PPC reports revenues of ZAR10.4bn in FY19

PPC reports revenues of ZAR10.4bn in FY19
01 July 2019

PPC has reported revenue up one per cent in the FY19 ended 31 March, rising to ZAR10.4bn (US$772.7m), while EBITDA increased four per cent to ZAR1.9bn. PPC's overall cement volumes rose by one per cent to 5.9Mt.

South Africa's cement market (including Botswana) as a whole saw a decline of 2-3 per cent in sales but the inland market remains competitive, according to the company. The coastal markets were impacted by increased imports which rose by 84 per cent in 2018 to 1Mt. Production costs for PPC in the domestic market were also seven per cent higher YoY.

Furthermore, PPC's Dwaalboom plant was shut down for a period which impacted overall costs for PPC, but the Slurry Kiln 9 project at the facility brought significant efficiency gains.

Cement prices rose by 1-2 per cent in the FY19, although prices were impacted by increased blended product in the inland market, and imports from Vietnam and China resulted in price erosion in the coastal markets. PPC implemented a double-digit price increase in mid-January 2019, as a result cement prices in the domestic market had risen to ZAR105/t by April.

"PPC has been able to produce a solid set of results," commented Johan Claasen, CEO. "The group has been successful in executing its FOH-FOUR strategic priorities, with key focus areas being financial, operational, human capital and customers. This has resulted in significant cost savings, as part of our ZAR70/t savings initiatives."

Regional results
Operational results for PPC in the rest of Africa were challenging but revenue increased by two per cent to ZAR826m. Cement volumes in Zimbabwe slipped by five per cent and a loss of power supply impacted production in the 3Q18. As a consequence, revenues declined by 20 per cent in Zimbabwe to ZAR1447m.

In Rwanda, Cimerwa increased output post debottlenecking and revenue growth of 10 per cent to ZAR885m was achieved on the back of a five per cent increase in cement volumes. 

PPC increased its market share from 25 to 30 per cent in DR Congo and some cost reductions were achieved, while revenue reached ZAR494m as production was ramped up.

Meanwhile, in Ethiopia cement production was impacted by plant performance and community disruptions. Production achieved more than 0.5Mt, but performance was impacted by "sub-optimal plant performance," said PPC.

Published under Cement News