Enterprise Africa February 2017

THE BUSINESS MAGAZINE FOR AFRICA’S INDUSTRY LEADERS

AFRICA

ENTERPRISE February 2017

www.enterprise-africa.net

IMPERIAL SELECT

WAITING TO ACCELERATE Exclusive Interview with Ross Barlow

ALSO IN THIS ISSUE:

Jaguar Land Rover / Fancourt / Kansai Plascon / MTN

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EDITOR’S LETTER

Joe Forshaw EDITOR joe@enterprise-africa.co.za Hal Hutchison SALES MANAGER hal@enterprise-africa.co.za Sam Hendricks SENIOR PROJECT MANAGER sam@enterprise-africa.co.za Shaun Cousins PROJECT MANAGER shaun@enterprise-africa.co.za Shannon James PROJECT MANAGER shannon@enterprise-africa.co.za Peter Littleboy PROJECT MANAGER peter@enterprise-africa.co.za Emma Smith SALES ADMINISTRATOR emma@enterprise-africa.co.za Harvey Tarlton SENIOR DESIGNER harvey@enterprise-africa.co.za

Published by CMB Multimedia Chris Bolderstone – General Manager E. chris@cmb-multimedia.com Sackville Place, 44-48 Magdalen Street, Norwich, NR3 1JU T. +44 (0) 20 8123 7859 E. info@cmb-multimedia.com www.cmb-multimedia.com 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.

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Welcome to our latest edition…

We’re excited and eager to hear what President Zuma will say during his State of the Nation Address this month. With many fearing that the economy will face significant challenges through 2017, the hope is that more spending will be announced, along with a message to potential international investors that South Africa is a safe and secure place to do business. Deputy President Ramaphosa expressed this during his recent visit to Switzerland and the World Economic Forum. His message was that South Africa is open for business, and this is the feeling that the private sector is hoping its government will continue to convey.

Our lead features this month come from the automotive industry and two prominent figures, Imperial Select and Jaguar Land Rover. Both have witnessed the impact of a slow economy yet, thanks to sound business practice and a proactive approach from staff, both companies continue to perform well.

However, their message is clear: the sooner the economy returns to meaningful growth, the better. Both are tipped for serious expansion and both have recognised brands that the market desires, but both wait for certainty.

We also hear from international paints and coatings business Kansai Plascon. When Japanese company, Kansai, purchased South African brand, Plascon, the idea to expand the brand internationally was quickly spawned. At international level, the company operates all over the world and some of the ideas that Plascon has developed in South Africa are now being exported to markets in Europe, the Far East, the Middle East and elsewhere, proving that SA knowhow is valuable beyond its borders and recognised for excellence.

If President Zuma’s SONA does anything to instil certainty and stability, companies like those we feature this month will be able to achieve their ambitious growth plans, creating jobs and contributing to economic development. This is part of the national development plan and as such, will surely be Zuma’s priority?

Tell us if your company’s growth plans are on track or if you’re still waiting for economic stability before making investments. We’re online at: @EnterpriseAfri1

Joe Forshaw EDITOR

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

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06/NEWS: The Month that was...

A round up of some of the latest news stories from around the country

102/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

8/IMPERIAL SELECT: Waiting To Accelerate While the economy continues to create a tough environment for South Africa’s auto sales sector, exceptional client service and adroit management is seeing Imperial Select extending its market reach. And as Managing Director Ross Barlow reveals, its highly-tuned internet presence is poised to become a major sales weapon.

8/ 4 / www.enterprise-africa.net

CONTENTS INDUSTRY FOCUS: AUTOMOTIVE

INDUSTRY FOCUS: FINANCE

16/JAGUAR LAND ROVER : A new discovery... And A Jaguar For Africa

66/BANKING ASSOCIATION: Maintaining and Raising African Banking Standards

22/CASTROL SA: Extending Engine Life for The Best Miles

INDUSTRY FOCUS: COMMUNICATIONS

INDUSTRY FOCUS: PAINTS 26/KANSAI PLASCON: Creating a Pan-African Paint and Coatings Business

72/MTN: Strong Connections

INDUSTRY FOCUS: HEALTHCARE 76/NETCARE: Continued Growth for Care Giants

INDUSTRY FOCUS: MINING

INDUSTRY FOCUS: ENERGY

32/ANGLO PLATINUM: Platinum Miner Positioning for Strong Future

80/TANESCO: Lighting Up Lives In A New Era

38/KUMBA IRON ORE: ET Carbon Disclosure Leader Award for Kumba

INDUSTRY FOCUS: MARINE

INDUSTRY FOCUS: RETAIL 44/SHOPRITE: Are We Close to Emergence of Retail Champion of Africa?

86/HIK ABALONE: Sustainability is Key in Walker Bay

INDUSTRY FOCUS: CONSTRUCTION 90/CALGRO M3: Calgro M3 Continues to Make a Difference

50/PICK N PAY: A Prize Pick

INDUSTRY FOCUS: FIRE PREVENTION

56/JOHN CRAIG: An Original African Outfitter

94/CROSS FIRE MANAGEMENT: Saving Lives, Protecting Property

INDUSTRY FOCUS: HOSPITALITY

INDUSTRY FOCUS: FORESTRY

60/FANCOURT: A Lifestyle In Paradise

102/MONTIGNY: Powering Development in Swaziland

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DTI TO SPEND R216M ON UPGRADES AT INDUSTRIAL PARKS The Department of Trade and Industry (dti) has announced plans to spend R216 million on renovations at five industrial parks in the country.

Minister Rob Davies said the renovations are aimed at upgrading the parks’ infrastructure so they can be better positioned to contribute to the country’s industrial development, economic growth and job creation.

“Last year, the dti spent more than R180 million for the upgrading of six industrial parks spread across five provinces in the first phase of our Revitalisation of

Industrial Parks Programme. We have set aside R216 million from our critical infrastructure incentive programme to start revitalising five more this year,” he said.

The first phase of the revitalisation of the Nkowankowa, Ekandustria, Bodirelo, Phuthaditjhaba and Garankuwa Industrial Parks is due to commence after their budgets were approved late last year.

The revitalisation programme is implemented in four phases focusing on various areas, with the first being the upgrading of security infrastructure.

The dti identified a need to revitalise

industrial parks located in various parts of the country, mainly the former homelands, as part of efforts to promote industrialisation, manufacturing and job creation.

“Our officials are already in the process of conducting inception meetings to discuss the implementation of the project with key stakeholders. The positive impact of the programme on the economy on the areas where the parks are located is felt as soon as the implementation begins, as most of the labour and construction materials are procured from those areas,” Minister Davies said.

CSIR WELCOMES NEW CEO The Council for Scientific and Industrial Research (CSIR) recently welcomed Dr Thulani Dlamini as its new CEO. He has previously served in different positions within the CSIR in the past. He joined in 2005 as the head of the CSIR National Laser Centre and in 2008 he was appointed to the position of Group Executive for Research and Development, a position he held until 2011 when he left the CSIR to join Sasol. At Sasol, he was Executive Manager: Research and Development and later became Vice President for Strategic Research and Technology.

Dlamini holds a PhD in Chemistry from the University of the Witwatersrand (Wits) and a Master’s in Business Leadership from the University of South Africa (UNISA). He has also completed advanced courses in several aspects of technology management and the chemical industry, offered by institutions such as the International Institute for Management Development in Lausanne, Switzerland.

He was instrumental in the establishment of the Photonics Initiative of South Africa and the development of a national strategy for photonics research, development and innovation. He is a member of the Academy of Science of

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South Africa (ASSAF).

Furthermore, he has served on numerous boards including the Sasol Pension Fund, Automotive Industry Development Centre, Sasol Technology UK and Netherlands.

“I am excited about my return to the CSIR to take forward the excellent work of my predecessors. I look forward to working with our partners and the brilliant minds in the organisation.

“The CSIR is well positioned to have an impact beyond South African borders and it is my hope that together with our global partners, we can deliver on the mandate of the CSIR to use science, engineering and technology to advance society and industry,” Dlamini said.

CSIR Board Chairperson Professor Thokozani Majozi said by appointing such a thought leader in science, the CSIR is poised for greater success ahead.

