Executing on priorities in pursuit of stakeholder value
DE HOEK SITE VISIT 24 SEPTEMBER 2018
SLURRY SITE VISIT 27 SEPTEMBER 2018
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
CONTENTS
SA OPERATING CONTEXT
page 3
DE HOEK SITE VISIT
page 10
SLURRY COMPLEX SITE VISIT
page 26
1. SA OPERATING CONTEXT
NJOMBO LEKULA – MD SA
CEMENT
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
1.1 SUPPLY DEMAND DYNAMICS
4
-20,0%
0,0%
20,0%
40,0%
60,0%
80,0%
100,0%
6 000
8 000
10 000
12 000
14 000
16 000
18 000
20 000
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
20
21
20
22
'00
0 t
on
ne
s
ANNUAL CEMENTITOUS SUPPLY AND DEMAND IN SOUTH AFRICA, BOTSWANA, LESOTHO & SWAZILAND
Industry demand Industry demand locally produced Industry Capacity (with SK9) Annual % change in demand
SK9 provides PPC with newest technology in the domestic industry
In 2020 an estimated 3mtpa of industry capacity will not meet emissions regulations
After 2020 the industry will be running at high capacity suggesting additional capacity will be required
New entrant
New entrant
PPC - Dwaalboom
PPC SK9
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
1.2 PLANTS IN SOUTH AFRICA | MODERNISED
5
Comment
• SK9 latest kiln technology
(2018)
• Capex – R1.9bn
• VRM technology
• Capex – R2.0bn
Capacity TechnologyComplex
2.0 mtpa
6 stage pre-
heater ILC and
grate cooler
Slurry
2.0 mtpa
6 stage pre-
heater ILC and
grate cooler
Dwaalboom +
Hercules
1.2 mtpa
4 stage pre-
heater and
grate cooler
DeHoek• Kiln upgrade
• Capex – R500m
Z A R 4 , 4 b n M O D E R N I S AT I O N C A P E X S P E N T I N S A I N T H E L A S T D E C A D E
P L A N T S I Z E A N D T E C H N O L O G Y M AT T E R – W E H AV E B O T H
P R I M E L O C AT I O N – P R O X I M I T Y T O M A R K E T, S T R AT E G I C R A W M AT E R I A L S
M A N U FA C T U R I N G F O O T P R I N T A N D E F F I C I E N C Y I N C L A LT E R N AT I V E F U E L T E C H N O L O G Y
Efficiency
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
1.3 THREE MEGA PLANT STRATEGY CAPITALISES ON OUR
FOOTPRINT
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P P C H A S T H E M O S T D E S I R A B L E C E M E N T D E L I V E R Y F O O T P R I N T I N S O U T H A F R I C A
PPC footprint
enables:
• In tegra ted p lan ts and
depots to serve
key marke ts
• Blend ing fac i l i t i es c lose
to the marke t
• Por t fo l io e f fec t
de l i ve r ing p ro f i tab i l i t y
• Abi l i t y to de l i ve r a t
lowes t cos t th rough
op t imal sourc ing
* Grinding plant only
Key
*cement capacity
PPCPPC Mega plant (3)
PPC Grinding plant (3)
Free State
Mpumalanga
North-West
GAUTENG
Pretoria
Stormill BlendingIsando Blending
Meyerton
Blending
and
milling
9
3
3
2
3
1
Botswana
Port Elizabeth
Polokwane
Lichtenburg
Cape Town
Saldanha
* Riebeeck
De Hoek
Richards Bay
Port Shepstone
East London
Durban
Newcastle
Gaborone
Nelspruit
*Johannesburg
1
2
3
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
1.4 PPC STRATEGIC RESPONSES TO MARKET FACTORS
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18Mt
14Mt
1,0Mt
INDUSTRY CAPACITY
LOCALLY PRODUCED
INDUSTRY
DEMAND
IMPORTS
25% excess
capacity gap
29% excess
capacity gap
SOUTH AFRICA CEMENT DEMAND AND CAPACITY (2018e)*
18Mt
14Mt
*Estimated data from market and industry sources
• Cement imports
• Growth of third party blenders leading to
• Erosion of quality
• Detraction from market related
pricing
• Value destruction for stakeholders
KEY CHALLENGES
PPC STRATEGIC RESPONSES
• Lobbying government to impose tariffs on
cement imports
• Driving efficiencies through cost leadership
and optimal sourcing
• Continued innovation in alternative building
technologies
• Enhanced product portfolio and route to
market strategy implementation
P P C C O N T I N U E S T O E N G A G E G O V E R N M E N T A N D R E G U L AT O R Y B O D I E S O N T H E S E
I S S U E S
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
90,00
95,00
100,00
105,00
Jan-1
5
Feb
-15
Ma
r-1
5
Apr-
15
Ma
