PPC’s Zimbabwe operations delivered a record dividend that underpinned its South African parent, PPC Limited’s, interim financial results, highlighting the growing significance of the local cement maker’s operations to overall group earnings.
The cement makers declared and paid US$36 million (R595 million) in dividends for the 10 months ended January 31, 2026, more than four times the US$8 million (R142 million) distributed in the same period last year.
PPC Zimbabwe dividends are accounted for in its 88 percent controlling parent, PPC Limited’s (the Group) financials primarily as repatriated cash income.
The Zimbabwe unit remains debt-free, holding US$7 million in unencumbered cash at the close of the period, while cement volumes in the local market jumped by over 22 percent, supported by robust demand across industrial and retail sectors.
Revenue increased 24 percent in US dollar terms, with earnings before interest, tax, depreciation and amortisation (EBITDA).
“The increase in group revenue for the current period was driven mainly by the increase in PPC’s Zimbabwe operations, while the South Africa and Botswana group revenue remained much the same as the prior period,” PPC Limited said.
“Volumes increased by over 22 percent in the current period, supported by sustained strong demand across the industrial and retail sectors. Revenue increased by 19 percent in rand terms (24 percent in US$ terms), while EBITDA grew by 23 percent in rand terms (28 percent in US dollar terms).”
Margins also improved following an extended maintenance shutdown in the first quarter, expanding by 0,9 percentage points to 26,9 percent.
However, the company cautioned that a mill gearbox failure at its Bulawayo factory would temporarily constrain cement milling.
“On 3 February 2026, after the close of the current period, a mill gearbox failure occurred at the Bulawayo factory, constraining cement milling at the site. Management has implemented several mitigation measures to minimise disruption for customers,” the company said.
“The failure is expected to have a temporary negative impact on margins, mainly in February and March 2026.”
Across the group’s South Africa and Botswana operations, sales volumes were broadly flat, with a 2 percent rise in South Africa offset by weaker performance in Botswana. Management emphasised a focus on value, margin, and quality sales over volume growth, which translated into adjusted EBITDA growth of 17 percent.
Margins expanded to 17,3 percent from 14,8 percent in the prior period, reflecting ongoing operational efficiencies and supply chain improvements.
Group revenue rose 4 percent, while adjusted EBITDA increased 22 percent, lifting margins to 19,4 percent from 16,6 percent.
Free cash flow in South Africa, excluding dividends from Zimbabwe and investment in the new Western Cape plant, amounted to R567 million, slightly down from R692 million the previous year due to a temporary R208 million increase in inventories linked to scheduled maintenance.Digital transformation services
The Western Cape RK3 cement plant, described by the company as a best-in-class integrated facility, remains on schedule and within budget, with R491 million spent to date.
Despite the investment, the South African operations closed the period with a net cash position of R367 million, up from R106 million a year earlier.
PPC Limited’s ongoing “Awaken the Giant” turnaround strategy appears to be delivering results. Following the interim update, the company’s share price rose sharply by over 4 percent, trading at R5,96 on the JSE, up from R4,10 a year ago.
“Our turnaround plan is deliberately ambitious, designed to restore PPC’s iconic status by strengthening competitiveness and long-term value creation,” chief executive officer Mr Matias Cardarelli said.
“The results for the ten months clearly demonstrate the ongoing benefits of this strategy.”
In Zimbabwe, the strategy has translated into a step change in free cash flow, while in South Africa, structural and operational changes, including logistics, procurement and plant efficiency improvements, have exceeded expectations.
Mr Cardarelli highlighted that growth in full-year 2026 earnings builds on robust improvements achieved in 2025, with further gains anticipated in 2027 and a step change in 2028 as the RK3 plant reaches full capacity.
The company announced that chief financial officer Ms Brenda Berlin will retire on June 30, with succession planning underway to ensure continuity. The board also indicated that any dividends from
PPC Zimbabwe could flow through to shareholders, consistent with the company’s distribution policy.
A capital markets day is scheduled for March 18, where management will provide additional details on the “Awaken the Giant” strategy and the expected earnings uplift from the RK3 facility.
With strong local demand, record dividends, and disciplined execution of its turnaround plan, PPC Zimbabwe remains central to the group’s growth story, reinforcing investor confidence in the company’s regional operations.-herald