“The board is excited about Dr Dlamini joining the CSIR and we have full confidence in his leadership and management skills. He is indeed the ideal incumbent to usher the CSIR into the new phase. He lands on solid ground, prepared by his predecessors.”

DR THULANI DLAMINI, CSIR CEO

NEWS ROUNDUP SA, CUBA TO BROADEN LONG-STANDING RELATIONS According to Deputy President Cyril Ramaphosa, South Africa and Cuba are looking into deepening and broadening their long-standing bilateral relations.

He announced this during a working visit of Cuban Vice President Salvador Valdes Mesa.

“I can say without any doubt that South Africa and Cuba have a very special relationship. At a political level, it is a relationship that was born in struggle and we do a lot of things even at a social level. The support that we continue to get from the government and people of Cuba just continues to strengthen the relationship between the two countries,” said the Deputy President.

He said the two countries are also looking at deepening and broadening relations at a commercial and economic level.

He said through such relations, government is able to expose South African companies to Cuba so that they can explore opportunities that are available for both countries.

To date, the two countries have signed over 30 bilateral agreements comprising vast areas of cooperation in education, defence, science and technology, agriculture, health services, infra-structure development, housing, water and sanitation, health cooperation, human settlements technical exchange, water resource management and water supply and public works technical assistance.

Vice President Mesa said he came to South Africa with his delegation to explore possible new areas of cooperation, mainly in trading and economic activities.

“There is no doubt that there are experiences that we can learn from South Africa, such as companies law, financial intelligence, and other fields such as renewables where important cooperation could be done,” he said.

SA CONVEYS OPENNESS TO DO BUSINESS AT WEF

Deputy President Cyril Ramaphosa has concluded a visit to Davos where he participated in the World Economic Forum (WEF), conveying to the international community South Africa’s openness to do business.

The 56-person delegation including, top level government, business and labour officials, highlighted that South Africa remains focused on pursuing a path to faster, inclusive and job-creating economic growth.

It also highlighted that government, business and labour have made significant progress in pursuing economic reforms; South Africa’s strong institutions,

stable macroeconomic environment, developed financial markets and strategic position provide a solid platform for stronger growth.

The team also highlighted that the country remains committed to strong fiscal discipline; South Africa is taking steps to strengthen policy certainty; government is working to achieve a more supportive business environment, including through Invest SA and incentive programmes; government has prioritised energy security; and that massive infrastructure investment will continue to bolster domestic demand and productive capacity.

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IMPERIAL SELECT

Waiting

to Accelerate PRODUCTION: Colin Chinery

While the economy continues to create a tough environment for South Africa’s auto sales sector, exceptional client service and adroit management is seeing Imperial Select extending its market reach. And as Managing Director Ross Barlow reveals, its highly-tuned internet presence is poised to become a major sales weapon.

ROSS BARLOW, IMPERIAL SELECT MD

INDUSTRY FOCUS: AUTOMOTIVE

//

February finds the South African motor trade still stuck in middle gear. New vehicle sales declined for the third year in a row in 2016, with a 14% new car price inflation and dealer margins squeezed by intense competition.

South African motorists are voting with their wallets, buying smaller new cars or moving to the used-car sector and lenders now financing two and a half times as many used cars as new.

“It’s the economy,” says Ross Barlow, Managing Director of leading one-stop auto dealers Imperial Select. “With the Rand under pressure the price of vehicles has risen but wages haven’t, so you have a lag between income inflation versus vehicle inflation.

“People are holding on to their cars longer, and when looking to

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switch, are increasingly looking at the used space. We have found the used car market fairly buoyant, and Imperial Select is taking advantage of this because it’s always been our main thrust.”

BRAND RENOWN With over 40 dealerships in seven provinces, Imperial Select is renowned for selling new and preowned cars, including brands like Hyundai, Mercedes-Benz, Honda and Citroen. In the new Kia slot it accounts for 45% of all South African new Kia sales.

Imperial Select has a long pedigree, founded thirteen years ago as a new car sales offshoot of Associated Motor Holdings, part of the R118b Imperial Holdings group. Soon after Barlow joined in 2000, AMH began looking at the pre-owned market. “With trade

ins, we found we needed a used car outlet within the dealership and quickly saw a definite opening for us.”

After visiting a successful used car outlet in Australia, he returned to AMH and began forming a selected pre-owned sales business.

“With the Imperial name prominent in the motor space we decided on Imperial Select, and the following year we went national and online to the internet. It was very small at the time.”

According to Derick de Vries, Chief Executive of Auto Information Solutions at credit information company TransUnion, higher new vehicle prices have stimulated demand for used vehicles, but as the supply of good quality used stock diminishes, there will be a natural shift back to the new car market.

IMPERIAL SELECT

“As far as the used car sector is concerned I would say we are fairly comfortable in that market space. We are always looking for improvement of course, and have conferences with our dealers looking at new opportunities. We believe there is a gap - a lot of it based on service, stock range and levels, quick response to customer needs and financing. There is definitely opportunity in this market.”

Parallel with this pre-owned segment is Imperial Select’s new car business, a multi-franchise operation with 177 showrooms, 48 registered dealerships and 57 individual footprints. “In each area we have different footprints. For example, we might have a Hyundai and a Renault business in Natal and a Kia and a Renault Business in Pretoria.”

//WE ARE STARTING TO SEE A SMALL GROUP OF YOUNG PEOPLE COMING INTO THE INDUSTRY WITH A CLEAN SLATE WHO HAVE VERY QUICKLY EXCELLED IN THE INTERNET SPACE IN TERMS OF THE NUMBER OF DEALS THEY ARE DOING// While Imperial Select is always looking at growth areas, Barlow says it’s critical in the current economy for a dealership to raise dealer-throughput figures. “With the market having shrunk in the last two years, all dealers in South Africa are looking to see how they can increase their throughput per dealer, and this is why there is so very little expansion going on at the moment.

“However, with new entrants into the economy all the time and

new suburbs being developed, we would definitely go into the growth areas, and in fact I have just opened a new Kia, Renault and Imperial Select business dealership in Pretoria North, Zambezi drive.”

But Barlow will not be adding more brands to the already extensive top name portfolio. “No, I think in South Africa we have too many brands for the current market, and maybe a little over dealerised as well across all the brands.”

The South African auto industry

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INDUSTRY FOCUS: AUTOMOTIVE

trade body, NAAMSA is hopeful that there will be a modest improvement in new vehicle sales during the second half of the year. This is on the back of expected GDP growth of around 1.5% for the South African economy, with private consumption expenditure growing from 0.8% to around 2%.

And last month came a rare green light, with new car sales recording growth for the first time in 14 months. However, this was triggered by a massive increase in sales to the vehicle rental industry, a specialised market and a development with limited feelgood implications for the wider trade.

“The performance of the Rand,

increases in energy and import costs, and fairly high food inflation have created an incredibly tough environment,” says Barlow. “But it also forces you to find better ways to save, to operate and find ways to be more efficient.

TOUGH TIMES: SMART RESPONSE “And I think this is what dealers have been going through over the last 18 to 24 months. How do they work smarter, reduce their cost base, how do they offer the customer a great proposition? And most of the dealers have managed to come through this. Those that haven’t learnt will now be in a very tough spot.”

A cut-throat scenario?

“Well it’s certainly very price competitive, and the internet allows the customer ease of shopping, making it easy to the prices up against one another. But I don’t think it’s reached the stage in South Africa where it’s terribly cut throat. I have seen worse in other countries.”

More than a consumer tool for price comparisons, for Imperial Select, the internet is poised to become a major sales weapon.

“In the dealership sphere we believe we have one of the best.

Currently 60-63% of our used car sales are generated from an internet lead, not necessarily through Imperial Select since we also play with a number of main aggregators

//Face it: you need a Super Ace! When you get behind the wheel of the Tata Super Ace EX2, you’ll discover a rich range of features, including unmatched engine performance, an efficient load body and enhanced driving comfort and safety.

The Tata Super Ace EX2 is powered by a 4-cylinder turbocharged intercooled 1405cc diesel engine, giving you high fuel efficiency, low operating costs and enhanced performance – which means a better bottom line for your business.

