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Trading Update for the Quarter October 2014 to December 2014
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")
Trading update for the quarter October 2014 to December 2014
In line with our rest of Africa expansion strategy, construction continues
in Rwanda, Zimbabwe, Ethiopia and the Democratic Republic of the Congo. We
are finalising the transaction that will see the company increase its stake
in Habesha Cement Company, in Ethiopia, to 51%. The civil and mechanical
construction of the 600 000 tpa plant in Rwanda is complete with only the
electrical installation work to be finalised. Consequently, production is
expected to commence early in the second half of 2015. Additional
opportunities continue to be pursued and further announcements may be made
in the near term.
The board is considering the merits of the merger proposal received from
AfriSam late last year and further announcements will be made.
Positive group cement sales volumes were achieved for the first quarter,
supported by the consolidation of Safika Cement and growth achieved in
Zimbabwe and Botswana. On a like-for-like basis, excluding Safika Cement,
group cement volumes would have recorded single digit declines against the
comparable period last year.
The operating environment in South Africa remains tough on the back of weak
economic growth, which has been exacerbated by power shortages, and
increased competitor activity. Domestic sales volume growth in Zimbabwe and
Botswana has shown an upward trend. However, in all territories muted
selling price growth has been achieved.
The lime division has shown an improved performance with new business
secured and higher off-take from the steel and alloys industries, while the
aggregates division has been impacted by reduced demand from project
related customers. Pronto Readymix, consolidated from July 2014, has
positively contributed to the group results.
While the South African trading environment will remain tough and highly
competitive, we believe that our various response strategies have
positioned PPC well to limit the impact on the group. The release of major
infrastructural projects in South Africa, Botswana and Zimbabwe would
provide a key driver for demand of cement products.
Earnings per share for the first half of 2015 are anticipated to reflect a
year-on-year decline mainly due to last year’s once off tax credit combined
with increased finance costs in this year.
Any forecast financial information on which this trading update is based
has not been reviewed by the company´s auditors.
BL Sibiya
Chairman of the board
26 January 2015
Sponsor
Merrill Lynch South Africa (Pty) Limited
PPC:
Azola Lowan
Tel: +27 (0) 11 386 9000
Azola.Lowan@ppc.co.za
Financial Communications Advisor:
Instinctif Partners
Louise van der Merwe
Mobile: +27 (0) 71 605 4294
Louise.VanDerMerwe@instinctif.com
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