Enterprise Africa October 2015

THE BUSINESS MAGAZINE FOR AFRICA’S INDUSTRY LEADERS

AFRICA

ENTERPRISE October 2015

www.enterprise-africa.net

NEDBANK:

Digital & Physical

Investments

ALSO IN THIS ISSUE:

NF Branding / Netcare / Exxaro / SANRAL

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EDITOR’S LETTER

Joe Forshaw EDITOR joe@enterprise-africa.net Timothy Reeder SUB EDITOR tim@enterprise-africa.net Sophie Bolderstone SENIOR PROJECT MANAGER sophie@enterprise-africa.net Sam Hendricks SENIOR PROJECT MANAGER sam@enterprise-africa.net Nathan Murphy PROJECT MANAGER nathan@enterprise-africa.net Shannon James PROJECT MANAGER shannon@enterprise-africa.net Lewis Seaman PROJECT MANAGER lewis@enterprise-africa.net John Mulley FINANCIAL DIRECTOR john@enterprise-africa.net Jane Larkman ACCOUNTS MANAGER jane@enterprise-africa.net Design by Naked Marketing +44 (0) 1953 850211 www.nakedmarketing.co.uk Published by CMB Multimedia Chris Bolderstone – General Manager E. chris@enterprise-africa.net Sackville Place, 44-48 Magdalen Street, Norwich, NR3 1JU, T. +44 (0) 20 8123 7859 E. info@enterprise-africa.net www.enterprise-africa.net CMB Multimedia does not accept responsibility for omissions or errors. The points of view expressed in articles by attributing writers and/ or in advertisements included in this magazine do not necessarily represent those of the publisher.

Any resemblance to real persons, living or dead is purely coincidental. Whilst every effort is made to ensure the accuracy of the information contained within this magazine, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved.

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Welcome to our latest edition…

//

One of the big stories of last month was the release of the annual Brand Finance SA list of the country’s 50 most valuable brands.

MTN sat atop the pile with Vodacom, Sasol, Standard Bank and FNB making up the rest of the top five.

With two telecoms companies and five financial companies in the top ten, it seems there is a clear indication of the direction the economy is headed. These guys will not want to surrender their position anytime soon and it seems that consumers have no intention of moving away from these high-tech organisations.

The number nine spot was occupied by Nedbank, one of Africa’s financial powerhouses, and this month we delve deeper into the banks transition from a physical to a digital organisation. There are many challenges involved in this sort of movement and many businesses fail when making the evolution. However, Nedbank has been a shining example of how to join the two worlds successfully and continues to invest in both its physical and digital assets.

We hear from a selection of executives to understand more about the banks plans for growth.

We have also been talking to NF Branding, one of Africa’s leading below-the-line advertising specialists, about their plans for conquering the North American markets.

One factor that seems common in both these stories of success is that it’s important for businesses to remember their roots. Both Nedbank and NF Branding ensured they were industry leaders in their home market before embarking on an expansion drive. This is something vitally important to remember in these times of economic uncertainty.

If you’re a Nedbank customer, we want to hear from you!

Do you believe they have successfully managed to merge digital and physical operations? Get in touch…

Joe Forshaw EDITOR

GET IN TOUCH +44 (0) 20 8123 7859 joe@enterprise-africa.net

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06/NEWS: The Month that was...

12/NEDBANK: Investing In the Digital & the Physical

A round up of some of the latest news stories in the industry

Nedbank is looking to become Africa’s most admired bank by all of its stakeholders. With investments into its branch network, its digital capabilities and its growing continental presence, this vision is looking more and more realistic every day.

08/FEATURE: Project Solaris flying high after certification milestone The innovative and exciting Project Solaris, based in Limpopo, has reached another milestone after being certified by the Roundtable on Sustainable Biomaterials (RSB).

74/EXHIBITION CALENDAR: Key Upcoming Events Across the Country Our regular update to help you keep track of important events and exhibitions taking place across the spectrum of industry sectors.

12/

4 / October 2015 / www.enterprise-africa.net

CONTENTS 32/

24/NF BRANDING: Giving new meaning to flying YOUR Flag NF Branding ‘gives wings to the biggest brands in the world’ and this innovative organisation is planning a major growth strategy for the next five years.

32/SANRAL: Caring for SA’s Economic Arteries As SANRAL searches for a new CEO to take over from the well-respected Nazir Alli, Enterprise Africa takes a look at some of the major projects that any potential candidates will have to pick up straight away.

38/NETCARE: Healthy expansion for SA’s Netcare JSE listed Netcare has recently completed extensive upgrades to its hospitals in Pietermaritzburg and Midrand.

The company is also celebrating a big milestone at its hospital in Port Elizabeth.

46/EXXARO: A Cool Coal Strategy As Exxaro enters a new phase in its history, under the leadership of Mxolisi Mgojo following Sipho Nkosi’s retirement, it seems that the strategy will not change and carbon fuels will continue to drive this ambitious business forward.

46/

62/

54/DEFY APPLIANCES: 110 Years Old and Still Growing At 110 years old Defy Appliances is offering efficiency, quality, growth and more.

58/SUNSHINE SEEDLING SERVICES: Quality Seeds, Quality Harvest This expert organisation is an example of how a modern agricultural business should be managed.

62/SA CORPORATE REAL ESTATE FUND: Changing Strategies to Change Results SA Corporate Real Estate’s vision is to exceed its stakeholders’ expectations in a way that delivers lasting benefits for all its stakeholders.

66/BYTES TECHNOLOGY GROUP: Helping Clients Do Great Work Bytes Technology Group has seen its divisions build major partnerships with the world’s most innovative organisations.

70/PARAMOUNT TRAILERS: Paramount for Africa Now settled in its new home in Midvaal, Paramount Trailers is a shining light in the SA manufacturing sector; creating jobs, delivering quality and driving innovation.

www.enterprise-africa.net / October 2015 / 5

NEWS IN BRIEF SA FILM INDUSTRY MAKING AN IMPACT In recent months, the SA film industry has seen much success following on from Cape Town director Oliver Hermanus’ The Endless River. At the highly competitive and well-regarded Venice and Toronto films festivals, two new SA movies have been taking plaudits much to the delight of local film critics.

‘For Love and Broken Bones’, directed by Tebogo Malope, and ‘Ayanda’, by Sara Blecher, are small, independent films that tell local stories in interesting and unusual ways. They both have a strong South African identity that is quickly winning fans around the world.

Recognition of this kind helps to grow the professional reputation of the film and television industry and this in turn does much to create new job opportunities for South African talent, both in front of and behind the cameras.

Then there is the effect outside of the country where SA is positioned as a cultural brand in a global context and this forms part of the government’s National Development Plan.

‘For Love and Broken Bones’ won the Portland Film Festival’s flagship Best Film award, and beat 220 entrants for the US independent festival’s Jury Narrative Feature award. The film has now been selected to be screened at the esteemed New York City Independent Film Festival.

‘Ayanda’ is the highly anticipated new film by award-winning director Sara Blecher, who is currently riding high from the critically acclaimed Afrikaans-language feature Dis Ek, Anna.

The film won the Special Jury Prize at the prestigious Los Angeles Film Festival, following its debut screening at the World Fiction Competition, where it received rave reviews.

BE WARY OF NUCLEAR SAYS GERMANY German ambassador to South Africa, Walter Lindner, who recently addressed the opening of the SA International Renewable Energy Conference, has warned SA to steer clear of nuclear energy in favour of renewable alternatives.

Germany recently snubbed nuclear energy to focus on growing the renewable energy industry and is looking for partners to bring rapid change to the sector.

Germany, like South Africa, has extremely ambitious targets when it comes to energy and environmental affairs. “We have the know-how for nuclear supply and a lot of companies who work in this sector,” said Lindner, “yet, we decided to give it up for several reasons.

“It was the first time a highly industrialised country decided to give it up.”

In the next 35 years Germany wants to increase its energy mix from 30% to 80% of renewable energy and to reduce energy consumption by 50% and greenhouse gasses by 80%. Lindner said: “We need international partners for discourse to exchange best practises and support change.”

FACEBOOK TO PROVIDE INTERNET FROM SATELLITE? Reports suggest that social networking giant, Facebook is looking into plans to launch a satellite that will be able to provide internet connectivity to rural parts of Africa and other developing regions.

Facebook’s famous founder, Mark Zuckerberg announced the plans in a post in and also hinted that the project could be set in motion as early as 2016.

“We’re going to keep working to connect the entire world -- even if that means looking beyond our planet,” he said.

The project will be launched in partnership with French-based

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provider Eutelsat and Facebook hopes the first satellite will be launched next year.

Eutelsat said: “Eutelsat and Facebook will each deploy Internet services designed to relieve pent-up demand for connectivity from the many users in Africa beyond range of fixed

and mobile terrestrial networks.”

Zuckerberg added: “Over the last year Facebook has been exploring ways to use aircraft and satellites to beam internet access down into communities from the sky.

“To connect people living in remote regions, traditional connectivity infrastructure is often difficult and inefficient, so we need to invent new technologies.”

The concern for most is the cost of this type of service which has so far proved to be expensive where similar services currently operate.

NEWS ROUNDUP NEW APPOINTMENTS TO STABILISE ESKOM Public Enterprises Minister Lynne Brown has welcomed the appointment of three executives aimed at stabilising Eskom.

“Cabinet approved the appointments of Dr Ben Ngubane as Chairperson of Eskom’s Board, Brian Molefe as Chief Executive and Anoj Singh as Chief Financial Officer of the State-Owned Company (SOE). I welcome these appointments and they are part of my ongoing interventions to stabilise Eskom,” she said.

Dr Ngubane has been appointed as the acting chairperson since 30 March. This followed on the resignation of former board chairperson Zola Tsotsi.

“Together with Mr. Molefe, who was seconded from Transnet in mid-April 2015, they have been successful in bringing stability to the company whilst dealing with a constrained grid.

“The Executive was further strengthened when Mr Singh was seconded from Transnet as Acting CFO from 1 August 2015 for a period of 6 months.

“I want to thank the Transnet Board for agreeing to second Mr. Molefe and Mr. Singh to Eskom,” explained Minister Brown.

Now that they have been permanently appointed at Eskom, the Minister has requested the Board to start the process to fill these vacancies at Transnet.

Dr Ngubane, the former Minister of Arts, Culture, Science and Technology, and also ambassador to Japan, has vast experience in the health sector, both local and international.

He has also served on the Boards of various children and community based organisations.

Meanwhile, Molefe’s qualifications include the following: Honorary Doctorate in Engineering, University of Glasgow Caledonian; Masters of Business Leadership, University of South Africa; Post- Graduate Diploma in Economics, London University.

The new CFO qualified as a chartered accountant in 2000. He has over 15 years’ experience in Finance; Auditing; Commercial; Strategy Development and Execution; Financial Risk Modelling and Management; Treasury and Capital Project Management. Currently he is the current CFO of Transnet.

CHEAP SMARTPHONES HEADING FOR SA Kazam, a British smartphone manufacturer, has announced it is looking to get a foothold in Africa with a plan to launch in South Africa and expand to the rest of the continent.

Kazam, which was founded in 2013 by two ex-HTC executives, Michael Coombes and James Atkins, and has won plaudits for its phones throughout Europe, where it says it ships and sells around 1.5 million handsets a month. It produces both Android and Windows phones in three main form factors from a sub-R1000 compact handset to a

R3000 flagship.

Ken Finneran of local importer Pursuit4 says that he believes the brand has great potential in South Africa, competing against the likes of Xiaomia and ZTE. While Kazam phones are light on extra features and run stock Android, the current generation do all come with extras that have historically proven attractive to South African customers, including dual SIM slots and a three year extended warranty and 12 months accidental screen damage.

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FEATURE

PROJECT SOLARIS FLYING HIGH AFTER CERTIFICATION MILESTONE EDITORIAL BY: Joe Forshaw

The innovative and exciting Project Solaris, based in Limpopo, has reached another milestone after being certified by the Roundtable on Sustainable Biomaterials (RSB). The partner companies involved in the project are now keen to press on and get started with test flights as soon as practically possible.

//

Back in December 2014, South African Airways, Boeing, SkyNRG and Sunchem SA announced that their partnership, named Project Solaris, was close to harvesting its first crop of Solaris – a cross-bred variety of the tobacco plant that is capable of producing bio-energy. Seeds can be harvested three times a year. Seed oils are then processed into jet fuel, with each hectare producing around three tons of oil and over six tons of oil and protein rick cake, which can be used as animal feed.

The project is a collaborative effort to develop an aviation biofuel supply chain with the Solaris plant, a nicotinefree variant of the tobacco plant. Over 300 varieties of the tobacco plant were crossed to create the Solaris variety, which is GMO free.

Initially, just 50 hectares were planted with Solaris crop in Limpopo at Marble Hall and Boeing remains confident that switching to the use of

8 / October 2015 / www.enterprise-africa.net

biofuels can reduce carbon emissions by as much as 80%.

This unique project has attracted attention from aviation industry commentators from all over the world and whilst other projects are in the pipeline for other parts of the world, Project Solaris is still at the forefront of all industry research as it’s the first operational feedstock project of its kind.

“The official launch of Project Solaris is an important milestone for SkyNRG as it marks the start of our first operational feedstock project.

Commitment of all partners in the supply chain is crucial to realize our joint ambition and make this project a success, and that’s why we’re proud to work together with Sunchem SA, Boeing and SAA. We also want to thank the Dutch government for their strong support in this project, and for the development in sustainable jet fuel in general,” said Maarten van Dijk, Chief Technology Officer of SkyNRG.

While the project has been the subject of much debate in the age old food vs fuel debate, the partnering companies are confident that farming Solaris will not impact negatively on the amount of food stock that is farmed for national consumption.

“Having to undergo a systematic process of evaluating the social and environmental ramifications of this development as prescribed by the RSB has allowed us to feel confident in promoting Solaris, not only as a financially viable crop for farmers in the region, but also one that will not affect food security or lead to environmental degradation,” explained Joost van Lier, Managing Director of Sunchem South Africa.

RSB CERTIFICATION Last month, Project Solaris announced that it had earned certification from the RSB for the production of the energy rich tobacco crop, marking a milestone for the partnership.

The RSB is an independent and global multi-stakeholder coalition which works to promote the sustainability of biomaterials. According to the coalition, RSB’s user-friendly certification scheme is the strongest and most trusted of its kind.

J. Miguel Santos, Managing Director for Africa, Boeing International

PROJECT SOLARIS

FEATURE

said in a release: “We applaud South African Airways and the South African Government for ensuring the sustainability of their emerging aviation biofuel supply chain as it is being developed. This milestone marks a very significant step forward in ensuring positive economic, social, and environmental outcomes for aviation and the planet.”

“Project Solaris has demonstrated that it can deliver sustainability on the ground in line with the RSBs global standard,” said RSB’s Executive Director, Rolf Hogan. “This is the result of a serious commitment to working with local stakeholders, rural development and reducing greenhouse gases while safeguarding the Limpopo’s unique natural environment.”