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The Tata Super Ace EX2 boasts a narrow 5.1m turning radius and power steering, giving you the freedom and manoeuvering flexibility to navigate narrow roads, busy streets and sharp corners with ease.

Additional driving style features include a digital clock, sleek dials, cup holders, a power socket and an elegant external appearance.

Safe driving is at a premium with the Tata Super Ace EX2, and active and passive safety features are standard, along with enhanced security measures for your vehicle and your valuables.

This versatile workhorse also comes with complete driving peace-of-mind including a 3 year/100 000km warranty, a 3 year/60 000km service plan and a 3 year roadside assistance plan.

To find out more about the Tata Super Ace EX2, visit www.tatasa.co.za.

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INDUSTRY FOCUS: AUTOMOTIVE

and are active on their websites.

“I think what makes us more successful than others is our sense of urgency and the value we put on leads. It’s a very strong medium and one to which you need to give a lot of attention. But it’s what goes on behind the website that really counts; the tools we provide our teams to work with that gives them the advantage of reaching the customer quickly.”

It’s a structural shift with obvious implications for a salespersons skills set. “In recruiting sales staff we want a blank slate.

Then we profile, test and train. It’s all about people; their selection, training, the mentoring and looking after them.

NEW MILLENNIUMS “I certainly think the older generation of sales people battle. The new millenniums coming in are likely to be more au fait with what people want than their managers. They have come to know the value of an internet leads and that there is a certain way and a certain style to deal with this type of lead. It’s quite different from when somebody walks into your showroom floor - who have probably done their online research anyway.”

In this New World of selling, Imperial Select will be looking for desk-free applicants working with their own device. “It’s a fresh project for this year and we are starting to test this.

“We are starting to see a small

group of young people coming into the industry with a clean slate who have very quickly excelled in the internet space in terms of the number of deals they are doing.

“They are already surpassing seasoned veterans, and since they understand this new area of people and how they want to be served, we want to bring them into management.

These are the young people we are earmarking for greater things.”

IMPERIAL SELECT 087 365 0004 www.imperialselect.co.uk

//Powerful Educational Solutions In 2003, automotive industry expert Stefan Vermaak and his small team founded Thethani Corporate Consulting - a leader in face-to-face training solutions. In 2005, the company was rebranded as Innermation SA™ and it is now recognised as a pioneer and innovator in up-skilling and employee development.

This unique and innovative company offers training, development and education to companies across various industry sectors and, importantly, Innermation delivers skills that are relevant to the workplace and immediately implementable.

Alongside this, all training activities are measurable in real time to provide a true organic Talent Management solution.

Initially, Innermation™ targeted the automotive industry and focussed on delivering specialist short courses for the development of sales and marketing skills. Before founding Innermation™, Vermaak had been involved in the automotive industry for some time as a driver, new and pre-owned vehicle sales consultant, sales manager, regional dealer brand leader and national fleet sales manager before moving into a consultancy role where he headed up product and sales training. He grew these sales training offerings until major international brands in SA including Volkswagen, Peugeot, Mercedes-Benz, Kia Motors and General Motors were all realising benefits.

“People don’t buy products. People buy people,” he says. “Educating your sales force is the only way to increase your bottom line and future-proof your business.”

Today, Innermation’s™ solutions are gaining results in all retail sales environments. As the customer service landscape changes with the introduction of new brands and products, and with many external pressures, it is now vital that your customer-facing staff, from reception to branch managers, are equipped with the necessary skills to perform their duties optimally within the workplace.

“Business has been conned into spending the majority of the budget to attract a customer. There is very little left to spend on what the customer experiences when they do respond to the call for their business,” says Vermaak.

Education within the workplace is arguably one of the greatest opportunities for companies to stimulate growth in profitability, customer satisfaction, and consistently meeting monthly sales targets, and in the automotive industry these are imperative. That is why industry-leading organisations such as Caltex, Samsung Electronics, Mitsubishi Motors, Glasfit, Kia Motors, Imperial Select and many more are now successfully utilising the services of Innermation™.

“With products unique selling features versus their direct competitors dwindling at a rapid rate, the future sales success of your retail sales and after-sales care departments is dependent on the differentiation in bespoke talent that is developed and incubated within the workplace,” says Vermaak. www.innermation.co.za

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JAGUAR LAND ROVER

A new discovery...

And A Jaguar For Africa PRODUCTION: Colin Chinery

For decades icon brands in South Africa, Jaguar Land Rover are poised to launch head-turning new entrants into the region’s showrooms. “The Jaguar and Land Rover product line-ups are the most desirable they’ve ever been,” says Jaguar Land Rover South Africa and sub-Sahara Africa Managing Director Richard Gouverneur. “Our vehicles live up to their promises and offer customers unrivalled luxury, sportiness, capability and refinement, the same qualities that make them so aspirational.”

INDUSTRY FOCUS: AUTOMOTIVE

//

These are exciting times for Jaguar Land Rover South Africa and sub-Sahara Africa, with the launch this year of the All-New Land Rover Discovery – the most capable, practical and advanced SUV in its segment – and revised styling and new technologies for the midlife-refreshed Jaguar F-TYPE sports car.

Over the last 12 months Jaguar Land Rover South Africa has successfully introduced the latest model of its award-winning XF sports sedan, as well as the F-PACE - its debut into the SUV market expected to see tremendous growth over the next four years.

First launched in 2008, the XF is credited as the model that wowed the market and helped build the brand’s success. The new XF takes it further by making use of Jaguar’s expertise in aluminium manufacturing to offer a model that is lighter, faster and packed with even more technologies.

“The Jaguar and Land Rover product line-ups are the most desirable they’ve ever been, with state-of-the art vehicles that have exciting designs, thrilling performance and unmatched capability,” Jaguar Land Rover South Africa and sub-Sahara Africa Managing Director Richard Gouverneur tells Enterprise Africa.

SENSUAL DESIGN “The first year’s F-PACE sales figures have already proven the demand for a Jaguar that has the ability to traverse more challenging terrain without sacrificing the brand’s trademark driving enjoyment or sensual design.

“F-PACE has proven incredibly successful in South Africa and our sub-Sahara Africa markets, increasing the appeal of the brand among a completely new set of car buyers. It’s also been a global sales success with Jaguar Land Rover’s sales up 20 per cent year-on-year,” he says.

Other new models in 2016 included the Jaguar F-TYPE SVR – the ultimate expression of Jaguar’s performance credentials - and the F-TYPE sports car

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with a thundering V8 soundtrack and the ability to accelerate from 0-100km in just 3.7 seconds and on to a top speed of 322km/h.

Land Rover also expanded its line-up with the Evoque Convertible; the world’s first premium compact convertible SUV. Thanks to Land Rover’s legendary off-road expertise, drivers can now enjoy nature or the city in all weathers and road conditions without sacrificing the comfort and refinement they’ve come to expect in a Range Rover.

The history of Land Rover in South Africa goes back almost as far as the Land Rover story itself. Soon after the first Land Rovers were built at the Solihull factory in the English Midlands in 1948, they began to appear in South Africa, proving invaluable across Africa’s inhospitable terrain.

“Since then Land Rover has grown from strength to strength,” says Gouverneur, “establishing itself as the de facto brand for explorers, adventurers and families who want a vehicle that does not compromise on capability or practicality. At the same time Jaguar cars became desirable not only for their performance and driving enjoyment but also their seductive styling.”

At a global level Land Rover and later Jaguar became hot properties among manufacturers looking to expand their portfolio, with first, BMW’s acquisition of Land Rover, and then Jaguar and Land Rover by Ford, before the two were united as Jaguar Land Rover when Tata Motors bought both brands in 2008.

BEST OF BRITISH Jaguar Land Rover South Africa and subSahara Africa started operations in that same year, bringing employees from each brand and region into a single head office. “With a global vision to offer customers premium vehicles from two brands that have a rich heritage and represent the best of British engineering and excellence experience, the company has set out to transform and

diversify its product line-up.

“As well as this, our vehicles live up to their promises and offer customers unrivalled luxury, sportiness, capability and refinement, the same qualities that make them so aspirational.”

Jaguar Land Rover has won numerous awards in Africa including an Africa’s Best Brands award at the 2016 World Brand Congress in Mauritius.

