PPC has reported higher full-year earnings after a “step change” in margins and cash flow due to delivery on the cost improvement initiatives in its turnaround strategy.
The cement producer said on Monday that earnings before interest, tax, depreciation and amortisation (ebitda) for the year to end-March increased 28% to R1.59bn. Headline earnings per share (HEPS) rose to 40c from 19c a year ago.
Revenue decreased 1.9% to R9.87bn mainly due to a 6.7% reduction in Zimbabwe’s revenue, while PPC’s SA and Botswana group revenue rose by 0.6%.
“The FY25 results are even more remarkable, considering that the markets where we operate didn’t have noteworthy growth,” said CEO Matias Cardarelli.
The group remained focused on things within its control — delivering on its plans and doing so at an increased pace, he said.
“Implementing phase one of our ‘Awaken the Giant’ strategic turnaround plan has resulted in a step change in PPC’s FY25 margins, profitability and cash generation,” he said.
He added that the group was becoming more competitive and better prepared to deliver an enhanced value proposition to its customers.
“Besides the positive impact of cost discipline, our contribution margin increased across all segments of our business. We were able to offset inflationary costs with early operational improvements, from logistics optimisation to a better product mix, lower clinker factor and improved sales sourcing.”
The main driver of the group’s improved performance was the reduction in cost of sales, which declined 5.8% to R7.92bn, combined with the reduction in administration and other operating expenditure of 8.2% to R950m These cost improvements were the primary driver of the 59% increase in trading profit to R982m, it said.
A dividend of 17.6c per share was declared comprising 1.9c per share from the SA and Botswana group and 15.7c being the dividends received from Zimbabwe.
The group said its view of the macroeconomic environment remained positive and it believed there would be steady and slow improvements in the environment in the coming years.
Its focus will continue to be on unlocking internal value. “Ultimately, our competitiveness strategy will position PPC even better once infrastructure projects begin to materialise,” the group said.
The group said the 2025 financial year was initially “year zero” of its turnaround strategy, but the combined effect of closing the gaps and accelerating the turnaround had delivered substantial results ahead of schedule.
“Notwithstanding the significant margin and cash flow improvements in the current year, opportunities remain to unlock additional value. Incremental improvements are anticipated in the financial years FY26 and FY27 from the turnaround efforts,” it said.
The next step change in financial performance is envisaged in the 2028 financial year after the new integrated plant in the Western Cape (RK3) becomes operational.
The construction of RK3,entailing a spend of R3bn over two years, will start in the 2026 financial year.
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