PPC Zim records increased first half sales and earnings despite economic challenges

Author Name
Respect Gwenzi
Stock Market 10 months ago

Harare – Regional cement manufacturer, Pretoria Portland Cement (PPC) says although trading conditions in Zimbabwe were characterised by a challenging economic environment and the impact of COVID-19 related lockdown restrictions, domestic cement volumes grew by 5% to 10% in the first half of its 2021 financial year supported by ongoing infrastructure projects.

Headquartered in South Africa, PPC also has operations in Botswana, Ethiopia, Democratic Republic of Congo (DRC) and Rwanda.

During the period under review, PPC Zimbabwe cement sales grew in the similar range, supported by an increase in volumes of 35% to 40% in Q2 with the Group highlighting that the positive sales momentum has continued into October and November, albeit at a normalised rate.

Revenue increased by 60% to R797 million compared to R497 million recorded in the same period last year. Cement pricing was adjusted to account for the increase in inflation and the devaluation of the local currency. Realised selling prices in US$ increased by 23%.

EBITDA improved by 62% to R326 million against R201 million in prior year and EBITDA margins improved to 40.9%, versus 40.4% in September 2019.

The Group further highlighted that the Zimbabwe unit continues to meet its debt obligations.

Overall, Group revenue increased by 1% to R5 006 million (September 2019: R4 948 million) attributed to robust cement sales, post the easing of COVID-19 restrictions across the jurisdictions in which the Group operates. Group EBITDA increased to R996 million from R868 million recorded in the same period last year.

Commenting on the Group performance, Chief executive officer (CEO) Roland van Wijnen said, “After a difficult start to the financial year as a result of the COVID-19-related trading restrictions across the jurisdictions in which we operate, I am pleased that we are once again able to serve our customers and play our part in keeping the economy going. My gratitude goes to my colleagues who have been working diligently to keep our operations running while observing stringent health and safety protocols. Our business has benefited from a strong recovery in cement sales in all our markets, post the easing of the lockdown restrictions, and this has resulted in improved financial performance for the Group. Our efforts to improve cost competitiveness and reposition PPC on a sound financial footing are yielding encouraging results and we are making good progress on our capital restructuring project, which remains a key priority for the Group.”

Equity Axis News

Stock Market ● 1 week ago
Room for FMCG ETF on ZSE

Since its January 4th debut on the ZSE this year, Old Mutual Limited's Exchange Traded Fund (ETF) has had an impressive run so far, presenting a good case for market interest in alternative financial investment instruments through formal & regulated channels. YTD price up 300% YTD market cap up 616% at ZWL 574.5m Broadly speaking, the ETF tracks and mirrors trading performance of the ZSE’s...

Stock Market ● 3 weeks ago
Cassava's trade suspension another thorn in ETF's side

Having violated ZSE listing requirements, shares of Cassava Smartech have been suspended from trading (effective October 1st 2021). The firm was due to publish its set of financial statements for the year-ended February 2021. Seven months later & no financials are out. Cassava’s market cap stood at ZWL 81.5 billion, with the firm well-positioned among the ZSE’s basket of “market heavies” – the To...

Stock Market ● 3 weeks ago
ZSE sustains record highs as magnitude subsides

The ZSE sustained record-breaking momentum in mid-week trades albeit at subsiding levels. The mainstream All Share Index surged by 1.97% in today’s session, a slow-down from an average daily gain of 3.7% over the past 5 days, to close at an all-time high of 8586.7 points. This is due to a -78% decline in demand as well as subsiding margins in market heavies and penny stocks respectively. On t...

Markets ● 3 weeks ago
Suppressed HY-21, Rosy Year-End Lined-Up For RTG

In the six-months ended June 2021, the Rainbow Tourism Group's occupancy closed the period at 24%, a 4% improvement from prior year levels. Inflation-adjusted revenue grew to ZWL 706m from ZWL 462m, representing a 53% growth. The Group says that in the face of business interruptions, gross margins managed to rise from 63% to 67% in the period. At ZWL 161m, EBITDA ended the half-year 6% down from...

Stock Market ● 3 weeks ago
Challenging the ZSE's "top performing stock market" narrative

After surpassing its own performance record (again), the ZWL-denominated exchange extended 2021 gains as the market’s counters continue facing economic uncertainties in the closing quarter of the year. Index up 198% YTD ZWL continues to depreciate Parallel market remains out of control Unlike steady-moving regional peers, the ZSE’s All Share Index (ASI) has nearly doubled its 2020 year-end...