PPC posts better-than-expected 1H in Zimbabwe

South Africa-based PPC has said its cement sales volume in Zimbabwe surpassed expectations as sales increased by 19 per cent in the six months to September as cement demand in the African country saw double-digit growth. Individual customers as well as government projects drove the increase in sold volumes. Compared with the equivalent period in 2019, PPC’s sales volumes advanced 31 per cent. As a result, revenue increased by 55 per cent to ZAR1.2bn (US$75.7m). PPC received US$2.7m in dividends from the Zimbabwe operations over the six months.

"Despite the challenging macro-economic environment, PPC Zimbabwe continues to trade well and ahead of expectations. For the six months ended 30 September 2021, PPC Zimbabwe's cement sales volumes increased by 19 per cent  YoY due to retail demand, increased sales to concrete product manufacturers, and support from government-funded projects," PPC reports.

PPC had to import 48t of clinker to support expanding demand.

However, the company, with a market share of 57 per cent, said trading conditions remain challenging due to frequent policy changes, foreign currency shortages and illegal imports.

Foreign currency shortages remain, PPC says, although they have eased because it can now sell in US dollars. Half of PPC's sales are now in US dollars.

In April government banned cheap cement imports to protect local industry. But illegal imports keep coming in, the company points out. On the policy front, reflecting the frustration across industry, PPC says "frequent fiscal and monetary policy changes" persist.