PPC doubles volumes in rest of Africa
Building materials group, PPC, managed to maintain margins for the year ended March 2022. Group revenue grew just over 10 per cent to 9.9 billion rands while headline earnings per share reduced to a loss of 3 cents. Joining CNBC Africa for more is Roland van Wijnen, CEO of PPC.
Mon, 27 Jun 2022 15:55:22 GMT
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AI Generated Summary
- PPC maintained margins despite challenging operating environment and reduced earnings per share
- Significant volume growth in Zimbabwe and Rwanda driven by infrastructure projects
- Focus on efficient operations, debt reduction, and decarbonization for future growth
Building materials group, PPC, has managed to maintain margins for the year ended March 2022, despite facing a challenging operating environment. Group revenue saw a growth of just over 10% to 9.9 billion rand, while headline earnings per share reduced to a loss of 3 cents. Roland Van Wijnen, CEO of PPC, discussed the company's performance and future strategies in a recent interview with CNBC Africa. Looking at the results, Van Wijnen highlighted the normalization of cement volumes in South Africa. He mentioned that the company saw strong sales post-COVID last year, but the volumes have now returned to pre-pandemic levels. In contrast, Zimbabwe and Rwanda experienced significant volume growth, driven by infrastructure projects and retail sales to combat high inflation. Van Wijnen explained that large projects such as road construction, power plants, airports, and stadiums contributed to the growth in these regions. In terms of managing hyperinflation in Zimbabwe, Van Wijnen pointed out that a significant portion of the revenue is in stable currencies like the rand, reducing the exposure to hyperinflated input costs. The company also successfully reduced its debt from 2.2 billion to 1 billion through strong cash generation and acquisitions. Van Wijnen emphasized that the current debt level is sustainable and future cash will be directed towards dividends and decarbonization efforts. Speaking about growth prospects, Van Wijnen mentioned that while the company is prepared to benefit from infrastructure projects, the focus remains on running efficient operations and reducing costs. He highlighted the importance of decarbonization and outlined strategies such as increasing the use of alternative products and renewable energy sources. Looking ahead, Van Wijnen expects continued growth in Rwanda and Zimbabwe, with South Africa remaining a key market for the company. However, he expressed concerns about high levels of cement imports and emphasized the need for government support to promote local manufacturing and employment. In conclusion, Van Wijnen discussed PPC's decarbonization strategy, which includes clear targets for reducing carbon emissions by 2025 and 2030. The company plans to increase the use of alternative products, replace coal with waste materials, and invest in solar energy generation to reduce environmental impact.