Portland

PORTLAND

PORTLAND

Portland Shows Strength

Amidst Unstable Industry Backdrop PRODUCTION: David Napier

The family-run Portland Quarry, Readymix and Hollowcore business in the Western Cape is expanding its offering by improving its products and growing its reach around the province. In a challenging construction industry, this 30-year old company is a true sign of strength. General Manager Nicol Heyns talks to Enterprise Africa about Portland’s ongoing development. www.enterprise-africa.net / 3

INDUSTRY FOCUS: CONSTRUCTION

Heyns Family at Portland’s 30 Year Celebration

// WE WILL ALWAYS TRY TO BE THE LEADER IN EVERYTHING THAT WE DO //

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South Africa’s construction industry remains on shaky ground. Research from FNB and the Bureau for Economic Research said in March that confidence in the industry is at its lowest point in more than 20 years, with more than 90% of respondents taking part in a quarterly survey unsatisfied with business conditions.

High national debt, little spending on infrastructure and a depressed economy have created what some industry commentators have labelled a ‘soft and crumbly sector’ where even some of the biggest names have not been able to weather the storm.

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Since 2010, and the FIFA World Cup projects which flooded the industry with work, construction has slumped as major government infrastructure projects have either dried up or quickly slowed down.

A rebalancing of the industry has taken place and those companies involved have had to adapt to embrace a new reality.

President Ramaphosa has vowed to attract new foreign and local investment to the country, and in March he said that billions of Rand was already flowing into the market after just a few months of his investment drive.

In the construction industry,

where projects usually last months and years, stability and market certainty are vital. Unfortunately for South Africa, where stability and certainty are not easy to come by, these vital elements have not been delivered.

But there are pockets of positivity and groups who look to the future with vigour, seeing opportunities rather than threats. This is certainly the case at Portland, the Western Cape-based quarry, readymix and hollowcore business that supplies into the regional construction, building and infrastructure industries.

“The economy is the way it is, and it makes it tough to come

PORTLAND

through unscathed. You still have to run the business and you can’t just refuse to supply everyone. You have to negotiate the best terms with your clients and ensure you protect your business,” General Manager Nicol Heyns tells Enterprise Africa.

Having grown impressively over the past three decades, this family business has created employment for almost 200 people. Its products have been involved in some of the Western Cape’s most important construction projects, and the Heyns family is refusing to accept negativity in its business. Portland owns a large Malmesbury Hornfels quarry north of Cape Town, and readymix and hollowcore factories. After growing a strong client base and an excellent reputation, Portland is looking to expand across all areas.

DIGGING DEEP “Looking at future growth, we have done a lot of research across all areas of the business. We want to expand in everything that we do,” says Heyns.

“The Western Cape is booming.

The bigger construction companies and civil companies are trying to expand their footprint into the Western Cape because there is a lot of opportunity here. There is definitely enough opportunity here for Portland for the next 10-20 years.”

Increasing quarry tonnage, installing new readymix plants, growing the number of hollowcore products sold, and developing the company’s range of precast concrete products are all targets for the GM. The improvement of products is also on his radar, helping to further Portland’s reputation for quality.

“The target for the tonnage from the quarry went up a lot of the past two years but that is because the market demanded that from us. We had to bring in mobile crushers to help process the extra materials. It’s the same with readymix – we have done research about the different areas that could benefit from a new plant and if the market demands that we expand, we will certainly do so.

“With Hollowcore, we are currently expanding. We are not putting up extra factory space, but we are making some internal changes by looking at our curing methods to up our quantities by 30%.

“We want to become superior in what we do. At the quarry, we are looking at putting up wash plants so that we can deliver a better stone – that will help us grow our margins.”

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INDUSTRY FOCUS: CONSTRUCTION

// OUR MAIN FOCUS IS TO IMPROVE OUR QUALITY AND IMPROVE OUR CLIENT SATISFACTION. THIS WILL MAKE US THE PREFERRED SUPPLIER IN THE AREAS THAT WE OPERATE AND CERTAINLY THE NUMBER ONE SUPPLIER FOR THE WESTERN CAPE //

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Portland closely monitors the quality and variety of other products across different markets so that it can remain at the very front of the industry in South Africa. The company is now aspiring to higher standards in terms of basic megapascal (MPa) – a measure of strength or pressure.

“On the readymix side, you always have to be in front of the market,” says Heyns. “That is why we are looking at self-compacting concrete, we are looking at areas like the UAE where they have a standard of 60. 80, and 100 MPa concrete compared to South Africa where the standard is 25 or 35.

We would definitely like to adapt our range so we are ahead of the market.”

Traditionally, Portland’s hollowcore business has been a supplier of decking and walling but the business has grown to manufacture other precast products for the construction sector.

“We also sell precast staircases, precast beams, precast lintels, precast columns and we think there is a big opportunity to expand this. We have doubled the size of our precast factory to be able to supply more staircases and beams, and we are entering a large project where everything is precast driven and must be concrete finished.”

This expansion and positive thinking is proof of Portland’s experience in the market. Over the past 30 years, the business has witnessed a number of national economic slowdowns and has adjusted to navigate them all. Preparing for when the market turns is vital, says Heyns.

“Unfortunately, the market and the economy are very tough in South Africa, especially in the run up to the elections.

