PRETORIA Portland Cement (PPC) Zimbabwe remains optimistic that its performance will be in line with its planned targets, but expects to close the year lower than 2015 due to economic challenges besetting the country. PPC Zimbabwe MD, Kelibone Masiyane, said the company was operating under harsh economic conditions which have seen its local sales volumes and exports tumbling in the first half of the year.
In its provisional results for the six-month period ended March 31 2016, PPC said volumes, including exports, at its Zimbabwean unit went down 22% due to liquidity challenges, increased local competition and lower disposable income. It said local selling prices for its cement also fell 3%, resulting in the unit’s contribution to group revenue decreased 4%.
“This has been further exacerbated by imports from neighbouring countries. Export volumes remain poor due to a higher manufacturing cost base compared to the region as well as the stronger US dollar against weaker regional currencies, making the company uncompetitive in export markets,” Masiyane said. The PPC boss, however, said good cost control measures had led to impressive declines in production costs and overheads. It is currently constructing an $80-million cement plant in Harare, which will have capacity to produce 680 000 tonnes annually. Apart from South Africa and Zimbabwe, PPC also has units in Botswana, Ethiopia and Rwanda.
