BUSINESS DAY, Companies & Markets 20 May 2015, p.7 PPC rises despite 38% earnings fall MARK ALLIX tive factors are responsible for Industrial Writer the decline," Victor Seanie, investment analyst at Kagiso SA's dismal construction and Asset Management, said. mining markets saw the "These include competition country's premier cement maker from cheap cement imported PPC post a 38% plunge in head- from Pakistan and Sephaku line earnings per share in the six cement aggressively taking months to March. FRESH EYES: market share from PPC by The company, its reputation PPC CEO undercutting it on price. hard hit by the sudden departure Darryll Castle "In addition, the slow growth of former CEO Ketso Gordhan presents in SA forces cement players to late last year after a battle with results in shave prices to keep plant capac- the board, has seen its share Sandton ty utilisation high enough to price halve in the past year. yesterday that cover costs and meet their vol- But the market rewarded were less than ume growth targets," he said. new management with a more stellar, but the Mr Seanie said another con- than 7% jump in the share price market was tributing factor was that PPC's yesterday, despite profit for the forgiving. net interest expense had risen period plummeting 43%. Picture: MARTIN 27% year on year, because the Ron Klipin, portfolio RHODES company's debt had increased to manager at Cratos Capital, said fund the cement plant construct yesterday "fresh eyes" and a istan, competition has become PPC Rwanda, Ethiopia and the tion elsewhere in Africa. change from the "politicking of much fiercer for the country's Half Year 2015 2014 Democratic Republic of the Imara SP Reid analyst the past" meant the company established producers, forcing Revenue (Rbn) 4.5 was slowly getting on the right PPC to look for 40% of revenue 4.2 Congo at the same time PPC was Sibonginkosi Nyanga said the Pretax (Rm) 444 651 growing output in Zimbabwe. result "fairly reflected" the track. "But the jury is still out." from the rest of Africa by 2017. Net income (Rm) 281 496 Gross debt of R6.8bn is set to difficulties faced d by SA's New heavyweight entrants There has been some relief into the regional market Diluted HEPS (c) 59 95 rise to R10bn-R12bn in years to construction sector. from competitive pressures in 38 come. But the group has ring Operationally, it reflected Nigerian- and Chinese-backed Dividend PS (c) 24 the past week after the Inter- fenced construction costs for that competition had toughened, empowerment groups Sephaku national Trade Administration After four months in the job, rest-of-Africa plants by timing both from new cement plants Cement and Mamba Cement - Commission of SA imposed pro- new PPC CEO Darryl Castle said ramp-up of production in each and from cheap and are set to add millions of tonnes visional antidumping duties of yesterday he would maintain and case with paying down debt. sometimes illegal - imports, and of cement output in SA. between 14.29% and 77.15% on accelerate the core group strat- "Ketso's (Gordhan's) depar- that the economy was not per- Along with big volumes of Pakistani cement imports, up to egy of keeping the "home fires ture has little to do with recent forming, he said. cheap cement imports from Pak- and including November 13. burning", while expanding into performance. Rather, competi- allixm@bdim.co.za