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Business Reporter
CEMENT maker Pretoria Portland Cement (PPC) recorded a nine percent increase in sales volumes at its Zimbabwean unit in the nine months to December 2016 after commissioning a $82 million plant in Harare.

In its latest trading update for the period, the group said its overall sales volumes were up four percent compared to the previous period.

“Zimbabwe, Rwanda and Botswana collectively recorded cement sales volume increases of nine percent for the nine months period to December 2016.

“On the back of increased sales promotions, cement sales volumes in Botswana have shown a 12 percent growth for the quarter ending December 2016.

Pricing in all the territories does, however, remain under some pressure,” said PPC.

It said the $82 million Msasa mill in Harare was completed on time and $3 million below budget without a single lost time injury.

“The project debt was initially anticipated to be $85 million.

“However, the use of own-cash resources reduced debt drawdowns by $20 million. The first bi-annual debt and interest repayment was made in December 2016.

“Following commissioning of the mill, cement sales volume performance, which had been trending lower, has shown an improvement when compared to the previous quarter ending December 2016,” it said.

The giant firm, however, said liquidity challenges in Zimbabwe continue to make it difficult to import key inputs and that management was exploring various solutions to overcome these challenges.

On the South African operations, PPC said cement sales volumes also increased by four percent as the average selling price dropped by the same margin.

“Following selling price increases implemented in the Gauteng and Inland regions in October 2016, these areas experienced high single digit declines in cement sales volumes for the quarter ending December 2016.

“Despite strong volume growth in the Western Cape region, overall cement sales volumes in South Africa declined marginally when compared to the same quarter in the previous year,” it said.

Similarly, the Rwandan unit recorded 81 000 tonnes of cement sales volumes in the quarter ending December 2016, bringing cement sales recorded for the nine month period to December 2016 to a total of 230 000 tonnes.

The company says it remains focused on delivering its expansion projects timeously and cost effectively.

“As the international projects are at advanced stages, the focus has largely shifted to operational performance and achieving maximum ramp-up without disrupting the market.

“Management also continues to give special attention to the cash generating units, specifically managing costs within management’s control while maximising efficiencies.

“Work is also underway to further optimise the company’s capital structure while also exploring ways to de-risk the project in the DRC,” said PPC.