Construction World August 2016

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LIFTING ITS FINANCIAL PERFORMANCE PPC Ltd recently announced its reviewed provisional results for

down 3%, on a per ton basis, while administration and overhead costs fell 12% for the period. PPC’s expansion strategy, embarked on in 2010 to extract value from high-growth economies, is progressing well. Projects in the DRC, Zimbabwe and Ethiopia are all over 70% complete and due to be commissioned in the next 12 months with ramp up to the required production capacity to take approximately three years. Darryll Castle, CEO of PPC, commented: “We are pleased with the cost savings achieved across the business during this period. We have a deliberate approach to navigating the current economic landscape by driving cost efficiencies and leveraging our capabilities to achieve oper- ational excellence. “Our strategy to expand into a diverse pan- African player is starting to bear fruit as evidenced by CIMERWA’s positive contribution to group revenue. The three African expansion projects to be commissioned in the next 12 months will provide us with the necessary head- room to cushion us against macroeconomic movements and operational risks including increasing competition.” To enable PPC to effectively execute its new strategy, a few changes have been made to the group’s operating architecture. PPC Aggregates, Pronto Readymix, Ulula Ash and PPC Lime have been consolidated into a materials business and a new commercial division with a dedicated project management office has been introduced. The materials business division which is focused on expanding PPC’s product range and service offering in aggregates, readymix, fly ash, lime and related businesses has made good progress including the imminent acquisi-

Group EBITDA was up 2% to R1,1-billion largely due to improved efficiencies and cost savings which resulted in reduced administration and other operating expenditure. The Profit Improvement Programme (PIP), which aimed to deliver R400-million by 2017, generated R178-million for the period after providing R212-million by September 2015. PPC’s total cement sales volumes for the six-month reporting period were 1% below last year. In South Africa, cement volumes were up by 1% although lower selling prices reduced revenue. While revenue in the lime business declined 12%, aggregates and readymix opera- tions contributed positively to group revenue. CIMERWA, PPC’s new operation in Rwanda, achieved sales volumes of 124 000 tons at the expected EBITDA margin, adding nearly R200-million to group revenue for the reporting period to 31 March 2016. Group cost of sales were only 2% higher following the inclusion of CIMERWA in Rwanda, with cost increases particularly well managed in the South African and Botswana cement businesses as well as in the lime division. Cost of sales in the South African cement business was the six month period to 31 March 2016, after the Board approved the change of financial year end from 30 September to 31 March. >

Darryll Castle, CEO of PPC.

tion of 3Q Mahuma Concrete, the largest inde- pendently owned readymix concrete supplier in Southern Africa. “PPC is fundamentally strong and profitable with a solid operating base. We have a deliberate approach to navigate the current economic landscape by driving cost efficiencies; leveraging our capabilities to achieve operational excellence and completing our sizeable projects. “With a view to the long term, we are equally deliberate about getting the company future- ready to partner with and enable economies across Africa achieve their growth imperatives,” added Castle. Dealing with these claims requires a signifi- cant amount of experience and expertise.“On average, all projects have a claim potential of approximately twenty percent of which fifty percent are recognised too late or not at all”, states Müller. “The level of claims administration applied impacts directly on the level of success in identifying and addressing the risks and chances inherent in any given project”, he adds. Claims managers that prepare or respond to claims have a well-established knowledge of construction methods and are knowl- edgeable in contract interpretation and contract law. Various international professional bodies exist in the construction industry such as the ICE for civil engineers (SAICE) and CESA for civil engineering companies, the Project Management Institute for project managers, RICS for chartered surveyors, RIBI for Archi- tects and Quantity Surveyors International. The Institute of Construction Claims Prac- titioners’ goals specifically are to give recog- nition to construction claims specialists but also to establish and develop international standards for the management of claims.

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SPECIALIST RECEIVES INTERNATIONAL RECOGNITION Stefan Müller, managing director of the construction claims specialist

company, GibConsult, is the first South African member of the international Institute of Construction Claims Practitioners (ICCP).

Membership is only given to those construction claims professionals who have the

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necessary education, qualifications, experience and competence that meet this industry’s high standards. Müller is a specialist in preventative claims management and prepa- ration with more than 16 years of experience and has been supporting clients on different types of large esteemed projects in Brazil, Dubai, Lebanon, Qatar, all over Europe and Africa. The primary goal of the ICCP is to create professional standards for its members so that they can gain recognition within the industry as qualified and experienced profes- sionals who deal with construction claims. Construction claims have become an integral part of the international construction industry.

Stefan M ü ller, managing director of GibConsult, specialist in claims management, and first South African member of the Institute of Construction Claims Practitioners.

CONSTRUCTION WORLD AUGUST 2016