PPC sees volumes improve and price rises stick

Cement-maker PPC said lower levels of capital expenditure has helped offset lower earnings during the 11 months to end-February, with its southern African business starting to show signs of stabilisation even as it continues to face price pressures from increasing exports.

The South African coastal business is experiencing a downturn in volumes affected by imports, while inland volumes are showing signs of improvement, the group said in a trading update. It has experienced average price increases of 8-10 per cent across the region.

The group has been trying to overcome a lack of infrastructure investment, muted price increases in southern Africa and weak consumer demand. It is also battling with a heavy debt burden.

PPC is currently trying to refinance and restructure the group, saying on Wednesday it expects negotiations over the relaxation of South African debt covenants to be finalised in the next three months.