Chairman of the Board Mr G K Chibuye (Non-Executive) (From 4 February 2002) Chairman of the Board Mr J M Mtonga (Up to 26 February 2002) Secretary to the Treasury Ministry of Finance and National Planning Mr B Nonde (From 26 February 2002) Secretary to the Treasury Ministry of Finance and National Planning Mr A M Kashimu (Up to 26 February 2002) Permanent Secretary Ministry of Mines and Minerals Development Mr S Mpishi (From 26 February 2002) Permanent Secretary Ministry of Mines & Minerals Development Dr A Mwenda Deputy Governor - Operations Bank of Zambia Ms J Mapoma Permanent Secretary Ministry of Energy & Water Development Mr D Kombe (Resigned 18 January 2002) General Treasurer Mineworkers' Union of Zambia Acting Company Secretary W S Musama 1 Management Committee General Manager M Shandavu Chairman Acting Company Secretary W S Musama Technical Investment Manager J M D Patterson Finance and Investment Manager Z Zekko Legal Investment Manager J K Kaite Technical Investment Officer W K Katoto Financial Analyst K K Mulaisho Committee Secretary Environmental Manager J Makumba 2 ZCCM INVESTMENTS HOLDINGS PLC and its subsidiary companies DIRECTORS' QUARTERLY SUMMARY ZCCM Investments Holdings Plc Group sales, comprising income from minority participation in the privatised mining companies and revenues achieved by its subsidiaries, namely Ndola Lime Company Limited, ZCCM (Smelterco) Limited and AHC Mining Municipal Services Limited, were K59 937 million for the quarter ended 31st March 2002, compared with sales of K41 461 million in the quarter ended 31 December 2001. This satisfactory top-line result was attributed to substantial improvement in quarterly sales at Smelterco. Despite the registered improvement in quarterly sales, a net loss of K66 086 million fell short of the previous quarter profit of K767 million which mainly arose from the sale of Lunsemfwa and Mulungushi Hydro Power Stations. The results for the quarter under review also took into account increased Group operational expenses of K103 357 million, interest and other income of K20 045 million, exchange losses of K41 010 million income tax of K129 million and interest charges of K1 572 million. During the quarter, Zambia Copper Investments Limited (ZCI), the majority shareholder in Konkola Copper Mines Plc (KCM), announced its intention to pull out of the operations of KCM, on the premise that weak prevailing and projected metal prices would necessitate additional external funding of approximately US $700 million for the development of the long term Konkola Deep Mining Project (KDMP). Without the prospect of raising finance for the development of KDMP on affordable terms, ZCI have stated that further investment in the relatively short life high cost operations of KCM would be of little benefit to their shareholders. The Government of the Republic of Zambia and Anglo American plc have since initiated negotiations, to facilitate ZCI's orderly exit in view of the need to maintain KCM as a going concern. Government has continued to provide funding in respect of both privatisation and pre-privatisation obligations, including ZCCM trade creditors. In this regard, during the period under review, an amount of K7 000 million was released from the 2002 National budget of K50 000 million. By Order of the Board W S Musama Acting Company Secretary Lusaka 23rd July 2002 3 ZCCM INVESTMENTS HOLDINGS PLC GROUP PROFIT/( LOSS) ACCOUNT FOR THE QUARTER ENDED 31 MARCH 2002 QUARTER ENDED 9 MONTHS TO 31 MARCH '02 31 MARCH '02 notes K Million K Million Sales 1 59,937 166,895 Cost of sales 2 (98,344) (234,620) Operating profit/(loss) (38,407) (67,725) Other income 3 19,754 55,093 Exchange gain/(loss) (41,010) (64,489) Environmental expenses (4,903) (11,750) Interest charge (1,572) (19,179) Interest income 291 3,254 Dividend receivable - 7,508 Royalty on minerals (110) (680) Profit/(loss) before taxation (65,957) (97,968) Income tax (129) (603) Retained profit/(loss) (66,086) (98,571) Notes: 1 & 2 Represents revenue /sales and administrative cost/cost of sales for the Company and its subsidiaries. Group sales are higher in this quarter due to improved sales at Smelterco( aproximately three times the sales of the second quarter). 