“The RSB certificate is a key factor for our company and development process,” said Sergio Tommasini, CEO of Sunchem Holding. “With RSB

we proved our Solaris technology under different aspects respecting sustainability criteria. Thanks to all partner efforts, we earned this important certificate. RSB believed in our technology and gave us the right advice to improve it during our scale up program.”

“SkyNRG, as one of the main founders of Project Solaris, believes that the RSB standard should play a central role in the aviation sectors’ efforts to develop truly sustainable jet fuel supply, meeting environmental and social safeguards. By receiving RSB certification, Project Solaris is achieving an important milestone for itself and for the aviation industry as a whole,” says Maarten van Dijk.

FLYING HIGHER The future of Project Solaris looks extremely bright, with plans already in place to increase the production

of Solaris which will create jobs and money for the local economy. In the next six years, Project Solaris is aiming for at least 50,000 hectares of Solaris under cultivation in South Africa.

This would result in an estimated 50,000 direct and indirect jobs; a huge increase from the current 350 who currently work on the project.

Increasing the area under cultivation would also lower the price of Solaris biofuel, which is presently more than twice as expensive as fossil jet fuel.

SAA is committed to using several hundred million litres of biofuel a year in the next eight years so demand is sufficient to drive the process and bring costs down.

One of the major positives of using biofuels of this kind, apart from reducing the impact of air travel on the environment and the creation of jet fuel without taking focus away from food production, is that aircraft engines don’t

//THIS MILESTONE MARKS A VERY SIGNIFICANT STEP FORWARD IN ENSURING POSITIVE ECONOMIC, SOCIAL, AND ENVIRONMENTAL OUTCOMES FOR AVIATION AND THE PLANET//

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PROJECT SOLARIS

//BY RECEIVING RSB CERTIFICATION, PROJECT SOLARIS IS ACHIEVING AN IMPORTANT MILESTONE FOR ITSELF AND FOR THE AVIATION INDUSTRY AS A WHOLE// not have to be changed, meaning no extra cost to airlines and consumers.

In modern aircraft, Solaris and other biofuels are blended in a maximum 50:50 ratio with conventional jet fuel.

With so many experts involved, it looks certain that it will not be long before there is a significant biofuel supply chain in South Africa. The model has already been proven in other parts of the world and Boeing is involved in many of the other biofuel initiatives that are underway.

In 2011, Boeing, and its partners Air China and other aviation organisations, conducted the first test flight using biofuel. This was a two hour mainland flight from Beijing Capital International Airport using a Boeing 747-400 powered by Pratt & Whitney engines.

After the flight, Boeing Commercial Airplanes Vice President of Environment and Aviation Policy, Billy Glover said: “The recent

success of our biofuel initiatives with government, energy and aviation organisations in China and around the world underscores the tremendous support that exists for the macro-economic benefits and value aviation provides through its unique ability to connect people, cultures, goods and services. Working closely with the Chinese and U.S. energy agencies we can reduce carbon emissions in the two largest aviation markets, while helping to ensure sustainable industry growth.”

If Project Solaris proves to be a long-term success, it could put South Africa in the centre of a hugely important global industry. It is estimated that 14% of the arable land in South Africa is under-utilised or unutilised. If just a small portion of that 14% were used for Solaris or other similar feedstocks, South Africa would provide enough fuel for all of SAA’s

needs. “It’s not displacing essential food crops [and] it’s a drop in the bucket in terms of total land footprint to produce quite a bit of what is needed,” claimed Darrin Morgan, Director Sustainable Fuels Strategy at Boeing when talking to BusinessGreen.

This is an idea that has huge potential for South Africa and there are a number of big-name organisations currently planning their own investments into biofuel production so a statement of intent from Project Solaris will hopefully attract more funding to the region.

Several international air carriers have already discussed their intentions, including British Airways and Virgin Atlantic Airways, and investment from just one of these heavy weights would undoubtedly create more jobs and stimulate more direct foreign investment for an economy which is crying out for it.

www.enterprise-africa.net / October 2015 / 11

NEDBANK

Investing In the

Digital & the Physical PRODUCTION: Karl Pietersen

Nedbank is looking to become Africa’s most admired bank by all of its stakeholders. With investments into its branch network, its digital capabilities and its growing continental presence, this vision is looking more and more realistic every day.

www.enterprise-africa.net / October 2015 / 13

BUSINESS PROFILE

NEDBANK

//

Of all the challenges that face modern businesses, there is one which still seems to perplex many leaders. How do we manage the movement of services from a physical to a digital environment? It seems absurd that not all businesses are comfortable in the digital space considering it has now been over 30 years since the so called ‘digital age’ began taking root in organisations around the world.

The digital age, also called the information age, is defined as the time period starting in the 1970s with the introduction of the personal computer and subsequent technology providing the ability to transfer information freely and quickly. This ability has changed the way businesses function forever – we now have companies that are 100% digital and have no physical components whatsoever; no buildings, no paper, no cash, no equipment; almost nothing tangible apart from a device that can connect to the internet. But what about an organisation of significant size?

What about a business that functions across many different territories?

Is it possible to be an industry leading business while effectively managing both a physical and digital environment?

No company can safely ignore the changes wrought by digital technologies and even though there are now clear strategies that are proven to work in the digital space, many companies still agonize over whether to invest significant resources in digital capabilities. Those that have done so tend to run their digital operations as independent business units—the way companies prefer to manage them, as opposed to the way customers expect to use them.

According to Darrell Rigby of the Havard Business Review, a major problem is that companies often ‘fail to account for how customers have changed: They now weave their digital and physical worlds so tightly together that they can’t fathom why companies haven’t done the same’.

Fortunately, not all companies are struggling to balance the digital and physical spaces; there are some that have embraced both sides of the market place. In South Africa, Nedbank has invested heavily in both its digital and physical presence. This is a business, and an industry, that has had to take control of both spheres to satisfy demand from a population that is increasingly going digital for its services but also requires a strong branch network to complete the customer experience.

Nedbank has over 30,000 employees and its fast-growing footprint has increased hugely since 2010 bringing its current points of presence to over 700, including the sales and service outlets and kiosks.

Nedbank has also invested in building its innovative, alternative distribution outlets through its eight-year strategic partnership with Pick n Pay and Boxer Stores – enabling communities to gain access to financial services every day of the week, including Sunday’s and public holidays.

An investment of over R1.4 billion in infrastructure expansion and refurbishments in recent years has allowed Nedbank to ensure that 79% of the bankable population are within a 15 km radius of a Nedbank point of presence.

Dean Retief, Nedbank’s HR Executive - Organisational Effectiveness, tells Enterprise Africa that currently the challenge is to digitise the workplace to complement the already excellent digital and physical set-up.

//FROM AN IT PERSPECTIVE, WE ARE DEFINITELY GOING ON A JOURNEY OF DIGITALISING THE WORKPLACE//

DIGITALISATION “From an IT perspective, we are definitely going on a journey of digitalising the workplace as well as digitalising the client space. I think from a banking perspective, next year we’re starting on our digitalisation process in the workplace in alignment with the progress in the client space,” says Retief.

“We definitely understand that unless we digitalise the workplace then the service that we provide to our clients is fictitious as they’re not experiencing the full package.

“From a generation perspective, the guys in management and senior management positions are probably not a generation that has been digitalised.

The new guys that are coming on board in the graduate space and in the learnership space are far more digitalised. There’s definitely a challenge in Nedbank to understand how we can change how we do things and that is going to be tough for not only Nedbank but also all large corporates around South Africa.”

Nedbank is an organisation that is always adapting to new situations and internally, the company is looking to learn how the digitalisation process can benefit from within.

“The main challenge that we face is realising the value of digitalisation meaning how we collaborate, how do we learn, how do we share ideas around the digitalisation of the work place.

We’ve done some smaller prototypes within the leaning programmes as an example of how people can use chat rooms and Skype to chat to one another. It’s not something that is fully embedded in the organisation from an employee perspective but it’s definitely something that we’re going to have to change as we move forward in the banking business,” explains Retief.

“We want our new generation to adapt the current environment rather than adapt to the current environment,” he says.

In terms of services for the customer, Nedbank is now a truly

www.enterprise-africa.net / October 2015 / 15

BUSINESS PROFILE

//FROM A GENERATION PERSPECTIVE, THE GUYS IN MANAGEMENT AND SENIOR MANAGEMENT POSITIONS ARE PROBABLY NOT A GENERATION THAT HAS BEEN DIGITALISED// ‘digical’ (digital-physical) business.

According to the Harvard Business Review, ‘a digical-savvy company thinks systematically about each piece of the customer experience. It develops innovative components and weaves them into a holistic system that extends competitive advantages and accelerates growth’.

Dave Woolnough, Head: Retail Digital & Mobile at Nedbank says that while digitalisation has benefits for the customer, it also has financial benefits for the bank.

“There is a big drive towards digital for a number of reasons,” he says. “Firstly, it’s about convenience for the client and secondly it’s about driving down cost

for the bank. There’s enough investment across the financial industry to acquire more digital technology in a servicing capacity so that customers can almost serve themselves.”

With all of the investment into new online services, is it possible that the branch network could one day become obsolete? While there are many European banks that exist without a branch network and operate pretty successfully in a purely online environment, Nedbank won’t be going down that path just yet.

“I do believe there will be a case for retail stores, certainly for the foreseeable future,” says Woolnough.

“There has to be a presence; somewhere

16 / October 2015 / www.enterprise-africa.net

where people can have a face to face conversation and the adoption of a full digital strategy will take some time so I think the branch environment will absolutely remain for at least the next five years. At Nedbank we see the branch network as a key part of our strategy in the future but we will be moving more and more towards digital to improve the client experience and client engagement.”

In fact, the branch network has received significant attention over the past few years and a major strategy has emerged, the ‘Branch of the Future’ concept, which has seen investments made into bringing the branch network into the 21st century with state-of-the-art technology designed to deliver a unique client experience to its personal and business banking clients. Things like Wi-Fi internet stations and iPads as well as video banking facilities and Intelligent Depositor ATMs have transformed branches into tech hubs that ultimately focus on a first class experience for the client.

NEDBANK

“We need to constantly evaluate whether we think current technology is the right technology for the future and we also need to constantly look at how technology can better solve our customer’s problems. As technology becomes more evolved and digitisation of branches becomes more prevalent, we might find that these technologies do not have the value that they do today. It’s a constant challenge and a constant evaluation,” says Woolnough.

BRANCH OF THE FUTURE One of the first branches to receive the ‘Branch of the Future’ treatment was Fox Street in Johannesburg’s Central Business District in October 2013 and the upgrade was met with praise from the community and from industry commentators who were particularly impressed with the welcoming environment as well as the technological tools on display.

The protective glass interface has been phased out and bilock doors and security screens have been removed to encourage a one-onone conversation with the teller and Nedbank hopes this will result in an open and welcoming atmosphere; the foundation for the building of enduring relationships with clients.

Nedbank has transformed a number of branches including notable locations in KZN (La Lucia Mall) and Gauteng (Hyde Park, Sandown and Meyerton). Locations for transformation have been selected carefully based on demand from a strong client base.

Meyerton is set to become an important strategic region of Sedibeng, owing to a fairly large business and residential corridor and vibrant

agricultural holdings allowing for farming development. As a result of this, Nedbank believes its presence will go a long way in enabling greater financial inclusion while contributing towards economic growth and social development in the community and surrounding areas.

Along with the Branch of the Future concept, Nedbank is also working hard behind the scenes to ensure its physical footprint leaves less of a carbon footprint.

In October 2013, at its Lansdowne Corner branch in Cape Town, Nedbank unveiled Africa’s first ever banking branch that fully offsets its energy usage through renewable energy sources.

The branch uses an innovative hybrid power installation, effectively making it a 100% off-the-grid outlet. The grid-tied renewable energy system harnesses solar and wind energy and converts this

//WE NEED TO CONSTANTLY EVALUATE WHETHER WE THINK CURRENT TECHNOLOGY IS THE RIGHT TECHNOLOGY FOR THE FUTURE//

to standard mains electricity fed directly into the Nedbank branch.

According to the bank, this development will effectively help to lower South Africa’s total CO2-eqt emissions by approximately 71 tonnes per year.

“We believe that Nedbank Lansdowne Corner has set the standard for future ‘green’ banking branches in South Africa,” said Ciko Thomas, Managing Executive of Consumer Banking. “The off-grid hybrid installation offers proof of what can be achieved when organisations have a genuine vision for, and commitment to, contributing to a greener future for our country.”

This approach to powering its branch network will certainly be important as Nedbank looks to further roll-out its Branch of the Future concept as these locations

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www.enterprise-africa.net / October 2015 / 17

BUSINESS PROFILE

are packed with high-tech digital equipment which does not sleep.

DIGITAL SECURITY Of course, digitalisation has its difficulties and one major problem that has been faced by companies going online, all over the world, is cyber security – how to keep your online information safe. Cybercrime is a fast-growing area of crime. More and more criminals are exploiting the speed, convenience and anonymity of the internet to commit a diverse range of criminal activities that know no borders, either physical or virtual.

At this year’s Mimecast Human Firewall event in Fourways last month, Brigadier Nicolaas Theodorus Pieterse, section head of the Electronic Crime Unit within the Hawks spoke of the current difficulties that the authorities face when it comes to stopping cybercrime. He said that today, if you were to go to your local police station

and report a robbery at your home you would get assistance but should you attempt to report that your online banking profile has been hacked, you’re less likely to get help. He stated that there is currently a drive to train law enforcement to deal more effectively with reports of cybercrime but it’s a lengthy process.

Woolnough agrees that more needs to be done but also understands the problem faced in recruiting specialists.

“There is always need for more investment into cybercrimes and cybersecurity and as much as we are closing gaps and finding ways to resolve issues, criminals are finding new ways to attack the banks and defraud our clients. There’s always need for more but there is certainly a lot of collaboration between the banking industry and the police force.

“Cyber security by nature is a specialised skill and we can’t expect the regular police officer to quickly

18 / October 2015 / www.enterprise-africa.net

become an expert,” he says. “There are forums in place which manage cyber security across all banks as it’s a common problem we’ll all have to solve so we’re in collaboration with the police force as well.”

Nedbank has invested significantly in online security and along with the Nedbank ID system that protects a customer’s internet banking details, the Approve-it system that was launched in 2012 is proving a huge success.

According to Nedbank, Approveit gives you complete control over fraud and phishing attacks by allowing you to accept or reject any internet banking transaction by simply using your cellphone. When you perform a sensitive internet banking transaction, you will receive a message on your cellphone requesting you to authorise that transaction.

“We’ve seen a significant reduction in cybercrime as a result of using this technology,” says Woolnough.

NEDBANK

“Approve-it is an exceptional identification tool. When you go online to take care of your normal transactions you won’t require approval but when you undertake a sensitive transaction you’ll have to go through an additional security step of receiving a SMS to your cell phone and approving or rejecting the transaction.”

Away from security, another digital investment that has proven to be hugely successful for Nedbank has been its new Market Edge tool. Released in July this year, Market Edge offers behavioural insights mined through big data on a webbased platform that provides customers’ spending patterns, income segmentation, gender and age demographics. Through Market Edge, businesses will be able to view consumers’ transaction histories and use this information to improve product development.

