About this report
This integrated report covers PPC’s financial and non-financial performance between 1 April 2016 and 31 March 2017. It follows a similar report produced for the financial period 1 October 2015 to 31 March 2016 after the company changed its year-end.
This report should be read together with the supplementary information and complete audited annual financial statements on our website.
We welcome your feedback on our full suite of reports. This should be directed to Siobhan McCarthy, general manager: corporate communications, tel +27(11) 386 9451, fax +27(11) 386 9260, email Siobhan.McCarthy@ppc.co.za.
For further details on sustainability matters, please contact Tshilidzi Dlamini, PPC general manager: group sustainability services, tel +27(11) 386 9122, fax +27(11) 386 9117, email email@example.com.
Details for obtaining copies of the integrated report from the PPC company secretary are on the inside back cover.
Disclosure covers all PPC’s:
- cement manufacturing plants, milling facilities and sales depots in the southern Africa segment (South Africa and Botswana) as well as the rest of Africa (DRC, Ethiopia, Rwanda and Zimbabwe)
- manufacturing, blending and batching facilities together with the aggregate quarries in the materials business (lime, readymix and aggregates)
We have also included an analysis of external factors that may have a significant effect on PPC’s ability to create value.
Report scope and materiality
The scope of this report includes the most material financial and non-financial issues for our group. Determining materiality is a comprehensive process that combines risk identification and assessment with strategic objectives, stakeholder feedback, market conditions and our own performance to prioritise issues that are key to our sustainability now and in the future. Where relevant, we detail material issues at project or business unit level. Ordinarily, these matters are those that are discussed at board and executive meetings. The process of determining materiality is:
Step 1 Identifying relevant internal and external matters (with consideration of risk register and the internal and external environments)
Step 2 Evaluating the importance of matters identified (with consideration of magnitude of the impact and likelihood of occurrence)
Step 3 Prioritising matters (with application of materiality filters and analysis)
The framework and method used to quantify or evaluate material matters utilises a five by five scale where both impact and likelihood is considered.
- Almost certain – 81% to 100% probability
- Likely – 61% to 80% probability
- Moderate – 41% to 60% probability
- Unlikely – 21% to 40% probability
- Rare – 0% to 20% probability
This methodology has been adopted by the board.
For the reporting period, our key material inherent risks, at group level (page 22) were:
- Declining profit margins and volumes
- New projects not achieving forecast volume, prices and market share
- A major investment not achieving expected business case return
- Group capital structure not effectively managed
In line with the IIRC framework, we have considered the resources and relationships used and affected by PPC. These are referred to collectively as the capitals and encompass financial, social and relationship, manufactured, human, natural and intellectual. How we interact with our external environment and these capitals underpins our ability to create value over the short, medium and long term. Please see our value creation model on page 34 for details.
Significant changes in the review perio
This was the first 12-month reporting period since PPC changed its financial year to March. In the period the company raised R4 billion through a rights issue, and R1,1 billion through the maturity of BEE 1.
As a listed company, PPC complies with all relevant procedures in preparing its annual financial statements. These were audited by Deloitte & Touche, whose unmodified report is on page 142. Certain sustainability indicators were also assured by Deloitte & Touche (page 138).
The board acknowledges its responsibility to ensure the integrity of the integrated report. Board members have applied their collective mind to the preparation and presentation of this report and believe it is presented in accordance with the IIRC framework.
The board has delegated the responsibility to ensure the integrity of the integrated report to the audit committee, which committee is happy to recommend that the board approve this report.
|Peter Nelson||Darryll Castle|
12 July 2017
|Chief executive officer|
For details of our annual general meeting, refer to our notice of AGM 2017 at www.ppc.co.za
REPORTING PRINCIPLES AND APPROACH
PPC’s integrated report clarifies the link between our financial and non-financial performance (environmental, social and governance), contextualises our risks and opportunities and summarises our engagement with stakeholders. These were key inputs in refining our business strategy (page 7). We report on our performance against strategic objectives where possible.
The following frameworks were applied in preparing this report:
- The International Integrated Reporting Council (IIRC) framework on accepted best practice in annual reporting. In determining the content that presents a complete view, we follow the IIRC’s guiding principles: strategic focus and future orientation; connectivity of information; stakeholder relationships; materiality, conciseness, reliability and completeness; and consistency and comparability
- Guidelines of the Global Reporting Initiative on sustainability disclosure (GRI G4). PPC reports against the latest guidelines (G4) for the second time
- International Financial Reporting Standards (IFRS)
- South African Companies Act
- Limited (JSE) Listings Requirements
- King III recommendations
In addition to this integrated report, please see supplementary reports at www.ppc.co.za.
- Annual financial statements
- Summarised group results and notice of annual general meeting 2017