PPC looking for more opportunities in Africa
Pretoria Portland Cement Company (PPC) is currently pursuing additional opportunities in Africa and expects to make further announcements this year, South Africa’s largest lime and cement producer said on yesterday. This means the company’s African expansion strategy is gaining momentum and will be as rapid as possible. During the first quarter of PPC’s 2013 financial year, the company took a significant step in its rest of Africa strategy with the announcement in December last year of the 51 percent acquisition of Rwanda’s Cimerwa Limited for $69.4 million.
“The receipt of our Zimbabwean indigenisation certificate in November 2012 is also an important step for this strategy,” Chairman Bheki Sibiya said in a statement. “The financial quarter was also characterised by growth in PPC’s South African, Botswana and Zimbabwean cement volumes.” In South Africa this trend was experienced across all provinces with the exception of the Eastern Cape where heavy rains and imports negatively impacted demand.
PPC said the effect of this positive demand has been partly offset by some product sourcing challenges experienced over the period.
These were primarily due to lower than planned production output at the company’s Dwaalboom factory. This technical issue has been resolved and normal production has been restored. While the selling environment remains challenging, some increases in prices were achieved in South Africa and Zimbabwe. Volumes in the lime division declined due to reduced off-take from the local steel industry while aggregates volumes remained under pressure due to weak demand. In South Africa, Botswana and Zimbabwe there remains limited visibility on major infrastructure projects. But the company’s outlook for cement demand in these three territories gives it reason to remain cautiously optimistic.
“Excluding the IFRS 2 charges recorded on the Zimbabwe indigenisation programme and the implementation of the company’s second BEE transaction, earnings for the first half of 2013 are anticipated to reflect a year-on-year improvement,” Sibiya said.
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Source: Ventures Africa