Nedbank claims that this tool helps merchants to understand the market as well as their customers.

“Market Edge comes from our business intelligence team,” explains Woolnough. “From a Nedbank perspective, we mine the data to understand various trends and insights around the point of sale transactional stream. In that context, we’ve developed a lot of IP around the point of sale spend and understanding location based services linked to transactional spend and the value that that would give to the bank to understand where customers are spending money and what they’re spending it on. This is info that our customers, the merchants, would really value.

“It helps us become a strategic partner, and aid in decision making processes, with our commercial clients.

It gives them an overview of their markets and how they’re performing.

“The insights have been built up over many years and we will continue to build around the data we already have. The development of the tool was

a relatively quick cycle and took just six months to get to market,” he says.

Market Edge is available to Nedbank’s card-accepting businesses and forms part of its focus on small, medium and large enterprises in SA. “Market Edge uses Nedbank data streams so it’s very much a South African product. Some of the larger retailers have signed up and are currently going through pilots to see if they want to take up the product,” adds Woolnough.

All of these digital developments, alongside the investment into the marvellous branch network form part of a growth strategy that saw Nedbank retail business’ headline earnings increase from a loss of R27m in 2009 to R2.5bn and ROE from (0,2%) to 11,6% in 2013. Today, the company is looking to further increase its market share but right now the economic outlook is not necessarily conducive to large-scale business growth.

www.enterprise-africa.net / October 2015 / 19

BUSINESS PROFILE

//CYBER SECURITY BY NATURE IS A SPECIALISED SKILL AND WE CAN’T EXPECT THE REGULAR POLICE OFFICER TO QUICKLY BECOME AN EXPERT// THE ECONOMIC CHALLENGE The economy is slow and the Rand has seen significant difficulties over the past 18 months. Unemployment is high (currently around 25%) and Stats SA announced last month that economy contracted by 1.3% (seasonally adjusted and annualised) in the second quarter of 2015.

Figures like this cast doubt in the financial markets and, after the global recession of 2008, everyone is hoping that growth rates will improve.

Dennis Dykes, Nedbank’s Chief Economist tells Enterprise Africa about the unemployment figures saying: “It is a concern and it’s something we are collectively trying to address.

“Unemployment is high but it’s not getting worse, it’s stable at these levels.

The alarming situation would be if we saw unemployment going up constantly – then it has different implications for the consumer of our products. We are very concerned because you want as much participation in the economy as possible; the more people in jobs, the more disposable income there is available and that means the economy is generally more able to withstand all sorts of shocks, to grow, and to improve.

It’s also important from a financial point of view because you want more people participating so your domestic market is broader and you can sell more products into that market.

20 / October 2015 / www.enterprise-africa.net

“It definitely affects us and we try different initiatives to address this in some way. Obviously it’s not a company responsibility but we do have projects around small businesses where we try to educate and assist small businesses in gaining finance and foster entrepreneurial spirit. There are also a lot of projects around education because one of the clear problems is that a very large portion of the unemployed is very unskilled and the more you can skill that population, the more likely they are to get jobs and become gainfully employed,” he says.

The economic climate is cyclical and constantly prone to change and this provides hope for businesses who operate in international markets and who are looking to the future for a more positive outlook. “We are going into a slower period of growth and it looks as though we are actually going to be under 1.5% growth but there’s nothing to say that won’t change and up until now it’s been relatively stable,” says Dykes.

NEDBANK

But even with the promise that the economy is bound to change for the better at some point in the future, problems still remain that need attention. One such problem comes from China.

China is now the number-one trading partner for most African countries. It also has more than US$20bn in investments, in addition to development aid. That makes it a huge customer for African governments selling resources such as minerals and oil on the international market. If the worries around the Chinese stock markets continue, the currency could be devalued which could result in less demand for African goods from China - as they are priced in dollars that would make them more expensive for the Chinese. However unlikely this may be, it’s certainly something to

keep an eye on as a slower economy is not good for any business including one the size of Nedbank.

“We’re not directly impacted but clearly we are indirectly impacted through effects on other emerging markets and the impact on commodity prices,” says Dykes. “It is definitely something that we watch closely. No one is seriously saying that the Chinese economy is going to fade away, it’s really a question of short term difficulties that you have to look through and expect China to come back strongly and that’s one of the reasons we are still enthusiastic about Africa as a whole.”

If the economy is to continue displaying poor growth rates, and if China is to continue showing signs of worry, perhaps growth in Africa could help spread the risk for many SA companies, including Nedbank.

Although it has already made moves on

the continent - owning subsidiaries and banks in Namibia, Swaziland, Malawi, Mozambique, Lesotho, Zimbabwe, as well as representative offices in Angola and Kenya and partnerships in West and Central Africa – Nedbank is still looking to grow in Africa.

“You have to look through the cycle and our long-term strategy will not change. There is a lot of interest in Africa,” explains Dykes.

“It has been a theme for South African businesses in general, especially retail, construction and banks, who have all been aggressive in Africa.

Africa is also commodity dependent and commodities are going through a rough time. It’s not strictly the case for every economy; a country like Kenya is less reliant on commodity exports.

There are clearly some dangers in moving into some areas that are going to have difficulties over the next few

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BUSINESS PROFILE

years. It’s been a remarkable success story; changes in economic policy have yielded good fruits but in the short term it’s not going to be a great diversifier because of the commodity story and the Chinese story. In the long term, Nedbank is extremely interested in Africa and would look through the short term difficulties for opportunities ahead,” he says.

Retief agrees that Africa holds important geographical markets for Nedbank but he says that the key is to understand the local requirements while further building the Nedbank brand.

“We want to make sure that as we grow in Africa, local people are running our banks. This all comes from building a brand that people admire and people want to work for,” he says. “While we

are in this growth phase, that is one of the things we will focus on – how do we become Africa’s most admired bank? South Africa is just one country on this continent and as a South African business we need to work on becoming more inclusive with what it means to be African.

“From a Nedbank perspective, in the rest of Africa our brand still needs to grow. In the South African business we are admired for the things that we stand for as a business. A lot of the research that we’ve done; especially from an employee perspective, shows that graduates admire Nedbank because of the culture that we have which is highly people-centred, they admire the investments we make into people from a development and career growth

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perspective and these things truly attract newcomers to this bank.

“In the rest of Africa, our growth strategy has picked up in the last two years and there are definitely plans for the next five years so the brand will definitely grow,” explains Retief.

BRAND STRENGTH The determination to continue growing in Africa is typical of this ambitious organisation and demonstrates a drive that has made the bank one of the most respected and well-recognised around.

Over the years, the group has cemented its position among the front runners in the financial industry and is now universally known as one of the top four financial institutions in South Africa.

Nedbank’s brand strength was

NEDBANK

//FROM A NEDBANK PERSPECTIVE, IN THE REST OF AFRICA OUR BRAND STILL NEEDS TO GROW// exhibited recently when Brand Finance Africa released its annual report on South Africa’s 50 most valuable brands. Nedbank came in at number seven, despite the challenging economic climate, and continues to boost the nation’s image as an investment location. “The Top 50 Most Valuable Brands once again highlights the incredible potential within South Africa’s great homegrown, world-class, brands,” said Brand Finance Africa MD, Ollie Schmitz.

Brand South Africa CEO, Kingsley Makhubela highlighted the importance

of the work done by these major brands saying: “Your excellence in the corporate field contributes immensely to the strength and positive reputation of the South African nation brand.

“Your product quality, customer service and ethical framework contribute to perceptions about our spirit of Ubuntu, our innovation, and the values that drive South Africa. South Africa’s corporate sector is therefore critical to enabling Brand South Africa to position the country as an attractive inward destination of choice.”

As Nedbank continues on its

journey towards becoming Africa’s most admired bank, investing in both its physical and digital assets, it looks certain that there will be no holding back when it comes to delivering first class customer service. The online services for individuals and for businesses, and the branch network that welcomes all clients big or small, are all vehicles for success for this business that is built to make good things happen.

NEDBANK 0860 555 111 info@nedbank.co.za www.nedbank.co.za

www.enterprise-africa.net / October 2015 / 23

NF BRANDING

Giving new meaning to flying

YOUR Flag PRODUCTION: David Napier

National Flag and Branding ‘gives wings to the biggest brands in the world’ and for the next five years this innovative organisation is planning a major growth strategy in Africa. This is a company that is truly flying the South African flag high!

24 / October 2015 / www.enterprise-africa.net

BUSINESS PROFILE

//OUR FOCUS HAS ALWAYS BEEN TO BE DOMINANT ON THE AFRICAN CONTINENT //

//

Founded in 1982 as a simple flag making company in Johannesburg, NF Branding (previously National Flag) has come a long way in the past 33 years. Today the company is the industry leader in below-the-line branding and caters for customers all over the African continent. NF Branding has been involved with some of the biggest events in Africa and now has some of the best technology, facilities and a skilled team. The company is about to launch a huge drive into a new geographical market and branch out into the global landscape. Sales and Marketing Director, Aydonne Samuels believes that NF Branding has a great advantage over its competitors.

“Our focus has always been to be dominant on the African continent – this is our home and we wanted to make sure we cemented our business relationships here. We’re currently the market leader in Africa for below-theline fabric products and in the next five years we would like to be a serious player internationally” says Samuels.

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AGGRESSIVE EXPANSION NF Branding is at the summit of the printing and branding industry in South Africa. Acting as the manufacturer and supplier of branding material for many important clients, the company offers complete coverage of the value chain, making life very easy for the end user.

Branding materials are produced at factories in Johannesburg, Cape Town and Port Elizabeth then transported and installed by a national service team. At the production factories, the company boasts some of the best equipment available as Samuels explains.

“We can now print direct to fabric.

Currently in the market there is direct to fabric printing but the colour isn’t great.

We can print direct to fabric up to 3.2m wide without a stitch line at brilliant quality and with brilliant colour-fastness and speed, this means better quality and turn-around time with the highest quality at competitive prices.”

Because of the success the company has seen in the local market, expansion across the border into the rest of Africa was inevitable. Today the

NF BRANDING

target is not just to grow in a few African nations but to provide services in all of the 54 nations.

“Our focus for the next five years is to be present throughout Africa.

Our strategy is not just to offer quality products but a holistic branding experience. Most importantly, we want to make ourselves accessible in all of the markets that we compete in,” says Samuels.

“We aspire to be seen as a complete international organisation that is serving the world and not just Africa.

Because of our large operations we can afford the technology that others within the industry cannot which serves as a competitive advantage for us. We offer the largest infrastructure in the industry backed by a world-class sales and production team.”

NF Branding will also be looking at unlocking other key markets that have the potential for growth and with seven of the world’s fastest growing economies situated in Africa, Samuels identifies other areas of interest for the company.

“We will be looking at the Francophone countries in Africa in the next couple of years where we feel there is still much opportunity for growth. There are issues with the language barrier but these markets are very buoyant and we feel we should be investing more here,” he says.

Recently, NF Branding started a new division of its business, NF Support, focussing on an area of the market that has so far been neglected.

//WE’RE CURRENTLY THE MARKET LEADER IN AFRICA FOR BELOWTHE-LINE FABRIC PRODUCTS AND IN THE NEXT FIVE YEARS WE WOULD LIKE TO BE A SERIOUS PLAYER IN THE NORTH AMERICAN CONTINENT//

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www.enterprise-africa.net / October 2015 / 27

BUSINESS PROFILE

//THE DIFFERENTIATION FACTOR IN OUR ORGANISATION IS THAT WE OWN THE COMPLETE VALUE CHAIN, FROM PRODUCING TO STORING TO ACTIVATING BRANDING MATERIALS, AND BEING PRESENT ON THE AFRICAN CONTINENT, WE’RE THE ONLY SUCH ORGANISATION PRESENT THERE// This new division looks to offer further solutions in below-the-line branding, bringing more products and services under one umbrella which makes life easier for customers.

“For instance, there’s a few dealers out there that have small printing machines to do their own printing so we’ve thus found that there is a gap in the market for supplying the hardware. This means the rods, the aluminium, and the steel products that go with the product.

“We exclusively manufacture these products in South Africa.

Traditionally, these products would come from Asia which meant longer

lead times. NF Support is an exciting division and has done very well in the market. It is certainly a division that we see a lot of potential in and will be much more prevalent in Africa in the coming years,” explains the Sales and Marketing Director.

A UNIQUE APPROACH Today, NF Branding has a huge range of products to suit any customer requirement. Products include a full range of flags, banners, point of sale products, signage and display systems.

“We specialise in large events, mostly international sporting events. We were involved in the 2010 FIFA World

28 / October 2015 / www.enterprise-africa.net

Cup and subsequently all the large international sporting events including AFCON, CHAN, political rallies on the continent, and our organisation is also geared up to service a small shop that wants a single banner – we cover the whole range,” says Samuels.

“The differentiation factor in our organisation is that we own the complete value chain, from production, storage and activation of branding materials, and also our presence on the African continent.”

After the success of the 2010 FIFA World Cup, the company’s capabilities were demonstrated for all to see and this has been a huge help when securing new contracts. With many high-profile sporting events on the horizon; including the 2022 Commonwealth games in Durban, the 2016 CHAN in Rwanda and the 2017 AFCON in Gabon; there is much opportunity for NF Branding in markets that it knows well. The company has secured the rights to supply the branding elements for the 2016 CHAN in Rwanda.

“We are talking to a few governments regarding international events. We do branding in stadiums

NF BRANDING

//DEALERS CAN GET UP TO A 20% DISCOUNT AND ANNUAL REBATE ON THEIR TOTAL SPEND WITH US// and we also specialise in is the citybeautification in airports and along protocol routes to the stadiums and this has set us apart from what’s currently available in Africa,” explains Samuels.

“The 2010 World Cup helped us a lot as the rest of the African nations saw the capabilities of South Africa and that was a great expose for us, opening up many doors. We have found that many of the African nations would rather come and source these services from SA rather than Europe where they have gone in the past.”

In addition to the below-the-line branding products that the company is renowned for, NF Branding is

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BUSINESS PROFILE

also going to be launching new products to complement its already impressive portfolio.

“In 2016, our product offering will extend,” says Samuels. “We’re looking for products that have synergy with our existing portfolio. We’ve also invested in our IT infrastructure in SA and we will now offer all customers an enterprise system that gives them access to all their orders in our factory and gives them live tracking of those orders so they don’t have to phone the factory; they can just log on and track their orders live on the assembly line This allows us to be as efficient and customer focused as possible.”

NF Branding’s main outlet is through a dealer network. This dealer

network was vastly expanded through Africa and South Africa in 2015 and this has been of huge benefit to all parties involved. The company runs the ‘Formal Dealer Program’ which allows dealers to grow and take on regional markets successfully.

“It also qualifies dealers for discounts to make business that little bit easier. We prefer a B2B model, mainly targeting dealers as opposed to endusers allowing us to sell at a dealer price rather than retail price.

