Robust growth at PPC

REGIONAL cement maker PPC says its unit in Zimbabwe recorded approximately 25% sales volume growth between August and September this year compared to the same period last year.

In its latest operational update, PPC said it recorded strong sales volumes in August and September this year, with PPC Barnet and PPC Zimbabwe “experiencing approximately 25% sales volume growth respectively compared to the prior comparable period.”

In Zimbabwe, the cement maker operates a clinker plant in Gwanda (Colleen Bawn) in the southern part of the country, as well as a cement milling plant outside Bulawayo and another one in Harare.

Apart from South Africa and Zimbabwe, PPC also has units in Ethiopia, the Democratic Republic of Congo and Rwanda.

In Rwanda, its unit, Cimerwa expects August and September cement volumes to increase by approximately 10% compared to the same period last year.

“All markets of these international subsidiaries of PPC benefit from a good performance of the cement plants and healthy construction activities,” PPC noted in its statement

“The increased sales volumes and the effect of the cost reduction and cash preservation measures have resulted in cash flows for the last few months showing a positive trajectory. The financial information contained in this announcement has neither been reviewed nor reported on by the company's external auditors.”

The company said its cement operations ramped up in May 2020 post the COVID-19 restrictions imposed at the end of March 2020 across most of the jurisdictions in which the group operates.

Double-digit year-on-year growth of cement volumes in South Africa were experienced in June and July and have continued at a high rate in August and September.

“The resumption of construction activities and the temporary effect of high activity in construction projects to catch up on the delivery of these projects have had a positive impact on the performance,” it said.

“Given the inherent uncertainty of the current South African economic environment, the company is cautious on the sustainability of strong cement volumes experienced and continues with the implementation of measures to reduce costs and increase cash generation from its operations.”

In aggregate, total cement volumes sold also showed double- digit growth comparing July 2020 with July 2019, it said.

Group revenue for the year ended March 31, 2020 is confirmed to have decreased by less than 5% compared to the prior year.

Earnings before interest, tax, depreciation, and amortisation, is confirmed to have decreased by approximately 16% compared to the prior year.

Total group equity is expected to be approximately R7,793 billion.

PPC expects to release its financial results for the year ended March 31, 2020 in the week beginning October 5, 2020.