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Harare - PPC’s [JSE:PPC] decision to invest in a new plant in Harare, Zimbabwe is already paying dividends as cement volumes, which had been trending lower, are now showing improvement.
In a trading update released on Thursday, parent company PPC Limited said following the commissioning of the mill in Harare, cement sales volume performance “has shown an improvement when compared to the previous quarter ending September 2016.”
The growth is in contrast to the six-month period ending September 30 2016 when volumes were down 5%, while local pricing fell 10%.
“There are however liquidity challenges in Zimbabwe which make it difficult to import key inputs,” said PPC, adding that management is exploring various solutions to overcome these challenges.
“The US$82m Harare Msasa mill was completed on time and US$3m below budget without a single lost time injury over the entire project construction period,” the company said.
PPC said the Harare project debt was initially anticipated to be $75m. However, the use of own-cash resources reduced debt drawdowns by $20m.
“All the performance tests have now been successfully concluded with final handover achieved late in January 2017,” it said, adding that the first biannual debt and interest repayment was made in December 2016.
Collectively, the business units of Zimbabwe, Rwanda and Botswana recorded cement sales volume increases of 9% for the nine-month period to December 2016.
As at January 2017, overall project construction in the Democratic Republic of the Congo is at 95% while construction of the cement factory is complete and ready for commissioning.
Project construction in Ethiopia is at an advanced stage with electrical installation work from the limestone crusher to the cement proportioning station, including the general substation, having been completed.
