http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 14.49Change: 0.10
R/$ = 10.50Change: 0.05
Au 1294.90 $/ozChange: -0.67
Pt 1407.50 $/ozChange: -21.00
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Nelson Mandela 1918 - 2013   Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science & Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Suppliers Directory Research Jobs Announcements Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
Nov 08, 2011

PPC aims to generate half of its revenue from rest of Africa by 2016

Back
Gauteng|Cogeneration|Costs|Pretoria Portland Cement|Pronto Holdings|Quarries Of Botswana|Renewable-Energy|Africa|Botswana|Democratic Republic Of Congo|South Africa|USD|Colleen Bawn Factory|Port Elizabeth Factory|Port Elizabeth Plant|Cement Industry|Cement Market|Cement Player|Cement Producer|Cogeneration|Electricity|Fly Ash Supplier|Government-owned Cement Producer|Transport|Cogeneration|Paul Stuiver|Rail Transport
gauteng|cogeneration|costs|pretoria-portland-cement|pronto-holdings|quarries-of-botswana|renewable-energy-company|africa|botswana|democratic-republic-of-congo|south-africa|usd|colleen-bawn-factory|port-elizabeth-factory|port-elizabeth-plant|cement-industry|cement-market|cement-player|cement-producer|cogeneration-industry-term|electricity|fly-ash-supplier|government-owned-cement-producer|transport-industry-term|cogeneration-person|paul-stuiver|rail-transport-product
© Reuse this



Cement producer Pretoria Portland Cement (PPC) plans to boost the revenue contribution from its African business, outside South Africa, to 50% in the next five years, CEO Paul Stuiver said on Tuesday.

The company increased its revenue contribution from the rest of the continent to 20% in the past financial year, which Stuiver said was in line with PPC’s strategic growth objectives, with Africa being “the growth story of the moment”.

“We would like our earnings from Africa to increase to between 40% and 50% in the next five years. We understand Africa better than most other players; it is on our doorstep and we believe it is an opportunity begging, especially for a cement player finding it difficult to grow in its home territory,” he told Engineering News Online.

The group looked at eight significant expansion opportunities into other African regions during the financial year ended September 30, four of which were abandoned due to either a lack of potential for value creation, unacceptable levels of risk or a combination of both.

Of the remaining four, one project has resulted in a $44-million conditional offer for a 58% stake in a government-owned cement producer in the Democratic Republic of Congo, Cimenterie Nationale. “We await the outcome of our bid. The remaining opportunities are being pursued and we expect that further opportunities will arise in due course,” Stuiver said.

In Botswana, PPC recently bought Quarries of Botswana for $6.8-million, which it said would benefit its aggregates operations in that country, and in South Africa, the group is buying Gauteng-based readymix and fly ash supplier Pronto Holdings for R280-million.

Stuiver said PPC was optimistic about the Zimbabwean cement market. Domestic sales in that country improved by more than half during the year,owing to a combination of increased demand and operational problems suffered by PPC’s competitors. The operating performance at the Colleen Bawn factory improved during the second half of the year and equipment at its Bulawayo grinding depot, that had been mothballed for 15 years, was recommissioned to meet increased demand.

However, Stuiver pointed out that significant input price inflation on key items such as electricity, continued to be a concern for the Zimbabwean operations.

While growth remained slow in South Africa, Stuiver stated that the group was confident in the long-term recovery of the domestic cement industry. “We have seen the worst. The cyclic trend is coming up again, after hitting the bottom in 2010.”

Stuiver cautioned, however, that the eurozone crisis could result in another general slowdown in business.

PPC said that overcapacity in the South African cement industry continued to drive competitive market conditions and was putting prices under pressure. “A weighted average increase of 4% in selling prices during the year was insufficient to recover rising input costs,” he said.

Costs rose 11% in the financial year on the back of above-inflation electricity prices and diesel price increases, accompanied by higher logistics costs as inadequate rail transport had to be supplemented by more expensive road transport.

PPC’s cement volumes in South Africa fell by 4% in the financial year ended September, while overall cement sales were 3% lower.

The group’s revenue was almost flat at R6.83-billion, compared with R6.81-billion in the previous financial year. Earnings a share declined by 22% to R16.40 a share.

PPC reduced headcount by 6%, or 180 people, over the past financial year, with 35 employees from head office and 45 employees from its Port Elizabeth plant taking voluntary retirement packages. Stuiver said this was necessary to align the Port Elizabeth factory to production capacity.

PPC also slowed its capital investment programme in line with depressed trading conditions. Capital investment of R483-million was incurred, compared with R613-million in the previous financial year.

ENERGY

Meanwhile, Stuiver said that PPC has completed a feasibility study into a cogeneration facility at one of its plants, but concluded that it would not be worth its while.

