CEMENT producer PPC Zimbabwe recorded its highest monthly volumes in seven years in June 2017 while at the same time achieving overall double digit volume growth for the year compared to the same period prior year, management has said. This is despite the challenging operating environment characterized by liquidity constraints being experienced in the country.
“Our Zimbabwe operations continue to exceed expectations, with the investment in the Harare mill contributing to volume growth,” said parent company PPC Limited (PPC Ltd) in a trading update for the period ended June 30, 2017.
In March this year, PPC Zimbabwe commissioned an $82 million dollar plant in Harare which is expected to bring the cement makers capacity to 1,4 million tonnes annually while allowing the company to increase exports in the region.
Across Africa, PPC Ltd said cement volumes have also seen double digit growth compared to last year while revenue has also tracked ahead of previous comparative period.
“Segment revenue and EBITDA are growing ahead of last year,” said PPC Ltd adding the group exercised cost containment measures during the period under review.
The South African business environment was however challenging with continued lower levels of fixed investment and consumer spend.
Resultantly, cement sales volumes in South Africa declined marginally compared to same period in the prior year, which however had two less trading days.
On a like-for-like basis, volumes were up 0,5 percent driven by solid performances in both the coastal and inland areas while imports declined by 27 percent.
But the rest of Africa experienced robust growth especially in Rwanda and the Democratic Republic of Congo where sales volumes are beginning to improve following a slow start.
While imports from Angola reduced significantly, competition from local producers increased. Pricing remained depressed due to excess capacity.
However, PPC said it would continue implementation of strategies to reduce fixed overheads.