CFO Tryphosa Ramano on successes and struggles in Africa


Tryphosa reveals how she sets the financial strategy for a pan-African business with challenges at home.

Tryphosa Ramano is an impressive yet understated business leader. She’s previously worked at RMB, SAA, WIP international and is now the CFO at PPC. Her years of experience have prepared her for the challenges of operating in multiple jurisdictions, in multiple languages and with differing tax laws, to develop a financial strategy that ensures PPC’s profitability. Georgina Guedes asked her ten questions about her current role, and what keeps her inspired and relaxed.
1.       Tell us how you ended up as CFO of PPC Cement? 
I’ve been with PPC for seven years. I was headhunted from Wiphold. At the time, there was a shortage of cement in the country, so Wiphold was importing cement, and I was driving that process, bringing in the Chinese to build a new plant. That plant is now called Mamba Cement.

There hadn’t been a new player entering the market in the last 50 years by then, so this was the first time that PPC was getting a competitor. And this competitor was becoming a disruptor. There was also the issue of transformation, and PPC’s board was looking for diversity to change the look of the organisation. I had the competencies and the skills, and there were no other women already in the sector, so it made sense for them to headhunt me.
2.       What are your primary focus areas as CFO? 
A CFO normally looks at business controls and financial strategy. PPC operates in more than seven countries, including Rwanda, Ethiopia, the DRC, Zimbabwe, Botswana and of course South Africa, so I sit on the boards and the audit committees of those entities, to ensure business control and governance, and that there are no surprises at the group level when it comes to consolidation. And of course, I provide leadership and governance guidance.
In terms of our financial strategy, we’ve spent close to a billion dollars in the last five years building cement plants in those countries. So we’ve had to come up with a funding strategy for project financing. But at the same time, in South Africa after 2010, cement consumption went down. The shortage was over and we had too much capacity, and we had too much debt in the balance sheet, while we weren’t producing income in new greenfields projects in those countries. Our balance sheet was overgeared. So we did a rights offer in 2016 and raised capital from shareholders to restructure the balance sheet. Things have improved since then because the projects are now businesses in their own rights and they are repaying on the debt.

