Harare – Pretoria Portland Cement (PPC) Zimbabwe revenue for the six months ended 30 September, 2018 grew by 31 percent to R1 077 million compared to R820 million the prior year on the back of strong volume growth of 28 percent.
The Group said in Zimbabwe successful implementation of its route to market strategy has enabled PPC to benefit from the upsurge in construction activity as consumers convert their monetary investments into fixed assets and growing government infrastructure expenditure.
In Zimbabwe during the period under review, EBITDA grew by 42 percent to R352 million compared R248 million in September 2017 with corresponding margins improving from 30 percent to 33 percent.
The Group said the country’s acute forex shortages as well as liquidity constraints continue to hamper economic activity.
“PPC Zimbabwe is operationally self-sufficient and continues to drive local procurement and exports to reduce forex requirements. Furthermore, the company is continually looking to capitalise on sustainable acquisition opportunities in the value chain in country.”
Going forward the Group said Zimbabwe is expected to deliver a steady performance, supported by robust demand and an improved political environment.
During the period under review, Group revenue rose by 8 percent to R5 597 million compared to R5 188 million last year supported by total cement volumes increasing by 4 percent to approximately 3,1 million tonnes.
Cost of sales increased by 16 percent to R4 494 million compared to R3 859 million the previous year.
The Group said the higher cost of sales was due to the DRC being fully accounted for in the period, which contributed R226 million and additional clinker imports and maintenance costs during the Cimerwa plant upgrade period of R33 million.
In the period under review, cost of sales was further impacted by additional expenditure related to phasing of kiln shutdowns and unplanned downtime in South Africa of R26 million and previously capitalised expenditure related to SK9 commissioning of R19 million.
On a like-for-like basis, cost of sales was up 9 percent.
Equity Axis is an online financial media service platform focused on African markets offering real-time stock quotes, news, analysis and data.