This 2007 annual report is our first annual report following PPC’s unbundling from parent Barloworld Limited which came into effect from 16 July 2007. Barloworld acquired control of PPC in 1977 and after almost 30 years PPC is once again an independently listed company. The theme of this report is delivering on our commitments and many of this year’s achievements are described in more detail throughout the report. They include achievements in delivering on our commitments to our customers, our shareholders and of course the employees who make up our wonderful Team PPC. Any company that thrives for 115 years can attribute that longevity and success to the people who have built the company, both past and present and the company’s values and culture will ensure that it continues to grow into the future. This has not been an easy year and has required an almost Herculean effort from everybody in the PPC team right from the factory floors up to the executive team.

It has been a year of many new milestones apart from the unbundling.

It has been a year of unprecedented demand in the history of the South African cement industry and an unprecedented year in PPC’s history, of running all 13 production lines in South Africa for the entire year at demanding production levels.

At the same time as running all our operations flat out, our management team and particularly our project team have been extremely busy with the various expansion projects.

Through all of this we had to keep our customers supplied whilst also experiencing pressure to supply non-traditional customers when our competitors could not.

It was also a year of unprecedented earnings, cash flow and dividends for our shareholders.

In terms of the normal day to day running of PPC, the unbundling has made very little difference to the majority of our employees. It means that they now merely have a wider spread of shareholders for whom they have to concentrate on creating increasing value every day.

The process of unbundling a listed company is not complex but involves many regulatory procedures and issues and attendant documentation and took five months to complete.

In terms of the unbundling agreement concluded with Barloworld, we had to assume responsibility for several of the services provided previously by the group. The company has appointed a new legal adviser/group company secretary and is in the process of appointing an investor relations manager. The company has also appointed certain external service providers. The related additional costs will be offset by the savings in fees previously paid to Barloworld Limited for services.

We implemented new employment contracts for all ex-Barloworld employees who did not have PPC contracts and effected their transfers between retirement funds. We also arranged new medical aid cover for all employees historically on the Barloworld medical aid scheme. This change took place almost seamlessly and resulted in slightly lower costs to the company and members for very similar or slightly better benefits.

We have implemented a new Long-Term Incentive Plan (LTIP) to incentivise senior management and executives into the future through a cash-settled rights appreciation scheme based on the growth in the PPC share price. The Short-Term Incentive Scheme (STIS) was revised to be more appropriate to the conditions of PPC and in line with current best practices in South Africa. Both the LTIP and STIS are covered in more detail in the remuneration committee section of the corporate governance report.

We now have over 35 000 shareholders and a current total of 22% international ownership. The company will become more proactive both locally and internationally in communication with shareholders and prospective shareholders as that role is no longer played by Barloworld Limited.