PPC says it is currently finalising its results for the six months ended 30 September 2022 with indications that Zimbabwe and Rwanda operations are going well.
“The PPC group continues to deliver sound cash generation and deleverage the balance sheet despite difficult trading conditions in its core South African and Botswana cement market, offset by positive trading conditions in its Zimbabwe and Rwanda (CIMERWA) operations,” PPC CEO Roland van Wijnen said in the company’s trading statement and operation update
Wijnen said that that although a planned maintenance shutdown affected Zimbabwe’s Q1 performance, demand arising from massive infrastructure development in the country means that yearly target will be met.
“As expected, PPC Zimbabwe’s financial performance was negatively impacted by a planned kiln shut down during the first quarter but has since recovered and is experiencing robust demand while the business maintains its ability to repatriate dividends.
However, like other businesses in the country PPC has been affected by hyperinflation which hit Zimbabwe towards the middle of the year and was only brought under control in the Q3.
“Hyperinflation in Zimbabwe skews the group’s results and analysing the group excluding Zimbabwe is therefore more meaningful,” said Wiljnen.
The reported numbers are materially impacted by hyperinflation accounting with reported EBITDA declining 48% to R148 million (September 2021: R287 million), with margins reducing from 23.2% to 17.3%.
But it is looking like a great year for PPC Zimbabwe an increase in foreign currency availability in the Zimbabwe economy and PPC Zimbabwe paid a dividend of US$4.4 million to PPC in June 2022.
PPC Zimbabwe ended the current period with R253 million in hard currency cash.
Volumes, compared to the first quarter, increased during the second quarter of the current period.
PPC Zimbabwe anticipates a recovery for the balance of the financial year and the outlook for CIMERWA remains positive.
Full details of the groups’ performance will be contained in the group’s unaudited interim financial statements for the six months ended 30 September 2022, which are expected to be released on or about 21 November 2022.
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