PPC sells its non-core Botswana assets
PPC Limited in its trading statement reports that earnings before interest, tax, depreciation and amortisation (EBITDA) for continuing operations is expected to increase by between 14% and 18% compared to EBITDA in the prior period.
This increase is notwithstanding the Group incurring significant restructuring costs in the current financial year and a full lock-down In April 2020 due to COVID with continuing COVID impacts thereafter.
In accordance with IFRS 5 – Non-current assets held for sale, the group has accounted for its PPC Lime, Botswana Aggregates and PPC Barnet DRC businesses as discontinued operations. Accordingly, the assets, liabilities and profit and loss are reported separately in the financial statements for the year ended 31 March 2021.
Headline earnings is impacted by the impairments of property, plant and equipment raised at 31 March 2020, some of which are now reversed as at 31 March 2021.
Earnings and headline earnings for the 2021 financial year are impacted by hyperinflation accounting in terms of IAS 29 – Financial accounting in hyperinflationary economies, resulting in a net monetary loss of R200 million in the current year compared to a gain of R651 million in the prior period.
Earnings per share (EPS) for the Group for the period is expected to be between 10 cents and 15 cents per share, an increase of between 108% and 112% from the 124 cents per share loss for the prior period. Headline loss per share for the period for the Group is expected to be between 13 cents per share and 18 cents per share, a decrease of between 148% and 167% compared to the 27 cents per share profit for the prior period.
SALE OF PPC AGGREGATE QUARRIES BOTSWANA PROPRIETARY LTD
A binding sale and purchase agreement has been entered into between PPC Botswana (a wholly-owned subsidiary of PPC) and a construction and mining company in Botswana, to sell PPC’s 100% shareholding in PPC Aggregate Quarries Botswana Proprietary Limited for a cash purchase consideration of Pula 47.5 million (equivalent to approximately R60 million at an exchange rate of R/Pula of 0.78).
The purchaser is not a related party in terms of the JSE Listings Requirements and the transaction is subject to customary conditions precedent for a transaction of this nature. PPC expects that the conditions precedent will be met before 1 August 2021.