PPC balance sheet improves after empowerment transaction‚ now plans to reduce debt, fund capex
This resulted in a cash inflow of R1bn in December 2016‚ which will be used to further reduce debt and fund capital expenditure. In terms of broad-based black economic empowerment codes‚ PPC’s contributor level has improved from level eight to level four.
“The company’s balance sheet has been strengthened significantly against the cyclical nature of the business‚” it said in a trading update on Thursday, 2 February. But following selling price increases‚ the group’s Gauteng and inland regions experienced high single-digit declines in cement sales volumes for the quarter ending December 2016 compared to the same period in 2015.
“Despite strong volume growth in the Western Cape region‚ PPC’s overall cement sales volumes in SA declined marginally when compared to the same quarter in the previous year‚” the group said. But for the nine-month period to December 2016‚ PPC’s overall cement sales volumes in SA rose by 4%‚ as average selling prices fell by 4%.
The company has implemented further price increases in selected regions‚ effective 1 February 2017‚ the effect of which would begin to reflect on the average selling price in the next few months. Meanwhile‚ business units in Zimbabwe‚ Rwanda and Botswana saw cement sales volumes rise a collective 9% for the nine-month period to December 2016.
BDpro