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Nqobile Bhebhe, [email protected]

PPC Zimbabwe has maintained its debt-free status, spurred by improved business performance and impressive cash flow generation as of January 31, 2025, according to the latest financial update.

The company has also bolstered its free cash flow generation, enabling a significant increase in total dividends declared and paid amounting to US$13 million year-to-date.

This marks an improvement from the US$11 million distributed during the comparable period last year.
In an operational update for the 10 months to January 31, the South Africa-headquartered group said the Zimbabwe unit experienced a nine percent decline in volumes during the period, reflecting the trend observed at the half-year mark.

However, there are signs of improvement, with January 2025 showing positive momentum as import levels remained consistent with those of January 2024.

PPC Zimbabwe has maintained its debt-free status, spurred by improved business performance and impressive cash flow generation as of January 31, 2025 (File picture)

“Volumes declined nine percent in the period, consistent with the nine percent decline at the half-year. This trend started improving in January 2025, which is positive given that both January 2024 and 2025 had the same level of imports in the market,” the firm said.

During the period under review, PPC Zimbabwe continued to remain debt free and held US$13 million in unencumbered cash.
“PPC Zimbabwe also increased its free cash-flow generation, leading to an increase in total dividends declared and paid, of US$13 million year-to-date compared to the US$11 million paid in the comparable period.”

The solid cash generation in the period, highlighted by record dividends from PPC Zimbabwe and healthy cash flow generation in South Africa, has positioned the company to potentially reward its shareholders further.

The board is set to consider a dividend in line with its distribution policy, which allows for the flow-through of dividends received from PPC Zimbabwe to shareholders.

“Following the strong cash generation in the current period, resulting in record dividends from PPC Zimbabwe and the healthy cash flow generation in South Africa, the board will consider a dividend in terms of its distribution policy, which, amongst other things, provides for a flow through to shareholders of any dividends received from PPC Zimbabwe.”

In terms of revenue, PPC Zimbabwe faced a 12 percent decline in rand terms.

The drop was primarily attributed to the strengthening of the rand in the current period compared to the previous comparable period.

Despite the revenue decline, PPC Zimbabwe achieved a six percent increase in Earnings Before Interest, Taxes, Depreciation and Amortisation’ (EBITDA), showcasing the effectiveness of its stringent cost control measures.

The company’s margins also improved significantly, rising by 4,4 percentage points from 21,6 percent to 26 percent.
“Revenue declined by 12 percent in rand terms due to the rand strengthening in the current period compared to the comparable period,” said the company.

PPC Zimbabwe Limited managing director, Mr Albert Sigei

“Despite the lower revenue, the EBITDA grew by six percent relative to the comparable period and margins grew by 4,4 percentage points from 21,6 percent to 26 percent due to the strict cost control measures.”

PPC Zimbabwe’s performance underscores its resilience and financial discipline.
The company’s ability to generate strong cash flows and improve profitability, even in the face of revenue and volume pressures, demonstrates a robust operational strategy that continues to deliver value to shareholders.

As a leading cement producer, PPC continues to play a significant role in uplifting the living standards of the country’s citizens through infrastructural development projects that include roads, housing and dam construction.

This is in line with the objectives of Vision 2030 where the country aims to attain an upper middle-income society underpinned by the National Development Strategy 1 (NDS 1), the Government’s five-year economic development programme that comes to an end next year and will be replaced by a similar blueprint — NDS 2.

Government has prioritised infrastructure development as one of the 14 key pillars to the attainment of the national vision.
Zimbabwe’s biggest cement maker can produce a combined 1,4 million tonnes per annum from its two factories in Bulawayo and Harare.

Meanwhile, the group noted that following the appointment of Mr Matias Cardarelli as chief executive officer and changes to the executive leadership team just over a year ago, PPC embarked on a transformative journey to reposition the group for sustainable profitability and long-term growth.

The “Awaken the Giant” turnaround plan was developed to work on the opportunities identified to improve the performance of the group while scoping strategic opportunities.

The first key steps implemented included key strategic personnel changes, the simplification of the previously complex organisational structure and the realignment of the organisational culture to ensure the appropriate results orientated focus, cost discipline and a sense of urgency.