“Both our research and performance in sub-Sahara Africa tell us our brands are desired and remain aspirational in the region.”

Jaguar Land Rover has invested heavily in expanding its footprint in both South Africa and sub-Sahara Africa, offering customers a premium retail experience. As a result, the South African market has seen the introduction of new retailers in key areas including the all-new Jaguar Land Rover Sandton facility – largest Jaguar Land Rover retailer in Africa. In subSahara Africa Jaguar Land Rover and its in-market distributors have opened new facilities in Zambia and Kenya.

South Africa will also see the opening this year of an all-new retailer in Tokai, Cape Town, while five dealerships will be renovated or rebuilt in line with Jaguar Land Rover’s global corporate identity, with a further 12 planned for 2018.

“Along with serving as the face of the brand, these new, state-of-the-art facilities have been designed to offer a world-class customer experience, from arrival to sales to service,” says Gouverneur.

A sector pace-setter, Jaguar Land Rover is a leader in aluminium manufacturing, with all vehicles featuring intensive use of the material.

Jaguar’s sports sedans, SUV’s and sports cars have class-leading driving dynamics and refinement, while Land Rover’s leadership in off-road expertise endows its vehicles with a range of technologies making them the most capable in class.

All Jaguar Land Rover models have hand-crafted interiors featuring the best materials and finishes for a premium

INDUSTRY FOCUS: AUTOMOTIVE

British look and feel. Complementing this is a range of world-class infotainment, audio entertainment and connectivity technologies that allow the vehicles to seamlessly integrate with consumers’ digital lifestyles.

ELECTRIC EFFECT The second part of next year should see the launch of Jaguar’s first all-electric five-seater performance SUV, the zeroemissions, 0-100km/h in around four seconds I-PACE. Is the market sufficiently mature for a premium electric super car?

“Absolutely,” claims Gouverneur.

“Our competitors are already active in this growing market segment, with either full battery electric or

RICHARD GOUVERNEUR JAGUAR LAND ROVER MD

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plug-in hybrid electric vehicles. With a combination of premium design, performance, practicality and longdistance range, we believe that I-PACE will not only be very competitive, but also offer no-compromise electric motoring.”

As an importer of vehicles into South Africa with no export credits to take advantage of the fluctuating rand, it has been difficult to avoid passing price increases on to consumers, says Gouverneur. “All manufacturers and importers in South Africa have been affected by the deterioration of the Rand. However, its recent improvement, while still highly volatile, does offer some respite against higher

than inflation price increases.

“2016 in our sub-Sahara African markets was very challenging, particularly with many markets suffering a lack of foreign exchange and coping with the impact of a declining oil price, affecting Angola and Nigeria in particular.

“Additionally, some markets have had changes in government and this has driven new legislation and country transition which in the short term has impacted the economy while realignment takes place, such as Tanzania and Zambia.”

Overall JLR has enjoyed continued growth in the premium sector across many markets, notably Kenya, where sales are bucking the trend, taking a 42% market share. “In Mauritius, Jaguar

JAGUAR LAND ROVER

volume has doubled year on year and we increased market share in a very competitive premium segment. Senegal, Ivory Coast and Ghana have also seen steady volume growth in difficult economic environments.

“With continuous partner investment in new facilities and new product introduction in 2017 Jaguar Land Rover looks forward to continued growth and increased market share in the sub-Sahara Africa markets,” explains Gouverneur.

AFRICA: A HUGE MARKET The African business is hugely important to Jaguar Land Rover, says Gouverneur, MD for the region since 2014 after being Network

Development Director for Jaguar Land Rover in the Middle East and North Africa region.

“Our partners in sub-Sahara Africa have invested and continue to invest heavily in Jaguar Land Rover franchises, through building or refurbishing state-of-the-art retail facilities that offer customers a worldclass, premium retail experience. Our confidence in our products into Africa is clear, where we have launched Extended Warranties and Service Packages as standard on our vehicles, a first for a premium manufacturers to do in Africa.

“We welcome the challenges of doing business in the developing

African markets and building affinity for our brands as well as attracting new customers, especially with the introduction of the Jaguar F-PACE which really is a Jaguar for Africa.”

JAGUAR LAND ROVER (012) 450-4000 crcza@jaguarlandrover.com www.landrover.co.za

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CASTROL SA

Extending Engine Life for

The Best Miles

PRODUCTION: Manelesi Dumasi

Castrol SA has been driving excellence in the oil and lubricants markets for more than 85 years. It’s product range is second to none and its sponsorship and marketing portfolio ensures the name remains synonymous with quality performance.

//

Castrol has been supplying its innovative, unique and highly respected products to markets in Southern Africa since it opened up in South Africa in 1929. Products were imported from the UK and distributed around the region by what was known then as Wakefield Company. The business supplied into the automotive market, the mining industry and many others as its name and reputation grew.

In 1960, Wakefield Company changed its name to Castrol South Africa and since then, it has been in a league of its own, driving the oil and lubrication industry forward with innovative ideas and special marketing campaigns.

As a company on the cusp of market and product development, Castrol is important to South Africa and its growth and expansion is good for complementary industries and companies in the country. The company markets itself and its products aggressively, not just in SA but in many markets around the world. You’ll find Castrol sponsoring events, cars, drivers, and targeted initiatives, keeping the name on the tip of the tongue for customers, old and new.

ENVIABLE PRODUCT RANGE With a large range of products, that can meet the need of industrialists,

manufacturers, motorists and many other users, Castrol is a true industry leader. Three of its most popular products include Castrol GTX, Castrol EDGE and Castrol MAGNATEC – all engine oils with superior performance.

A new variant of the popular GTX brand, Castrol GTX ULTRACLEAN promises a healthier engine thanks to cleaning properties that help to eliminate harmful sludge build ups.

“As a vehicle’s mileage increases, its engine can become susceptible to sludge – a thick, tar like substance that, if left untreated, can cause poor running, loss of power and even engine seizure. It can build up in an engine’s vital oil ways,

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INDUSTRY FOCUS: AUTOMOTIVE

restricting the flow of oil, preventing it from protecting the engine,” the company says.

“Small particles of dirt, that are generated through normal engine running, become attracted to each other. As they come into contact with each other, they can combine to form larger particles that fall out of the oil, leading to sludge. Castrol GTX tackles this build-up of problems head on. Its unique double action formula breaks down and cleans away existing sludge and protects from sludge reoccurring by preventing dirt particles forming larger particles. Castrol GTX helps extend engine life for the best miles ahead.”

One of Castrol’s most impressive products, Castrol EDGE, has been advanced with the input of engine designers from around the world and is now one of the most highly recommended engine oils on the market. Used by many of the world’s most prominent racing teams, EDGE is one of the most robust solutions for those looking for strength and endurance, and with the edition of titanium FST engines can operate at maximum performance levels.

24 / www.enterprise-africa.net

“The need for better fuel economy, reduced emissions and the demand for high performance has led to smaller but more powerful engines,” Castrol explains.

“As a consequence of these advances in engine design, engines work harder and at higher pressures than ever before. The oil needs to withstand pressures of up to 10,000 kg per cm2, the equivalent of five cars balanced on one square centimetre.

The only thing stopping metal to metal contact is a thin layer of oil so the oil needs to be strong and remain strong.

The unique titanium FST in Castrol EDGE physically changes the way oil behaves under extreme pressure. It doubles Castrol EDGE film strength and reduces friction by up to 15%. We’ve pushed the boundaries of technology to bring customers our strongest, most advanced engine oil for maximum performance.”

In April 2016, perhaps the most recognised of all the Castrol products, Castrol MAGNATEC was labelled as ‘the best motor lubricant in South Africa’ at the Product of the Year awards, the world’s largest consumer-voted programme that identifies innovation in

the products and services industry.

“We’re delighted and pleased to see the continued wide acceptance of Castrol MAGNATEC 10W-40 among South African consumers,” said Managing Director of Castrol South Africa, David Bouet.

“This award is testament of the support and endorsement by South Africans for our brand. We have the best products, rated amongst the best in the world by SA consumers – this is a real indication that our strategies to lead the industry in terms of technology continue to deliver the results.

