for the year ended 31 December 2017
I am pleased to present the Annual Report of CEC Africa Investment Limited (CEC Africa) for 2017. During the year under review, the Group has been able to record some modest improvements on the previous year’s performance, providing a good reason to remain optimistic about the potential growth of CEC Africa and its subsidiaries in the years to come.
In Nigeria, the keystone of our investments, implementation of the Power Sector Recovery Program (PSRP) commenced signalling the commitment of the Federal Government to ensure commercial viability of the entire power sector value chain, including, ultimately delivering optimal benefit to the end users. We are confident that in the short to medium term, application of the PSRP principles will turn our asset, the Abuja Electricity Distribution Company Plc (AEDC) into a profit making entity.
Evidence of the positive impact of the PSRP policies and programs on sections of the power sector, has been clearly demonstrated among generation companies and to this effect, North South Power Company Limited (NSP) recorded improvements in profitability and cash flow to the extent that the company was able to declare and partially pay a dividend during the year.
The Company continued to expend significant effort to further restructure the US Dollar denominated acquisition finance facility that was obtained from UBA to finance the acquisition of 60% of AEDC through KANN Utility Company Limited (KANN). Notwithstanding the difficulties that the situation presents, it is heartening to note that interest payments on the facility are current.
With regard to finalisation of the shareholder dispute in KANN, the court process to register the favourable award of the London Court of Arbitration that was handed down in 2016, was successfully concluded. However, our partners have since lodged an appeal against which CEC Africa is continuing to vigorously defend its rights.
Overall, although we continue to face a variety of challenges, some due to the macroeconomic environment in Nigeria, the few successes we have scored hint at the opportunity that is available for us to exploit. I remain optimistic that the Company and its subsidiaries will rise to the challenge and begin to exhibit tangible shareholder value.
CECA.zm | 2017 Annual report