3 Other income includes the sale of 80% shareholding in Kansanshi Mines plc to First Quantum Minerals Group. 4 The exchange rates applied are : March 2002 :US$=K3967 December 2001 :US$=K3800 September 2001 :US$=K3754 June 2001 :US$=K3733 ZCCM INVESTMENTS HOLDINGS PLC GROUP BALANCE SHEET As at 31 March '02 As at 30 June '01 K million K million Current assets Bank & cash 40,827 34,091 Inventories 53,014 44,352 Metal debtors 99,168 108,568 Other debtors 149,329 68,368 Total current assets 342,339 255,379 Current liabilities Creditors local 122,570 65,627 Overseas 33,362 17,173 Provisions 249,636 263,815 Taxation 2,845 2,027 Bank overdraft 118 172 Total current liabilities 408,532 348,814 Net current assets/(liabilities) (66,192) (93,435) Long term receivables 329,294 309,987 Investments 192,232 150,033 Fixed assets 256,238 128,304 Long term borrowings (1,627,578) (1,342,500) Grants/others (94,385) (93,088) Subordinated loan (865,445) (865,445) Total Net Liabilities (1,875,837) (1,806,144) Financed by: Share capital 893 893 Reserves (1,876,730) (1,807,037) Total shareholders' funds (1,875,837) (1,806,144) ZCCM INVESTMENTS HOLDINGS PLC GROUP CASH FLOW STATEMENT Quarter ended 9 months to 31 March '02 31 March ' 02 K Million K Million Operating activities Cash received from customers 28,278 208,098 Cash paid to suppliers and employees (42,573) (285,061) Net cash generated from operating activities (14,295) (76,963) Interest received 308 3,373 Interest paid (182) (200) Taxation paid (475) (1,509) (349) 1,664 Net cashflow from operating activities (14,644) (75,299) Investing activities Purchase of fixed assets (12,964) (94,093) Proceeds from sale of fixed assets (Kabwe Hydropower) 4,720 5,402 Proceeds from sale of shares in subsidiary 6,858 6,858 Net cashflow from investing activities (1,386) (81,833) Financing activities Long term borrowings received 19,832 144,429 Long term borrowing paid - - Short term borrowings received - - Short term borrowings paid Grants 2,235 5,909 Net cashflow from investing activities 22,067 150,338 Dividend received - 7,508 Net cash inflow/(outflow) for period 6,037 714 Cash balances at start of period Cash and bank balances 27,581 32,753 Bank overdrafts (323) (172) 27,258 32,581 Cash balances at end of period Cash and bank balances 33,413 33,413 Bank overdrafts (118) (118) 33,295 33,295 CORPORATE LOCATIONS Registered Office UK Registrars Mukuba Pension House CAPITA IRG Plc First Floor Bourne House 5309 Dedan Kimathi Road 34 Beckenhan Road P O Box 30048 Beckenham LUSAKA Kent BR3 4TU Lusaka, 10101, Zambia England Tel Numbers 260 (01) 221023 Tel No. 020 8639 2000 220351 Fax No. 020 8658 3430 220654 228833 Depository for American Shares Fax Numbers 260 (01) 221057 JP Morgan 220449 Chase & Co 220727 60 Wall Street New York, NY 10260-0060 United States of America E-mail:corporate@zccm-ih.com.zm Tel No. 001 212 648 3207 Fax No. 001 212 648 5104/5 Kitwe Office Investments House Kantanta Street P O Box 20172 Kitwe Tel Numbers 260 (02) 245008 245117 245118 245054 245160 245155 245319 245324 Fax Numbers 260 (02) 245363 245364 245474 E-mail:corporate@zccm-ih.com.zm 7 This information is provided by RNS The company news service from the London Stock Exchange

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