Iconic 134-year-old company takes a hit from a stronger South African rand

Cement giant PPC incurred some foreign exchange losses due to the rand strengthening against the US dollar in the six months through September 2026.

This is because PPC hedged its US dollar exposure on the construction of its “state-of-the-art” cement plant in the Western Cape, RK3.

However, even with these exchange rate losses, PPC’s Awaken the Giant turnaround strategy continues to deliver results, with interim earnings set to grow by between 20% and 38%.

PPC outlined its expected earnings for the first half of its 2027 financial year in a trading statement released on Thursday, 5 November.

PPC expects its earnings and headline earnings per share to increase by between 20% and 38% compared to the first half of its 2026 financial year. 

On a pro forma basis, adjusted for the after-tax impact of the foreign exchange losses, earnings and headline earnings are expected to rise between 17% and 35%.

“The increase in both EPS and HEPS reflects the continued momentum of the ‘Awaken the Giant’ turnaround, delivering increasingly tangible benefits to the group’s earnings,” PPC said.

PPC explained that the foreign exchange losses resulted from its US dollar exposure related to the construction of RK3, which was fully hedged to de-risk the company’s balance sheet.

“During the current period the rand strengthened against the US dollar, and foreign exchange losses (both realised and unrealised) were incurred,” it said. 

The construction of RK3 is one of the biggest projects PPC has undertaken to date, estimated to cost R3.1 billion.

The plant has been designed to secure PPC’s cost competitiveness by reducing costs and enhancing value accretion.

This will make PPC less reliant on growth in the domestic construction industry, which has struggled in recent years.

The struggling local construction industry has put pressure on PPC over the past decade, triggering the launch of its Awaken the Giant turnaround strategy.

While still ongoing, this strategy has paid off for PPC’s bottom line, with its profit in the 2026 financial year growing by 84.33% to R859 million.

PPC said this momentum continued into the 2027 financial year, with the company’s full interim results set to be released on 16 November 2026.