Displaying items by tag: PPC
Matias Cardarelli named as the new head of PPC
06 September 2023South Africa: PPC has appointed Matias Cardarelli as its new chief executive officer for four years, with effect from 1 October 2023. He will replace Roland van Wijnen, whose contract began in 2019. Cardarelli has held various positions at private cement companies, including chair of Natal Portland Cement (NPC), part of InterCement Group. He also led the operational and financial turnaround of Amreyah Cement in Egypt and the expansion of Yguazú Cementos in Paraguay.
PPC Employee Share Ownership Trust to increase stake in PPC South Africa Holdings by 10%
07 August 2023South Africa: PPC South Africa Holdings says that it has concluded a deal to sell 10% of its shares to employees via the PPC Employee Share Ownership Trust. News24 Online News has reported that all South African employees of the company will be eligible to buy shares, provided that they are not already currently participating in its long-term incentive programme. The total value of shares transferred under the deal will be US$20.4m
CEO Roland van Wijnen said "PPC has been built upon the shoulders of its employees, and this transaction provides a meaningful way of rewarding those in South Africa who do not participate in PPC’s long-term incentive plan to share in the creation of shareholder value. We are pleased that the terms of the transaction are such that it stands to benefit employees for many years to come.”
PPC publishes Integrated Report 2023
28 July 2023South Africa: PPC has published its Integrated Report for its 2023 financial year, which ended on 31 March 2023. The producer recorded revenues of US$559m, up by 0.2% year-on-year from US$557m in the 2022 financial year. Its cost of sales declined by 0.1% to US$471m from US$472m. As a result, PPC's loss widened by a factor of more than seven, to US$32.5m from US$4.36m.
PPC's cement volumes fell by 5.8% in South Africa and Botswana, where its cement prices rose by 8%. The company noted sustained 'good demand' for cement in coastal South Africa. It said that demand was 'robust' in Zimbabwe, however its local sales volumes fell by 16% on account of an extended kiln shutdown at one of its cement plants during the half. In Rwanda, PPC's subsidiary CIMERWA increased its cement volumes by 1%.
PPC launches US$10.8m share buyback
27 June 2023South Africa: PPC has commenced a buyback of US$10.8m-worth of its registered shares, the Cape Times newspaper has reported.
Chief executive officer Roland Van Wijnen said "We have been very conscious of our capital allocation to ensure our debt levels come to acceptable levels and we have finally achieved that." He added "We believe our share price is well below the true value and therefore we believe it is better for our shareholders to initiate a share purchase rather than a distribution through cash."
Update on South Africa, June 2023
21 June 2023Mining and materials company Afrimat said it was buying Lafarge South Africa this week. The assets it is acquiring include aggregate quarries, ready mix concrete (RMX) batching plants, one integrated cement plant, two cement grinding plants, cement terminals and fly-ash sources. The means of purchase is somewhat unusual, as Afrimat is paying around US$6m but it also appears to be taking responsibility for around US$50m of outstanding debt that Lafarge South Africa owes its parent company, Holcim. In a statement Afrimat’s chief executive officer (CEO) Andries van Heerden talked up the benefits for his company in terms of the boost to its aggregates and concrete businesses.
This is quite the change from 2012 when India-based Aditya Birla Group was reportedly looking into buying Lafarge South Africa. At this time the value for the business for a similar mix of assets, including 55 RMX plants and 20 quarries, was said to be to US$900m. Prior to this, Lafarge South Africa spent around US$170m in the late 2000s on increasing the production capacity at its integrated Lichtenburg plant and building its Randfontein grinding plant. Then in 2014, when the merger between Lafarge and Holcim was announced, Lafarge consolidated its Nigeria-based and South Africa-based operations as Lafarge Africa. It later decided to move the South African business to another Holcim subsidiary, Caricement, in 2019 to keep the business in Nigeria more profitable by reducing its debts. This transaction was valued at US$317m. At the time chair Mobolaji Balogun said that Lafarge South Africa’s operations had faced a challenging market in South Africa, with shrinking demand in an aggressively competitive sector. Afrimat is now buying Lafarge South Africa and its subsidiaries from Caricement.
Holcim isn’t alone in making an effort to sell up in South Africa. In April 2023 the Valor Econômico newspaper reported that Brazil-based InterCement was receiving offers for its remaining African-based assets in Mozambique and South Africa with a potential deal valued at around US$300m. InterCement runs Natal Portland Cement in South Africa, which operates one integrated plant and two grinding units. This follows the sale of its Egypt-based assets in January 2023 to an unnamed buyer.