“We have gold dealers, platinum dealers and exclusive dealers. This gives our dealers an opportunity to grow with us and eventually become the exclusive dealer of our products in a certain territory,” he adds.

30 / October 2015 / www.enterprise-africa.net

AN AFRICAN SUCCESS NF Branding has forged its own path on the continent and through innovation, investment and a customer-centric approach to business, the company has managed to become extremely successful.

Even with the planned growth internationally, NF Branding will not be neglecting its traditional market place – which has provided excellent returns over the past three decades.

“We’ve been fortunate that we’ve always recorded annual growth and the past year has been a very good year as our strategic approach was to focus on exports and to further cement our relationships in Africa and that’s gone well for us,” says Samuels.

NF BRANDING

//WE’VE BEEN VERY AGGRESSIVE IN OPENING THE AFRICAN MARKETS AND RECENTLY WE’VE BUILT A VERY STRONG POSITION IN MARKETS FROM NIGERIA TO ZAMBIA// “Product-wise, we have secured the latest technology in direct fabric printing which is currently still exclusive to our factory in Africa so the quality of our fabric printing is certainly still the best in the industry and we are also very competitive on price with these products. Market-wise, we’ve been very aggressive in opening the African markets and recently we’ve built a very strong position in markets from Nigeria to Zambia.

“In below-the-line fabric branding products, South Africa is certainly an international leader.

However, the local companies are all looking outside of South Africa for opportunities but they don’t all have the skill-base to implement their strategies. We feel that the industry is buoyant, there is consolidation in the local market and we will be looking at further consolidating our market share in South Africa but certainly remaining very present in exports.

“The growth will come from exports as the local economy is in a bit of a slowdown but there are still growth opportunities with SA, however we are looking forward to

the exciting export opportunities currently at hand,” he adds.

The last few months of 2015 and the next two years will be hugely significant for this South African success story. If the company can maintain its strength in the African markets, while growing into those where it does not already have a major presence, and also make a noteworthy impact internationally, then NF Branding could realize its vision of being a complete international organisation that owns and operates a complete value chain.

NF BRANDING +27 11 887 0143 sales@nationalflag.co.za www.nationalflag.co.za

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www.enterprise-africa.net / October 2015 / 31

SANRAL

Caring for SA’s

Economic Arteries PRODUCTION: Joe Forshaw

As SANRAL searches for a new CEO to take over from the wellrespected Nazir Alli, Enterprise Africa takes a look at some of the major projects that any potential candidates will have to pick up straight away. This truly is a company with a lot happening and it looks like the future will only bring more busy times.

//

South Africa’s 52 million people need to move efficiently around the country which spans 1,219,090km2 and while flying is often the quickest way between east and west and trains are easiest in the bustling metropolitan cities, sometimes there is no beating the car or bus. Also, when it comes to the movement of goods, often there is no alternative to road transport.

South Africa, which is more than three times the size of Germany, measures roughly 1,600km from north to south, and roughly the same from east to west. Obviously, moving around this vast expanse of land by road is difficult – especially when it comes to the rural and mountainous regions. The road network is made up of 18 major highways which are interconnected by hundreds of smaller but equally busy routes.

The responsibility for maintenance, upkeep and management of these roads falls to SANRAL (South African National Roads Agency Ltd) and while much is written and said about this government

owned organisation which was formed in 1998, there is one common theme in all the discussion and that is that SANRAL always stimulates economic activity in the areas that it operates.

Right now, the company is going through an uncertain period after current CEO, Nazir Alli announced his retirement for the end of August 2015; yet here we are in October with no new CEO and uncertainty about his successor.

Alli has been in charge of SANRAL since its inception and has been a key driver behind the growth of the organisation moving from an entity with just 7,200km of road, to a top national employer managing 21,403km currently, which is expected to grow to 35,000km in the future. The roads and other related infrastructure that have been built by SANRAL under his leadership are of outstanding quality and have won numerous global awards in engineering excellence.

“His last day in the office will be determined by the minister of transport, in consultation with SANRAL’s board,

32 / October 2015 / www.enterprise-africa.net

subsequent to the appointment of the new CEO and a hand-over period,” said SANRAL Board Chair Roshan Morar.

“He has been at the forefront of modernising South Africa’s national road network to world class standards for 17 years, and his impeccable track record speaks for itself. ”Although it is a challenge to replace someone of Nazir’s stature, we would like him to enjoy spending time with his family after his selfless service to our country.”

However, even with the retirement of Alli, life goes on and SANRAL currently have a number of major projects underway which will undoubtedly demand the attention of the new CEO as soon as he/she starts in what will be a demanding role.

HUGUENOT TUNNEL One project of significance is the Western Cape’s Huguenot Tunnel which, after years of increased traffic flow, now needs expansion to cope with evergrowing demand. It is now thought that a northerly bore would be needed to allow for a dual carriageway.

“The tunnel is one of the Western Cape’s most vital economic assets and it is SANRAL’s mandate to maintain the tunnel in such a state that it functions optimally and in the best interest of road users,” SANRAL’s Western Cape Project Manager, Tiago Massingue said in a recent release.

SANRAL

SANRAL CEO, NAZIR ALLI

//ALTHOUGH IT IS A CHALLENGE TO REPLACE SOMEONE OF NAZIR’S STATURE, WE WOULD LIKE HIM TO ENJOY SPENDING TIME WITH HIS FAMILY AFTER HIS SELFLESS SERVICE TO OUR COUNTRY// “We don’t want to sound melodramatic but it is important for the public and the authorities to know the risks we face if works on the tunnel are delayed or do not proceed.

It is thought that work on the tunnel could take up to eight months and during that time, no traffic would be allowed through, creating a problem for the public.

“To reroute traffic over the Du Toitskloof Pass for such a long period is just not a viable option. Scaffolding will have to be erected to carry out the work and a stop-go control is not recommended, as it would increase the risk of accidents.

“The only viable option is to construct the north bore and once it has been completed, to divert traffic to the new tunnel. The existing south

bore systems can then be improved,” Massingue explained.

Along with the problems created by closing the existing tunnel, there has also been problems with public relations for SANRAL after it was suggested that the upgrades to the Huguenot Tunnel would be paid for by the tolls collected on the proposed N1/N2 Winelands Toll Road. There was also suggestions that current toll fees would rise in order to raise funds for the upgrades to the tunnel – something which has not been denied by SANRAL. N1/N2 WINELANDS TOLL ROAD SANRAL has proposed a toll road running from along the N1 and N2, with the N2 portion stretching from the R300 to Bot River. The multimillion rand project was put on hold after the

34 / October 2015 / www.enterprise-africa.net

Western Cape high court granted an interim interdict in May last year and ever since, there has been much to and fro with the City of Cape Town not keen on the idea of tolls and SANRAL firm in its stance that the road will only benefit the agricultural community in the Western Cape.

“While the City of Cape Town in the past was at pains to point out what it would cost road-users to travel on the planned toll road roads, tariffs had not been set and whatever numbers are bandied about are pure speculation. The Minister of Transport will set the final toll tariffs,” Nazir Alli said in a statement.

“Financing of the N1/N2 upgrades and subsequent maintenance can only be done through tolling as these are now declared toll roads,” he added.

He also claimed that there was a lot of “misunderstanding and misinformation” about the proposed N1/N2 Winelands Improvement Project.

Kobus van der Walt, SANRAL’s Regional Manager in the Western Cape, said SANRAL very much supports the City of Cape Town’s push towards a leading public transport system but such a system does not yet exist and for now, the freeway system will have to provide this service. “Traffic flows in and out of the city will be vastly improved over sections as there will be three lanes instead of the current two on the N1 and N2, in both directions,” he said. “The new planned interchanges will help to ease traffic congestion at on-and-off ramps on to the freeways, and SANRAL has offered to assist the City and the Western Cape Government to repair the surfaces of some secondary roads affected by traffic deviating around toll plazas.”

In one of the most recent upgrades in the saga, SANRAL itself has announced that it has solid plans in place to ensure the road is a toll road and that the cost of the project will total R10 billion.

Justifying the need to toll the road, van der Walt told the media: “The notion that SANRAL should fund this project from its own resources is uninformed.

This year we received a total allocation

BUSINESS PROFILE

of R12.5 billion to look after the entire national road network. Clearly we cannot take all of it to do one project in one province.”

N2 HIGHWAY SANRAL is not only working on major projects in the Western Cape; there are also a number of big things happening in the Eastern Cape, one of which is a R900 million upgrade to the N2 highway.

The upgrades will take place between Grahamstown and the Fish River Pass, on a 47km stretch of road. It is expected that the work will take around six years and the scope of the job includes geometric improvements to portions of the national road that traverses mountainous terrain and also the addition of climbing lanes to steep sections of the road to improve the level of surface.

SANRAL said in a statement that the project would also see improvements made to parts of the national network

//THE EXISTING ROAD WAS BUILT IN THE 1960S AND CURRENTLY DOES NOT MEET SANRAL’S DESIRED ALIGNMENT AND SAFETY STANDARDS// between Port Elizabeth and East London.

“The existing road was built in the 1960s and currently does not meet SANRAL’s desired alignment and safety standards. An increase in traffic volumes, particularly heavy vehicles, over the past ten years has prompted the need for this road upgrade,” explained SANRAL Southern Region Project Manager, Steven Robertson.

“SANRAL aims to improve sight distance for drivers in order to reduce road accidents and also reduce vehicle operating costs. The new road will also ensure travel time-savings for vehicle operators, once completed,” he said.

This will be a difficult project for SANRAL and will require a lot of innovation and ingenuity. Some areas need rock blasting and some regions require special bypassing to allow for the road to be widened. SANRAL claims this project will create 360 jobs and it is committed to implementing a training and employment programme for rural communities along the route.

Also in the Eastern Cape, Nazir Alli announced that 23% of the provinces 4544 km of road (the most road in any province) would receive attention from SANRAL this year. He said that the maintenance would help to make the province more attractive to foreign

//SANRAL PROVIDES EXCEPTIONAL EMPLOYEE CONDITIONS, NURTURES AND DEVELOPS TALENT THROUGHOUT ALL LEVELS OF THE ORGANISATION AND HAS DEMONSTRATED ITS LEADERSHIP STATUS IN THE HR ENVIRONMENT// 36 / October 2015 / www.enterprise-africa.net

SANRAL

investors. It is reported that a total of 2.2 billion Rand will be spent on the N2, N6, R61, R63, R65 and R67 this year.

One piece of welcome news regarding the N2 came last year when SANRAL announced that its work on the Ballito Interchange in Durban had been completed after long delays and earlier this year, in July, the company also announced that upgrades to the Umgeni Interchange had been completed.

In Ballito, SANRAL partnered with infrastructure consultants, SMEC, who advised on the construction of both the new loop ramp and also the new bridge that could accommodate double loop ramps underneath it, as well as the additional lanes on the cross road on top.

At Umgeni, where SANRAL has been building new ramps and bridges, work has been widely praised and even awarded. The Concrete Society of Southern Africa chose the Umgeni Road interchange as the winner of the prestigious Fulton Award in the category for civil engineering structures over R100m in value.

“We hope that the generations to come will enjoy the long-term benefits of this remarkable interchange and we are proud of the legacy we are leaving behind in the form of a truly iconic structure,” said Logashri Sewnarain, SANRAL’s Eastern Region manager.

TOP EMPLOYER A recent highlight for the company in an HR focus was receiving certification from the Top Employers Institute, a Dutch-based organisation that globally certifies excellence in the conditions that employers create for their people.

SANRAL was given the certification in 2015 and the Top Employer Institute said: “SANRAL provides exceptional employee conditions, nurtures and develops talent throughout all levels of the organisation and has demonstrated its leadership status in the HR environment, always striving to optimise its employment practices and to develop its employees.”

Certification is only awarded to the best employers around the

world: companies that demonstrate the highest standards of employee offerings.

Particular highlights that contributed to the certification included graduate development programmes and traineeship, internship programmes and job rotation programmes, career progression opportunities, substantial benefits and other well-being programs.

This award will come as an important booster for the company that has, especially in the Western Cape, had a turbulent time recently. When looking after the country’s so called ‘economic arteries’, you need a group of employees who are happy and well catered for and it looks as though SANRAL has managed to achieve this.

SANRAL 012 844 8000 info@nra.co.za www.nra.co.za

www.enterprise-africa.net / October 2015 / 37

NETCARE

Healthy expansion for SA’s Netcare

PRODUCTION: Joe Forshaw

//

One of the fundamental objectives of any business is growth. Along with profit, nearly all businesses target growth and this is true for all industries. Even in an extremely customer-centric industry such as health care, growth and expansion are still important targets. In South Africa, the largest provider of private healthcare services is Netcare and, of course, this is an ambitious company that is constantly looking for opportunities to grow and in the last few months it has completed important expansions to two of its major facilities and celebrated a big milestone at another.

At the Waterfall City Hospital in Midrand, Netcare has opened a specialised orthopaedic and sports centre together with an additional 36 bed orthopaedic ward, a new 22 bed surgical ward and a ten bed paediatric intensive care unit. At St Anne’s Hospital in Pietermaritzburg, Netcare recently announced the opening of new medical and surgical wards as well as a high care unit, fully refurbished and re-equipped 16 bed maternity unit with three labour wards, a new dedicated caesarean theatre and a six bed neonatal ICU. Meanwhile, at Greenacres Hospital in Port Elizabeth, Netcare is celebrating 30 years of successful operation.

WATERFALL CITY HOSPITAL “Midrand is one of the ten fastest growing development nodes in

JSE listed Netcare has recently completed extensive upgrades to its hospitals in Pietermaritzburg and Midrand. The company is also celebrating a big milestone at its hospital in Port Elizabeth and with more upgrades planned for 2015 and 2016, this is a company that is showing no signs of stopping its investment into continent-leading health care facilities.

South Africa, along with areas such as Centurion, Fourways and Sunninghill,” Rolien Kuhne, Waterfall City Hospital General Manager explained in a statement. “Netcare Waterfall City Hospital is situated in close proximity to the major highways connecting these areas, and is thus easily accessible to healthcare consumers in the vicinity, many of whom happen to be working in Midrand,” she said.

“As part of the expansion, we are establishing a specialised orthopaedic and sports centre, together with an additional 36-bed orthopaedic ward.

A new 22 bed surgical ward and a ten bed paediatric intensive care unit will also open,” she added.

“We have tried our level best to minimise the impact on our patients and their loved ones. We believe that this expansion will make a meaningful contribution to the wellbeing of the greater Midrand community. Our vision is to be the hospital of choice for our community and the additional facilities and capacity will make it possible for us

to remain abreast of the needs of the communities we serve.

“Our increased bed capacity opens the door for more specialists to practise at our hospital and accordingly, a further 16 specialists’ consulting rooms have been built.”

These expansions will bolster what was already an extremely well equipped hospital. The site has an internationally accredited centre of excellence for bariatric surgery and is home to one of Netcare’s two da Vinci Si centres for robotic-assisted surgery. National Renal Care is opening a unit at the hospital to serve chronic renal patients and provide acute renal services to in-hospital patients.

