PPC : INTEGRATED ANNUAL REPORT 2023

INTEGRATED REPORT 2023

DRIVING PERFORMANCE TO SUSTAIN OUR PURPOSE

2023 CONTENTS

CHAPTER 1		CHAPTER 2		CHAPTER 3		CHAPTER 4		CHAPTER 5
About this report	IFC	PPC at a glance	8	PPC's Value Creation Framework	15-17	Financial capital	39-43	Fostering an ethical culture	86-87
Chairman's report	3-4	PPC's footprint	9	Driving performance	18-20	Manufactured capital	44-53	Transparent accountability	88-90
CEO's report	5-6	Alignment with the United	10-13	External environment	21-22	Human and intellectual capital	54-68	Corporate governance review	91-97
		Nations SDGs	Stakeholder management	23-26	Natural capital	69-80	Audit, risk and compliance
				Customer review	27-30	Social and relationship capital	81-84	committee report	98-100
				Social, ethics and transformation
				Material risks and opportunities	31-37
						committee report	101-105
								Strategy and investment
								committee report	106-107
								Reward and talent committee
								report	108-110
								Remuneration report	111-126

CHAPTER 6
Independent limited assurance
report	128-129
GRI index	130-136
King IV compliance
supplementary report	137-142
Glossary	143-144
Corporate information	145
Forward looking statement	146

REPORTING SCOPE AND BOUNDARY

This integrated report (IR) details the financial and non-financial information for the year ended 31 March 2023 (FY23), including significant events after year-end and up to board approval on 21 July 2023. PPC's report provides concise material information on its operational performance (page 44) against the strategic focus areas of the Value Creation Framework (page 15), stakeholder relationships (page 23), governance practices (page 91) and material risks and opportunities (page 31). PPC's disclosures include the financial and non-financial performance of the following segments of the group:

• The cement business segments, comprising cement manufacturing plants, milling facilities and sales depots located in South Africa, Botswana, Zimbabwe and Rwanda
• The materials business segment, comprising readymix concrete, aggregates and fly ash plants across South Africa

PPC's audit, risk and compliance committee (ARCC) report on pages 98 to 100 provides annual internal assurance relating to the assurance plan's execution.

PPC used the GRI Standards as a reference guide for the FY23 reporting period.

Integrated reporting	Financial reporting
boundary
boundary
Annual financial
IR*
statements (AFS)
A, B, C, D and F
B, C, D and E
Notice of the FY23	FY23 King IV
application
annual general meeting (AGM)
register
B, C and D
A

Legend

1. Integrated Reporting Framework
2. King IV Report on Corporate Governance™ for South Africa, 2016 (King IV**)
3. Johannesburg Stock Exchange (JSE) Listings Requirements
4. The Companies Act 71 of 2008, as amended (Companies Act)
5. International Financial Reporting Standards (IFRS)
6. Global Reporting Initiative (GRI) Standards

For detailed information on PPC's operational performance, refer to pages 44 to 53.

For comprehensive information on PPC's human capital, environmental and social performance, refer to

pages 54 to 84.

* Limited assurance - refer to the independent limited assurance report on pages 128 to 129.

** Copyright and trademarks are owned by the Institute of Directors in Southern Africa NPC and all of its rights are reserved.

Find PPC's reporting suite at www.ppc.africa

ABOUT THIS REPORT

PPC's IR provides a holistic yet concise view of the group's operations in four countries across sub-Saharan Africa.

While the report is aimed at shareholders and lenders, it includes information that will interest all stakeholders. In this report, PPC explains how it creates, preserves or erodes value for stakeholders over the short-, medium- and long-term, and

includes information on the company's human capital, environmental and social performance.

CHAPTER 1

ABOUT THIS REPORT

BOARD APPROVAL

The PPC board, with support from the ARCC, acknowledges its responsibility in ensuring the integrity of this report and that it fairly details PPC's FY23 performance.

The board is satisfied that this IR complies in all material aspects with the Integrated Reporting Framework and is confident that the report is an accurate account of all the material issues and core strategic commitments, risks and opportunities of the group, presented in a balanced and fair manner.

The board unanimously approved the FY23 IR on 21 July 2023. It will be presented to shareholders at the AGM on 6 September 2023.

DIRECTOR	Signature
Title

Phillip Jabulani (Jabu) Moleketi

Independent chairman

Roland van Wijnen

Chief executive officer

Brenda Berlin

Chief financial officer

Kunyalala Maphisa

Independent non-executive director (NED)

Noluvuyo (Nono) Mkhondo

Independent non-executive director

Nonkululeko Gobodo

Independent non-executive director

Daniel Luke Smith

Independent non-executive director

Bjarne Hansen

Independent non-executive director

Charles Naude

Independent non-executive director

Mark Richard Thompson

Independent non-executive director

PPC INTEGRATED REPORT 2023 1

THE SIX CAPITALS

Social and	Human	Intellectual	Manufactured	Financial	Natural
relationship	capital	capital	capital	capital	capital
capital

VALUE CREATION FRAMEWORK

Governance	Engaged	Process	Financial	Delighted	Purpose and
and	people	excellence	Performance	customers	CSR
compliance

STAKEHOLDERS

Providers	Government	Suppliers	Employees and	Customers	Industry
of capital	and regulators	and local	labour unions		associations,
and insurers		business			media,
(including					communities,
investors,					NGOs and
shareholders					others
and banks)

PPC'S PURPOSE

TO EMPOWER PEOPLE TO EXPERIENCE A BETTER QUALITY OF LIFE.

REPORT NAVIGATION

The following navigation icons appear throughout this IR for ease of reference:

Refers to related information

in the IR.