y-1
5
Jun-1
5
Jul-1
5
Aug-1
5
Sep-1
5
Oct-
15
No
v-1
5
De
c-1
5
Jan-1
6
Feb
-16
Ma
r-1
6
Apr-
16
Ma
y-1
6
Jun-1
6
Jul-1
6
Aug-1
6
Sep-1
6
Oct-
16
No
v-1
6
De
c-1
6
Jan-1
7
Feb
-17
Ma
r-1
7
Apr-
17
Ma
y-1
7
Jun-1
7
Jul-1
7
Aug-1
7
Sep-1
7
Oct-
17
No
v-1
7
De
c-1
7
Jan-1
8
Feb
-18
Ma
r-1
8
Apr-
18
Ma
y-1
8
Jun-1
8
Jul-1
8
Aug-1
8
8
1.5 CONTINUED PRICE RECOVERY IN A CHALLENGING TRADING
ENVIRONMENT
AVERAGE SELLING PRICE (ASP) TRENDS
Source: PPC Research ASP indexed from January 2015
Pricing
bottomed
W E C O N T I N U E TO R E A L I S E E F F E C T I V E P R I C E I N C R E A S E S
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
1.6 NEW SURE RANGE OF PRODUCTS LAUNCHED
Cement for road
stabilisation
Premium
multipurpose
cement for
general building &
civil
Masonry cement
designed for
plaster & mortar
Early strength
cement designed
for concrete,
mortar, plaster &
bricks
High early strength
cement designed
for precast
products
Superior high
strength specialist
cement
F I T F O R P U R P O S E R A N G E O F C E M E N T S TO C AT E R TO A L L C U S TO M E R
N E E D S9
2. De Hoek SITE VISIT
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.1 DE HOEK TEAM
E X P E R I E N C E D M A N A G E M E N T T E A M
Johan VorsterGeneral Manager
BSc, MBA (9 years)
Johan SteynB-Com, MBA, Dip Tax,
Charted Management
Accountant (18 years)
Annetjie MinnaarRisk Manager
B-Tech Safety Mng (14
years)
Michael DanielsProduction Manager
BSc, (Hons) (17 years)
Jaco JoubertEnvironmental Manager
M Tech : Env Health, ND
Safety Mng (22 years)
Adele StoneQuality Assurance Manager
NHD Microbiology (29
years)
Jan VorsterHuman Resources
Manager
BS, (Hons): DPLR (27
years)
Vincent DiergaardtMining Manager
B-Tech Mining Eng
(12 years)
Steven StraussEngineering Manager
N Dip, GCC (11 years)
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
1919 Lime Company discovered limestone at De
Hoek
1923 Cape Portland Cement took over and began production
with one kiln
The company continued to trade under this name until 1983 when
the name changed to Pretoria Portland Cement
160 Feet long, (49 m)
Diameter of 9 feet, (2.7m)Limestone transported
with trolleys to the factory
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2.2 DE HOEK HISTORY
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.3 DE HOEK OVERVIEW
Mining
Factory
Village
Dispatch
Vondeling Pit
Zoutkloof Pit
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.4 PRODUCTION PROCESS
Crushing plantKiln feed preparation and
blendingCoal stockpile
Coal mill
raw mill
Finish milling & dispatchPre-heater, kiln line & cooler
Limestone mining
Clinker
storage
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
• Commenced during 1979/80
• Planned mining until end 2017
• Final depth 190m
2.5 MINING | ZOUTKLOOF PIT & VONDELING PIT
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.6 MINING | SCREENING, STOCKPILING, CRUSHING AND
RECLAIMING
2 x Secondary crushers (Impact)
Transportation via a 4 km belt
conveyor underneath the N7 to the
plant
Semi-mobile Primary Crusher (Cone)
Move once in 3-4 years for maintenance
Takes 1 day to travel to the service area
Raw materials
Mined on site 91% Limestone
1,5% Shale
External Supply 5% Sand
6-10t/hr Coal
2.5% FDG (Fe)
Product extender 9 - 37% Slag
3% Gypsum
7-15% Limestone
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.7 CEMENT ASSET PORTFOLIO IN SOUTH AFRICA |
COASTALRIEBEECK
Clinker
• DK5 – Capacity: 310 kt
• 4 stage preheater kiln
• DK6 – Capacity: 460 kt
• Upgraded in 2012
• 4 stage preheater kiln
• RK1 –Capacity: 240kt
• Long dry kiln
• RK2 – Capacity: 270kt
• 1 stage preheater kiln
Finishing Mills
• FM 5 – 65 tph
(Unblended cement)
• Open circuit ball mill
• Commissioned in 1972
• FM6 – 60 tph (OPC)
• 2nd Generation closed
circuit ball mill
• All product ranges
• FM 1 – 32.5: 32tph
• Open circuit Unidan
mill
• FM 2 – 32.5: 57tph;
52.5:28tph
• Open circuit Unidan
mill
• All product ranges
GEORGE
• Warehouse and bulk cement
