PPC restructures executive committee to drive SA growth amid headwinds

In September, PPC said there was a need for further operational efficiencies and cost containment measures to mitigate rising input costs. That was amid a muted economic climate in the key South African market where competition had also remained high across its product portfolio.Matias Cardarellias was selected as PPC's new CEO in December. He succeeded Roland van Wijnen in June 2023 during a headline profits per share loss of 8 cents for the entire year, which had increased from the 3 cent loss the year before.

 PPC now claims that, in light of the anticipated decline in cement demand in the South African market, it has reorganized the executive committee to improve its profitability prospects."To drive improved profitability and a sustainable return on capital for its South African business, the board of directors has approved a substantially reorganized and strengthened executive committee," the company announced on Thursday.
The chief strategy officer would collaborate closely with chief financial officer Brenda Berlin to carry out profit development projects, and the new chief operations officer would concentrate "on increasing efficiencies, productivity and cost reduction initiatives." Increasing the company's top line and developing a single revenue engine would be the chief revenue officer's (CRO) duties.
PPC hired Kevin Ross to be the corporate secretary and chief legal and compliance officer, and promoted Mokate Ramafoko to CRO.
Ernesto Acosta and Paulo Marques, two seasoned business professionals with over 20 years of combined experience in the cement industry, will assume the responsibilities of COO and CSO, respectively, according to the company.
At PPC, we are going through a transformative period. The first stage in creating the ideal organizational structure is assembling the new executive team, according to Cardarelli.
He said that PPC now has “the right blend of institutional knowledge, energy, and global and local cement industry experience” from the new hires, which will help the business develop, become more profitable, and increase returns.
"The new team will be distinguished by its focus on results, agility, accountability, and ownership," he continued.
Cardarelli would anticipate that despite the "weak macro environment" in the nation, the company's new top management will help boost revenue above the R10 billion recorded last year.
This would depend on whether demand from an improved infrastructure program could rise and whether the economy could improve enough for PPC to be able to “more effectively utilise the capacity available” in the South African market.
The business stated in September that it "remains hopeful that the South African government will implement its infrastructure development plans and safeguard the local cement market through the imposition of blanket import tariffs."
PPC worked on a disciplined capital investment in the whole year of 2023; however, it was reduced from R553 million in 2022 to R415 million. The country of Zimbabwe saw an R69 million reduction in capital expenditure throughout the time, while South Africa and Botswana Cement experienced an R53 million decline.
There has been a recent supply downturn in Zimbabwe, with operators finding it difficult to keep up with demand due to government infrastructure spending and a rebound in residential housing activity.

However, cement consumption in South Africa was "expected to remain subdued" this year barring a notable boost in infrastructure spending and the country's GDP.

In any case, PPC South Africa was in a good position to profit from a rise in the demand for cement since it had extra capacity on hand to take advantage of the demand spike without having to make any further capital investments.
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