Pretoria Portland Cement (PPC), which, in the 2002/3 financial year posted a 40 per cent increase in operating profit to R866-million, expects a further increase in earnings this year, although at a lower rate. The company, South Africa¹s largest cement producer, bases its optimism on increased infrastructural spending by the public sector, rising demand from the residential and industrial sectors as well as the Coega industrial development zone (IDZ) project, on the East Coast, which is now in full swing. ³We predict that earnings will grow this financial year, and we believe
that, excluding the Coega project, industry volume growth for the year will be three per cent to 3.5 per cent,² says chief operating officer John Blackbeard. ³With Coega, growth will be between 4% and 5%,² he adds. Already, Ngqura Harbour Contractors, responsible for the construction of the Ngqura Harbour, a core component of the Coega IDZ, has announced that it will be using PPC¹s all-purpose cement, SureBuild. PPC will be supplying about 240 000 t of SureBuild to the harbour project over the next three years. Blackbeard declines to state the volume PPC produced in 2002/3 and the estimate for the current year, but confirms that the company enjoys the lion¹s share of South Africa¹s yearly cement production of about 9Mt
Despite the expected continuing increase in demand for cement, PPC does not have immediate plans to expand its plants. In South Africa, cement sells at around $70/t. ³Our prices are quite low about the middle of the range globally and it is for this reason that we have not had imports for many years,² says Blackbeard. ³PPC will only require additional production capacity in 2008/9 and, as it takes two to three years to build a new plant, we will not need to start building a new plant until about 2006. ³We have about 25 per cent of spare capacity which we are not using,² he says.