Refers to additional information available on PPC's website at www.ppc.africa

STAKEHOLDER FEEDBACK

PPC appreciates your feedback on its FY23 integrated annual report. Please contact the group company secretary with any comments on this IR:

Kevin Ross [e-mail] [phone]

CHAPTER 1

ABOUT THIS REPORT continued

PPC's Value Creation Framework describes integrated thinking as detailed in the Integrated Reporting Framework's six capitals, and depicts how the company creates value for stakeholders over time.

PPC has embraced integrated thinking internally, and it guides the business in creating a sustainable organisation.

INTEGRATED THINKING

PPC uses the six capitals to drive its integrated thinking to guide the company in creating value across the business for all stakeholders. The Value Creation Framework demonstrates the importance of value creation throughout the organisation - investors provide financial capital and PPC aims to provide suitable returns. The company does so by ensuring customers are delighted, employees remain safe and engaged through excellent processes, and PPC's communities and regulators are satisfied.

Purpose and corporate social responsibility (1)

DELIGHTED

ENGAGED

PROCESS

CAPITAL PROVIDED

CUSTOMERS

PEOPLE

EXCELLENCE

FINANCIAL PERFORMANCE

extra mile

(1)

(2, 3)

(4, 6)

Willing to

World-class operations,

Employees

lowest possible

pay premium

willing to go the

cost to customers,

prices

best environmental

performance

Governance and compliance

For more information on PPC's material risks, refer to pages 31 to 37.

1	Social and relationship		As a responsible corporate citizen, PPC partners with customers,
	communities, suppliers and other stakeholders in dynamic and
capital
	responsive relationships.
2	Human capital			PPC realises its purpose by empowering its people through a safe and
		healthy, engaging, rewarding and meaningful working environment.
3	Intellectual capital		Innovation is critical to delivering quality products and affordable
	services, and PPC consistently seeks to improve its product offering.
4	Manufactured capital		Efficient management, optimisation and maintenance of PPC's assets
	(plants, factories and quarries) ensure stability and growth.
5	Financial capital		PPC manages its shareholders' investments in the business with diligent
	capital allocation and a drive to create value for all stakeholders.
6				PPC's commitment to operating a sustainable business includes
Natural capital		environmental impact management. PPC reduces its carbon footprint
	through various environmental initiatives, such as air quality
				management and water and land use.

MATERIALITY

Material risks are top-of-mind issues that could substantially impact the group's ability to create value. PPC's materiality determination process is an essential step in establishing the company's approach to creating sustainable value for stakeholders. The group's senior leaders and management identify material risks by assessing the challenges, risks and opportunities facing the company.

PPC sources inputs and considerations of these issues from:

• Group and divisional strategies
• A group-wide risk assessment
• External and internal outlook

The ARCC assesses and approves the material risks and recommends them to the board for approval. The material risks are frequently evaluated to ensure PPC's strategy remains relevant in an evolving operating environment.

Effective management of the risks most material to PPC's business is essential to sustain the value created for stakeholders. The content of this IR examines those issues that could substantively impact value creation over time.

PPC INTEGRATED REPORT 2023 2

CHAPTER 1

CHAIRMAN'S REPORT

While the past year presented challenges throughout our regions, we remain resilient. We see many opportunities for our business and believe that our trajectory remains strong with a multi-skilled and passionate workforce.

Jabu Moleketi

Chairman

21 July 2023

OPERATING ENVIRONMENT

A persistent environment of low economic growth in our main South African market confronts us. The failure of major infrastructure programmes to materialise, and reduced investment in a low-growth and uncertain economy have resulted in depressed demand. The issue of imports remains unchanged from the previous year, compounding the situation - as does an environment of geopolitical uncertainty.

Given the challenges in our external environment, we need to manage efficiencies and margins across our value chains - from raw materials to our consumers.

To ensure the efficiency of our equipment, we focus on human capital, training to maximise the efficiency of our production and continuous service and maintenance.

South Africa was particularly affected by macro-economic and structural factors and we saw Rwanda and Zimbabwe perform well in comparison. We are acutely aware of South Africa's underperformance and need to ensure efficiencies and cost structures are managed to increase shareholder benefit and value.

PPC INTEGRATED REPORT 2023 3

This difficult environment likewise confronts our peers and competitors and we must remain alert to our markets, produce relevant products for those markets and price them correctly.

OUR PEOPLE

We are proud of our safety performance and decrease in injuries over the year. However, even a single injury is one too many and we continue to create and maintain an environment in which safety risks are closely managed and mitigated.

PPC does well in supporting communities near its operations and entrenching its enterprise development initiatives. In Rwanda and Zimbabwe, particularly, we supported the establishment of enterprises that have proven sustainable beyond our involvement. Our end goal is to create long-term economic activity that extends beyond the lifespan of our operations.

Jabali, our human capital framework, is an essential component of our work to build an environment that is supportive and conducive to high performance, in which excellence is expected and performance appropriately

awarded. The ethical underpinnings of our culture are supported by our anonymous whistleblower reporting platform, education and training, and by ensuring an ethical culture is embedded from the top.

Building an organisation that meets the needs of the future means we must create an adaptable workforce capable of learning and remaining productive in the face of new technologies and processes, without constraints on their performance. The mining industry has long been male dominated and I would like to see that change more quickly. We are managing this area closely, ensuring we create an environment where women feel safe and empowered.

GOVERNANCE AND LEADERSHIP

I am confident that PPC's governance is well-led. Over the past few years, we have paid attention to any gaps in board skills and today we have a competent, technically skilled board that is diverse in terms of gender, race, knowledge and experience. We ensure that the board operates effectively and complies with the Companies Act, King IV and JSE Listings Requirements.