PPC prepares to enter the Algerian Cement Market PPC Ltd (Incorporated in the Republic of South Africa) (Company registration number: 1892/000667/06) JSE Code: PPC ISIN: ZAE 000170049 ("PPC" or the "Company") PPC PREPARES TO ENTER THE ALGERIAN CEMENT MARKET PPC is pleased to announce that advanced plans are in place to enter the Algerian cement market through a partnership with Algerian private sector investors in Hodna Cement Company (“Hodna”). Our partners have experience in construction and related sectors, and fulfil one of PPC’s key requirements - to partner with local shareholders when investing in a new country. Hodna will be constructing a 2 million ton per annum plant for approximately US$350 million in the Hodna area, roughly 300km east of Algiers and close to the university and technology-focused town of Setif. PPC will acquire a 49% stake of Hodna and assume management control which allows for the consolidation of the financial results of this project into the PPC group accounts. The transaction will be funded on a project finance basis, with 80% debt funding from local Algerian banks. “The Algerian cement market is very attractive as consumption exceeds local production by approximately 3 million tons of cement per annum. Moreover the Algerian government has committed itself to large scale capital spending programmes, including the US$6 billion New City Hassi Messaoud project, which will see the rollout of thousands of housing units. This will certainly boost the demand of cement in this country,” said Ketso Gordhan, CEO of PPC. Once the feasibility study has been concluded, construction of the plant will take up to 30 months with commissioning anticipated by the fourth quarter of 2016. As with its other expansion projects, PPC intends to engage China’s Sinoma International Engineering as the contractor that will supply and build the plant; supported by India’s Holtec Consulting, specialists in project management. Cement selling prices in Algeria range between US$80 and US$120 per ton with favourable costs of production due to affordable gas prices. The factory site is well located with the necessary raw materials in close proximity. The well-developed road and rail network also assist in managing the cost of logistics. With a population of close to 40 million people, of which 74% live in urban areas and a relatively high GDP per capita of US$5582, Algeria still requires the construction of 225 000 housing units per year to meet demand. The national housing shortage in Algeria is estimated at 1.2 million units. Ketso Gordhan, added “We are already building cement plants in three countries; Ethiopia, Rwanda and the Democratic Republic of the Congo. This project sees us entering yet another African country and gives us confidence that by 2017, 40% of PPC revenues will be earned outside of South Africa.” Sandton 10 February 2014 Sponsor Merrill Lynch South Africa (Pty) Ltd PPC: Azola Lowan Tel: +27 (0) 11 386 9000 Azola.Lowan@ppc.co.za Financial Communications Advisor: College Hill Louise van der Merwe Mobile: +27 (71) 605 4294 Louise.vanderMerwe@collegehill.co.za Sources: PPC research, Hodna Research, IMF, Centre for Affordable Housing Finance in Africa Date: 10/02/2014 07:48:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.