According to CEO, Darryll Castle, the construction of PPC’s new plant in Zimbabwe remains on track for completion in 2016, despite riots in the country and restrictions remaining on some South African goods. The new mill, with an expected capacity of 0.7Mta, is crucial to reducing the company’s costs, Mr Castle said. "Even if the volume is not required because Zimbabwe’s economy slows, the project still makes sense from a cost-optimisation process."
This project in Zimbabwe is one of four plants PPC is building in Africa to increase sales as growth in its home country of South Africa slows. It is also a contributing factor to PPC’s decision to launch the proposed ZAR4bn (US$285m) capital raising. The key reason for this capital raising is to alleviate short-term pressures on the balance sheet, as the company’s debt is expected to peak at ZAR10-12bn by 2017.