Netcare operates 50 hospitals and four Public Private Partnership hospitals across South Africa and in March, the company gave Waterfall City Hospital a Quality Leadership Award for medium-sized hospitals in the company’s Gauteng South West region after a long-term improvement in different quality indicators.

“When it comes to all-embracing

www.enterprise-africa.net / October 2015 / 39

NETCARE

//WE BELIEVE THAT THIS EXPANSION WILL MAKE A MEANINGFUL CONTRIBUTION TO THE WELLBEING OF THE GREATER MIDRAND COMMUNITY// quality healthcare, the people of Midrand and its surrounds need look no further than Netcare Waterfall City Hospital,” said Kuhne.

PIETERMARITZBURG HOSPITAL In Pietermaritzburg, upgrades have been made to the emergency department with a host of new facilities and technology. The upgrades were completed in August and staff and patients are already starting to feel the benefit.

“We are really pleased that we are now able to be of greater service to the communities we serve. Our extremely busy emergency department sees approximately 1700 patients each month, ranging from those injured in motor vehicle accidents to those suffering serious asthma attacks. Our staff

members have been doing a wonderful job but, due to the huge demand for our services, it was essential for us to create the necessary capacity in our facility,” said Netcare St Anne’s Hospital General Manager, Louis Joubert in a statement.

“We thank our patients, their families and the community for bearing with us during this hospital expansion project. We trust that the fruits of these labours will bring great benefit to the communities we serve,” he added.

In May, other upgrades were completed to the hospitals facilities and new medical and surgical wards and a high care unit were completed. In August, it was not just the emergency department that was upgraded.

There was also full refurbishment and advancement of the 16 bed maternity unit with three labour wards, a new

40 / October 2015 / www.enterprise-africa.net

dedicated caesarean theatre and a six bed neonatal ICU. “Netcare St Anne’s Hospital has grown from strength to strength and we are now in an even better position to help those in need of urgent medical assistance,” said Sister Irene Jones, unit manager of the emergency department, in the same statement.

“Our state-of-the-art emergency department now includes eight examination bays, two resuscitation bays and a theatre where local anaesthetic procedures are performed.

The existing Netcare sexual assault centre – a private self-contained facility with an en-suite bathroom which is located in the emergency department – has also been upgraded.

“Through providing exceptionally professional services in this modern, private setting, we aim to provide a streamlined, efficient and compassionate service,” she said.

Demand for healthcare services continues to grow at St Anne’s Hospital and as the facility builds on its already sterling reputation in KZN, it looks as though these upgrades have come just at the right time for Netcare.

GREENACRES HOSPITAL In August and September, Netcare was celebrating a huge milestone at its Greenacres Hospital in Port Elizabeth.

It is now 30 years since the opening of the facility and staff and patients look back through the history of the hospital with fondness.

“In the early days, the hospital was much smaller and offered only basic services,” Netcare Greenacres Hospital acting general manager, Dina Botha said in a statement.

“When the hospital – then known as Poli Clinic – opened its doors on 1 August 1985, it had only ten beds, a casualty unit with three resuscitation bays and a two-bed treatment room, a pharmacy and two theatres.

Radiologists, Drs Vosloo & Partners, offered an X-ray service next to the two ground floor theatres.

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NETCARE

“We now have 340 beds in the hospital, including 223 medical and surgical general adult beds, 23 paediatric beds, 15 obstetric beds and 19 day beds. We also have 35 adult intensive care beds, seven neonatal intensive care beds, 18 adult high care beds, as well as an emergency department with eight examination and four resuscitation bays.”

To mark the 30th anniversary, Botha announced that the hospital would soon undergo a large expansion program to modernise many facilities.

“We are about to embark on a further expansion project,” she said “which is expected to take around ten months. The construction project will see the main reception being upgraded and the addition of a coffee shop, doctors’ suites, a management suite and administrative office space.

“The hospital has grown from

strength to strength over the past 30 years and we have no intention of resting on our laurels now. We look forward to further improvements and advances in patient care in the decades to come.”

One of the hospitals longest serving employees, Glenda Paton from the billing department, who has been employed at Greenacres since it first opened as Poli Clinic in three decades ago, has seen the benefit of all of the positive expansion projects over the years.

“For the first five years I worked as an assistant nurse. As the hospital grew, I gained experience working in the orthopaedic and medical wards. I still miss the interaction with patients, especially the elderly people. However, I know that the work I do now is also a vital part of the service we provide our patients,” she said in a statement.

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42 / October 2015 / www.enterprise-africa.net

MEDIHOSP are one of the leading suppliers of Hospital beds and furniture in South Africa.

We have recently supplied all the hospital beds and furniture to the 2 new hospitals in the Netcare Group – based in Polokwane and Krugersdorp.

Our state-of-the-art and extensive range of products includes: • Full range of imported manual and electric hospital beds • Imported patient trauma and transfer trolleys • Locally manufactured hospital furniture and equipment • Specialised pressure relieving/ reducing mattresses and seating • Deep vein thrombosis prophylaxis systems • Moving and handling products • Patient hoists • Hand held vascular and fetal dopplers • Lymphoedema therapy systems • Portable patient warming systems • Clean Patch repair – Mattresses – • Oxygen concentrators and Pulse Oximeters • Patient aids and orthopaedic bracing/ slings • Bariatric beds and furniture • Suction Machines • Patient Scales • Wheelchairs • Stainless Steel / Holloware • Theatre Gel Products

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NETCARE

Dr Mervyn Williams, a retired cardiothoracic surgeon, has performed life-saving surgery in Port Elizabeth and he is also impressed with the development of facilities over the years. “There have been tremendous advances in technology, such as much more sophisticated surgical equipment and techniques, safer anaesthesia, as well as advanced diagnostic technology and non-invasive treatment options,” he said in a statement.

In an industry that requires such a large amount of trust from its clients and a forward thinking approach to every day to day task, it seems that Netcare is still leading the way. These recent investments and expansions are proof of the organisations commitment to one

of the key elements of its vision, to provide ‘excellence in a unique brand of patient care delivered by people who are passionate about the sanctity of life, personal respect and dignity’.

With more investments planned for 2015 and early 2016, this is a business that is certainly moving forward at pace – something which you would not only want, but something which you would expect from the national industry leader in healthcare.

NETCARE +27 11 301 0000 info@netcare.co.za www.netcare.co.za

//DRÄGER TECHNOLOGY FOR LIFE “Everything we do, we do with passion – and we do it for life.”

(Stefan Dräger, Executive Board Chairman) As an international leader in medical and safety technology, Dräger develops innovative equipment and solutions people all over the world trust. No matter where Dräger products are used: it’s always about life. Whether for use in clinical, industrial or mining applications, in fire fighting or rescue services, Dräger products protect, support and save lives.

“Technology for Life” means more than merely guaranteeing technical excellence. It means assuming responsibility for the lives of those who use our products and depend on them. Technology for Life is both our guiding principle and the central challenge that we draw on for inspiration and motivation. Not technology for technology’s sake. Not technology in a vacuum.

Technology for Life. And we’ve developed our corporate culture and core strengths accordingly: customer intimacy, employees, innovation and quality.

MORE ABOUT DRÄGER Dräger is a leading international company in the fields of medical and safety technology. Founded in Lübeck in 1889, Dräger has grown into a worldwide, DAX-

44 / October 2015 / www.enterprise-africa.net

listed enterprise in its fifth generation as a family-run business. Our long-term success is predicated on a value-oriented corporate culture with four central strengths: close collaboration with our customers, the expertise of our employees, continuous innovation and outstanding quality.

“Technology for Life” is our guiding principle. Wherever they are deployed – in clinical settings, industry, mining or emergency services – Dräger products protect, support and save lives.

The safety division offers its customers complete hazard management solutions with a special focus on personal safety and protecting production facilities. The safety division’s current portfolio includes stationary and mobile gas detection systems, respiratory protection, fire fighting equipment, professional diving gear, and alcohol and drug-testing instruments.

The medical division’s product range covers anaesthesia workstations, ventilation equipment for intensive care, emergency and mobile ventilation units, warming therapy equipment for infants, patient monitoring equipment, IT solutions and gas management systems. www.draeger.com

“Choosing the right partner now can give us a competitive edge for years to come.”

Chris, 52, hospital manager

At your side at the hospital: Dräger.

In the fast-paced, cost-intensive and technology-driven field of acute care medicine, you have to face the most complex challenges every day. Technology solutions from Dräger offer more than just direct value for your patients and support for your clinical team. They help you to enhance cross-departmental or even hospital-wide management activities. It is our passion to develop Technology for Life to improve quality and reduce the cost of care.

1

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EXXARO

A Cool Coal

Strategy PRODUCTION: David Napier

As Exxaro enters a new phase in its history, under the leadership of Mxolisi Mgojo following Sipho Nkosi’s retirement, it seems that the strategy will not change and carbon fuels will continue to drive this ambitious business forward.

//

The South African mining industry has historically been the driving force behind the growth of the country’s wealth, continually developing what is already Africa’s most advanced economy.

Modern mining began after the discovery of a diamond in the banks of the Orange River by Erasmus Jacobs in 1867. Today, it’s not just precious stones and metals that are mined.

South Africa remains full of mineral riches. It is the world’s largest producer of chrome, manganese, platinum, vanadium and vermiculite. It is the second largest producer of ilmenite, palladium, rutile and zirconium. The Rainbow Nation also produces huge amounts of iron ore and in 2012 it overtook India to become the world’s third biggest iron ore supplier to China.

South Africa is also the world’s third largest coal exporter and much of the country’s coal is used for power

production. Reports suggest that around 77% of the country’s energy needs are provided by coal.

But even with the historical success of the industry, nothing can stop an economic slowdown once it has set in. The 2008 global financial crisis had its impact on the mining industry and recovery has been slow and difficult.

Now, the international economy is facing further doubt as problems in the Chinese stock market are having knock on effects in global markets. In August, Economic Development Minister Ebrahim Patel said South Africa’s mining sector is “in trouble” after huge job losses and plummeting commodity prices as a result of Chinese uncertainty.

Mineral Resources Minister Ngoako Ramatlhodi entered urgent talks to try and ease the concern over job cuts and stabilise the industry which contributes around 7% to the economy.

The problems have been felt by all

46 / October 2015 / www.enterprise-africa.net

EXXARO

EXXARO CEO DESIGNATE - MXOLISI MGOJO

//WE NEED TO STEER THIS COMPANY THROUGH THESE STORMY WATERS AND IT’S NOT AN EASY JOB. THE INDUSTRY NEEDS TO RESPOND TO THESE CONDITIONS AND WE AS EXXARO ARE NO EXCEPTION//

the major mining houses with Lonmin, Anglo American and Harmony Gold all reporting difficulties and job cuts. But one of the largest South African-based diversified resources groups, Exxaro, is managing to find reasons to be positive in amongst all the doubt and concern.

Exxaro has interests in the coal, titanium dioxide, ferrous and energy commodities and current operations and projects in South Africa, Botswana, Republic of Congo, China and Australia.

The group is the second-largest coal producer in South Africa with current production of 39 million tonnes per annum and it seems that coal will be a

48 / October 2015 / www.enterprise-africa.net

market that provides a boost in these difficult times.

In March, the company announced that longstanding CEO, Sipho Nkosi would retire and be replaced by Mxolisi Mgojo who was the executive responsible for carbon operations. But even after Nkosi’s retirement, he has been clear on the strategy that was left behind for his successors to implement and certainly surrounds coal.

CARBON FUTURE At an investor presentation in August, Nkosi said: “We need to steer this company through these stormy waters

www.pwc.co.za

Knowing where to look

We know that in today’s challenging economic environment, it’s sometimes hard to know where to start when you want to grow your business. We also understand that what separates truly great businesses from mediocre ones is not merely the quality of their service offering, but the calibre and dedication of their people.

With its forward thinking vision, Exxaro is a company that truly exemplifies this philosophy.

We wish you everything of the best with your future growth strategies and look forward to supporting you on this journey.

©2015. PricewaterhouseCoopers (“PwC”). All rights reserved.

(15-17744)

EXXARO

and it’s not an easy job. The industry needs to respond to these conditions and we as Exxaro are no exception.

“In the next three to five years, carbon business is key. Our focus is going to be on the coal business. We see a lot of value in that business and we are in control of that business. In terms of capital allocation and growth, our focus will be on coal and you won’t find too much capital spend in other areas.

“We will remain a diversified organisation as that is our long-term aspiration.”

CEO-designate, Mgojo reiterated this when he spoke to CNBC Africa

in August saying: “We have a very strong coal story; one which talks of a future of growth. We are seeing many opportunities in domestic and export markets. We have long term contracts in place with Matimba and Medupi power stations. We have short term contracts with commercial mines and we have not had any complaints from Eskom regarding the quality of coal.

“I was part of the Executive Committee with Sipho from the first day that Exxaro was created. We all subscribe to the strategy that he led and we are focussed on building a robust carbon business. It’s a strategy that I fully

//NORTON ROSE FULBRIGHT NORTON ROSE FULBRIGHT IN AFRICA Africa has seen its fastest economic growth to date in the energy and infrastructure, mining and commodities sectors. Investment in other sectors ranging from financial institutions to technology and food security is also rising, along with Africa’s appetite for consumer goods and services such as financial services, mobile commerce and retail brands.

We have worked with a wide range of clients in Africa (some for many years) particularly in corporate, M&A and securities, banking and project finance, and dispute resolution and litigation. Africa’s industry growth trends are a perfect match for our key sector strengths: financial institutions; energy; infrastructure, mining and commodities; transport; technology and innovation; and life sciences and healthcare.

Our lawyers are working on transactions from Morocco in the north to Nigeria and Senegal in the west, Kenya and Tanzania in the east, and across southern Africa. We advise on a variety of common and civil laws, including English, Tanzanian, French, Moroccan and South African law, and have experience in Lusophone jurisdictions, specifically Mozambique and Angola. We have offices in Morocco, South Africa and Tanzania, and alliances with firms in Uganda, Burundi and Zimbabwe.

Our global presence enables us to manage transactions across the developing axes of growth between Africa, Australia, Canada, China, India, Russia and the United

50 / October 2015 / www.enterprise-africa.net

States. Africa’s trade volumes with these and other emerging partners have doubled in value over the last decade, and inbound investment from trans-national corporations continues to rise.

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BUSINESS PROFILE

//WE ALL SUBSCRIBE TO THE STRATEGY THAT HE LED AND WE ARE FOCUSSED ON BUILDING A ROBUST CARBON BUSINESS// endorse as I was part of the team that crafted that strategy with the board.”

Nkosi has had a long and successful career in South Africa’s commercial sector. The 60 year-old has a reported private wealth of around R1.4 billion and this has been built up over 30 years.

Nkosi and Mgojo co-founded Eyesizwe Coal, which became Exxaro Resources in 2006 with the addition of assets from Kumba Iron Ore, BHP Billiton and Anglo American.

“The Exxaro Board would like to thank Sipho for developing Exxaro into a leading South African resources company and for delivering significant value to stakeholders. The Group has a strong balance sheet, solid growth potential and is poised to move to the next level of growth,” said Dr Len Konar, chairman of the Exxaro Board.