“The capital cost of setting electricity cogeneration units at our plants, versus the energy costs we would save does not make it worthwhile. We would rather take the capital and put it towards a cement plant,” he said.

However, the company was investigating a wind power joint venture. “We have an exciting prospect and would like to tender in the next round of government’s renewable-energy procurement scheme in March 2012,” he said.

PPC is aiming to generate about 30 MW, or 10% of its total energy needs.
 

Edited by: Mariaan Webb
© Reuse this Comment Guidelines
 
 
 
 
 
 
 
 
Other Construction Materials News
Michael Garcia
Steel and vanadium producer Evraz Highveld Steel and Vanadium on Wednesday appointed executive director and FD Jan Valenta CEO, with immediate effect, after Michael Garcia stepped down. Olga Luzik would replace Valenta, who was appointed FD and director in 2011.
Ghana has banned the export of ferrous scrap metal immediately in a bid to make more raw material available to sustain the West Africa country's steel industry, Trade Minister Haruna Iddrisu said on Tuesday. Iddrisu said the government was also drafting legislation...
Steel products manufacturer Andrew Mentis reports that it attributes its success in the provision of flooring and handrailing solutions to its approach of prioritising consumer feedback and researching the best methods of incorporating consumers’ input into its...
Article contains comments
More
 
 
Latest News
Few would argue with the notion that unemployment, which stands at around 25% on the narrow definition as reported by Statistics South Africa, remains one of the country’s most pressing challenges. Fewer still could contest the view that South Africa’s education...
Renewable-energy projects, such as this Northern Cape solar farm, seen as key to low‐carbon energy supply.
Upfront investment costs will and should remain a critical consideration as South Africa moves to upscale and accelerate its infrastructure programmes. But one of the lead authors of the latest Intergovernmental Panel on Climate Change (IPCC) argues that the...
The barrier to efficient water service delivery in South Africa was not of a technological nature but rather related to legal and Constitutional challenges, Water Research Commission (WRC) CEO Dhesigen Naidoo said on Thursday. Opening a WRC debate under the theme...
More
 
 
Recent Research Reports
Steel 2014: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2014 report provides an overview of the global steel industry and particularly of South Africa’s steel sector over the past year, including details of production and consumption, as well as the country's primary carbon steel and stainless...
Projects in Progress 2014 - First Edition (PDF Report)
This publication contains insight into progress at the delayed Medupi and Kusile coal-fired projects, in Mpumalanga and Limpopo respectively, as well as at the Ingula pumped-storage scheme, which is under construction on the border between the Free State and...
Automotive 2014: A review of South Africa's automotive sector (PDF Report)
The report provides insight into the business environment, the key participants in the sector, local construction demand, geographic diversification, competition within the sector, corporate activity, skills, safety, environmental considerations and the challenges...
Construction 2014: A review of South Africa's construction sector (PDF Report)
Construction data released during 2013 hints at a halt to the decline in the industry during the last few years, with some commentators averring that the industry could be poised for recovery. However, others have urged caution, noting that the prospects for a...
Electricity 2014: A Review of South Africa's Electricity Sector (PDF Report)
This report provides an overview of the state of electricity generation and transmission in South Africa and examines electricity planning, investment in generation capacity, electricity tariffs, the role of independent power producers and demand-focused initiatives,...
Defence 2013: A review of South Africa's defence industry (PDF Report)
Creamer Media’s 2013 Defence Report examines South Africa’s defence industry, with particular focus on the key players in the sector, the innovations that have come out of the defence sector, local and export demand, South Africa’s controversial...
 
 
 
 
 
This Week's Magazine
The Electronic Systems Laboratory (ESL) of the Department of Electrical and Electronic Engineering at Stellenbosch University is strongly reaffirming its position as one of South Africa’s leading centres for satellite technology and expertise. It is currently...
MORE IN SA Phase 2 should see local content on the mainline locomotive increase from 65% to 80% by the end of 2014
The world’s lowest-cost diesel-electric locomotive is not made in China, but in Pretoria, at RRL Grindrod Locomotives’ newly upgraded 30 000 m2 plant. The company’s locomotive pricing is “more competitive than any other original-equipment manufacturer (OEM)...
The South African Defence Review 2012, released to the public at the end of last month (despite the year given in its title) recommends the creation of the post of Chief Defence Scientist. This official would be responsible for the management of defence technology...
AltX-listed engineering technology company Ansys has been awarded an R188-million contract by Transnet to supply integrated dashboard display systems to the freight rail utility’s locomotives. Black-owned and controlled Ansys developed the bespoke integrated system...
South Africa’s sole nuclear power station Koeberg, which is located in the Western Cape, breached a major operations milestone on April 4, which marked the thirtieth anniversary of Unit 1 having been connected to the grid. Eskom, which operates the two-unit plant,...
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks