Good morning, ladies and gentlemen, and dear guests online. Welcome to the results presentation of PPC for the six months that ended on the September 30th, 2023. The agenda for today's presentation, which will be followed by a Q&A, is a brief introduction from myself, followed by the financial review done by our CFO, Brenda Berlin. Then we go, as usual, into the operational review, whereby I will talk through South Africa and Botswana, and my colleague, Mokate Ramafoko, will speak through the results in Zimbabwe. As this is my last results presentation with you as outgoing CEO, we welcome Matias Cardarelli as the incoming CEO, and we have asked our chairman, Jabulani Moleketi, to speak on a few words around the leadership changes that are happening at PPC. I will then summarize the presentation, and we go into the Q&A.
Just to lay of the land as an introduction, we manage PPC across the various geographies where we are active. So on this slide, you'll see our cement and materials business in South Africa and Botswana, which we call the heart of the group, as it is the largest portion of the revenues that we generate. Our international businesses outside of South Africa and Botswana comprise of Zimbabwe and CIMERWA in Rwanda. If we look at our international businesses, our business in Zimbabwe has its own board and its own management team. We, from South Africa, provide management and technical support, and we continue to extract dividends based on the good performance of PPC Zimbabwe. On Rwanda, we announced a change upcoming last Friday.
We have signed a sales and purchase agreement with National Cement Company, part of the Devki Group, a Kenyan-based company that is active in Kenya and Uganda and has ambitions to grow in that region. For us, this fits perfectly in our strategy to focus on Southern Africa, Zimbabwe, Botswana, and South Africa. The expected close of the transaction is at the end of January 2024, with a long stop date agreed with the buyers at the end of February. If we look at the landscape that we are confronted with across our key markets, South Africa and Botswana continue to be faced with a challenging trading environment. On the back of a muted spending in retail, as well as the lack, continued lack of government spending by government. This year, our coastal business was largely impacted compared to our inland business.
That was partially on the back of very bad weather in the first six months of the year, but also on the fact that the retail market started to slow down later than what we've seen in our inland markets. The oversupply continues to cause large competitive pressures, especially in the inland market. If we look at our international business, the Zimbabwean demand remains very robust. On the back of the fact that we had a long kiln stop last year, our volumes have increased significantly, as you will see. A second relevant part for our business in Zimbabwe is that we have seen a continued increase in the hard currency revenues, and therewith, according to the accounting rules, we are now able to show you the numbers in U.S. dollars. So we have done away with the so-called hyperinflation accounting.
The markets in Rwanda and Eastern DRC, which are the home markets for our CIMERWA business, continue to be strong in terms of demand, although we have seen, as expected, an increase of competition. A second element that has impacted this business is the strengthening of the U.S. dollar versus the local currency, and a large amount of input costs of our business in Rwanda is in U.S. dollars. If we look across the portfolio, on the back of the announcement of the disposal of our interest in CIMERWA, we are now a company that purely focuses on South Africa, Botswana, and Zimbabwe, which enables us to simplify our organizational structure. More on this in the words from our chairman. The input cost pressures continue to be of an impact on our business.
If we look, for example, in South Africa, electricity costs keep rising, and I don't need to talk to you about some of the other cost elements, as we will cover that later in the presentation by Brenda. Cement imports remain a structural challenge as well. You will see later in the presentation that despite the congestion in the South African ports, the import of cement and clinker into South Africa at dumping prices has continued. We continue to benefit from decarbonization opportunities that not only lower the CO2 footprint of our business, but it also gives us opportunities to reduce our costs, as you will see throughout this presentation. If you look at this landscape and you translate it to the cement demand, you'll see here on the slide that we see a backward trend in South Africa and Botswana.
5% volume decline overall, more pronounced in our coastal region, and we will unpack this a little bit more further on in the presentation. You'll see the Zimbabwe numbers with a spectacular jump of 44%. However, this has to be seen in the light of the fact that the first six months of the previous financial year were impacted by the lower sales on the back of a plant maintenance. And our business in CIMERWA continues to benefit from the robust demand that I highlighted with a 12% volume increase compared to the same period last year. The focus areas that we have communicated to you in our most recent communications were to implement measures to further enhance our operational equipment efficiency, to reduce cost and to lower carbon intensity.
We've done well, and this is a testament to Team PPC that across our plants have enabled us to improve one of the most important metrics in the operational side of our business, the overall equipment efficiencies of our key equipment, combined with cost containment along the lines. It has enabled us to improve our margins slightly. Our second focus point was to optimize our core South African assets while we're managing Zimbabwe and CIMERWA. You will hear later about the capital allocation model that is strictly adhered to, and the fact that those businesses continue to be completely self-funded.