PPC, the country’s largest cement producer, is staying put. However, it issued a mixed trading update this week ahead of the formal release of its annual results to 31 March 2023. Trading conditions in the interior of South Africa and Botswana were described as being ‘difficult,’ with cement sales volumes down by nearly 6% year-on-year and earnings before interest, taxation, depreciation and amortisation (EBITDA) down by 26%. Yet the group says it was able to grow its revenue. PPC’s CEO Roland van Wijnen added, “We therefore remain hopeful that the South African government will roll out its infrastructure development plans and protect the local cement market through the introduction of import tariffs to create a level playing field for domestic producers.” Dangote Cement subsidiary Sephaku Cement was more circumspect in its recent trading update but it too warned that, “deteriorating economic conditions and persistent challenges in the cement industry impacted Sephaku Cement’s financial performance to break-even levels.”
Much of the above makes for gloomy reading. As the local trade association Cement and Concrete South Africa (CCSA) has laid out to local media, the market faces the problem of having 20Mt/yr of production capacity, 12Mt/yr of demand and over 1Mt/yr of imports compounding the problem. Lobbying by local producers against imports has been a feature of the market since the early 2010s and this work continues through the efforts of the CCSA and others. However, the plea by PPC for government infrastructure spending suggests that the market faces more systemic problems. As a consequence some cement producers are trying to leave the market, while others are attempting to tough it out.
PPC publishes 2023 financial year trading update
16 June 2023South Africa: PPC has advised investors that its full-year 2023 results will show a more-than-doubling of its headline loss per share from continuing operations. The group said that its cement sales volumes in South Africa and Botswana fell by 5.8% year-on-year, while volumes in Zimbabwe dropped by 16%. Its subsidiary Cimerwa increased its cement sales volumes during the year by 1%. Despite the local decline in volumes, PPC increased its revenues in South Africa and Botswana by 1.7%. South Africa and Botswana cement sales constituted 46% of group revenues, Zimbabwe cement sales 17% and Rwanda cement sales 15%.
South Africa: PPC has forecast a drop in its cement sales volumes during the 2023 financial year, which will end on 31 March 2023. It says that its South African sales will drop by 4%, and its Botswanan sales by 7%. In the first half of the financial year, sales dropped by 2.6% year-on-year. PPC now says that disruptions at South African ports will likely limit the decline in its sales volumes in its home country by reducing competition from imports. South Africa imported 30% of cement consumed during the 2022 financial year, however congestion at ports and currency effects have kept this figure from rising throughout the present financial year.
PPC's CEO Roland van Wijnen said "Rising input costs and the objective of maintaining our market share continue to cause margin pressure." The group now expects to reduce its debt by 28 - 33% to US$39.5 - 42.2m in the 2023 financial year.
PPC contemplating sale of Zimbabwe business
08 February 2023Zimbabwe: South Africa-based PPC is reportedly considering selling PPC Zimbabwe for US$200m. The Zimbabwe Independent newspaper has reported that the group received an unsolicited offer from a local company.
PPC said “PPC’s board has a duty to assess any such approaches on their respective merits.”
World Cement Association appoints three new directors
01 February 2023UK: The World Cement Association (WCA) has appointed three new directors: Fabien Charbonnel, the chief executive officer (CEO) of Cem’In’Eu; Xu Gang, the chair of the board of Maweni Limestone and Vice President and Head of Overseas Area of its parent company Huaxin Cement; and Kevin Lunney, the chief operations officer of Mannok Holdings. The appointments were agreed at the WCA General Assembly Meeting, which took place in January 2023.
At the same time Mohammed Ali Al-Garni, the CEO of Saudi Cement, and Roland van Wijnen, the CEO of PPC, were re-elected to the board of directors. Vincent Lefebvre, the founder and executive chair of Cem’In’Eu, and Mahendra Singhi, the managing director and CEO of Dalmia Cement, have also resigned as directors. They joined the board of directors of the WCA in 2019 and 2020 respectively.
Children burnt at PPC Zimbabwe cement plant
18 January 2023Zimbabwe: Three boys aged 11, 12 and 14 were injured at PPC Zimbabwe integrated Colleen Bawn cement plant on 13 January 2023. Two of children reportedly jumped into a dump site at the plant and sustained second-degree burns from hot material, according to News24. The third child suffered burns whilst trying to help the other two. The children are in a stable condition. The dump is reportedly quarantined from the local community. An investigation is ongoing.