Latest news with #MambaCement
Zawya
24-06-2025
- Business
- Zawya
Tanzania: Twiga Cement acquires limestone firm Mamba for $16mln
Tanzania Portland Cement Company (TPC Plc), also known as Twiga Cement, acquired a 95 percent stake in limestone extractor Mamba Cement Company for Tsh42 billion ($15.94 million). According to the company's latest annual report for 2024, the acquisition aims to secure access to vital limestone reserves — a key raw material for cement production — and to strengthen Twiga Cement's financial position.'During the year, TPC Plc acquired a controlling interest in Mamba Cement Company Limited, a company whose principal activity is to extract limestone,' Twiga says. The investment provides the company with access to significant limestone deposits, addressing limited reserves at its current quarry at the Tegeta–Wazo Hill in Dar es Salaam.'This will give the company access to the largest limestone deposits near Dar es Salaam, approximately 125km from TPC Plc plant.'The shares were acquired from United Arab Emirates-based Sura Holdings Ltd, a private investment company with extensive operations in regional economies, international markets and various industry sectors. The transaction comprised a cash investment of Tsh39.69 billion ($15.06 million) and Tsh2.32 billion ($880,672) for the transfer of property, plant and equipment.'The acquisition was done with the intention of vertical integration of Mamba Cement's operations with TPC Plc,' the company said. Dividend payoutDespite a 42.9 percent decline in net profit, the Dar es Salaam Stock Exchange (DSE)-listed company enhanced its dividend payout to shareholders by 53.84 percent to Tsh107.95 billion ($40.97 million), or Tsh600 ($0.22) per share. This is an increase on the Tsh70.17 billion (Tsh390 per share) paid in 2023. The dividend is expected to be approved by shareholders and paid in June 2025. The company recorded a net profit of Tsh56.67 billion ($21.51 million) in 2024, down from Tsh99.18 billion ($37.64 million) the previous year. Its total revenues declined by 8.5 percent to Tsh448.58 billion ($170.28 million) in last year, down from Tsh490.17 billion ($186.06 million) in 2023, attributed to overall market shrinkage and increased competition. Production costs, particularly those relating to energy and raw materials, also strained profitability. Twiga's clinker production declined by 1.4 percent during the year, while cement output increased by a marginal 0.3 percent. Tanzania's cement market is highly competitive, with 13 plants operating below 60 percent capacity utilisation as of December 2024.'Despite a challenging market environment and higher energy and raw material prices, cash inflow from operating activities in the 2024 financial year increased by 13.6 percent to Tsh108.6 billion ($41.22 million) from Tsh95.6 billion ($36.28 million) in 2023, surpassing the previous year's level. This improvement was primarily driven by better working capital management compared to the prior year,' the company says. © Copyright 2022 Nation Media Group. All Rights Reserved. Provided by SyndiGate Media Inc. (
The Citizen
10-06-2025
- Business
- The Citizen
PPC: Why is it so expensive to produce cement in SA?
Calls on government to find out – and says it must also address public safety and unfair competition concerns. JSE-listed cement and building materials producer PPC believes the government should pay attention to why it's so costly to produce cement in South Africa – despite its confidence that the new R3 billion cement plant it's building in the Western Cape will enable the company to increase its competitive edge against cement imports. PPC CEO Matias Cardarelli on Monday (9 June) said the government also needs to address the outsourcing of cement blending to independent blenders from a public safety and fair market competition perspective. Cardarelli mentioned that it's very costly to produce cement in SA compared to other countries, which is the reason cement has consistently been imported into the country for many years. ALSO READ: Treasury bans use of imported cement on all government-funded projects Levelling the playing field Referring to the government, he said it should play a role in creating a level playing field for local cement producers against importers, adding that more than one million tonnes of cement has been imported into the country in recent years, however, he emphasised that imported cement is not PPC's priority. 'We are becoming more modern and efficient and we are sure that we are going to compete going forward.' According to Cardarelli, the South African cement sector hasn't benefitted from the designation of cement for infrastructure projects, as it has not seen 'the infrastructure plan by the government unfold'. He approves of the planned R1 trillion infrastructure investments by the government and is confident the government of national unity will get the ball rolling, but 'so far they have not executed that plan'. ALSO READ: PPC to sell lime business for R515 million Competition He said international players are entering the South African market and two Chinese international companies have bought assets into the country, with rumours that a third player may be joining them soon. Apparently, this company will bring in new technology and change the market landscape. This is a reference to Mamba Cement, which is jointly owned by the Jidong Development Group and the China-Africa Development Fund – as well as the acquisition of Natal Portland Cement (NPC) by China-based Huaxin Cement. Cardarelli said PPC's plans include replacing its two old plants in the Western Cape with a new plant in two years' time, which means the company will own the two newest and most modern plants in SA – while its third plant is also 'pretty modern'. He added that its two old plants are unable to run efficiently from a cost margin and environmental perspective, and that the imminent project is focused on lessening PPC's environmental impact while increasing its financial outcomes. However, Cardarelli said the decision to build the plant was also influenced by the fact that someone else would eventually have taken the initiative, which would affect PPC's position in the market. He added that it's a perfectly valid process worldwide to blend cement with extenders – and that PPC and NPC have their own blending plants. ALSO READ: PPC highlights impact of cement imports on itself and the economy A public safety risk However, he said PPC studies have routinely shown that in some cases that blended cement produced by independent blenders, which is then distributed into the market, has low standard strength. Cardarelli stated that this is a public safety risk. 'If you are not producing cement at the standard required by South African legislation and worldwide designation, there is a real risk that cement will not have the strength for the uses they are giving to that cement. 'I'm not saying that all blended cement shows that low strength standard, but some have consistently shown that,' he said. 'When you sell cement under the strength needed, the cost of that cement is going to be cheaper, and that is why the sector is facing unfair competition from independent blenders.' ALSO READ: Cement industry facing improved operating environment PPC on upward trajectory Despite a 1.9% decrease in revenue to R9.87 billion in the year to end-March, PPC on Monday reported a 28% increase in earnings before interest, tax, depreciation and amortisation (Ebitda) to R1.59 billion. PPC's Ebitda margin improved in the year to 16.1% from 12.3%. Headline earnings per share grew by 110.5% to 40 cents from 19 cents. An ordinary dividend per share of 17.6 cents was declared, which is more than 28% higher than the 13.7 cent dividend declared in the previous year. Awakening the giant Cardarelli said implementing phase one of PPC's 'Awaken the Giant' strategic turnaround plan has resulted in a step change in the group's margins, profitability, and cash generation, which are the highest since its 2018 financial year. 'This early success is largely as a consequence of a fundamental change in our strategic direction, the organisational culture, and an absolute focus on our core competencies,' he said. Cardarelli is increasingly confident about the outlook for PPC. He said optimising PPC's competitive position in the current markets will better prepare the company for market changes and that it remains cautiously optimistic about the construction market uplift in South Africa, but does not know the base or scale. 'So our plans are based on a scenario of low to no growth in demand while we keep fully ready to capture any growth opportunity when finally this long negative construction cycle comes to an end – and it will come to an end. 'At the same time, we will continue to implement price adjustments. Market share for us does not come at all costs and, through [a] competitiveness strategy, we naturally create the conditions for market share recovery.' This article was republished from Moneyweb. Read the original here.