We've also been able, as we have communicated prior, to extract $4 million in the first six months out of our Zimbabwean business, and a further $7 million were declared by PPC Zimbabwe in November of this year, and we expect that to arrive in our South African bank accounts shortly. The agreement to sell CIMERWA, I've indicated. The fourth element that we focus on is to make sure that we have the financial and operational flexibility to withstand the current economic conditions in South Africa, and that means that we continue to focus on being a low-cost operator with high operational discipline and discipline in the capital allocation, which has helped us to have a much stronger balance sheet today than a number of years ago.
Lastly, it is all about making sure that we have our leverage levels under control, and as you will see in the presentation of Brenda, leverage levels have come down further in the first six months of this financial year. We also announced a share repurchase program on the back of the financial results of the previous financial year, and I'm pleased to say that we're well progressing with that program, and more than 50% of it has been completed. If we look into a little bit more detail of the numbers, and Brenda will unpack this a little bit more, so I will just highlight some of the numbers on this slide. On the improved operational performance, you see that our EBITDA margins have gone up from the first period of FY 2023, from 12.2%-12.6%.
Important to mention that the material business, where we promised a restructuring to bring it back to positive EBITDA, has yielded positive results, and we now have a ZAR 14 million positive EBITDA coming out of that business compared to a loss last year. The Zimbabwean results on the back of the higher volume look very well, with an increase in revenue of more than 100%, an increase in EBITDA of more than 100%, and an EBITDA margin back to where we like to see it of 24.6%. We will unpack a little bit later how the imports of clinker into our Zimbabwean business impact our EBITDA margin, but strengthen the cash generation out of that business. The Rwandan environment, a revenue increase in South African rands of 14.5%.
EBITDA margins still at a very comfortable level of 29.4%, slightly down from last year, largely on the basis of the U.S. dollar input costs that I've indicated to you before. If we look at our financial position, we had a net debt reduction compared to what we last communicated. Our gross leverage remains well below the levels that we have indicated to be comfortable with. Our disposal of the Rwandan business, which expects to close, will further help with that. And on that note, I hand over to you, Brenda, to talk us through a little bit more of the details of the financials.
Morning, everybody. I'd like to start with just an overview of the key features of the overall group results. Revenue is up by 20.9% to ZAR 6.2 billion. EBITDA margin for the group increased by three percentage points, from 14.3% - 17.3%. Headline earnings per share increased to ZAR 0.26 from a loss of ZAR 0.05 in the prior comparable period. In terms of capital allocation, the group spent ZAR 220 million on CapEx and repurchased ZAR 103 million of PPC shares. This is just over 50% of the target. Cash flow before financing activities increased 147%, from ZAR 234 million - ZAR 578 million.
I will now deal with the salient features of the disposal of PPC's 51% stake in CIMERWA before moving on to an analysis of the performance of each of the groupings in the business, being the SA and Botswana Group, PPC Zimbabwe, and CIMERWA in Rwanda itself. For some time, we've communicated the strategy of focusing on our Southern African assets, and the disposal of CIMERWA achieves this strategy. The conditions precedent that remain to be fulfilled are by and large statutory notifications, such as the notification of the transaction to COMESA, tax clearances, and South African Exchange Control approval. All these conditions need to be fulfilled by February 29, 2024. PPC has given customary warranties for a transaction of this nature, and one of the significant operating companies in the Devki Group has given PPC a corporate guarantee for the selling price.
The selling price for our 51% stake is $42.5 million. At the closing rand dollar exchange rate at September 30, 2023 of 18.9, this equates to some ZAR 804 million in rand proceeds. The audited book value of the shares at March 31, 2023, which is carried at historical cost, amounted to some ZAR 275 million. 100% of CIMERWA's net asset value, also at March 2023, amounted to ZAR 1.2 billion. The selling price of $42.5 million equates to a 3.2x multiple on the last 12 months' EBITDA, which needs to be seen in the context of the increased level of competition in the country and the constrained life of mine. Right. Moving on now to the consolidated income statement.
This slide sets out the key metrics of the income statement, which you can see has been significantly simplified, as we now account for Zimbabwe in a U.S. dollar functional currency. The comparatives have not been restated and therefore still reflect the impact of hyperinflation accounting. Just touching on a few items, as I will, as I said earlier, deal with each entity in more detail later. The impairment of ZAR 53 million relates to the mothballing of the Jupiter milling plant in May 2023 to secure cost savings. The tax charge is normalized. As you can see, it is at an effective tax rate of 23%, which includes a one-off benefit of unwinding deferred tax due to the change in functional currency. Excluding this benefit, the effective tax rate would have been at 27.5%.
