Cement producer Pretoria Portland Cement on Tuesday reported diluted headline earnings per share of 263 cents for the year ended September from 226 cents a year ? an increase of 16 percent.
A final dividend of 166 cents and a special dividend of 61 cents were declared. The total dividend for the year was up 21 percent to 265.5 cents.
The group's revenues grew 19 percent to R5.6-billion, while cash generated from operations was up eight percent at R2.2-billion. Net attributable profit was 18 percent higher at R1.4-billion.
CEO John Gomersall said these were "another good set of results on the back of continued growth in cement volumes with all of our production units running at very high utilisation levels to meet the high cement demand".
"We remain focused on maximising our efficiencies though this has not been without its challenges due to increased energy and transport costs and a higher level of maintenance cost occasioned by these high utilisation levels."
PPC said that in the past year cement margins were impacted by the dilutionary effect of imports at little or no margin, and by increased energy, transport and maintenance costs.
Capital expenditure amounted to R953-million, compared with 2006's R396-million and related mainly to the Batsweledi expansion. There were also environment-focused plant upgrades and expenditure on expanding some of PPC's limestone quarries and plant upgrades at the Laezonia aggregate quarry, the balance being attributable to routine plant replacements.
Regional cement sales volumes grew 10 percent over last year with the residential and non-residential construction sectors performing strongly.
In Zimbabwe, operating and trading conditions became increasingly more difficult as the country reeled under inflation rates increasing into the thousands.
PPC said ongoing shortages of production inputs and a Zimbabwe selling price which is insufficient to cover production costs require it to increasingly focus on exports to sustain operations.
"The ongoing inability to exercise effective control justifies the continued non-consolidation of this company's results," it said.
Lime revenue and operating profit improved significantly over the prior year as the benefits of renegotiated long-term supply agreements flowed through for the full year.
Local demand reduced mainly due to an extended Mittal blast furnace shut-down, but this was fortunately off-set to some degree by exports.
Looking ahead, PPC said a positive market outlook, combined with incremental cement output in the second half of 2008, should enable the company to report improved performance and a strong operating cash flow for the ensuing year.
"We are on track to commission the new Batsweledi capacity at Dwaalboom early next year which will increase our output during the second half and therefore reduce the need to import. We are confident about achieving another improved performance next year," Gomersall said.