“What makes Castrol MAGNATEC 10W-40 the best motor lubricant is that it protects your car’s engine during the critical warm-up stage when up to 75% of engine wear occurs. Its intelligent molecules cling to critical parts when the oil drains down and cling to your engine forming an extra layer of protection during warm-up and beyond,” added Bouet. “If you needed another reason to make sure you have only MAGNATEC in your own car, Product of the Year should be it.”

CASTROL SA

STRONG PERFORMANCE IN CHALLENGING CLIMATE With the South African economy facing significant challenges in recent years, only narrowly avoiding a downgrade by international credit agencies at the end of 2016, some industries have struggled.

Mining, automotive, manufacturing and heavy industry, all important for Castrol, have all been hit by slowdowns and difficulties but in 2014, 2015 and 2016 the company continued to perform well and advance its industry leader status.

Castrol saw a 5% increase in oil sales in Africa in 2015 compared to 2014, and according to Ken Research, the lubricant market in South Africa is expected to reach USD $1.8 billion by 2020.

“Some markets have no dollar availability, such as Angola and Mozambique. During these tough economic times they make their dollars available for primary goods,” Bouet told Engineering News. “We hope to find a way to support them.”

“Doing business in Africa is about resilience. Commodities behave in a cycle, and we must remember that. We need to keep supporting – to keep the faith. What is true today can change tomorrow. The same is true for South Africa,” he added.

Predictions of improving new and used car sales, along with a resurgence of the mining and construction industries in the coming five years also makes for good reading for Castrol.

Gauteng, the Western Cape and KZN account for around 80% of total lubricant consumption in SA and as such, Castrol will look to position its brand strongly in these urbanised hubs.

back in 2008, the project recently received extra funding and new sponsorship, and is now headed for the record books aiming at achieving 1050 mph.

In December, testing of the jet fuel system for the project was completed in Newquay, England. The car combines a hybrid rocket motor with a Rolls-Royce EJ200 jet engine to produce 47,500lbs of thrust – equivalent to 135,000 thrust horse power and Castrol EDGE will work to ensure the clean and stable running of this potential record breaker.

BLOODHOUND’s Chief Engineer, Mark Chapman said: “This test marks a milestone in the development of the Supersonic Car. It’s the culmination of many months of engineering, detailed planning and high tech manufacturing, all made possible with the support of world class sponsors.”

Castrol has a history with land speed records and has been involved in

21 record breaking performances. The current record, standing since 1997, is just over 763 mph. Andy Green will drive the BLOODHOUND SSC and attempt to break his own record by reaching 800 mph, and then more than 1000 mph in 2018. Former Global Chief Executive of Castrol, Paul Waterman said: “We are delighted to support the Bloodhound project. At Castrol, we have a proud history of fuelling pioneers and this partnership gives us the chance to showcase how our high-performance products set new standards and push boundaries.”

CASTROL SA +27 (0)11 488 5111 infosa@za.bp.com www.castrol.com

BLOODHOUND PROJECT A major project that Castrol SA is involved with, as a sponsor and supplier, is the BLOODHOUND Project, set to take place in October 2017 in South Africa’s Northern Cape. The spectacle will see a group of British engineers and scientists attempt to break the world land speed record in a rocket powered car along a 10-mile stretch of Hakskeen Pan desert. Started

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KANSAI PLASCON

Creating a Pan-African

Paint and Coatings Business

PRODUCTION: David Napier

After being acquired by Japanese company Kansai Paint in 2011, South Africa’s Plascon paint brand is now aiming for market leadership across the entire African continent. Kansai Plascon Africa CEO, Farid Masood, tells Enterprise Africa that the company hopes to more than double in size in the next five years.

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INDUSTRY FOCUS: PAINTS AND COATINGS

//

Much of the success realised

by South Africa’s leading paint and coatings business, Kansai Plascon, is owed to its long, interesting history and rich brand heritage. Its roots stretch back more than a century, to a time when there was little industry in South Africa, and when the company offered floor polish, carriage varnish, and ready-mixed tinted paints. It was the brainchild of Herbert Evans, a Welshman who had moved to South Africa and brought his trade with him.

After his arrival in Johannesburg and the establishment of his business, growth came quickly. Herbert Evans & Co became known for quality, and excellent customer service. At the same time, Solly Rudner was building his own company, Chrome Chemicals, the manufacturer of Plascon Paint.

Plascon quickly became recognised as an industry leading product and in 1945 created its own company, Plascon Paints and Chemical Industries.

In 1970, Plascon Paints and Chemical Industries merged with Herbert Evans & Co to form Plascon Evans, which for the next 30 years became the driver of innovation and excellence in the retail, trade, industrial and furniture coatings markets in South and Southern Africa.

With the Japanese acquiring Plascon in 2011, the new focus is on creating a

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business with a footprint across most of the African continent.

Recently appointed CEO, Farid Masood tells Enterprise Africa that, despite the fact that Plascon’s owners reside in the Far East, direction and strategy planning for the Pan-African business remains in South Africa. “We define the business plan and how we want to grow,” he adds. “Whilst we get input and guidance from Japan, goals are set by the team, management and board that sits here in South Africa.

“The acquisition of Plascon by Kansai was part of Kansai’s aspirations to become a much more global business,” he says. “Kansai’s philosophy has been to give acquired businesses autonomy, allowing them to operate the way they have in the past. Plascon has been a South African business for the last 128 years and the brand surely remains South African. So we are trying to leverage the benefits of this very strong Plascon brand in the market, combined with the expertise we extract from Japan, to grow across Africa.”

Having originally focused only on auto paint manufacturing, Kansai has grown and is now one of the largest suppliers in the world for OEM auto paint. “Many of the Japanese auto companies are our customers (Toyota, Nissan etc.), and we want to leverage

that R&D expertise into Africa - the R&D that goes into paint is first class,” says Masood.

Thanks to the local expertise, and the historic success that the company has realised in the decorative paints market, Kansai Plascon Africa is beginning to contribute ideas and innovations to the global business.

“Plascon is a leader in decorative paints with world class products that have been developed locally in SA, which are helping Kansai grow throughout the world, “ explains Masood. “In Africa, we have developed a design and décor concept using paint in conjunction with design. We call it ‘Spaces’ and Kansai has adopted that concept, using it in different parts of the world, most recently in Russia.”

PAN-AFRICAN GROWTH Masood explains that today, the ultimate goal for Kansai Plascon is to build a Pan-African business and continue with the type of growth that has been achieved throughout its history, with his immediate focus being on expansion in East Africa.

“On my agenda, East Africa is the number one area for growth and we have already started an operation in Kenya. With the substantial opportunities available in this territory, together with our expertise and brand, we are well positioned for East African growth,” he says. “In East Africa, we think Kenya is a market that will continue to grow, supported by favourable economic and political developments that are happening there. It’s very exciting for us. Uganda, Tanzania and Ethiopia are all very strong destinations for the coatings business.”

The company already has three iconic manufacturing sites in South Africa, at Mobeni, KwaZulu-Natal; Luipaardsvlei in Krugersdorp; and Epping in Cape Town. The most recent addition being a manufacturing and distribution business for decorative paints in Nigeria, established through a local partnership. Automotive

KANSAI PLASCON

Refinished coatings will be introduced in Nigeria in due course.

Slow growth in South Africa has emboldened the company to move quickly and accelerate its African growth. “We see massive growth across Africa and we want to be the leading player in all regions of Africa,” says Masood. “The SA economy has remained flat for a number of years, limiting our growth in this market and hence we are looking to East and West Africa for expansion opportunities.

Both are markets that we see growing with infrastructure development and construction. We will consider greenfield, acquisitions and partnership opportunities to expand, as we’ve done in Nigeria with the local partnership set up. We will use this as a base to expand into other areas, particularly Ghana, Ivory Coast and Senegal.”

With the SA economy not creating

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big opportunities for growth, some companies have struggled in recent years and have been forced into consolidation strategies rather than PanAfrican growth. Minimal GDP growth, constantly changing exchange rates, low investor confidence and political uncertainty have not helped encourage serious growth, but fortunately for Kansai Plascon, the effect of a bleak economic outlook has not caused serious concern.

