Debt for new African plants weighs on PPC’s earnings
PPC saw headline earnings per share nosedive 66% to 14c and a normalised 36c in the six months to September, despite cash generated from operations being up 58% and overall cement sales volumes up 13%. Group revenue of R5.2bn was up 15%, but profit for the period fell to R58m from R351m in the six months to March as a result of a 54% increase in finance costs. The company’s financial year end has recently changed, accounting for the comparison with the previous six months. But the group put a positive face on its efforts to claw back market share in regional cement markets, while it still carried a heavy debt burden. "We are encouraged by these results. The benefits of a diversified portfolio are increasingly evident, with the materials business and operations outside SA contributing positively," CEO Darryll Castle said on Wednesday. The group had conducted a rights issue in March that reduced debt from R9.2bn to R5.9bn. The debt is funding for new African cement plants. Meanwhile, ...
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