This slide shows the contribution of each of the three business units to both revenue and EBITDA for the period. The comparative contribution of each business unit is set out in boldface on the outside of the pie charts. As you can see, the contribution from Zimbabwe has increased significantly, with revenue increasing from 17%-28% and EBITDA from 20%-40%. But these pie charts are just intended to give you an overall view of the relative sizing of each business unit, as I will now deal with each in some detail. Dealing first with the SA and Botswana Group. Some key features on this slide are that SA and Botswana cement revenue was up by 3.7%. This was a combination of a continued weak macro environment that resulted in volumes decreasing by 4.7%.
This was offset by an increased average selling price of 8.8% and with a small 0.4% product mix variance. Cost performance of the SA and Botswana Group will be dealt with in more detail on the next slide. The material businesses, especially the ready-mix and aggregate businesses, continued to experience difficult market conditions. There was a significant focus on cost containment, which, notwithstanding the decline in revenue, resulted in EBITDA moving from a negative ZAR 14 million in the prior period to a positive ZAR 14 million in the current period. Regarding group services and other, in the current period, PPC changed the basis for charging out group fees to the international entities, which resulted in lower recovery of fees from Zimbabwe and Rwanda.
PPC Zimbabwe continued to declare dividends, and PPC's share of the $4 million declared in June amounted to ZAR 73 million, and it was received during the period. The key gearing metrics of gross debt to EBITDA has improved from 1.7% - 1.1%. Just to remind you again, Roland did mention it, the target remains at 1.3x-1.5x . This slide depicts some of the cost analyses for the SA and Botswana cement business. The pie on the top left shows the composition of costs as between variable distribution costs, variable production costs, fixed costs, and maintenance costs. Inflation period on period is depicted below the pie. The total distribution cost per ton increased by 2.6% period on period.
This was driven by a decrease in the diesel price, but offset to some extent by both increased volumes of clinker transported to Zimbabwe at higher rail rates than the prior period. Variable costs per ton sold increased by 9.7%. Two main cost pressures in this number are coal and electricity, which make up some 50% of these costs. Both these items increased well above inflation during the current period. Fixed costs were well controlled and decreased period-on-period by 1.9%.
All in, total costs for the SA and Botswana cement business increased by 3.6%, and set out on the right-hand side of the slide is a waterfall that illustrates how the increase in revenue, that I dealt with on the previous slide, of 3.7%, combined with the overall cost increase of 3.6%, has resulted in an increase in the EBITDA margin, improving by 0.4% from 12.2% to 12.6%. This slide, just talking about margins, just shows the margin trend over the half year periods from H1 FY 2022 to date. Margins have to improve further for this business unit to achieve its targeted return on invested capital. I will now close off with the SA and Botswana group cash flow and then move on to Zimbabwe.
Set out here are the key cash flow items for the period that resulted in net debt decreasing from March 31, 2023 by ZAR 70 million. What is important to note here specifically is that the operating cash flow before working capital changes of ZAR 348 million was sufficient to fund finance costs, taxes, CapEx, and the ZAR 103 million share repurchase. Moving now to Zimbabwe, this slide shows the results in U.S. dollars, which is now the functional currency. As we have always done, the comparatives are also shown in U.S. dollars, but translated at parallel rates. Zimbabwe had a very six months recovering its market share, with volumes increasing by 44%. As can be seen, revenues increased by 68.6%.
This increase, over and above the increase in volumes, is entirely due to more hard currency sales in the current period, being 91%, compared to the prior period of 76%. The 24% rather, local currency sales in the prior period were translated into dollars at the high parallel rates, thereby subduing dollar revenues in that period. EBITDA margin improved to 24.6%, notwithstanding increased clinker imports that are more expensive than own produced clinker. CapEx was only $2.1 million, but will increase as PPC Zimbabwe invests in its value accretive fly ash project. Cash balances remained healthy, and as Roland mentioned, a further dividend was declared of $7 million in November 2023.... I will deal briefly with Rwanda, given that it is in our half-year results. Revenue, beg your pardon.
CIMERWA increased its volumes by 12%, but the main contribution to the increase in revenue, rand appreciation was more pronounced in the prior period of 10%, compared to only 1% in the current period. There is increased competition in the region, and this is putting pressure on the margin. The net cash position remained healthy, especially in the context of the ZAR 172 million dividend paid in March 2023. Moving back now to the overall group, I would like to touch on the consolidated cash position and then close off with capital allocation for the period and returns. The bars on the left of the slide show the entities in which the cash is held. The cash held by PPC International Holdings in Ethiopia of ZAR 15 million is excluded from the picture in both periods.
The pie on the right depicts the various currencies making up the total ZAR 625 million in cash at September 30, 2023. The most significant cash holdings are in dollars, with both Zimbabwe and CIMERWA having dollar cash balances. Our capital allocation model remains unchanged. To remind you, we first allocate available cash to capital required to sustain the business, being largely maintenance and compliance CapEx. Thereafter, any potential expansion CapEx has to compete with returning cash to shareholders and meet the required weighted average cost of capital and return on invested capital hurdles, as well as targeted payback periods. On the right-hand side of the slide, the actual CapEx spend is depicted for the period. The various periods, I beg your pardon.
At the year-end results, we guided a total of ZAR 600 million for the year, and this remains unchanged, notwithstanding that our spend for H1 FY 2024 is ZAR 219 million. Oops, go to the back page. Over and above the ZAR 200 million spend in a period, mostly on sustaining CapEx, a further ZAR 103 million was spent on the share repurchase program. The capital allocation model will be reapplied at year-end to assess dividends or further share repurchases. This slide sets out how we calculate the return on invested capital. The calculation is depicted for the South African Botswana Group, which includes dividends received from Zimbabwe and Rwanda, but also including the cost of those investments in the invested capital. The EBITDA that has been used in the calculation is the last 12 months EBITDA to September 30, 2023.
As can be seen on the right-hand side, the ROIC has improved to 5.6%, but is still well below our WACC. We are not able, at this point in time, to report on Zimbabwe's ROIC, as the first six months are still in hyperinflation. This will be reported on at year-end, when we have a full set of results in U.S. dollars. Looking forward, I would just like to highlight the five key areas of focus which remain unchanged. These are cost containment, capital allocation discipline, with a focus being on SA and Botswana Group, dividend extractions from Zimbabwe, implementation of value accretive decarbonization projects, and maintain the leverage at the 1.3x-1.5x gross debt to EBITDA. Many thanks. I'll hand you back to Roland.
Thank you, Brenda. It's my pleasure now to take you through some more details of the operational review in the various countries. I will talk about South Africa, Botswana, and then I will hand over to Mokate to talk about Zimbabwe. I will not talk through the key highlights on the left, as they were well covered by Brenda. I will talk to you what is here on the right side of the slide. Average selling price being up on the back of biannual price increases. It remains an important factor for us to adjust our prices on the back of what we see happening on our input costs, as well as the dynamics that we see in the markets where we operate.
It remains, as I said to you earlier, a highly competitive market with tremendous overcapacity, especially in the inland market, which has led to various volume movements of our competitors. If we look at that inland market in a little bit more detail, the results were largely driven by flat volumes, good price increases, and a better position and improving better position in the retail market, a focus area that we indicated to you before. The demand for industrial product and construction remains a key focus area for PPC. It's an advantage of PPC to have various plants within the inland region, and I do believe that we are one of the few, if not the only, provider of cement to those customers that can flexibly provide them throughout all the cycles of the economy.
The OEE improvements, the operational equipment efficiencies that I've indicated to you before, combined with energy initiatives, have enabled us to keep our costs in check, which has been, together with the price increases, the enabler of the slight margin expansion that was mentioned by Brenda. Another element already mentioned by Brenda is that we have mothballed a small grinding station that we had in the heart of Gauteng, close to Johannesburg in Germiston, the Jupiter plant. It was a small plant of which we were still dispatching volumes, and after an optimization model of our distribution, we have decided that we can supply our customers directly from our other operations, hence the mothballing. That also went hand in hand with the startup of the blending plant in Highveld. That blending plant allows us to more cost-effectively deliver our products into the Mpumalanga and Limpopo region.
It is positioned close to the power plants. Therewith, it reduces the costs of distribution for the fly ash that we use to blend the pure cement into the retail product that is being served out of the Highveld plant. If we look into the coastal area, in the coastal area, we saw an absence of some of the larger construction projects. There were some delays in wind farms, but we also had excessive rains during part of the first half of our financial year, 2024. Although imports are at a manageable level, I will show you in the next slide that imports continue to be a thorn in the side of the local South African cement industry.
And on top of that, if we look at Botswana, Botswana got negatively impacted in this financial year by increased imports out of Namibia, which were supported by the Namibian government, who provides export incentives to the local producers. Talking about the imports, here you see the details of the 9% increase in cement imports that I alluded to earlier. We've also seen an import in the clinker imports that are coming into the country and are used by the grinding station in the south, and there with the total would go up at 27%.
On the right, you see the various ports of entry, and as I mentioned to you before, what we've seen also over the weekend, press spelled out in the press, the high congestion of the ports of South Africa have not yet had any dampening impact on the amount of product that is being dumped on the South African shores. PPC has done an independent social impact, socioeconomic impact analysis of the level of damage that imports create on our local manufacturing base. Due to the fact that local producers of cement have a completely local supply chain, the impact of our business in total is more than 16,000 jobs that are at stake and ZAR 8.8 billion of GDP that is being generated. This is something that we continuously engage with the South African government to put in place a level playing field.
If we look at our ready mix ash and aggregates business, I indicated to you before that there was a focus to bring this business back into profitable EBITDA generation, and that has been achieved. It has been achieved on the back of stringent cost measures that were implemented, especially in our aggregates and ready-mix business, and being more selective on the projects and customers that we serve. While this had a negative impact on volumes out of those two businesses, the overall impact has been that it generates positively to our EBITDA. Our ash business has seen an increase in volumes, and it is a focus area for us to get more ash into the market. It's a niche product that we believe has a good future in PPC's portfolio of products.
Unfortunately, the power plants continue to struggle, and that negatively impacts the availability of ash to our customers. The focus areas that we mentioned to you earlier are on the left of this slide, and I'll briefly talk you through them. The biannual price increases have led to an average selling price increase that went up by 8.8%. Still not enough for us in order to restore the margins that we need to come to the return on invested capital that we target. We have improved our inland retail position. If we look at the data that we analyze, we've seen over the last month a slight increase in the position that we have vis-à-vis our competitors. I've touched upon the material business that is now contributing positively and the fact that we continue to seek more opportunities in the fly ash business.
I've spoken to you about the improvements in industrial performance, and it is with a big thank you to the team PPC and Njombo, as well as Mokate with Industrial, who have made this happen. It is a key factor for us to focus on those areas that we have under our own control, and we see more opportunities to reduce clinker factor and to improve our thermal and electrical energy consumption. The ongoing engagements with key government and other stakeholders regarding imports and the potential for alternative fuels are ongoing. Unfortunately, they have yet to yield the results we aspire. On that note, I'll hand over to Mokate to talk you through Zimbabwe.
Thank you, Roland, and good morning, ladies and gentlemen. I will take you through Zimbabwe's performance. As my colleagues already mentioned, we've seen a very strong recovery out of our Zimbabwe business following our maintenance shutdown that we executed in H1 of the prior year. Brenda has covered most of the metrics. On the left-hand side, I'll just try and give a little bit of perspective, especially around the volumes. We've seen a very strong volume recovery in H1 of FY 2024, and a few things that are very key to this increase in volumes. One is the fact that we've executed our maintenance shutdown. We've been able to increase our clinker capacity in H1 compared to last year.
But also, government has been quite, helpful in Zimbabwe with the withdrawal of import permit licenses, which really resulted in, significant growth of our volumes in the north. We've seen for the first time in the history of Zimbabwe, where the northern region supplied more volumes than the southern region, purely because of the withdrawals of the import licenses, and we're seeing a very strong retail demand. In terms of the product split, the one element that we've also noticed, which also increased our average selling price, is the fact that our high-end product, which is showcased, as a percentage of the total mixed, increased from 18% to roughly 38%, which really, increased, our net, our average selling price in that market. Zimbabwe remains a clinker-deficient market.
One of the things that we did this year, we've actually imported close to 95,000 tons of clinker to support this growing demand. Compared to prior year, we only imported 35,000 tons of clinker. As Brenda alluded earlier, the market remains a foreign currency, or the transactions are dominated by foreign currency transactions. We've seen our overall volumes, 91% of those volumes were sold in foreign currency, and only a small fraction in ZWL, compared to last year, which was only 76%. Power has been a big issue for us in Zimbabwe. We've actually seen improved stability of power supply following the commissioning of Hwange 6 and 7, or 7 and 8. We've seen less power outages since the commissioning and synchronization of those power plants into the grid.
It remains, distribution remains a challenge, but at least generation has stabilized up to this point. In terms of the operational, we keep on focusing on industrial performance. We've seen significant improvement on our kiln performance, in the first half of this financial year. We actually also seen some of the challenges in the north, particularly with our competitors, but that's also helped us to increase our volumes, particularly in the north. And as Brenda mentioned, Zimbabwe continues to declare biannual dividends to PPC, and we're expecting $7 million in due course. We've outlined earlier about our focus areas in Zimbabwe.
I think, one of the key feature of our performance last year has been a loss in market share because of, extended shutdown we had on the kiln. We've, finally recovered our market share. We actually even exceeded, you know, our clinker installed market share. We averaging more than 60% of our market share estimated. So our cash, EBITDA generation remains strong. We've been able to declare, ZAR 7 million in November of dividends. Industrial performance. Our industrial performance is steadily on upward trajectory, supported, obviously, by a very stable power supply, and we've, established a clinker supply network. We've actually out of 95,000 tons of clinker that we insourced, almost 50% came out of South Africa via rail into the Bulawayo market.
We are focusing on expansion projects to make sure that we make Zimbabwe self-sufficient. I thank you, and before I leave the stage, I'll welcome our chairman to actually take you through some of the leadership changes. Thank you, ladies and gentlemen.
