South Africa’s biggest cement producer, Pretoria Portland Cement, expects full-year operating profits to increase thanks to robust sales, the company said on Friday. "We still expect that local cement demand is likely to grow at between 6 and 8 per cent in the year ahead. The growth in cement volumes should enable the company to report increased operating profits for the full year," it said in a trading update. But it said net profit attributable to shareholders will be affected by a significantly higher level of secondary tax on companies and net profit is not expected to be materially different from that of 2004.
The firm, two thirds owned by industrial giant Barloworld, said South Africa’s building industry was showing signs of strain with shortages of tradesmen and construction materials. South Africa’s property market is in a boom period with property prices gaining a nominal 32.1 per cent in 2004, the biggest increase since 1981. PPC said it expected strong cash flows to continue due to increased profitability and low capital expenditure expected in 2005.
