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Johannesburg - South Africa's biggest cement maker PPC [JSE:PPC] will expand more slowly after spending on several cross-border projects jacked up its debt load, its chief executive said on Wednesday.
PPC is building plants in African countries, including Ethiopia and the Democratic Republic of Congo, as part of a wider plan to generate 40% of its sales outside its home market by 2017.
READ: PPC terminates merger talks with Afrisam
But spending on these projects is pushing up its debt levels and Chief Executive Officer Darryll Castle said PPC's debt would likely hit as much as R12bn in the next two years and possibly breach agreed covenants with banks.
"We wouldn't want to stretch our balance too much. The focus currently is on existing projects," Castle told reporters.
Castle also said his firm was in talks with banks about changing the agreed debt covenants to reflect the fact that some of the debt was ring-fenced from the South African balance sheet.
PPC borrowings totalled R6bn by the end of September last year, putting its net debt to EBTDA, or core profit, at 2.4 times - slightly below the agreed level of 3 times with lenders.