“We’ve been able to maintain our current position, although we haven’t grown as much as we should have,” says Masood. “We’ve been a premium brand, at the high end of the market in Africa for a long time. That part of the market has remained flat and we don’t see much growth there. We do see growth in the mid-tier decorative segment and that is where we will be repositioning ourselves. In the next couple of years,

we will be expanding into these segments aggressively. There’s a lot of opportunities around industrial and protective coatings, we also have a very strong auto-refinish business and we will be growing those areas as well.”

PAINT PEOPLE Even with all of the innovation and technological advancements that Kansai Plascon has achieved, it would not have grown to hold the strong position that it does now without the ongoing commitment and passion of its people.

Masood views people development as a business imperative and explains that being able to harness skills from other parts of the world is a real advantage.

“People strategy is critical. One of the biggest advantages is being part of a multinational group,” he says.

“Attracting, selecting and developing people to the level that is needed for

2017/01/31 10:40 AM

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INDUSTRY FOCUS: PAINTS AND COATINGS

//TRANSFORMATIONAL THINKING MEETS TRANSFORMATIONAL DOING Accenture has been helping major international companies develop transformative business solutions so that they can build strong futures for more than six decades. Locally and internationally, Accenture delivers transformational outcomes for a demanding new digital world.

In 2014, at the SAP Africa conference, Accenture was introduced to exciting paints and coatings company Kansai Plascon – a business that was on the cusp of a major transformation, bringing on board all-new modern technology systems to keep in touch with customers and markets in a way befitting of a modern Pan-African organisation.

“We got an understanding of the technology modernisation programme that Kansai Plascon was about to embark on,” explains Cameron Tandy, Managing Director – Energy and Chemicals at Accenture. “We started the formal relationship in early 2015 and joined a far-reaching technology modernisation programme that Kansai Plascon was running – the Synergy Project. At its heart, that project was about transforming the entire back end technology infrastructure of the organisation and take the company to the next level, giving them the underlying infrastructure to achieve their expansion ambitions.

“Specifically, we are the implementation partner for their SAP ERP programme and we replaced all of the ageing back end technologies with a wide-scope, wall-to-wall SAP solution. It includes a lot of modern functionality, leveraging the latest SAP technologies, cloud, mobility and more,” he adds.

Movement across different technology platforms, updates to latest solutions, and effectively managing these changes comes with risk, cost and potential business disruption. This is why it pays to partner with a seasoned, knowledgeable and proven provider. As Kansai Plascon continues its growth in East and West Africa, Accenture will remain a trusted partner on this journey.

“These type of technology transformations are hard but we’ve completed it together. We recognise that Plascon is a proudly South Africa brand and it’s important for us to bring the best of Accenture. We’ve built a trusted relationship, we’re a partner, we support their SAP systems and we’re now driving a number of initiatives around enhancing the platform that has been established and building on the next level of technology.

“At our heart, we’re a technology business and technology is borderless. In an ever increasing digital world, the expectations of technology are the same in Kenya as they are in South Africa or Europe. With cloud and digital, everything is borderless so people have similar, high expectations wherever they are in Africa,” says Tandy.

“Kansai Plascon drove an ambitious programme with a number of firsts for us in South Africa and it’s great to work with a partner that is so forward thinking,” he concludes. www.accenture.co.za

the next ten years is a challenge, but we are geared as an organisation to achieve this. We have a large Kansai business in India and Asia, we have operations in Japan, we’re growing in the Middle East and North Africa, we’ve just bought a company in Europe, and so this opens up significant opportunities for collaborative learning as we grow and learn from each other around the world.

The CEO himself has utilised his experience with the company in other regions to help his own development and now, working with a large and experienced team, he says that it’s the quality of the employee base that allows Kansai Plascon to set its standards so high.

“I have spent the last 10-15 years working in emerging markets and helping businesses grow from an investment banking and private equity

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stand point and that has helped me. I helped Kansai set up the business from a financial perspective in the Middle East and North Africa and that’s how I got to know the company.

“When they asked me about expanding across Africa, I knew that I could bring my expertise and help them grow but I had to learn about the paint business. When I was interviewed, I explained that I didn’t know much about paint, but I was told I have 2700 people across Africa who know a lot about paint. I bring knowledge on finance and running businesses in emerging markets, and we have a lot of people who know about running a paint business. So, we work together as a team, where our combined strengths enable us to set higher expectations and deliver on our goals,” he says. Since joining the business in April 2016,

Masood has set out his ambitions very clearly, and with a strong brand, international quality standards, world class innovation, and extensive local industry knowledge, there’s no reason why these goals cannot be met.

“We want to grow our business by two and a half times in the next five years and the key to achieving this ultimately is through building a capable organisation with skill sets that will meet the new business challenges across Africa, “ he concludes.

KANSAI PLASCON 0860 20 40 60 advice@plascon.co.za www.plascon.co.za

© ANGLO AMERICAN

ANGLO AMERICAN PLATINUM

Platinum Miner Positioning for

Strong Future

PRODUCTION: Manelesi Dumasi

A positive production report, ongoing investment into innovation and CSR projects, and an expectation of positive financial results for the past year have all combine to make for a positive outlook for one of South Africa’s leading PGM miners, Anglo American Platinum.

//

With many industry commentators pessimistic about the current state of the mining industry, you can forgive Anglo American Platinum for being upbeat about a positive 2016 fourth quarter production report, the expectation of improved financial results and the successful investment into innovative technology businesses.

Demand for platinum in local and international markets has far outweighed supply for some time, thanks to the prominent use of the precious metal in automotive and

related sectors, and with South Africa responsible for approximately 80% of global platinum supply, and Anglo Platinum the recognised leader in South Africa, this company shoulders huge responsibility. However, for Anglo Platinum, the focus is not on flooding the market with excess supply, it’s more about stabilising the price and hoping that it will climb back up after a serious decline on the back of a global commodity price drop.

Of course, the first step towards settling market dynamics is ensuring success internally, and continuing to

create a product that is desired by consumers.

The company’s Q4 production report showed that total platinum production (metal in concentrate) was up 2% to 610,100 ounces as a result of improved performances during the quarter at Mogalakwena, Unki, and at JV operations’ Kroondal and Bafokeng Rasimone Platinum Mine (BRPM). Also, impressively, the report confirmed that the Number 1 furnace at Waterval smelter was successfully rebuilt and is operating at full capacity. The rebuild was completed ahead of schedule and Continues on page 36 www.enterprise-africa.net / 33

GLASSES

WATCH CELLPHONE

XSCANN TECHNOLOGIES

BELT COINS

Xscann Technologies is an innovative company that has been operating within South Africa for several years and is responsible for the development of state of the art Body Scanner solutions that are in operation throughout Africa and the rest of the world. By utilizing the cutting-edge technology offered by Xscann, companies eliminate the usual problems associated with conventional body searching methods and send a message of zero tolerance to potential smugglers. For customers who place importance on the prevention of smuggling of precious metals and gems, the Full Body Scanner is an essential security tool. The new machine offers outstanding image quality of the entire body with high image resolution and a flicker free display making it an effective tool for the detection of: 1. Precious stones – including diamonds, 2. Precious metals, 3. Objects Concealed internally or externally, 4. Contraband and threat detection (weapons, explosives, narcotics, etc.)

System description

Dual view X-ray Body scanner (BS16HR-DV)

Xscann Technologies boasts an in-house developed X-ray Management Software (XMS).

Xscann X-ray management software (XMS) Includes: Once off software licensing, Matrix configuration for gender segregation, various access control integration (e.g. Babylon, Impro, Opto, etc.), Algorithm to ensure that personnel will not be subjected to radiation exceeding 1mSv per annum, Logging of personnel radiation data for archiving, Reports generator.

XMS reporting includes: X-ray totals by radiation, X-ray totals by name, Over quota individuals, Excessive entries, Excessive dummy scans, Excessive holds, Scan logs, search logs, etc.

