PPC reports improved results in 5MFY23-24

Revenue for PPC’s South Africa and Botswana operations (excluding Zimbabwe and Rwanda) increased by five per cent YoY in the first five months of FY23-24 (April-August 2023), supported by higher average selling prices but lower sales volumes. Cement sales volumes in the two markets fell by six per cent YoY with inland volumes in August 2023 continuing their decline but at a lower rate. Coastal deliveries saw a downturn in volumes following higher-than-usual rainfall and weak retail demand. Following price increases in January and July 2023, the average selling price was up 10 per cent YoY.

Meanwhile, revenues from Zimbabwe and Rwanda operations were up by 19 and 58 per cent YoY in terms of South African rand and US dollar values, respectively, during this period. Sales in Zimbabwe expanded on the back of residential construction and government-funded infrastructure projects and PPC Zimbabwe continue to recover market share after its planned maintenance shutdown in the year before. Cement sales volumes increased by 42 per cent YoY while the average sales price, in US dollar terms, picked up by 12 per cent YoY. As a result, EBITDA margins advanced to 27 per cent, up from 14 per cent in the year-ago period. Rwanda also continues to see a strong demand for cement with sales volumes up 13 per cent YoY as demand from infrastructure projects remains robust. However, new competitors impacted export volumes. EBITDA was up nine per cent in South African rand terms but the EBITDA margin was down to 29 per cent from 32 per cent YoY.

As a result, PPC group cement sales volumes for the 5MFY23-24 increasing by three per cent when compared with the year-ago period.

PPC’s outlook remains unchanged and the company will continue to focus on profitability improvement and cash generation in South Africa while maintaining its market positions in Zimbabwe and Rwanda.