“The appointment of Mxolisi is the

culmination of a thorough succession plan that was implemented over several years. The Exxaro Board is pleased to welcome him as our CEO-designate and we look forward to the strategic management, business acumen and operational know-how that he will bring to bear in the roll-out of the Company strategy,” he added.

“Mxolisi will draw on the support of executives who between them have extensive experience in all facets of the business,” added Dr Konar.

Exxaro expects to export around four million tonnes of coal for the full 2015 financial year. API4 export prices had averaged about $63/t at the start of 2015, declining to lows of $59/t in June.

A strategic purchase that was finalised in August was Exxaro’s acquisition of Total SA’s South African coal unit (TCSA). This is in line with

52 / October 2015 / www.enterprise-africa.net

the carbon strategy outlined by Nkosi and Mgojo and will bolster sales and production. TCSA is the fifth largest coal producer in South Africa and has a majority interest in two main operating complexes, Dorstfontein and Forzando, located in the Witbank coal basin in South Africa’s Mpumalanga province.

TCSA recorded combined sales of approximately 4.5 million tonnes per annum in 2013. The majority of TCSA’s production is export coal which is shipped through Richards Bay Coal Terminal (RBCT) to international markets, mainly India and China.

However, even with these impressive statistics, the purchase agreement was amended in August reflecting at least a 19% price decrease compared to when first announced amid a slump in prices for coal.

Exxaro said it will pay $262 million in cash and make five annual payments totalling as much as $120 million, depending on average prices at RBCT, the world’s largest single facility for the fuel. When the deal was first announced, Exxaro said it would cost $472 million.

EXXARO

//THE GROUP HAS A STRONG BALANCE SHEET, SOLID GROWTH POTENTIAL AND IS POISED TO MOVE TO THE NEXT LEVEL OF GROWTH// “In the 12 month period since the acquisition was announced, commoditymarket conditions have deteriorated significantly. As a consequence, Exxaro and Total have agreed to a reduction in the purchase consideration to take into account the change in market circumstances,” the company said.

MATLA COAL & WATER Significant investment has been made in Exxaro’s Matla coal mine in Mpumalanga and in April, the company announced that it will build a new R250 million water treatment plant at the site to reduce the safety risk posed by large quantities of water that have filled mined-out underground cavities while simultaneously benefiting the environment and local water users.

Exxaro expects the facility to treat 10 mega litres per day and says that it will form part of the organisations holistic group-wide water management strategy which promotes responsible and sustainable water management.

The Matla underground mining operations experience significant water ingress into the workings from surface, leading to flooding risks to the safety of workers and to the surrounding environment which could be impacted by the contaminated water should this water be released back to the surface without prior treatment. The treatment entails underground water being pumped to the surface where it undergoes comprehensive treatment using innovative filtration processes to remove contaminants and purify the water. The water treatment plant will treat 10 mega litres per day and of this some 6.5 mega litres will be discharged to the Olifants River and the remainder will be used in the Matla operations or for potable water needs at the mine.

“Water is a strategic natural

resource in South Africa and it is our duty to ensure that we reduce the impact of our mining activities on this precious resource,” said Nkosi. “We are committed to protecting and improving water quality by ensuring the water we discharge is of the same or better quality than the original consumption.

The Matla water treatment plant is a prime example of this approach and is one of three water treatment plants in our Mpumalanga region which are part of our long-term water management strategy,” he added.

It is expected that construction of the plant will be completed in 2017.

This is encouraging news for

investors, showing that even during the extremely difficult market conditions, Exxaro is still ready and willing to spend.

Many coal optimists say that we are in a cyclical downturn and the price will bounce and Exxaro will share this optimism. When the Chinese drama calms and when the delayed Medupi and Kusile power stations eventually reach full completion, the local and international demand for coal should increase and this will play straight into the hands of Exxaro thanks to the carbon strategy set out

by Nkosi and Mgojo.

EXXARO +27 12 307 5000 info@exxaro.com www.exxaro.com

www.enterprise-africa.net / October 2015 / 53

DEFY APPLIANCES

110 Years Old and //

Still Growing PRODUCTION: Karl Pietersen

You certainly wouldn’t rely on a 110 year old person to deliver efficiency, quality and growth but at 110 years old Defy Appliances is offering all of this and more. This is one of South Africa’s most popular brands and now is certainly a good time to invest.

In this the 110th year of Defy Appliances operations in South Africa, the company is doing better than ever and contemplating further growth in the prosperous continental African market. In 2011, the company posted net sales results of R2.5 billion and now boasts three state-ofthe-art ISO 9001-2009 certified facilities in Durban, Ezakheni and East London.

Defy is now the largest manufacturer and distributor of major domestic appliances (including stoves, ovens, microwaves, refrigerators, washers and dishwashers, airconditioners and small appliances) in South Africa and a major exporter to Africa and the Indian Ocean Islands.

To celebrate its 110th anniversary, Defy is rolling out a large promotion for customers which involves the company offering five year warranty on all fridges and freezer purchases valid from 1st June to 31st December 2015, they are giving their customers a chance to win a premium trip for two people to the exclusive Champagne district in France and there is also a chance for 110 lucky customers to win one of 110 Defy appliances.

Winners of these prizes will most certainly have to count themselves lucky as Defy is well known for its world class quality and reliability – we are all familiar with the slogan ‘you can rely on Defy’.

“It’s very important for us to have products which are truly differentiated; that have features and benefits that transform the lives of our consumers,” says Defy Marketing Director, Rajan Gungiah.

And after 110 years of success in South Africa and across the borders, it looks like now might be the time for Defy to make a real assault on the markets to the north, bringing those benefits to consumers in previously underserviced African regions.

AFRICA The African market is a developing market that holds huge potential, not just for companies like Defy, but for any business operating in the consumer

54 / October 2015 / www.enterprise-africa.net

retail market. Global professional services firm KPMG describes the nature of the market in its 2015 report on white goods in Africa saying: “Africa is currently home to one billion people, presenting a massive potential consumer market. Furthermore, the continent’s population will surpass the 1.5 billion mark by 2026 and the two billion mark 15 years later. The strong growth in African consumer spending over the past decade and the positive outlook for demographic dividends over the coming decades is part of the consumer evolution story that is perennially talked about in African business and investment circles.”

While many international companies are dubious about investing in underdeveloped African nations because of the notion that expenditure is directed more to necessities, KPMG states that there is still a huge number of potential customers to be serviced.

“The continent’s middle class (those households spending more than US$3000 per annum) totals almost 40 million,” the report says.

Defy has already started making its move on the continent and this will be ramped up over the coming years as Gungiah explains: “Our development has been in the Southern African region, in key countries on our borders. In time, the company’s strategies and goals are to develop strategic countries within Africa but it’s very important we do this in an opportunistic way so that we are able to offer something in a way that we do here locally in South Africa.

“We have a broad coverage in terms of our areas of responsibility. We do have plans to broaden into Africa but at the appropriate time. We have an expansion plan that includes one or two countries every year for the next ten years. When we open in a country like Zambia or Kenya or Tanzania; that comes with the full weight of Defy support, operating centrally from Johannesburg but working in a decentralised fashion based on what THIS IS A CAPTION, THIS works in that market.

IS A CAPTION

“We have an export division here at our head office and based on their recommendations, we will choose two countries to move into next year. There are four or five that are ripe for investment and we will go through a process to single out one or two,” he says.

South Africa, and Defy, exports all types of goods to African countries with the main partners including Namibia, Botswana, Mozambique and Zambia.

Defy is well established in these nations with local dealers in place but it is further afield where the company, and its parent organisation, wants to expand.

Koç Holding purchased Defy in 2011 in what is reported to be the largest investment ever by a Turkish company into Africa. The Turkish organisation immediately set about upgrading production so that exports into sub-Saharan African could increase. Reports suggest that renovation of the Jacobs facility in Durban (key products include stoves, build-in ovens and air conditioners) and the establishment of two more production lines at the Ezakheni facility in Ladysmith (key products include refrigerators and freezers) was completed within the first two years after the buyout.

This is great news for both Defy and South Africa as the government has identified manufacturing, and particularly the white goods industry, as a strategic industry for growth.

“We have developed a white goods strategy with key interventions of upgrading the technology and meeting the environmental imperatives,” said Trade and Industry Minister, Rob Davies.

Most of the continents white goods are currently imported from China and Africa has seen huge increases from most of the continent’s largest economies but with South Africa and Egypt both improving quality and lead times, with companies like Defy at the forefront of the industry, there is certainly opportunity for more Africanmade goods to increase market share.

“The main drivers for fast growth in cooling, cooking and cleaning equipment is Africa’s growing middle class, rising urbanisation rates, increasing electricity supply, as well as healthy tourism sectors,” says KPMG. MOVING FORWARD “We are exceptionally positive about the future despite the current climate in the market which is quite flat. We are still growing market share and we are

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DEFY APPLIANCES

still winning in all the segments that we compete in,” says Gungiah when speaking of the future.

The Marketing Director is optimistic about growth in sectors where Defy is less penetrated. “While we are highly penetrated in some segments such as cooking, we believe there is opportunities in others, such as dishwashing, where we have only a 7% market share,” he says.

“This opportunity for us to grow, from a business perspective, is massive over the next 10-15 years. We believe that the investments we are making in South Africa, outside of all of the

external factors that affect business performance - the economy, politics and employment – give us a great foundation to expand and the signs point to even greater success to come.

The potential in South Africa and Africa is massive based on the penetration numbers we know,” he concludes.

DEFY APPLIANCES 0861 003339 info@defy.co.za www.defy.co.za

//APEX CORDSET TECHNOLOGIES BUILDING LONG-TERM CONNECTIONS Apex Cordset Technologies (Apex) has been operating in the electrical accessory industry for nearly thirty years.

By combining speedy turn-around times, innovative products, creative staff and entrepreneurial ambition, the company has managed to carve out a position at the front of this extremely competitive industry.

Manufacturing in South Africa has become a significant driver of economic growth and is now known as a sector that can compete on a global playing field. Its ability to stimulate complimentary activities and create jobs is demonstrated by Apex, the Gauteng based manufacturer of moulded plugs, cordsets, wire harnesses and extension cords.

Founded in 1986 by Konstantinos Gerasis, Apex has seen exponential growth, now employing over 500 people in its five manufacturing divisions; Apex Leads, Kosmolink, Pintek, Evrotek and EDCAP. Christos Gerasis, Operations Director for Apex explains that the company is now looking for widespread expansion; in its product range, facilities and workforce.

“It is our vision to become the preferred supplier of the entire range of plug and connector systems globally,” he says. “Through our research and development, we aim to expand our product range so as to provide our customers with a complete one stop solution to their product needs.

“We have earmarked a number of very exciting new projects, including the construction of a new, 7000m²

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production facility, to produce exclusive branded products.

“We are also in the process of improving our training academy to provide a much needed educational facility.

This will not only improve and empower our current workforce, but will also assist in providing a steady stream of knowledgeable employees.”

It is these knowledgeable employees and the company’s innovative product offering that encourage names like Defy to choose Apex for power cordsets and wire harnesses needs. Apex has worked with Defy for more than two decades and the two companies enjoy a thriving relationship.

“The relationship with Defy started in 1989 when Apex began supplying Power supply cords and Wire Harnesses for their white appliance goods. Over the years we have tailored and enhanced these cable assemblies allowing Defy to increase efficiency and competitiveness, making them market leaders in their industry,” says Gerasis.

“We have established ourselves in this very competitive market by being very conscious of our customer’s needs and being able to deliver the large volumes they require on time whilst maintaining the highest possible quality.

“Our ability to provide products of the highest quality in a cost effective and efficient manner as well as our culture of striving for perfection has allowed us to be selected as a preferred supplier.”

SUNSHINE SEEDLING SERVICES

Quality Seeds,

Quality Harvest PRODUCTION: Karl Pietersen

Sunshine Seedling Services produces some of the highest quality timber and vegetable seedlings in South Africa. This expert organisation is an example of how a modern agricultural business should be managed, utilising a mixture of innovation, experience and quality. Managing director, Ken Leisegang tells us more…

//

In South Africa, the forestry and agriculture sectors are hugely important but sometimes undervalued by the general public and the commercial sectors. As the economy continues to develop and moves more towards the provision of secondary and tertiary services, people get caught up in the race towards new technology or unnecessary expertise and forget that agriculture and forestry accounts for more than 3% of GDP and around 10 million direct and indirect jobs – in fact, the government plans to create five million new jobs in the sector by 2020.

One company that understands the importance of the agriculture industry, a company that has had its roots firmly planted in the sector for the last 33 years, is Pietermaritzburg based Sunshine Seedling Services (SSS).

The company is a mixture of nursery expertise, scientific innovation and a focus on quality and founder Ken Leisegang explains

that while the business has come a long way since its establishment, SSS is a true industry leader with further ambition for the future.

“We have a winning formula with a winning team. SSS is more professional, customer orientated and quality focused than our competitors. We also have a long and trustworthy history in the industry.

“Annually, we have an ISO 9001 certification audit which is done by the SABS to ensure our quality is maintained. In addition, the seedlings growers’ association certification is done by an independent auditor annually,” he says.

A GROWING BUSINESS Starting life as a small crop of vegetables in KwaZulu-Natal, the business has seen exponential growth in the past three decades and now boasts two thriving branches, some of the country’s highest quality timber and vegetable seedlings, and large production figures of over 35

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million vegetable seedlings annually, 12 million timber seedlings and eight million clones.

“SSS was started in 1982 by myself as a small forestry nursery which expanded into vegetables and then clonal forestry 20 years ago,” explains Leisegang. “I formed the company as I saw the opportunity with the containerised seedling industry starting in SA in the late 1970’s. SSS has not changed much over the years except that it has expanded and become more professional with increased competitiveness.

“We pride ourselves on good quality seedlings. We do this by ensuring our seedlings are well hardened before dispatching. For seedlings that are going to be planted in harsh conditions, we plant in a model 98 tray which ensures the plate is much bigger and is able to withstand the harsh conditions.

“Our growing medium has been developed over the last 30 years and we feel we now have a very good recipe. The four products we use for our growing medium are coir, peat, composted pine bark and vermiculite.

To this we add a slow release fertiliser.

On the clonal side, we have a slightly different product in that we want good water drainage. For this we use perlite and coir.”

BUSINESS PROFILE

//THE MAJOR SUCCESSES IN THE LAST YEAR HAVE BEEN THE EXPANSION INTO THE CLONAL EUCALYPTUS MARKET WHERE SSS ARE NOW THE LARGEST PRIVATE NURSERY SUPPLYING CLONAL EUCALYPTUS MATERIAL// In recent times, the business has seen significant opportunities in two major areas: clonal Eucalyptus and SADC expansion.

“The major successes in the last year have been the expansion into the clonal Eucalyptus market where SSS are now the largest private nursery supplying clonal Eucalyptus material,” says Leisegang.

Sunshine has a selection of GXN, GXU and GXC clones that have been extensively tested across a number of sites.