The changing too. Thank you. Thanks. Thanks. Well, thank you, and, and thanks a lot, ladies and gentlemen, for attending this results presentation. I'd like to thank Roland, Brenda, and Mokate for making my task to be quite easy, because I think the environment is quite positive, and I think the topic that I'll be dealing with must be viewed within that context. This topic, the importance of this topic is that at any given point, when our senior leadership, there's change of senior leadership, it's important for us to communicate the changes, to give the rationale behind the changes, and also to cite, those changes come with challenges and opportunity, how we're dealing with the challenges, and also how are we focusing on the opportunities.
As for Roland, I think this has been communicated before, that Roland has done quite an amazing work, particularly in the following areas: the restructure of our debt and also to refocus the objectives of this organization, realign governance and the reporting standards. The issue of setting up the benchmarks around the reporting standards was one of the fundamental changes that were brought into this company. And with that, I think it's quite clear that we've built quite a solid base.
With a solid base, as someone once said, "Once you are able to climb a hill, as soon as you are right on top, you realize that there are other challenges lying ahead." And when Roland told us more than a year ago that he won't be renewing his contract, it became important for us to look at the way forward, and in dealing with that, we did not just deal with the issue of the personality, who is going to replace Roland? We said we have a firm base, and how do we build from this firm base to address some of the challenges that are still confronting this company? This solid base exposes some of the challenges, one of which is that in some of our markets, our objectives and achievements are quite pedestrian.
It became important for us to take that on board, as a board, in terms of formulating the criteria. How do we come up with a criteria that addresses, among others, building on the solid base, but over and above that, coming up with a set of objectives that will also take us to higher levels? What we mean by that is that in some of the pedestrian performance, we talk about the issues of revenue, we talk about the issues of profits, and we talk about the issues of EBITDA. That those were basically pedestrian in some of the markets. And how we improve that, it meant there ought to be a change. And hence, that said, the Board set up a clear criteria in terms of what kind of candidate are we supposed to be looking for?
It clearly indicated that we needed a particular leadership, a set of leadership skills in this candidate, among which it's someone who has had an experience in turning around entities and organization in emerging markets and challenging markets. That's one. Secondly, somebody also who has a track record around this area, not just in cement, but in terms of other areas in as far as leadership is concerned. And thirdly, we also said we are not just looking for a cement experience in South Africa, because our intention was basically to build on the solid base that was built by our senior leadership and to take the company forward. We had a process, a process that engaged a whole range of stakeholders.
We had a list of candidates, which we narrowed to a short list, and the Board selected and identify a panel that will go through this interviewing of the shortlisted candidates. That panel, ladies and gentlemen, was comprised of all the chairs of our subcommittees of the Board. The Audit Chair, Mark, was part of the panel. Charles, who is the chair of the Strategy and Investment Committee, was also part of the panel. Nono, who is also the chair of our Remuneration and Talent Committee, was part of the panel, and also Nonkululeko Gobodo, who is the chair of our Social and Ethics Committee, was part of the committee, and I was also part of the committee.
So we went through this candidate, and we're looking with specific criteria that was given to us by the Board, of the type of candidate that we believe would be able to turn the company around and begin to build on some of the areas that were basically challenged in terms of their performance. We settled on a gentleman who is now known to you because this has been indicated, Matias Cardarelli. He comes with an experience, as we say, of change, change experience, and he also has quite an extensive experience, particularly also in South Africa. He's been in South Africa for five years, so he knows the environment in South Africa. And Matias currently is finalizing the work permit, and we hope that he will be on board in the next few weeks.
As I indicated, Roland will be leaving the company on the December 31st, 2023, and by that time, it is our hope that Matias will be on board to take over. But in between that, which I think is also important, because transition of leadership is also about handover. In the process of that, Roland and Matias have been interacting so that the onboarding of our new CEO is done in a very, very, well, seamless, with all the difficulties that we're currently experiencing around the work permit. But we try to ensure that he is aware, he is fully briefed about the company and about the challenges that the company is currently confronting. Roland has done a sterling job in terms of bringing Matias on board, and so did Njombo.
That takes me to the next topic of Njombo. Njombo has been with this company for more than 30 years. I think it's 33 years, if I'm not mistaken. He has contributed solidly to the growth of the company in a whole range of areas, Zimbabwe being one of them, and also South Africa being the other. Njombo resigned from the company because his change comes. He believes that there might be opportunities. There is pursuing opportunities out there. So that meant that at the end of the day, where we have a situation that confronted us, one of which, as we clearly indicated, that we're not going to be filling the role that Njombo played. You know, MD South Africa, that role disappears. There is a restructure that is taking place. We are socializing the structure as it stands.
