PPC gets reprieve on repaying DRC project debt
PPC has managed to secure a two-year capital holiday on repaying debt on its Democratic Republic of Congo (DRC) venture, it said on Friday.
The statement lilfted PPC’s share price as much as 3.2% to R8 by 12.55pm.
PPC built a $300m cement plant in the DRC in partnership with a local company, Barnet, and the International Finance Corporation (IFC). PPC owns 69% of the plant which has an annual production capacity of 1-million tonnes of cement.
In its interim results released in November, PPC said it had "made considerable progress in negotiating its debt obligations in SA and the DRC, which will result in an extended debt profile and should be capable of being serviced from internal cash generation".
In Friday’s statement, PPC chief financial officer Tryphosa Ramano said: "This latest development is a major achievement in addressing our capital structure. The rescheduling of debt firstly reduces the capital requirements by PPC Barnet DRC from PPC.
"Secondly it will improve cash flows for the DRC business which in turn will allow the business additional liquidity during this ramp up phase."