Major Installations (Over 30 completed projects): • Diamonds industry: Petra diamonds – 2 units, Letseng diamonds mine (Lesotho) – 1 unit, Kao diamonds mine (Lesotho) – 1 unit, Liqobong diamonds mine (Lesotho) – 1 unit, Alexkor – 2 units, • Gold industry: Sibanye Gold – 2 units, Rand Refinery – 2 units, Harmony Gold – 2 units • Platinum industry: Impala platinum – 5 units, Anglo American (PMR) – 5 units, Lonmin – 6 units, Heraeus SA – 1 unit, Tanzanite one (Tanzania) – 2 units Contact details: Address: 6 Guernsey Drive, Longmeadow East, Edenvale Tel: +27 11 608 1504 Fax: +27 11 608 1570 Email: info@xscann.com, axel@xscann.com, charl@rdscreening.com, rudzani@xscann.com Web: www.xscann.com, www.rdscreening.com, www.smithsdetection.com

INDUSTRY FOCUS: MINING

Continues from page 33 at lower expected capital expenditure of R95 million.

“The feedback on the report was that it was well received. The comments we’ve got state that it was a solid set of production numbers. Production reflects the actions that the company has taken over the past year to manage business for the current price environment. Investors buy into the strategy that Anglo Platinum has and how we’ve geared the business going forward so it was within expectations and there weren’t any surprises,” says Anglo Platinum.

The current price environment (less than $1000 an ounce) has been caused by a number of combining factors. A slowdown in Chinese infrastructure spending has resulted in slower demand from the Eastern power house, and this has in turn resulted in oversupply from primary PGM producers (South Africa, Russia and Zimbabwe).

“Chinese demand, more stringent emissions regulations in Europe in auto manufacturing, the level of above ground stocks, and a whole host of issues have impacted on price. The underlying fundamentals of global commodities remain and we need to ride out the environment that we’re currently in,” the company says.

The platinum mining industry has seen its fair share of problems in recent years, especially when it comes to labour. Numerous strikes, labour disputes and retrenchments have led to discontent throughout not only platinum mining but also the wider industry. Because of this, Anglo American as a group will use its centenary year celebrations to reconnect with its employee base.

“Commodity pricing definitely has an impact on employees. The industry has seen subdued prices over a number of years but the company adapts. We’ve implemented a number of restructuring processes and that can impact on the overall morale of employees in the

36 / www.enterprise-africa.net

organisation. We’re repositioning the entire portfolio and with that, adapting to prices and volatile economic conditions. We focus on change management and reconnecting individuals with the culture and the organisation. This is Anglo’s centenary year and the main drive of the centenary celebrations is to reconnect individuals with the company and create a coherent force going forward,” the company says.

INNOVATIVE INVESTMENT Anglo Platinum has a history of investing in innovative technology solutions that can help to develop the business and the industry, alongside investing in market development strategies with international partners and stakeholders.

A recent investment of note saw Anglo Platinum invest into small scale gas-to-liquids technology business Greyrock Energy. Greyrock’s systems use proprietary catalysts to convert methane rich feedstocks into premium transportation fuels while also generating significant potential environmental benefits.

Greyrock’s catalysts incorporate metals produced by Anglo Platinum.

Greyrock’s Direct Fuels Production™ and Flare-to-Fuels™ product lines convert flare gas, natural gas, natural gas liquids, bio-gas, or other similar feedstocks that would otherwise be wasted into clean liquid transportation fuels, with hydrogen produced as a by-product during the process. The hope is that development of this technology will result in increased demand for PGM products through the growth in the fuel cell electric vehicles (FCEVs) industry – fuelled by hydrogen.

“If you look at investment opportunities, this is an integral part of the strategy of the company and it’s about investing for the

future as we build a stronger, more dynamic Anglo.

“We will continue to aid the widespread commercial adoption of fuel cells and hydrogen in transport and other sectors. We see opportunities in the South African market as a manufacturing location for fuel cell products as the need in SA is so wide. We have pilot sites in rural areas where we have fuel cells generating electricity for rural communities and the creation of that industry, along with manufacturing, installation and maintenance, is aligned with the national development plan and governments industrial development priorities,” Anglo Platinum says.

Andrew Hinkly, Executive Head of Marketing at Anglo American Platinum, said: “We support the commercialisation of new applications that use our metals, particularly those that are synergistic with our business and existing portfolio companies. Greyrock’s systems produce clean transportation fuels that could be used by Anglo American in its operations while simultaneously providing a solution to the environmental challenge posed by flaring. This investment in Greyrock boosts demand for our metals while simultaneously working to reduce the delivered cost of liquid fuels and hydrogen. Our investment in Greyrock adds yet another building block to our portfolio of investments.”

Robert Schuetzle, Greyrock CEO said: “We are excited to partner with Anglo American Platinum. Their investment will allow us to accelerate the deployment of our technology across the globe. In addition to adding Anglo American Platinum as a strategic investor, Greyrock looks forward to working with the company in other important areas where there are synergies.”

Previously, Anglo Platinum has invested in Ballard Power Systems, Altergy Systems and Johnson Matthey

ANGLO AMERICAN PLATINUM

//IF YOU LOOK AT INVESTMENT OPPORTUNITIES, THIS IS AN INTEGRAL PART OF THE STRATEGY OF THE COMPANY AND IT’S ABOUT INVESTING FOR THE FUTURE AS WE BUILD A STRONGER, MORE DYNAMIC ANGLO// Fuel Cells and all of these advances form part of Anglo American Platinum’s PGM Investment Programme, which provides growth capital to companies that can demonstrate the commercial viability of products or technologies that use or enable the use of the company’s metals.

A RESPONSIBLE CORPORATE CITIZEN While the industry waits for a price upturn, Anglo Platinum will continue to invest in the communities where it operates. In 2015, the company spent R546 million on social investment initiatives but in the future, a new strategy will be adopted to ensure that this type of spend makes the largest possible impact.

“We had a change in strategy relating to how we look at CSR funding and we realised that what we spend at mine level is not adequate to meet the full range of community needs and expectations so we’ve initiated a study around economic and social change in Limpopo,” the company says.

“It has identified a more holistic approach with the intention of linking people and places, and being more effective in what we do with social projects. It’s about looking at what a province needs and relating that to national priorities. Our strategy then moves towards a development partner strategy and that means we will create partnerships with other regional stakeholders in the area to impact communities in a much more sustainable way. We will start to see the effects of this in 2017 and onwards.

It’s about regional socio-economic

development rather than just one mine, and we hope it will filter through to benefit the wider South African economy.”

Anglo Platinum will release its financial results for 2016 this month, and its integrated report in March, and more details on CSR spend will be revealed. Of course, with headline earnings and headline earnings per share for the twelve months ending 31 December 2016 set to be at least 20% higher than the previous year, it’s safe to say that restructuring programmes are working and future investment will continue.

“We aim to be a positive influence on growing the economy rather than investing outside of South Africa. We will continue to invest in low capital, high-return projects and our chrome recovery plant that we’ve built at the Amandelbult mine is an example.

“We are in South Africa, we will remain in South Africa and we will do all we can to uplift the economy and the communities in which we operate,” the company concludes.

ANGLO AMERICAN PLATINUM +27 (0)11 373 6111 www.angloamericanplatinum.com

www.enterprise-africa.net / 37

© ANGLO AMERICAN

KUMBA IRON ORE

ET Carbon Disclosure Leader

Award for Kumba

PRODUCTION: Karl Pietersen

Kumba Iron Ore, part of Anglo American, has been named as a Carbon Disclosure Leader for 2016 by Engaged Tracking (ET) Index Research, a company that ranks the world’s largest companies according to greenhouse gas emissions and disclosure.

//

When Anglo’s Kumba Resources was reorganised in 2006, and its coal and heavy mineral operations were spun off, Kumba Iron Ore and Exxaro Resources were formed. Kumba Iron Ore became responsible for heavy minerals and Exxaro for coal. Since then, the company has continued with a worldleading operation, producing iron ore for domestic and export markets.

Used mainly for the production of iron and steel, Kumba’s international

customers come from China, Japan, South Korea, Europe and the Middle East, and they come because of the company’s reputation. Former CEO, Norman Mbazima said: “Iron ore is a critical commodity that the world cannot do without. Our products are valued for their superior physical properties and we are known for our consistent high product quality and reliability of supply.”

