Cement manufacturing giant PPC is set to earn a unique image of transformation among its peers on the JSE and within mainstream industrial players when Ketso Gordhan takes up the position of CEO at the beginning of next year.
PPC already features a black chairman of the board in form of Bheki Sibiya and a black chief financial officer Tryphosa Ramano. This gives the group an unmatched top three leadership which is made of highly respected transformation activists.
Boasting a rich antiapartheid activism Gordhan moved from the presidency and has also served as an executive at Rand Merchant Bank. Sibiya currently serves as the CEO of the South African Chamber of Mines and is the past president of the Black Management Forum. Ramano serves as the president of the Association of Black Securities and Investment Professionals (Absip) and seats in the Black Business Council board.
PPC announced this week that Gordhan joined its board at the beginning of November as CEO designate to succeed Paul Stuiver who retires at the end of December. Gordhan’s appointment as CEO was initially announced in September.
PPC said Gordhan’s appointment was part of a broader transformation of PPC which has been readying itself to meet new challenges. PPC is emerging out of a difficult phase marked by a rapid slow down infrastructure development expenditure which has hit cement sales in its primary South African market. Faced with rising competition and the planned introduction of a new cement manufacturing entity, Sephaku, PPC is pursuing opportunities outside its traditional southern African focus.
Releasing its financial results for the year ended September, PPC said “During the year we finalised a number of key strategic issues including our first new investment into sub Saharan Africa, CEO succession and are in the process of converting our mining rights in South Africa”.
The group also finalised another BBBEE transaction. “In September 2012, the company completed a second phase of BBBEE transaction by placing an additional 39,3 million ordinary shares (6,5% of PPCs increased share capital) under black ownership. The transaction results in more than 26% effective black ownership of PPC’s South African operations and has enabled the company to meet the South African mining rights conversion requirements as set out by the Mining Charter,” said the group.
The transaction will also allow PPC to streamline its corporate structure in 2013 by creating separate South African and international operating entities with focused strategies. In line with its brand-building activities the company also took the opportunity to rename its listed entity Pretoria Portland Cement Company Limited as PPC”.
The group also said that “In line with our strategy to increase PPC’s revenue generation beyond South Africa, the first phase of our Habesha investment in Ethiopia will increase our revenue outside South Africa from the current 21% to approximately 26% within the next three years. The new 1,4 million ton per year Habesha cement plant is due to come on-line during 2014. Plans for the second phase of this investment include a doubling of capacity to 2,8 million tons a year”.
The group said “South African cement demand for the nine months to the end of June 2012, showed encouraging growth, but given the impact of labour unrest in the mining industry and the effect of the transport strike, it is likely that more subdued numbers will be reported for the remainder of 2012. The effective rollout of governments infrastructure programme has the potential to ensure a sustained recovery in the South African cement market. Failing this, growth in demand for 2013 will be muted”.
“While we continue to monitor and prepare for new entrants, their new capacity will not come on-line before 2014. We expect cement demand in Zimbabwe to continue growing but are cautious that national elections could potentially interrupt the recent growth trend. Demand in Botswana should begin improving during 2013 as the Botswana government has recently released some sizeable projects”.
“PPC is currently pursuing four opportunities in other African countries, all of which are at different stages of development including final due diligence. We remain confident that further tangible progress on this front will be made during 2013”.