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3.       What are some of the complexities of operating in multiple jurisdictions?
There are many complexities that one is faced with when operating in multiple jurisdictions in multilingual countries. I will give you an example. In Ethiopia, the language is Amharic. They were using an accounting system based on their own tax laws, and have only now adopted IFRS. As you can imagine, consolidating non-IFRS accounts is very challenging. I had to assist with the IFRS migration, which is still underway. Also the AGM presentations are done in Amharic, with a translator at the meeting.
The DRC is a French-speaking country, their accounts are in French and they use OHADA for local reporting purposes. But they had to integrate with our SAP system, so we had to do their accounting first in line with the OHADA, and then again in IFRS in English. This is duplication of work– for the people on the ground and audit, as the system needs to be integrated.  In addition, all board meetings are conducted in English but first we had to agree and record that they should be conducted in English. The OHADA accounts are in French and we have to sign them in French. You can imagine, if you don’t understand the language, the risks of signing something you don’t understand. You have to rely a lot on lawyers and interpreters.
There are also multiple tax regimes with different approaches in the DRC, Rwanda and Ethiopia, making it very difficult to harmonise reporting. For example, in Rwanda providing food to staff is not tax deductible, but we provide canteen facilities in our factories and our factory in Rwanda is in remote area where its paramount to do so.
So I don’t only need typical business controller skills and financial strategy skills, but I also need political skills and leadership skills and the ability to engage at different levels of government, ensuring that things are done properly. We make partnerships everywhere we go. So there’s a contact at country level, but when high-level delegation is required, I will get involved.
4.        What is your biggest success story at the moment?
Our success story is in Zimbabwe, where we built a milling plant at a cost of approximately $80 million – close to a billion rand – to increase our milling capacity. Zimbabwe is now growing at 30 to 40 percent a year in volumes and is running out of capacity. With the political situation improving, it was the right thing to do.
Although we don’t control the investment in Ethiopia, we are doing very well there. It’s the fastest growing economy in Africa at eight to 10 percent per annum, with an infrastructure ten to fifteen years behind where we are in South Africa. And cement imports have been banned. We started production at our 1.4 million tonnes per annum plant just over a year ago, and we sell cement three months in advance. We receive the money and then they come and collect in three months’ time because of the shortage.
Rwanda will run out of capacity by the end of 2019, and cement consumption is growing by between 8 and 10 percent. The country is developing new airports, housing and roads. It’s a very nice country to operate in with proper governance and a lot of aid from the World Bank. We’re the only producer of cement in Rwanda.
5.       Are there any countries where you are currently underperforming?
We are not currently successful in the DRC. We have all the resources but the problem is that because of the political issues, most of the projects that they had committed to were stopped and the infrastructure went backwards. Then the copper prices went down (though they have since improved). There is overcapacity in the market with three major players, including ourselves, having approximately 2.6 million tonnes of cement per annum while the demand is approximately 1.2 million tonnes per annum. Pricing in this competitive environment is tough.
6.        What are some of the challenges specific to the cement industry?
The biggest challenges are logistics costs and energy costs. To build a cement plant, you need limestone reserves near to where you factory is. In Rwanda, we mine limestone in the mine within the factory and then we transport the cement we produce to Kigali, approximately 300km away.  The logistics costs are high, given that you transport low value product over long distances.
7.        How has South Africa’s market affected your global strategy?
With the South African market deterioration due to overcapacity as a result of new entrants in the market and reduced GDP growth, we saw local profitability being impacted while the group debt increased. Therefore we had to raise capital in 2016. Thereafter the board resolved to focus on delivering on business strategy and focus on capital structure, operational efficiencies and human capital optimisation. We ended up developing strategic focus called “FOH-FOUR”.
In 80 percent of markets we operate in, we’re the market leader. We need to defend that market leadership, which means being competitive in price, product and services. Our brand is crucial to this.
8.        You are very active on various women’s associations. Do you feel that it’s important to actively further the support of women in the finance and construction industries?
Women development is paramount in any economy. It should be part of the DNA of doing business. When I joined PPC, there was no women representation at executive leadership level. I realised there were no initiatives around the development of women. So I engaged a number of women managers in organisation and started the Women’s Forum in 2012, and we signed the United Nations Principles of Women Empowerment and then launched across our various sites in South Africa. Every August during Women’s Month, we hold the forum and talk among ourselves about women’s issues. 
I used to be the president of the Association of Black Investment Professionals. It has a women’s chapter. In 2013, we approached Nicky [Newton-King] at the JSE to say that the only way of making sure that listed entities take women seriously is by amending the JSE rules. We engaged further, and then Nicky took it up herself with her team, and then eventually in 2014, it was required that JSE-listed companies had to report on gender policies and targets at board level. At PPC the gender policy of board is in the integrated report.
To show how important women are in the JSE industry and then at PPC level, we established Women in Manufacturing in 2014, but we haven’t been very active. The point for me was to develop young African women to get into the profession.
Certain women took it upon themselves to mentor me and show me the ropes, and I believe it’s my duty to pass on the same to others.
9.       What inspires you?
I am inspired by development – seeing something that started as a concept through to the final outcome.
We have a CA training programme here at PPC, which was launched in 2013, and we’ve produced more than 10 CAs. It’s a great initiative, and I love seeing people come here as trainees, go through accreditation with SAICA, and become qualified CAs. We have also participated in a programme with Fordham University [in New York] where those trainees go as a part of their training. There is nothing as inspiring and motivating as a young person going to an Ivy League institution and come back with better knowledge.
I also like gardening. I think there’s a relationship between my love of development and my love of gardening, because you tend plants from seeds until they become flowers or vegetables. It inspires me to think differently and helps me to relax.
10.   What else do you do to relax? 
I enjoy crocheting and reading. I read anything – from fiction to seriousness to spiritual works. I sit by the pool with a Danielle Steel or a Dan Brown. And then I read business publications like the Harvard Business Review and business books to stay in touch with the reality of what’s happening in the world, so that operating in South Africa, I can become a more effective manager. I read spiritual books to be in touch with myself and understand what’s happening around me from a spiritual point of view.

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