PPC Zimbabwe sees tough 2017
. . . to focus on boost export
CEMENT making giant Pretoria Portland Cement (PPC) Zimbabwe says its focus this year will be on reviving its export markets, a move projected to boost its revenue.
The giant firm last year recorded a decline in business due to an influx of imports as a result of the stronger dollar.
Responding to e-mailed questions, PPC Zimbabwe Limited managing director Mr Kelibone Masiyane said the company had encountered a decline in domestic and overall sales volumes last year, compared to 2015.
He said export volumes were poor due to a higher manufacturing cost base compared to the region as well as the stronger United States dollar against weaker regional currencies which rendered the company uncompetitive in export markets.
“We project that 2017 will be a tough and challenging year in terms of volumes and pricing pressure. Despite these conditions, we believe that with the strategies we have put in place we will keep the company on the right path,” said Mr Masiyane.
“Regarding exports, we are disadvantaged by the high manufacturing cost base. We also face pressure because of weaker regional currencies against the stronger dollar. Despite this, our focus this year is to resuscitate our export markets which formed a significant component of our business in the past.”
Mr Masiyane said the company’s new plant in Harare would create opportunities for growth going into the future and this expanded factory-footprint presented them with exciting possibilities.
In November last year PPC commissioned an $85 million plant in Msasa, Harare, and it was estimated that the company would double its annual production capacity to 1,4 million tonnes.
The giant firm has two other plants in Bulawayo and Colleen Bawn near Gwanda with a combined annual capacity of 700 000 tonnes.
The Msasa plant is expected to provide greater scope to export into regional markets including Zambia and Mozambique.
PPC, like any other cement manufacturer and business entity, Mr Masiyane added, had struggled to remit foreign payments for key production inputs due to the liquidity situation prevailing in the country.
He said PPC had also faced competition in the form of cheap imported cement from neighbouring countries. “This year, we expect the impact of imports to be reduced as a result of support from Government through its various interventions,” said Mr Masiyane.
On capacity utilisation, he said: “Capacity utilisation and production levels were under pressure due to reduced activity in the economy. We are optimistic about the future because of the recent commissioning of our Harare plant and export initiatives and we anticipate a slight improvement in our levels this year due to anticipated increase in sales volumes.”
With small beginnings in 1913 as Zimbabwe’s first cement company, east of Bulawayo, PPC Zimbabwe started under the name of Premier Portland Cement (Pvt) Ltd.
Its products were packed in jute bags and initially went on sale to the public in September 1914 with exports to then Northern Rhodesia (Zambia) and the Belgian Congo (DRC) beginning in 1916.
The factory at Colleen Bawn was established in 1946.