Cement producer PPC expects to report higher interim earnings, though unrealised foreign exchange losses relating to outstanding forex contracts to hedge dollar exposure associated with building the new cement plant in the Western Cape would affect results.
In a voluntary trading statement on Monday, the group said headline earnings per share (HEPS) for the six months to end-September were expected to be between 8.3% and 18.7% higher than a year ago.
Management said it took a decision to de-risk PPC’s balance sheet from rand weakness given the material dollar-based capital expenditure associated with the new RK3 plant. In the current period, the rand strengthened against the dollar, giving rise to unrealised forex losses on the contracts.
The group expects interim HEPS of between 23.5c and 25.75c from 21.7c a year ago.
Adjusted HEPS for unrealised foreign exchange losses are expected to be 27%-36% higher than a year ago.
In September the group said it had seen a marked improvement in its results despite the weak SA macroeconomic environment.
The group, which is entering the second year of its strategic turnaround, said previously that group earnings before interest, tax, depreciation and amortisation (ebitda) increased more than 20% in the four months to end-July compared with a year ago, and ebitda margin grew more than two percentage points to 15.9%.
Group revenue for the four months to end-July increased 4%, driven by growth in cement sales in SA, Botswana and Zimbabwe.
The construction of RK3, entailing a spend of R3bn over two years, has already begun.
The plant, with a capacity of 1.5-million tonnes of cement a year, will replace and increase existing capacity at the group’s Riebeeck and De Hoek plants, which are both more than 40 years old.
It expects to release results on November 24.
At 9.30am on Monday the group’s shares were up 2.46% at R5.41.
Note: November 10 2025
This story has been altered to reflect that RK3 construction has already begun.
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