13 February 2013

Zimbabwe: PPC Plans U.S.$200 Million Cement Plant

PPC Zimbabwe, a Zimbabwe Stock Exchange-listed subsidiary of South Africa's Pretoria Portland Cement (PPC), is planning to build a US$200 million plant in the country, a development that could significantly boost output and market share.

PPC Zimbabwe dominates the domestic cement market alongside Lafarge Cement Zimbabwe, a subsidiary of Lafarge, the French building materials group. The two command a 90 percent share of the local market, with Chinese-controlled Sino Zimbabwe holding the balance of the market share.

Todd Moyo, PPC Zimbabwe's board chairman, said the cement maker was at an advanced stage of a feasibility study for the US$200 million plant earmarked for Rushinga in Mashonaland Central.

"A significant investment has already been made in exploration drilling at two locations," Moyo said.

"Not only will this investment address the expected future increase in cement demand in Zimbabwe, but create employment opportunities, beneficiation of the country's mineral reserves and a significant growth opportunity for Portland Holdings Limited's indigenisation partners," said Moyo.

He added that the increased capacity would also allow the company to increase its exports into the Southern African Development Community region and increase the stock of foreign currency in the country, helping ease a liquidity crunch triggered by adoption of a hard currency regime in Zimbabwe.

Ketso Gordhan, CEO of PPC said in Harare last week: "In recent years our investment in Zimbabwe has shown strong growth on the back of a more buoyant and stable economy. This together with the fact that PPC has received an indigenisation certificate makes us optimistic about the future of the economy and the country as a whole."

Gordhan added: "The construction of additional cement capacity will ensure that PPC continues to be a key player in the development of infrastructure in Zimbabwe and neighbouring countries. It is totally in line with our stated strategy of growing our non-South African revenue from the current 21 percent to at least 40 percent by 2016."

Moyo also said PPC Zimbabwe had embarked on a US$6 million project at its Bulawayo plant aimed at boosting the factory's efficiency and making it one of the most advanced facilities in Africa.

PPC Zimbabwe has another cement plant in Colleen Bawn, Matabeleland South.

"Currently, the company is engaged with a US$6 million project at the Bulawayo factory to improve loading and dispatch," said Moyo.

"This will make the Bulawayo factory one of the most advanced dispatching facilities in Africa."

He said the investment at the plant was capable of producing 3 000 tonnes of cement a day, demonstrating PPC's growth in Zimbabwe and commitment to further investment.

The company's managing director, Zakarai Limbada, and the business development and corporate strategy director, Gavin Stephens, said the project, expected to be complete before the end of September, would also increase efficiency in packaging from the current 1 800 bags per hour to 2 400 per hour.

As part of growing its non-South African revenue base from the current level of 21 percent to at least 40 percent by 2016, Pretoria Portland Holdings, through its Zimbabwean unit,

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