That's why I said to you, there is an opportunity for us to reposition, to restructure, and to refocus the organization. This is where we are at this point, and I'm confident that in the next six months from now, when the team presents the results, it will be quite clear that there's been these changes. The changes that will bring a lot of value, unlock value within the company, the changes that will deal with the challenges that I've indicated, the changes that will also ensure that we build on a very strong base of [Javani]. You know, the strength and the commitment of our employees, and also the fact that our employees, in terms of the culture, and engagement ratings, are quite... They're shooting the lights out, and that, that is the foundation that this executive has left.
My last, I'd like to thank both Roland and Njombo for a sterling job that they've done in terms of bringing this company to a point where we feel we are ready to move to different heights. Thank you very much, ladies and gentlemen.
Thank you very much, Chairman. As the chairman spoke about the changes that are upon us to further improve the business, let me still remind you that our investment case remains solid. There is a number of elements that, in my view, are still there and are the foundation of our investment case. A team that is performance and returns-focused, with a leadership position across all the markets where we operate. Well-positioned, especially in South Africa, to take advantage of structural growth as and when it comes. With a plan in place for value-accretive projects that will reduce our carbon footprint and enhance returns, and there we provide a more sustainable business going forward. With an optimal capital structure and a disciplined capital allocation process, and a focused, experienced, and motivated leadership team. In closing, ladies and gentlemen, the points that I have on this list have not changed.
We continue to be focused on the areas that we can impact, implementing further measures to notch up that operational equipment efficiency and bring down the costs. Continue to focus on having the discipline to increase prices twice a year in order to mitigate the cost pressures that we face as well. Strategic focus on Southern Africa and continuous dividend repatriation out of Zimbabwe. Clearly, with the flexibility, both operationally and financially, to benefit from an uptick in the Southern African economic, economic environments, or to withstand a prolonged cycle that we currently face. In closing, before I hand over to the Q&A, I would like to also say my word of thanks. It will take too long to thank everybody that has helped me in the four years and a few months that I've been with this company.
But I first would like to thank you, as our investors and potentially colleagues of the media that are online. I have enjoyed our interactions. I appreciate the work that has been done by our customers to stay loyal to us, to give us the feedback where we can improve, and of course, to all my colleagues in team PPC that are working throughout our operations or that have been working more closely with me in the executive team, Njombo, Mokate, Brenda, as well as our board, under the leadership of Jabu. As I hand over to Matias, and we welcome him into the business, we have had various conversations, and one of the questions that you always ask yourself when you start a job, but also when you're in a job, is to put things in three boxes: What is happening? What would you like to stop?
What would you like to start, and what would you like to continue? As the team is working through those questions, I wish them well in making sure that they put the right things in the right boxes. I have all the confidence that they will bring PPC to the next level. Thank you very much, and I'll hand over to Debbie for the Q&A.
Thank you. So far, we only have questions from Rowan Goeller, from Chronux. So if anybody does want to ask questions, please, could you pose your questions? But I'll proceed with Rowan's questions so long. And we'll start with the sale of Rwanda. Rowan asks, "With the sale of Rwanda, will the cash proceeds be extracted immediately, and are there any residual cash, assets or and/or tax liabilities or other liabilities that may remain in that region? Essentially, how clean will the break from Rwanda be?
I'll ask Brenda to comment. Thank you, Rowan. It's a very clean break. So the moment the CPs are fulfilled, there will be a payment in exchange of the shares that we have. Warranties are customary, so in my book, that goes as a very clean break.
Brenda's nodding.
Yeah, Rowan, it is a clean break. I mean, just to be clear, the cash that is actually held by CIMERWA will stay in the business. It's been priced into the transaction, as will all the liabilities that they actually have or have accrued for, will remain in the business. So it is a, it's a clean break for $42.5 million.
Thank you. I think, we've got a question here from Nick [Kriker, Signalum]. I think it just stays with the Rwanda theme, so let's perhaps, close that. The segmental balance sheet of Rwanda does not allow one to reconcile the ZAR 38.5 million NAV provided in the SENS announcement. Can you provide more details, specifically, what is the net debt of Rwanda?
The $38.5 million, you won't see in the consolidated accounts, because we obviously consolidate 100% and then take out the minority, the NCI, effectively. So you won't see it there. The net debt of Rwanda, it's actually got net cash at September 30, 2023 of ZAR 107 million equivalent.
Thanks, Brenda. Roland, back to you. A little bit of a interesting question on you leaving. "Roland, well done on your four-year term," This is Rowan again from Chronux, "in stabilizing PPC. On reflection, you do seem disappointed on the lack of government support for the local cement industry. What is your opinion on this ever happening?