“Conditions in this market are good due to the increase in demand for Eucalypt clones due to increased pest and disease pressures.”

“SSS is franchising its nursery

ideas into the SADC countries at present,” he adds.

THE NURTURING PEOPLE Of course, the success that the company has witnessed over the years has not been down to just one man. Leisegang has invested heavily in employees and now is proud to say that SSS has more than 130 years of practical and academic experience from qualified agriculturalists and a well-established management team.

“SSS has many employees who have worked here for over 30 years,” he says.

“The great ideas in our company come from networking, experience and

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good teamwork in management. Most of the credit for the Clonal Program must be given to Bryn Pollard who has headed up the forestry operation over the last 15 years and is now a shareholder in SSS. “We have an all-inclusive policy where ideas are welcome from all staff members who share in profits that SSS makes.”

And it’s not just employees who receive special attention from SSS – all stakeholders, including the local community, customers, suppliers and government, are important to operations and are therefore important to SSS. “We rely on our customer base and input suppliers who we have established good relationships with over our many years in business. We believe in supporting local community projects to help further education and skills development. We are SGASA and SABS certified and are the agents for nursery technology specialists, Urbinati, in South Africa,” explains Leisegang.

SUNSHINE SEEDLING SERVICES

//SSS IS FRANCHISING ITS NURSERY IDEAS INTO THE SADC COUNTRIES AT PRESENT// STUNTED ECONOMY Despite the successes that SSS has realised through its strong history, there are always challenges that are out of the company’s control. One such problem is the current commercial slump that is consuming the South African economy.

Growth is slowing, unemployment is high, the Rand is having an extremely tough time in the currency markets and energy and fuel continue to cause problems across the nine provinces.

Fortunately, Leisegang says that his industries have so far not seen the effects of slow growth in the economy compared with others. “We are not as concerned as if we were not in forestry and agriculture which have

not experienced the downturn in the economy as much as other industries.

“The weakening of the Rand has only affected us in that input costs have increased substantially which will have to be passed on to the end user.”

Away from the traditional economic problems SSS is faced with another challenge and that comes from high input costs and some large scale customers taking their clonal requirements in-house.

“Our industry is highly capital intensive and has become very competitive. The large forestry companies have erected large clonal nurseries to supply their own requirements into the future,” explains Leisegang.

However, the managing director

remains positive and the company’s focus on quality is something that will continue to really set it apart, not just in the seedling industry but in the agricultural industry more widely.

“Quality is not questionable when it comes to Sunshine Seedlings,” says Leisegang. “We pride ourselves on our reputation for maintaining consistently high quality seedlings.

“Sunshine Seedlings is the leader in the containerised seedling industry and we are well placed to meet the highest expectations,” he concludes.

SUNSHINE SEEDLING SERVICES 033 390 3047 admin@sunshineseedlings.co.za www.sunshineseedlings.co.za

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SA CORPORATE REAL ESTATE FUND

Changing Strategies to

Change Results PRODUCTION: David Napier

SA Corporate Real Estate’s vision is to exceed its stakeholders’ expectations by generating superior, sustainable returns, investment in quality real estate assets, optimal allocation of its capital resources and the sustainable management of its operations in a way that delivers lasting benefits for all its stakeholders.

After a slow start, it looks like this vision will start to be realised.

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//

The one and only thing that is certain in business is change.

Change provides opportunities, it creates competition, it generates demand and it moves people. In today’s complex and challenging commercial environment, it’s virtually impossible for organisations to make sound strategic decisions and completely accomplish objectives when deprived of strong change management strategies. This is especially true in the world of project, program and portfolio management, where obstacles and ambiguity are inevitable at every juncture.

Change is vital and many influential figures throughout history have been quoted recognising its importance.

Charles Darwin said: “It is not the strongest or the most intelligent who will survive but those who can best manage change,” Bill Clinton said: “The price of doing the same old thing is far higher than the price of change,” and Benjamin Franklin remarked: “When you’re finished changing, you’re finished.”

One organisation that has realised the value of change in the past few years is SA Corporate Real Estate, a Corporate REIT (Real Estate Investment Trust) listed under the Real Estate, Diversified REITs sector of the South African Stock Exchange, the JSE. SA Corporate is one of the oldest and most established property

companies in the South African market.

The company features an attractive portfolio diversified across 166 properties which covers 1.39 million square metres of lettable space.

This type of business is now hugely important and supports many jobs across the country. REITs are tied to almost all aspects of the economy, including apartments, hospitals, hotels, industrial facilities, infrastructure, nursing homes, offices, shopping malls, storage centres, student housing, and timberlands. The model has become popular because of the different types of regular income streams, diversification and long-term capital appreciation that they offer.

SA Corporate has an interesting history. For a long time it was considered an underperformer in the market because of a series of poorly timed acquisitions, disposals and funding structures. There was also a management problem and a lack of direction after the business went through five CEOs in six years.

But in August 2012, change for the better came along and brightened up the outlook for the fund with the installation of Rory Mackey as CEO and eventually, in December 2012, he took over as Managing Director and went about making changes that have so far proven to be successful.

Mackey was formerly Group Executive: Commercial at Airports Company South Africa Limited. He was also General Manager of Africa’s largest airport, OR Tambo International Airport, from 1996 to 2001. He also worked as part of the team managing the Old Mutual Investment Group South Africa Alternative Investments boutique from 2008.

STRATEGY DEVELOPMENT A change in strategy has resulted in a change in fortunes for SA Corporate following the implementation of a four pillar turnaround strategy at the beginning of 2013, which was aimed at driving a turnaround in performance of the company and providing a base from which it would be able to deliver sustainable distribution growth in the future.

As a result of the four pillar plan, the 2013 financial results proved to be some of the strongest in the fund’s history, for the first time exceeding the 32c/ share distribution which it achieved back in 2007. The 8.6% distribution growth was an impressive performance, not only against its own historical earnings growth numbers but also in relation to the market in general.

From an operational perspective, the company delivered strong results with like-for-like property income increasing by 9.1% (adjusted for the unit buy-backs). This was driven primarily by in-force escalations of more than 8% and the continued compression of vacancies.

Management has been reasonably active in allocating capital recently, with nearly R500m worth of acquisitions made and a further R254m committed to other deals. This includes what is now SA Corporate’s third-biggest asset, the World Trade Centre in Sandton.

In March, Mackey said: “The total net property income growth increased 19.4% due mainly to R1.7bn worth of acquisitions over the past two years,” after the announcement that for the second half of last year, distributions were 9.4% higher than for the second half of 2013. Overall distributions across the total portfolio grew 9% for the year to December last year, compared with the year to December 2013. The market average for the same period was just 8%.

Vacancies were down 3% at the end of 2014 compared with the same period in 2013 and Mackey said: “Further reductions are anticipated as we seek to improve the quality of the retail portfolio through redevelopments.”

RESIDENTIAL One major strategy change that has attracted attention in recent times was SA Corporate’s investment into Affordable Housing Company (Afhco) and its Johannesburg assets, in a substantial R953-million transaction that saw the fund delve deeper into residential property than it has ever done before. Listed property funds are increasingly investing in residential property because of improved stock becoming available and demand for affordable housing.

Immediately after the announcement of the acquisition, shares in the fund began to surge with investors buoyed by what SA Corporate call ‘arguably the most attractive JHB Inner City CBD residential portfolio

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BUSINESS PROFILE

offering scale, quality and diversity’.

“Our strategy is to achieve residential critical mass in precincts either in close proximity to transport hubs or being in prime city locations and leveraging off high residential density and foot count to achieve high retail performance is well on track,” Mackey said.

Another significant decision made in 2013 that complemented the investment in Afhco was the award of the entire portfolio to property management specialist Broll. At the time, SA Corporate’s portfolio comprised 139 properties, covering 1.19-million square metres of lettable area and Broll was the natural choice.

“Broll has a particular competence in managing retail properties of the range of sizes in our portfolio and intelligence in trends in South African logistics necessary to drive the growth of the fund’s portfolio,” Mackey said at the time.

“It is now our single largest client in our property management business.

We were impressed by the passion and the integrity of the SA Corporate team during the rigorous tender process,” said Broll CEO, Malcom Horne.

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CHALLENGING TIMES Even with a diversification strategy and generally improving stats in retail and industrial units, SA Corporate is still facing a big challenge in the coming years with a dull economic outlook showing no signs of brightening up.

Real estate has been one of the main industry sectors driving the economic growth that SA has witnessed since the dawn of democracy. However, very few economies were safe from the global recession of 2008 and SA, and many

//TECHNOLOGY IS ALREADY DISRUPTING REAL ESTATE ECONOMICS, BUT BY 2020, IT WILL HAVE RESHAPED ENTIRE SECTORS//

SA CORPORATE REAL ESTATE FUND

others, are still recovering from the problems faced during that difficult time.

Unemployment is high (sitting at around a quarter of the population), growth rates are slow (this year showing well under 2%) and there is a trend for many businesses to look outside of SA to diversify their offerings during these slower times. Also, the three powerhouse provinces (Gauteng, KZN, Western Cape) provide the majority of the economy’s GDP meaning, outside of these areas, there is little opportunity for investment.

However, according to PWC Global Real Estate Leader, Kees Hage, the real estate industry is one which should grow over the next six years despite the challenges ahead.

“High energy prices, climate change and government regulation are already pushing sustainability up the real estate agenda, but by 2020 their

impact is expected to be far greater,” he says. “Technology is already disrupting real estate economics, but by 2020, it will have reshaped entire sectors. And the real estate community will have taken a greater role in the financial ecosystem, in part moving into the space left by the banks.”

A report by PwC, titled Real Estate 2020: Building the Future predicts that the global stock of investable real estate will expand by more than 55%, from US$29.0 trillion in 2012 to US$45.3 trillion in 2020 and the global audit company says that global megatrends will drive growth opportunities in the real estate industry across the African continent.

In South Africa, the government is pouring resources into infrastructure development and there is significant urbanisation with development in the major hubs that SA Corporate knows

Business Law Engineering and Construction Law Litigation Property Services Maritime Law, International Trade and Insurance Mining and Minerals Administration of Estates and Trusts Estate Planning Agriculture and Environmental Law Empowerment and Transformation Tax Law Labour Law Competition Law Insolvency and Recovery of Assets Intellectual Property

well. From 2001 to 2014, six of the world’s ten fastest-growing economies were in sub-Saharan Africa and of course this means that international investors will always be interested in these regions.

Now with a stable management team which is injecting energy into the fund and opportunities being presented for development, it is likely that SA Corporate will likely further its already impressive performance and finally fully shake the tag of ‘underperformer’.

SA CORPORATE REAL ESTATE FUND +27 21 529 8410 info@sacorp.co.za www.sacorporatefund.co.za

Property Services Cox Yeats is a leading commercial law firm where the partners of Cox Yeats are represented by some of South Africa’s top lawyers in their fields of expertise.

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T: 031 536 8500 | F: 031 536 8088 | E: coxyeats@coxyeats.co.za | www.coxyeats.co.za

www.enterprise-africa.net / October 2015 / 65

BYTES TECHNOLOGY GROUP

Helping Clients

Do Great Work PRODUCTION: David Napier

In the past six months, Bytes Technology Group has seen its divisions build major partnerships with some of the world’s most innovative organisations, all with the goal of providing the best possible service to its clients in South Africa.

//

As one of the country’s leading IT companies, and a principal subordinate of the JSE-listed Altron Group, Bytes Technology Group (Bytes) shoulders heavy responsibilities from its portfolio of industry leading customers.

Leading the way in all things IT, from Big Data Management and Smart Process Applications to Document Management and Transaction Solutions, Bytes offers a selection of services that support information technology in a wide range of different industries.

According to Telkom’s annual report for the year ended 31 March 2015 which was released earlier this year, Bytes remains South Africa’s largest IT services provider based on revenues in 2014. The report states that Bytes’ 2014 revenue of R8.8 billion is the highest amongst the country’s leading IT service providers and shows that Bytes is certainly leading other dominant ICT players.

The company is made up of many different businesses that sit across four main market sectors; telecommunications, multimedia, IT and business development.

Some of the instantly recognisable businesses in the Bytes portfolio include Bytes Managed Solutions (Bytes MS), Bytes Document Solutions (DS), Bytes People Solutions and Bytes Secure Transaction Solutions to name just a few.

Recent developments have seen Bytes tighten its grip of the SA IT industry, with Bytes MS in particular making important advances which will benefit customers in a huge way.

South Africa’s IT sector is well established and sophisticated, with companies largely considered leaders in technology, particularly in the field of mobile software and electronic banking services. South African companies are also world leaders in pre-payment, revenue management and fraud prevention systems.

Bytes CEO, Rob Abraham says that the figures prove the importance of Bytes involvement in the market.

LEADING THE WAY IN SA “In addition to Bytes’ revenue of R8.8 billion, if we were to add the other IT elements of Altron Telecommunications

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Multimedia and Information Technology (TMT), the combined revenue is close to R13 billion which illustrates the significance of our success as an IT player in South Africa,” he says.

The company is known for representing the world leading IT brands including Cisco, Microsoft, NCR, Oracle, Xerox and Alcatel-Lucent and Abraham understands that this is valuable for customers.

“By localising these brands and adding value we remain relevant to our customers who seek to work with specialists,” he says.

“It’s a symbiotic relationship where we help our partners achieve their business objectives in the African market through our proven track record of service delivery. In tandem with leveraging off other business units within Altron TMT, we are able to provide our customers with the ultimate turnkey solutions, tailored specifically for their needs,” he adds.

Following the track record of success that Bytes has displayed over the last ten years, it is no surprise that the company is looking north to other quickly developing countries in Africa for growth but Abrahams reiterates that South Africa will always be at the heart of this impressive outfit. “…we remain a proudly South African company committed to the

BUSINESS PROFILE

was also exhibited just last month when the company introduced the biggest change to the way an ATM operates since the self-service banking channel was invented nearly 50 years ago.

//WE REMAIN A PROUDLY SOUTH AFRICAN COMPANY COMMITTED TO THE GROWTH NOT ONLY OF SOUTH AFRICA, BUT THE WHOLE OF AFRICA// growth not only of South Africa, but the whole of Africa,” he says.

MODERN, SAFE, EFFICIENT In a hugely important deal for Bytes, and also for the IT/Finance industry, Nedbank completed the purchase of 250 NCR Teller Cash Recyclers (TCR) from Bytes MS for a reported R65 million in July.

Nedbank is currently undergoing a modernisation process across many of its branches, addressing the needs of consumers for branches to carry the latest self-service technology required to ensure a more efficient and satisfactory banking experience.

Consumers are increasingly looking for positive, successful interactions when they visit a physical banking location and a TCR automates cash handling enabling staff to process transactions more quickly and efficiently while offering a greater customer experience.

Bytes MS Business Development Director, Alan Anderson says that the TCRs will offer both improved security as well as improved customer service.

“Used correctly in conjunction with cash management software, the devices can ensure a more productive banking experience for the customer.

Additionally, with the removed bullet proof glass from in front of the tellers, the recyclers allow for a more comfortable and customer centric environment within which to transact.

