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Cement producer PPC reported a sharp improvement in profitability and cash generation over the year, as gains in its South African cement business lifted earnings and strengthened the group’s financial position. The group grew earnings before interest, tax, depreciation and amortisation (ebitda) by 31% to R2.079bn, extending its two-year recovery to 62%, while strong cash generation from its South Africa and Botswana operations supported overall performance, it said in its results for the year to end-March. “Cement sales volumes in South Africa and Botswana, including clinker sales to Zimbabwe, increased by 1.3% compared with the previous year. In South Africa, overall volumes were stable, with growth in the industrial and construction segments offsetting softer retail demand, where competitive pressure remained elevated,” the group said.The group’s “awaken the giant” strategy continued to filter through to its results for a second consecutive year, anchoring a stronger turnaround for the 12 months, with performance steadily improving across the board.The group declared a gross cash dividend of R469m for the year, up from R274m in the previous year, reflecting a payout of 30.2c per share.HEPS increased 25% to 50c.On the broader macroeconomic outlook, the group said its long-term sustainability remains anchored in strong fundamentals rather than the external environment, adding that profitability has been driven by competitiveness and disciplined execution rather than topline growth.“Margins have been structurally improved over the past two years, positioning the business to convert incremental volumes into higher earnings when conditions improve. While remaining cautiously optimistic on a recovery in South Africa, Zimbabwe is expected to remain a stable market, supporting steady growth,” the group said.Group revenue rose 3.9% to R10.255bn, driven mainly by a 14.3% increase in Zimbabwe, while the South Africa and Botswana businesses saw a marginal 0.4% fall.PPC Zimbabwe reported an 18.2% increase in sales volumes, supported by its nationwide operational footprint and turnaround initiatives in a growing demand market, it said.PPC also received R490m in dividends from its Zimbabwe operations, though R105m was earmarked to secure a guarantee arrangement in South Africa linked to the business.Zimbabwe’s operating ebitda rose to $56m (R922m), though margins eased slightly before recovering strongly in the second half to 30.9%.PPC CEO Matias Cardarelli said the performance was significantly ahead of expectations and had positioned the group for its next phase of growth, which is expected in the 2028 financial year after the completion of a new integrated cement plant in the Western Cape.“Two years ago, we began a fundamental transformation of PPC, resetting legacy ways of working, rebuilding our foundations and introducing the ‘awaken the giant’ strategy to sharpen competitiveness, accountability and execution. The results over this period have been exceptional and show the value that can be unlocked in a well-run PPC,” Cardarelli said.