Thank you, thank you, Rowan. Yeah, it is frustrating and therewith, you know, call it disappointing, that in the four years that we've been trying to explain this topic, we have received a positive feedback on the Pakistani imports, but we haven't yet addressed the root cause of the issue, which is a common understanding that the imports will move around. And currently, you know, as you well know, Rowan, it predominantly comes out of Vietnam. You know, what I've been trying to reflect upon is not necessarily, you know, why are people not listening or taking actions? It is more, what can we do as an industry differently in order to position that message? You know, what else can we do?
Because in my book, you know, when the message doesn't arrive, it is not necessarily the receiver of that message that is wrong. It is actually the sender that might not be clear enough in its arguments. So I do think that as we go into a new chapter of PPC and PPC playing a leading role in the cement industry, we should also have a refreshed look at how do we make sure that we get our points across in order to get a common understanding with the South African government. And to be very frank, I don't think that, you know, my disappointment on imports is the only area of disappointment in the South African economy.
Next question's from John Arron, SBG Securities: Given that you are the only cement producer in the Western Cape, what is your strategy regarding ready mix in the region?
... That's an interesting question. So for us, ready-mix, in general, is a business that, A, needs to be profitable, by itself, and B, play an important role to secure us the cement sales out of the cement assets. Now, obviously, given the fact that, you know, we are a large and significant player in the Western Cape, if we enter into the ready-mix business, we start to compete immediately with the customers of our same cement. So, so far, we haven't entered into the ready-mix business, and we have no tangible plans at the moment to change that view.
Thank you. Roger Williams, Centaur Asset Management. Well done on some excellent results. What is your dividend distribution policy of PPC? What opportunities do you see for accretive growth?
Dividend.
Accretive growth. Roger, the dividend policy remains relatively simple. We haven't changed it from 31 March 2023, and that's really to get to a target debt ratio of 1.3x-1.5x gross debt. So to the extent that we are below that number, that dictates the pot of cash that's available, and then we go through our capital allocation model, as I've discussed in the presentation. If there are no expansion opportunities, that balance will then be available for returning to shareholders, either by way of dividend or share repurchase at the time.
Staying with the distribution, we've got Clifford Motevie. He's not from any company. He's obviously a private investor. What's the core purpose of the share buyback? Is it going to progress until the full amount outstanding is utilized?
Certainly. The core purpose is to add value to PPC shareholders. At the time we announced it, we were quite fixed and firm that we believed it was an environment where we felt our share was undervalued, and buying the share back, shares back cheaply, therefore, adds value to shareholders, more so, in our opinion at the time, than a dividend. Yes, we will continue until the full ZAR 200 million has been reached, subject to the caps that the Board and the Strategy and Investment Committee have approved.
Thanks, Brenda. Just a reminder, we've only got one more question, so just a reminder, if anyone does want to ask questions, to please do so shortly. Otherwise, we, we will be closing the session. So the last question I currently have is, from Rowan Goeller again, from Chronux. EBITDA margins across the industry remain low, and you suggested South African cement prices remain too low, despite recent increases. What is your outlook for further price increases, given the continuing weak demand?
Thank you, Rowan. I think that is the, call it the 1 million dollar question. There is no doubt in my mind that price increases on a biannual basis will, will have to continue. In the inland markets, particularly, we do see very strong competitive behavior. And we are yet to see, an industry that is more disciplined than what I've observed over the last four years. And I'll just give you two examples, and this is based on public information. In the recent, announcement that one of our competitors made to the market, to the stock exchange, they had quite a significant jump in volumes, in the last couple of months. And those kind of wild jumps in volumes, they are normally related to playing with prices, because the market doesn't suddenly change.
So that is just one indication of, you know, instability in the market. The second indication that I can give you is that I was recently forwarded a price communication from one of our competitors that they sent to their customers, and they introduced price reductions in November, and they called it November Madness. And I said to my colleagues, "At least I got the madness right." And that gives you an indication of the dynamics that we're faced with in the inland market.
Thank you very much. We've got a few Zimbabwe questions. John Arron again, from SBG: What dividend was received from Zim last year, and what is expected this year? Does Zim have the same year end?
So Zim does have the same year end. Last year, we received a total of $10 million, and this year we will receive, in this financial year, a total of $11 million.
The private investor, Nick Kriker, asking again, a while back, there were some rumors that there was a buyer for Zimbabwe. Can you comment on this? Will PPC consider selling Zimbabwe?
Zimbabwe is a key part of our Southern African footprint, and they're within our process. We're not running an active process on selling Zimbabwe. However, as we commented on the market rumors at the time, if and when an unsolicited offer comes that is of a certain credibility, as a board, PPC Limited has a duty to its shareholders to consider this. As and when something would materialize, we will communicate.
Thank you. We have no further questions.
Thank you, ladies and gentlemen. Thank you, Debbie. Thank you to my colleagues and our chairman.
Thank you.
Thank you.