Fin24

PPC profit slumps 38%

2011-05-17 07:58

Johannesburg - Pretoria Portland Cement [JSE:PPC] reported a 38% drop in first-half earnings on Tuesday, hit by continued weakness in the country's construction industry.

PPC, South Africa's biggest cement producer, said headline earnings per share fell to 71.3c in the six months to end-March, compared with 114.3c a year earlier.

Headline EPS, the main measure of profit in South Africa, excludes certain one-time items.

South Africa's construction industry, which was shielded from the worst of the global economic crisis because of big World Cup projects, is struggling to bounce back as the government and private sector tighten purse strings.

The labour-intensive building industry is critical to Africa's biggest economy, which is struggling with a high unemployment rate.

PPC, which has been in operation for nearly 120 years and has been listed in Johannesburg for a century, said revenues were down 5% to R3.3bn.

The company declared an first-half dividend of 35c per share, compared with 45c a year ago.

PPC, which was spun off from industrial group Barloworld [JSE:BAW] in 2007, said cement volumes in the first half declined 7%, higher than the national average of 4%.

PPC shares have lost 27.6% this year, largely in line with Johannesburg Stock Exchange's construction and materials index , which has shed 24.6% so far this year.