The developers are in two minds on whether to push forward or wait and see what happens. That is normal and construction is a cyclical industry but while you are in a slow period you must prepare for the next boom. At some point, things will turn around and you have to be prepared for the work that will come in your direction.”

PORTLAND

HISTORIC SA BUSINESS Portland was established in 1988 by Heyns’ father Nico and business partner Helenus Scholtz. In the beginning, the business was focussed on property development with Nico being focussed on development and Scholtz an attorney with an interest in deeds.

The pair handled all building and construction, putting together teams and carrying out work, before also getting into marketing.

“When Portland started, it was called Portland Bouers (builders). For the first decade it was all about property development,” says Heyns.

“In 1998, Portland got the transport and marketing rights for Hardrock Quarry. Two years later, Portland acquired the quarry and registered the name as Portland Quarry. After acquiring the quarry, the company started Portland Readymix to buy directly from Portland Quarry.

“By the end of 2000, Portland Bouers, had 60-70 properties in the rental market and that was a big part of the business.

On the marketing side, Nico and Helenus had grown their activity and became 66% owners of RealNet Estate Agency.”

By 2003, Portland was no longer directly involved in building and development. While still purchasing parcels of land for development purposes, the company was now selling the land into the market at tender for a construction company to take on the project. All employees of Portland Bouers were moved to Portland Quarry, Portland Readymix and Portland Hollowcore which started in 2006.

Today Readymix and Hollowcore makes up around 40% of the total Portland Group each with Quarry representing around 20%.

In 2015, the Heyns family bought the stake from Helenus Scholtz and since then, it has been running as a family business. “My dad Nico is the Managing Director, my mother Kitta is also a Director, my sister Aniska is the Business Systems Manager, and I am the General Manager,” says Heyns.

“We do have our disagreements but overall, we all support each other. It’s nice to know that people in the office will back you, whatever the situation.

We are a very good team and we all work together well, with the same outlook and the same goals.”

In order to keep a finger on the pulse of the development sector, Nico and Kitta Heyns established Nicka Beleggings Pty Ltd in 2005. The company works on small individual developments and is a completely separate entity from Portland.

“They’ve completed a few developments and they are working on upmarket residential apartments. They are putting a beachfront building into the market now with units that are priced between R4-8 million. There are two more high-end residential buildings going up later this year with around 40 units. All are located in Blouberg,” says Heyns.

SOLID PIPELINE Right now, Portland is supplying into a number of large construction and infrastructure companies that are involved in some major projects around the Western Cape. In the future, the company is looking to deepen its involvement in these projects and to build its reputation among these big clients.

“National Asphalt is a big client for the quarry and they buy a lot of road stone from us. We want to be able to supply all the stone requirement for National Asphalt as long as we are able to deliver the correct spec.

“Our other big customers are logistic companies who make deals with construction companies to supply product to their projects. On the Readymix side, we have great relationships with a number of clients

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INDUSTRY FOCUS: CONSTRUCTION

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from the development, building and construction industries. For example, we started supplying Balwin Construction earlier this year, everything is running well and we are looking forward to beginning a big project together in May. “For Hollowcore, Balwin is again a big customer and we are happy to be working with them on a precast design that is used across the Western Cape. Calgro M3 is very active with government projects and they are precast driven. They are expanding their footprint in the Western Cape and we are happy to be supplying them on the Belhar Gardens development. Concor is a strong brand in South Africa and we are busy building a relationship together. We are also excited about a relationship we are building with Stefanutti Stocks. These big companies are all starting to work more with precast and that is exciting for us,” details Heyns.

“For both Readymix and Hollowcore, Group 5 was a big customer but they are now in business rescue

PORTLAND

so we are in negotiations with the companies that are taking over the projects,” he adds.

Housing, commercial buildings, industrial property, roads, and more are all taking Portland products and the company’s reach continues to grow.

In terms of geographic expansion, with so much work still waiting in the Western Cape, Heyns is reluctant to push into other provinces at this time.

He explains that a strategy has been

// LOOKING AT FUTURE GROWTH, WE HAVE DONE A LOT OF RESEARCH ACROSS ALL AREAS OF THE BUSINESS. WE WANT TO EXPAND IN EVERYTHING THAT WE DO //

developed which will see Portland grow away from its home at the quarry in steady 50km steps.

“We want to grow the company but we don’t necessarily want to grow outside of the Western Cape at this stage,” he says. “We would like to expand our reach within 50km of our existing sites. We want to be the preferred supplier of the materials we offer in the Western Cape and so it doesn’t make sense to open up plants that are long distances away from our existing operation.”

This is a company that knows its market, and has 30 years of experience delivering quality. As the second generation of family leadership moves to the fore, the challenge will be to overcome slow market conditions.

“The Group 5 situation has been troublesome for the industry but we have been through this type of thing before with the likes of NMC and Botes & Kennedy.

“We know we have to run our business safely but we also know we

must continue to push boundaries.

We will always try to be the leader in everything that we do so whatever work there is comes to us first, and with that I am confident,” says Heyns.

Compared to a construction industry which remains unsteady, Portland is strong and Portland is stable, and the people behind the business have built a robust strategy to take the company forward without allowing any cracks to show.

“Our main focus is to improve our quality and improve our client satisfaction. This will make us the preferred supplier in the areas that we operate and certainly the number one supplier for the Western Cape,” Heyns concludes.

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