PPC overcomes COVID-19 woes with strong sales recovery

Author Name
Respect Gwenzi
Author
Analysis 5 months ago
  • Sales volumes rose by a fifth in October YoY
  • Experienced a muted sales in April and May 2020 due to the COVID-19
  • Cement volumes for PPC Zimbabwe grew by m approximately 5%

Harare – JSE-listed Pretoria Portland Cement (PPC) said sales volumes have bounced back in the three months July to September 2020, showing a recovery of 20% to 25% year-on-year.

The Group has operations in Zimbabwe though PPC Zimbabwe Limited.

It is good news for SA’s largest cement maker after experiencing a muted sales in April and May 2020 due to the COVID-19 restrictions imposed across most of the jurisdictions in which the group operates.

In an operational update on Wednesday, the Group said a strong recovery was experienced in PPC South Africa and Botswana from June, with double-digit year-on-year growth in cement sales volumes since June.

In the period July to September 2020, sales volumes in PPC Zimbabwe and PPC Barnet increased by 35% to 40% and 20% to 25% respectively, compared to the same period in 2019.

“October 2020 has seen more moderate growth in cement volumes for PPC Zimbabwe at approximately 5% compared to October 2019, whilst PPC Barnet has continued to experience strong growth, with cement volumes up 25% to 30% compared to October 2019”, the Group said.

In Rwanda, CIMERWA experienced approximately 5% to 10% volume growth from April 2020 to September 2020 compared to the same period last year, and in the months July to September 2020 sales volumes increased by 15% to 20% year-on-year while the International operations were less affected by the COVID-19 pandemic.

The Group is highly likely to close the year on a high as October 2020 cement volumes have continued to show good growth, up 15% to 20% compared to the same period last year.

The Group has however, cautioned that despite the continued positive sales momentum, the group remains cautious on the outlook for the rest of FY21 given the ongoing health crisis and its resultant impact on economic activity.

“PPC’s initiatives remain focused on cash preservation, improving cost competitiveness by lowering operational costs, positioning the business for recovery and improving internal controls and accountability,” the Group said.

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