distribution
PE FM4
• 30t/h (OPC) Open Circuit Ball Mill
with KHD Roller Press Pre-
Grinding Circuit
DE HOEK
RIEBEECK
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.8 KEY EQUIPMENT
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
Two packing machines 2 900 bags p/h each
Bulk loading facilities by road and rail
Cement storage capacity = 20 000 tons
We can pack in excess of 1.4 million bags of cement per month
De Hoek can sell approximately 26 000 tons of cement per week
2.9 PRODUCTS PACKAGING AND LOGISTICS
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PRODUCTS
• Suretech (CEM II 52.5 N)
• Surebuild (CEM II 42.5 N)
• Surecast (CEM I 42.5R)
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.10 WATER SAVINGS INITIATIVES
• Geophysical Survey: Determine Underground Water Source
• Desalination Plant 40m³/h (Raw Water from old Quarry convert to
20m³/h drinkable water)
• Employees staying in village reduce water consumption from
150 litres to 80 litres per person
• Overall plant consumption reduce water consumption by 60%
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.11 ALTERNATIVE FUELS | TYRE BURNING
229 422
1 275 2 069
6 637
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
FY15 FY16 FY17 FY18 FY19
TONS TYRES PROCESSED
Actual Forecast
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.12 ENVIRONMENTAL | MINE REHABILITATION
End use for mining area is agricultural activities
Rehabilitated 9.5 ha during 2018
Wheat planted
Backfilling Zoutkloof pit
Use overburden from new Vondeling pit
Already filled ¼ of the pit
Concurrent rehabilitation costs approx. R1.5m per annum
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
2.13 PPC DE HOEK SHEQ PERFORMANCE
INTEGRATED SHEQ MANAGEMENT SYSTEM
Quality Management System
Environmental Management System
Health & Safety Management System
Bag mass e-mark
Energy Management System
HIV/AIDS Management system
WE ARE CERTIFIED IN THE FOLLOWING
STANDARDS
ISO 9001
ISO 14001
OHSAS 18001
SANS 184123
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
Wittewater Water project - phase 1
& 2
Porterville Youth
Centre – launch June
2018
Mini Science Lab to Steynville Secondary School
2.14 PPC DE HOEK CSI AND SLP ACTIVITIES
Mr Saal
and
Kabira Akoob
(PPC Group CSI
Manager), sign a five
year contract
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QUESTIONS
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
INVESTOR CONTACTS
Anashrin Pillay
Investor Relations
+27 11 386 9000
www.ppc.co.za
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PPC SITE VISITS SLURRY AND DE HOEK – SEPTEMBER 2018
This document including, without limitation, those statements concerning the demand outlook,
PPC’s expansion projects and its capital resources and expenditure, contains certain forward-
looking statements and views. By their nature, forward-looking statements involve risk and
uncertainty and although PPC believes that the expectations reflected in such forward-looking
statements are reasonable, no assurance can be given that such expectations will prove to be
correct. Accordingly, results could differ materially from those set out in the forward-looking
statements as a result of, among other factors, changes in economic and market conditions,
success of business and operating initiatives, changes in the regulatory environment, other
government action and business and operational risk management.
Whilst PPC takes reasonable care to ensure the accuracy of the information presented, PPC
accepts no responsibility for any damages, be they consequential, indirect, special or
incidental, whether foreseeable or unforeseeable, based on claims arising out of
misrepresentation or negligence arising in connection with a forward-looking statement. This
document is not intended to contain any profit forecasts or profit estimates, and the
information published in this document is unaudited.
DISCLAIMER
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