“In addition to the product improving operational efficiency at branch level, the preventative nature of the device will ensure Nedbank is less exposed to potential theft at its branches,” he says.

Bytes relationship with NCR is longstanding and as the only partner for the tech-innovator in South Africa, Bytes is again displaying its dominance of industry leading tech, something which

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ADVANTAGES OF THE CLOUD In another partnership with NCR, Bytes MS has launched Kalpana software in South Africa, an enterprise software platform that moves ATM software and operations to the cloud.

Kalpana software runs ATMs remotely and is designed to eliminate malware and enable rapid deployment of new devices and ATM services, to reduce costs by up to 40 percent, and create amazing customer experiences.

“This new software platform will revolutionise the domestic ATM security market in addition to reducing operating costs and will greatly improve and accelerate the process of bringing new ATM services to market,” says Anderson. “Apart from the operational cost savings and commonly known efficiencies that come with any cloud-based platform or solution, the Kalpana platform will greatly reduce the expenditure associated with power management, security updates, paper receipts and other consumables and the deployment of new ATMs.” “NCR’s Kalpana software is the most disruptive change to the ATM ecosystem in decades. Business and consumer applications are increasingly turning to enterprise or cloud-based solutions that reshape security and enable fast, nimble and dynamic customer experiences,” said Dimitri Kanellopoulos, NCR country manager, South Africa.

“Kalpana software is ideal for financial institutions and independent ATM deployers looking to improve security, quickly advance service delivery through technology, and reshape their cost to serve.”

Kalpana software greatly improves agility, helping bring new ATM services to market twice as fast as before, while also significantly decreasing the

BYTES TECHNOLOGY GROUP

//POSITIVE CHANGE IS BEING FELT THROUGHOUT THE ORGANISATION, WITH PEOPLE BUYING IN TO BETTER WAYS OF DOING THINGS. WE’RE ALL EXCITED ABOUT THE FUTURE OF THE COMPANY// cost of deploying new ATMs, security updates, power management, paper receipts and other consumables, remote management via cloud-based data flow and support for dispute resolution.

IMPROVED SERVICE DELIVERY Bytes DS last month announced its partnership with service lifecycle management and mobile workforce solutions company Astea International.

The partnership is intended to create consistent and highly personalised experiences at every customer relationship touch point. As the largest Xerox distributor in the world, Bytes DS is a customer-focussed business and leaving a positive impression is of vital importance.

“It’s important to invest in improving customer service and in effective tools to help you stay on top of managing your customer experience,” says Anton van den Berg, Bytes DS divisional director of services. “This will ensure that your customers are getting good service from your staff, all of the time. In addition, with some areas of office automation technology becoming commoditised, BDS distinguishes itself in the market through service excellence, hence the investment in Astea.”

2014 saw Bytes DS run a companywide service modernisation programme with the aim of improving service excellence. The drive also utilised Astea solutions that technicians receive and clear service calls via their mobile phones. The product announced in September from Astea is furthering that drive by allowing technicians to efficiently complete and document assignments, manage vehicle assets, capture expenses and generate revenue through add-on sales during their contact with a customer.

“BDS is one of few that can rightfully claim the capability to deliver a full managed print service (MPS) solution nationally, and of those few, we are clearly the leader in delivering this service,” says van den Berg.

“In addition to enhancing our service to Xerox customers, we are also seeing a positive impact on BDS’s profitability as a result of greatly enhanced productivity on the part of our technicians,” he adds. “Positive change is being felt throughout the organisation, with people buying in to better ways of doing things. We’re all excited about the future of the company.”

It is because of solutions like this, alongside the organisations vast knowledge of IT services, that Bytes is known as a leader in its market. Bytes services four of the five major SA banks, all of the major retail companies and all of the major telecoms companies – an example of one industry leader driving others.

The numbers prove it, the staff know it and the customers believe it – Bytes Technology Group is a business that provides customers with the best technology solutions and helps them to do great work.

BYTES TECHNOLOGY GROUP +27 (11) 715 9000 info@bytes.co.za www.bytes.co.za

FA 2308 Sunlyn Enterprise advert_final(88mmx125mm).indd 1

10/2/15 3:59 PM

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PARAMOUNT TRAILERS

Manufacturing: Paramount

for Africa PRODUCTION: Joe Forshaw

Now settled in its new home in Midvaal, Paramount Trailers is a shining light in the SA manufacturing sector; creating jobs, delivering quality and driving innovation.

//

Last year, The Economist described Africa’s manufacturing sector as an ‘awakening giant’. The global business-focus newspaper stated that ‘a quiet boom in manufacturing in Africa is already taking place’ and ‘manufacturing’s share of GDP in subSaharan Africa has held steady at 1014% in recent years’. According to the paper, industrial output in what is now the world’s fastest-growing continent is expanding as quickly as the rest of the economy and with six of the world’s ten fastest growing economies being situated on the African continent, it is certainly fair to expect a manufacturing sector to thrive in the coming years.

In South Africa, an established and diversified manufacturing base that has shown its resilience and potential to compete in the global economy has been developed over the years so that it now provides stimulus in other sectors such as services.

Manufacturing is split across different sectors with automotive being one of the most prominent.

Despite its distance from some of the major markets Africa, and particularly South Africa, produces high quality products at prices competitive with other automotive manufacturing and assembly centres. The South African automotive and components industry is growing rapidly and is perfectly placed for investment opportunities. South Africa’s aim is to become an automotive investment destination of choice and investment from the government and the private sector has prompted the establishment of several small, medium and large manufacturing outfits that are creating employment and growth around the country.

One business that has a long and proud history is manufacturing is Paramount Trailers, the Midvaal based trailer builder and repair specialist.

FAMILY OWNED Founded in 1997 by current Chairman and CEO Fernando Marques, Paramount

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Trailers is now run by Managing Director and Fernando’s son, Warren Marques.

Warren is particularly proud of the company’s main milestone of the past few years – the move into a new facility which expanded production capacity from 40 to more than 250 trailers a month.

“We decided in 2011 that it was time to either grow the business where we were at the time or to buy new property and develop. We were operating very inefficiently where we were as we had bought smaller properties and we were moving around, across streets, and it just wasn’t efficient so the decision was made to spend the money on a big facility to makes us more efficient, more competitive and more professional,” explains Warren.

“We started building in early 2012 and we moved in in August 2013.

Capital expenditure was R150 million on the project itself with an extra R30 million on machinery and equipment.

The facility covers 75,000 m2 of land (equivalent to nine soccer fields), 25,000 m2 of factory and 2000 m2 office space.”

The company’s previous facility in Alrode covered just 16,000 m2 and was not allowing the efficiency and growth that the new base offers in abundance.

“In recent years we have evolved as a company by diversifying our product range and bringing more options to market,” Warren told MetalWorkingNews.

“The investment in the new machinery, with more to come, has allowed us to improve our efficiencies as well as bring in house and manufacture a number of components that we were outsourcing in the past.

Naturally this is also going to bring down costs.”

“These new facilities are a reflection of our commitment to investing in this industry and becoming a leader in customised trailer manufacturing across the African continent,” continued Fernando.

//THE DECISION WAS MADE TO SPEND THE MONEY ON A BIG FACILITY TO MAKES US MORE EFFICIENT, MORE COMPETITIVE AND MORE PROFESSIONAL// When the new facility was completed, and in the following months, Paramount acquired a range of new industry leading equipment including a Durma AD-R 30220 CNC hydraulic synchro press brake featuring 3-axis CNC control as standard (3050 mm x 2600 mm between frames and a 220 ton bending force), a Durma SBT 3010 HS hydraulic NC guillotine for shearing sheet thicknesses of 10 mm and a cutting length of 3100 mm, a Durma DC8 – S360 bandsaw and a Durma DB – S 560 bandsaw that comes with an automatic feeding line.

Now settled in its new home, Paramount is situated in the Kliprivier Business Park. This location was strategically selected by the management because of its easy access to the important N1 and N3 highways and its close proximity to the railway line and station adjacent to the development, running parallel to the R59 - from Germiston through Meyerton to Vereeniging.

Following the move into the new premises, Paramount expanded its staff base to cope with increased capacity and demand. The employee count

jumped from 120 employees to 200 and reports suggest it could eventually reach 400 when the facility soon reaches full capacity.

But even through all of the growth and development, this remains a family business, focussed on delivering quality, just as it has for the past two decades.

“Our reputation and success can be attributed not only to the excellent trailers we produce but the superb client relationships we foster.

Paramount Trailers is committed to supplying excellent customer service, an affordable quality product and leadership in innovation and design,” Warren told MetalWorkingNews.

“We like to maintain a finger on the pulse of the company, personally knowing the majority of the customers and being able to put a face to a name,” added Fernando.

ROAD IS THE WAY TO GROW Many Paramount trailers are used for the transportation of heavy goods, such as mining materials and agricultural supplies, and the company is now wellknown for manufacturing commercial flat deck trailers such as tri-axles and

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PARAMOUNT TRAILERS

super-links, small parts manufacturing and offering trailer service and repairs.

These products often dominate the highways of the country and a growing transport industry, albeit with certain drawbacks, is obviously beneficial for Paramount.

In October 2014, KPMG said that the transport sector is ‘a vehicle for growth in SA’s economy. Richard Machett, Divisional Director at WSP Civil and Construction Engineers Africa said: “If you can’t move goods, services and people around, your economy stagnates. Having a long-term view when preparing budgets for new infrastructure or for upgrading existing transport networks is critically important. That said, once this infrastructure is in place, it’s important to ensure it is well maintained – in fact, it’s cheaper to maintain infrastructure than to build new replacements.”

But SA has not always been bullish when it comes to investing in road infrastructure. Many still require

attention, particularly in more rural areas. Then there is the issue of the cost of travel. Fuel prices continue to rise (although they have evened out recently) and the weakening Rand hasn’t helped this one bit making life extra difficult for road transport businesses. Also adding to the mix of problems is tax. According to the Road Freight Association of South Africa, the road freight industry remains one of the highest taxed industries in SA with ever-increasing road user charges, cross-border taxes, toll fees, vehicle licensing fees, inspection fees and other legal requirements.

Of course, it would be beneficial for Paramount for these issues to be addressed and would give customers that little bit of extra flexibility and purchasing power but even with these challenges, the business is looking to grow in the SADC region and is also diversifying its offering to bring rental services and used trailer repairs and sales to its portfolio.

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“Paramount has built its reputation on being able to develop and manufacture trailers to meet customer requirements. This is even more critical when manufacturing a trailer for countries across the border. It is important to understand the conditions in which the trailer will be operating.

We have developed and manufactured an export trailer that is more robust for cross-border transport. The design uses stronger materials, which allows for longer trailer life under tough road conditions while ensuring that carrying capacity is not compromised,” said Financial Manager, Paulo Ribeiro in a recent interview.

“It is important not to sacrifice trailer strength for payload. A lighter trailer will more than often not be able to last in tough conditions.

Engage with your trailer manufacturer to ensure that the correct trailer is purchased for your operating requirements, i.e. application, road conditions, type of trailer, etc.

Consider purchasing a trailer that will provide you with greater versatility in transporting different types of cargo as this will assist in having loads delivered both to and from the SADC destination,” he added.

As Paramount continues to drive into markets north of the border, it will continue to create opportunities and jobs for people in Gauteng and this is excellent news for the manufacturing industry.

Even though our developing economy is one which now looks to the service sector for most of its growth, India has boomed for more than two decades on the back of services, while steadily building a manufacturing sector from a very low base and we should not bet against Africa doing the same.

PARAMOUNT TRAILERS +27 11 900 1228 sales@paramounttrailers.co.za www.paramounttrailers.co.za

Our new Heavy Gauge Stretcher Leveler produces flat sheet and plates that stay flat after operations like laser, plasma or water jet cutting, shearing, turret punching, bending, forming, welding and finished assembly.

All trapped stresses and shape memory are completely eliminated, and the cost savings from producing less scrap can be as much as 15 %.

The Stretcher Leveler achieves this by stretching the entire cross section of the strip – top to bottom and edge to edge – beyond its yield point.

The machines capabilities are from 1,2 mm to 12 mm thick, 2000 mm wide strip with up to 15 metre lengths.

Benefits • Stretcher Leveler produces flat material that stays flat • Equalised stresses eliminate spring back • Reduces percentage of scrap loss • Process will not change mechanical properties • Common cuts can be achieved on Laser • In line material cleaning is optional • Minimum spring-back on bending applications

Please call Warne Rippon on 082 412 2956, should you like to arrange a viewing of the machine, or for more information.

EXHIBITION CALENDAR //TABLE OF ALL EVENTS:

KEY UPCOMING EVENTS ACROSS THE COUNTRY Our regular update to help you keep track of important events and exhibitions taking place across the spectrum of industry sectors.

UNMANNED AUTONOMOUS SYSTEMS AFRICA 14-16 OCTOBER 2015 Unmanned Autonomous Systems Africa invites the global unmanned systems community to gather in Johannesburg, South Africa October 13 – 15 for the annual Unmanned Autonomous Systems Africa conference and exhibition 2015.

Hosted by Thebe Reed Exhibitions, this premiere event is shaping up to be a fantastic conference and exhibition showcasing the sector through presentations and networking events designed to maximize the benefits for attendees, covering UAS technologies across unmanned air vehicles, autonomous marine vehicles, and unmanned ground vehicles.

Unmanned vehicle technology has matured to a point where civil and commercial applications are feasible and compelling. From army to homeland security, manufacturing, agriculture, mining, oil and gas; the technology holds the potential to benefit our industries in many ways. In addition to its applications, autonomous vehicle technology is poised to positively impact jobs and economic health throughout Africa.

IPAD DRC MINING & INFRASTRUCTURE INDABA 15-16 OCTOBER 2015 iPAD Indaba DRC Mining & Infrastructure is the only international event in the DRC bringing together local and international investors, the government and suppliers in the same objective: to stimulate the mining industry in the DRC. The event also features the DRC Mining Industry Awards.

UASA Indaba Hotel, Johannesburg 14-16 October IPAD DRC MINING & INFRASTRUCTURE INDABA Fleuve Hotel Kinshasa, DRC 15-16 October CONMACH NIGERIA Lagos Oriental Hotel 16-19 October IPAD KATANGA MINING WEEK Grand Karavia Hotel, Lubumbashi, DRC 20-21 October AVIANA POULTRY & LIVESTOCK EXPO Accra International Conference Centre 20-22 October PAPER MIDDLE EAST Cairo International Convention Centre 22-24 October INVESTMENT & RETIREMENT EXPO Coca-Cola Dome, Johannesburg 23-25 October SPORTS & EVENTS TOURISM EXCHANGE Protea Hotel Fire & Ice, Tshwane 27-29 October

CONMACH NIGERIA 16-19 OCTOBER 2015 ConMach Nigeria is an international trade fair for construction machinery and takes place in Lagos. Its goal is to bring together professionals from the industry from around the world in Nigeria. For manufacturers and distributors of construction equipment, this is an excellent opportunity to showcase products and services as the African market is steadily growing.

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