S&P downgrades PPC on weaker earnings and debt-reduction prospects


S&P Global Ratings has downgraded PPC’s credit score rating because of the cement maker’s “weaker earnings and debt-reduction possibilities”.

The ratings company decreased its lengthy- and short-time period credit score ratings on PPC to zaBBB-/zaA-3 from zaA-/zaA-2.

“The downgrade follows weaker-than-anticipated profitability in PPC’s SA enterprise coupled with ongoing macro-monetary and forex regime uncertainty in Zimbabwe,” S&P said.


The organization’s debt-to-profits ratio is predicted to boom, and PPC might end up more reliant on shorter-term working capital centers to meet upcoming debt maturity obligations, the employer said.

PPC said in advance in March it is thinking about promoting off non-middle belongings. It is likewise searching at options to repatriate price range caught in Zimbabwe, which is tormented by a liquidity crisis. Its coins balance in that market were decreased to $60m (R865m) due to a debt charge on the cease of February, it said.

S&P stated that because of declining call for and accelerated opposition in SA, PPC’s debt-reduction prospects in its home market had been “dampened”, and the institution’s margins in SA could fall inside the monetary yr to quit-March.

S&P said, “Additionally, we do not forget that macro-monetary and currency regime uncertainty in Zimbabwe will have intense bad implications for PPC’s Zimbabwe commercial enterprise in the short time period, from a buying and selling and monetary reporting angle.”


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