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BPC announces first profit in a decade

The Botswana Power Corporation(BPC) has performed well above expectation as its recently released financial report highlights that the corporation’s operating income grew by 34 percent-which stood at P138 604 million in this current financial year against P103 544million of the previous year.

The improvement in BPC performance comes after the company has been experiencing a ten year drought since its last profit making year in 2008. BPC chairman Sebetlela Sebetlela revealed that their improvement in performance is owed to their efforts in making both Morupule A and B projects. When announcing the company’s milestone, Sebetlela never failed to announce the contribution of the two plants to the growth and performance of BPC.

Off the Morupule B Sebetlela said, “the combined effort of stabilizing Morupule B operation and competitive electricity trade on the SAPP market resulted in a cost reduction from BWP 1.964 billion in 2015/16 to BWP 1.514 billion in 2016/17, (a reduction of BWP 449 million).”
He also added that stabilization of Morupule B operation resulting in improvement of plant availability from 56% to 70% hence a significant reduction of power imports.

Government last month stopped in its tracks to sell Morupule B to a Chinese company after negotiations between two parties hit a snag. The plant cost P11 billion to build and it has been bleeding a lot of money from government since its inception and the contractor was blamed for mismanagement of the project.

“Recovery of Morupule A plant degradation and pollution abatement which will see the return to service of Morupule A Power Station providing 120MW generation capacity by end of December 2017,” said Sebetlela on Morupula A’s contribution to BPC’s healthy profits.
With this country having experienced less power crises in the 2016/17 period, Sebetlela lauded BPC saying the corporation has managed to achieve its strategic objectives amongst them being, stability of power supply and the financial turnaround of BPC.

According to BPC CEO Dr Stefan Schwarzfischer, the corporation is still going through an exercise of restructuring and that will see a much better BPC in future. “The power utility will be less reliant on subsidies from Government, become self-sufficient in power supply with improved customer service. Most importantly, we will also improve our supply of renewable energy to about 20 percent which is important as far as reduction of carbon emissions into the environment is concerned,” said Dr Schwarzfischer.

Coming with good performance, BPC made sure that its total operating expenditure reduced by 12 percent-was P4.3 billion in 2017 a decrease from P4.9 billion the previous year. BPC’s current liabilities also recorded a decline of 9 %, from P4.7 billion in 2017 to P4.27 billion in 2016. BPC’s non-current assets increased by 6 percent-to P17.806 billion compared to P16.734 billion in 2016.

However with the promising year BPC also recorded 3 percent decline in total revenue, 4 percent decrease in non-current liabilities and a 41 percent increase in total comprehensive loss (P140.247 million loss incurred compared to P99.61 million loss in 2016). Auditors of BPC raised a red flag on the corporation incurring losses as going concern. 

“The Corporation has incurred a loss of P1,807,747,000 (2016: P2,420,973,000) before taking into account the tariff subsidy grant received from the Government of the Republic of Botswana of P1,667,500,000 (2016: P2,321,360,000). In addition, as at 31 March 2017 the Corporation’s current liabilities exceed its current assets by P2,954,,790,000 (2016: 3,015,717,000). These conditions indicate the existence of a material uncertainty about the Corporation’s ability to continue as a going concern,” said the BPC report.

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Matsheka seeks raise bond program ceiling to P30 billion

14th September 2020
Dr Matsheka

This week Minister of Finance & Economic Development, Dr Thapelo Matsheka approached parliament seeking lawmakers approval of Government’s intention to increase bond program ceiling from the current P15 Billion to P30 billion.

“I stand to request this honorable house to authorize increase in bond issuance program from the current P15 billion to P30 billion,” Dr Matsheka said. He explained that due to the halt in economic growth occasioned by COVID-19 pandemic government had to revisit options for funding the national budget, particularly for the second half of the National Development Plan (NDP) 11.

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Lucara sits clutching onto its gigantic stones with bear claws in a dark pit

14th September 2020
Lesedi La Rona

Botswana Stock Exchange (BSE) has this week revealed a gloomy picture of diamond mining newcomer, Lucara, with its stock devaluated and its entire business affected by the COVID-19 pandemic.

A BSE survey for a period between 1st January to 31st August 2020 — recording the second half of the year, the third quarter of the year and five months of coronavirus in Botswana — shows that the Domestic Company Index (DCI) depreciated by 5.9 percent.

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Botswana Diamonds issues 50 000 000 shares to raise capital

14th September 2020
Diamonds

Botswana Diamond PLC, a diamond exploration company trading on both London Stock Exchange Alternative Investment Market (AIM) and Botswana Stock Exchange (BSE) on Monday unlocked value from its shares to raise capital for its ongoing exploration works in Botswana and South Africa.

A statement from the company this week reveals that the placing was with existing and new investors to raise £300,000 via the issue of 50,000,000 new ordinary shares at a placing price of 0.6p per Placing Share.

Each Placing Share, according to Botswana Diamond Executives has one warrant attached with the right to subscribe for one new ordinary share at 0.6p per new ordinary share for a period of two years from, 7th September 2020, being the date of the Placing Warrants issue.

In a statement Chairman of Botswana Diamonds, John Teeling explained that the funds raised will be used to fund ongoing exploration activities during the current year in Botswana and South Africa, and to provide additional working capital for the Company.

The company is currently drilling kimberlite M8 on the Marsfontein licence in South Africa and has generated further kimberlite targets which will be drilled on the adjacent Thorny River concession.

In Botswana, the funds will be focused on commercializing the KX36 project following the recent acquisition of Sekaka Diamonds from Petra Diamonds. This will include finalizing a work programme to upgrade the grades and diamond value of the kimberlite pipe as well as investigating innovative mining options.

Drilling is planned for the adjacent Sunland Minerals property and following further assessment of the comprehensive Sekaka database more drilling targets are likely. “This is a very active and exciting time for Botswana Diamonds. We are drilling the very promising M8 kimberlite at Marsfontein and further drilling is likely on targets identified on the adjacent Thorny River ground,” he said.

The company Board Chair further noted, “We have a number of active projects. The recently acquired KX36 diamond resource in the Kalahari offers great potential. While awaiting final approvals from the Botswana authorities some of the funds raised will be used to detail the works we will do to refine grade, size distribution and value per carat.”

In addition BOD said the Placing Shares will rank pari passu with the Company’s existing ordinary shares. Application will be made for the Placing Shares to be admitted to trading on AIM and it is expected that such admission will become effective on or around 23 September 2020.

Last month Botswana Diamond announced that it has entered into agreement with global miner Petra Diamonds to acquire the latter’s exploration assets in Botswana. Key to these assets, housed under Sekaka Diamonds, 100 % subsidiary of Petra is the KX36 Diamond discovery, a high grade ore Kimberlite pipe located in the CKGR, considered Botswana’s next diamond glory after the magnificent Orapa and prolific Jwaneng Mines.

The acquisition entailed two adjacent Prospecting Licences and a diamond processing plant. Sekaka has been Petra’s exploration vehicle in Botswana for year and holds three Prospecting Licenses in the Central Kalahari Game Reserve (Kalahari) PL169/2019, PL058/2007 and PL224/2007, which includes the high grade KX36 kimberlite pipe.

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