Today, Kumba Iron Ore is Africa’s leading producer of the sought-after

commodity and one of the top ten largest producers in the world. Its two mines; Sishen and Kolomela, have an annual capacity of around 40 million tons. Sishen, in Kathu in the Northern Cape, contributes 37 million tons; Kolomela, in Postmasburg, also in the Northern Cape, contributes around 10 million tons; and Thabazimbi, in Limpopo, was contributing around one million tons – mainly for the domestic market before the announcement of its closure thanks to

www.enterprise-africa.net / 39

INDUSTRY FOCUS: MINING

economic reasons in 2015. Sishen and Kolomela produce mainly for export markets, but also for local customers, and they load product onto dedicated rail lines that run to the Port of Saldanha Bay, South Africa’s largest natural anchorage and port for transport around the globe.

In recent years, Kumba has faced challenges, thanks to a changing economic environment and falling global commodity prices, but it remains an important organisation for South Africa, bringing in large amounts of tax revenue and significantly supporting the communities in which it operates. The company employs around 13,000 people and has expressed its ambition to further grow its local production while also establishing a presence in West Africa.

Growing production locally is

something which Kumba, and Anglo, have been looking at for some time.

In order to facilitate this growth, the Sishen and Kolomela mines have become two of the major driving forces behind a new mega water project in the Northern Cape. The R18 billion Vaal Gamagara Water Project began in October 2016, when Water and Sanitation Minister, Nomvula Mokonyane hosted a sod turning ceremony, citing ‘increased demand is the expanding iron ore and manganese mining operations’ as the driving force behind the project. The water project will bring increased capacity and improved pipelines to the area.

ENVIRONMENTAL RECOGNITION As one of South Africa’s most important industries, mining is increasingly placed under

the spotlight when it comes to environmental sustainability.

Traditionally, the industry has been cast in a negative light thanks to high carbon emissions, ageing technology and machinery, and suspect impacts on land when the mine reaches post production stages. In recent years, there has been a major drive towards implementing green principles and making operation efficient and as environmentally friendly as possible.

Many methods have been discussed including measures such as reducing water and energy consumption, minimising land disturbance and waste production, preventing soil, water, and air pollution at mine sites, and conducting successful mine closure and reclamation activities.

International organisations including the UN and the World Bank have

© ANGLO AMERICAN

40 / www.enterprise-africa.net

KUMBA IRON ORE

//IRON ORE IS A CRITICAL COMMODITY THAT THE WORLD CANNOT DO WITHOUT. OUR PRODUCTS ARE VALUED FOR THEIR SUPERIOR PHYSICAL PROPERTIES AND WE ARE KNOWN FOR OUR CONSISTENT HIGH PRODUCT QUALITY AND RELIABILITY OF SUPPLY// adopted and promoted the use of such measures.

Anglo American has implemented a company-wide environmental focus, with a special emphasis on water, to ensure that every effort is made to improve environmental sustainability.

The organisation claims that in 2015, 64% of its water usage came from recycled sources.

In South Africa, In December 2016, Kumba Iron Ore was recognised as one of the Carbon Disclosure

Leaders for 2016 by Engaged Tracking (ET) Index Research. ET ranks the world’s largest companies according to greenhouse gas emissions and disclosure. Those that include clear reporting on carbon footprints and efforts to improve environmental sustainability, on company reports and websites, are researched and ranked. Kumba was the only company from the BRICS region on the list in the annual ET Carbon Rankings.

Sam Gill, CEO of ET Index

Research, said: “It is particularly encouraging to see increasing action from institutional investors to mitigate the carbon and climaterelated financial risks within their portfolios over the last 18 months.

With the Paris Climate Agreement now in force, institutional investors are increasingly planning how to reallocate capital as the transition to a low carbon economy gathers pace.”

Chris Huhne, Co-Chair of ET Index Research and former UK Secretary of State for Energy and Climate Change, commented: “Carbon and climaterelated risk are increasing. With global corporates responsible for up to 70% of GHG emissions, our ability to keep warming to a manageable level will depend on strong leadership from the world’s largest companies.

One of the key purposes of the ET Carbon Rankings is to highlight those

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INDUSTRY FOCUS: MINING

© ANGLO AMERICAN

KUMBA IRON ORE

//CARBON EMISSIONS ARE PART OF A COMPLEX RANGE OF GLOBAL ENVIRONMENTAL ISSUES WHICH THREATEN TO EXACERBATE CHALLENGES SUCH AS FOOD INSECURITY AND COMPETITION FOR WATER AND LAND, WHILE POTENTIALLY ALSO UNDERMINING HEALTH AND LIVELIHOODS// companies that are leading the field and taking action today.”

Themba Mkhwanazi, CEO of Kumba said: “I am delighted that Kumba has been acknowledged in the ET Index for its excellence in carbon disclosure reporting as this forms an important part of our commitment to sustainability. Reporting is a powerful management tool that enables us to change behaviour and improve operations while further increasing transparency for our shareholders and stakeholders.

“As a company, we recognise our responsibility to work with our stakeholders to continually improve our sustainability by tackling the causes of climate change such as carbon emissions. Not only will this help us manage risk and meet rising stakeholder expectations it also encourages us to embrace new efficiencies and operational excellence.

“Carbon emissions are part of a complex range of global environmental issues which threaten to exacerbate challenges such as food insecurity and competition for water and land, while potentially also undermining health and livelihoods.

Kumba will continue to help combat the causes of climate change and to protect our employees, assets and host communities against its potential impacts by striving to achieve best practice in sustainability and corporate reporting.”

Of course, with the onset of environmentally friendly mining,

many companies with long histories will have to look at changing the way they do business in order to remain relevant. For those that do not embrace this change, there will be significant challenges. Some studies from prominent universities in South Africa and around the world have suggested that subscription to green mining principles can result in financial savings, making mining operations more viable.

FINANCIAL PERFORMANCE After a number of difficult quarters, Kumba is expecting to release a more positive set of results for the year ending 31 December 2016 on 14 February 2017. “Kumba’s headline earnings and basic earnings for the period are likely to be at least 20% higher than the comparative period translating to an increase of at least R758 million and R94 million, respectively. In this regard, HEPS and EPS are also likely to be at least 20% higher than the comparative period translating to an increase of R2.36 and R0.30, respectively. The expected increase in earnings is largely attributable to the increase in export iron ore prices during the year and the weaker average ZAR/US$ exchange rate,” the company said in December.

Some have credited Themba Mkhwanazi, who replaced former CEO Norman Mbazima when he stepped down in July 2016. Mkhwanazi is a former CEO of Anglo’s SA coal division and has backed an efficiency

drive that has seen production and workforce cut but significant increases in earnings compared to previous years.

In November, BMI Research, global economic research company, part of the Fitch Group, said that it expected iron ore prices to remain constant throughout 2017 but turn unpredictable in 2018.

“We expect iron ore prices will trade between $50-70 a tonne over H1 2017 as additional Chinese stimulus measures will tighten the market, providing support to prices over the next six-to-nine months,” the company said.

“From 2018 onwards, continued high-cost Chinese iron ore production cuts and slowing growth from major producers will reduce the global oversupply, and thus prevent a further weakening of iron ore prices,” a statement read.

While closely monitoring the global market in the coming months, Kumba will stick to performing its core business to the best of its ability.

“We produce a high-grade iron ore that is one of the minerals that society needs to develop and prosper. Iron ore is the key component in steel, the most widely used of all metals. It is used in the construction of buildings and bridges, and manufacturing of vehicles and many household appliances,” the company says, and while this statement remains true, there will always be significant demand for Kumba’s high-quality product.

KUMBA IRON ORE +27 12 683 7000 @AngloAmericanZA www.angloamericankumba.com

www.enterprise-africa.net / 43

SHOPRITE

Are We Close to Emergence of

Retail Champion of Africa?

PRODUCTION: David Napier

Shoprite is working on a tie-up with Steinhoff International. The result would be Retail Africa, one of the most diversified and powerful retail groups in the world, with almost 200,000 employees.

www.enterprise-africa.net / 45

INDUSTRY FOCUS: RETAIL

//

Last month, we learned more about the retirement of Whitey Basson as the CEO at Shoprite, and his replacement, former COO Pieter Englebrecht.

This came into effect on January 1st 2017 and, with Englebrecht a Shoprite veteran and longstanding colleague of Basson, the thought was that not too much would change and the business would continue to operate successfully as it had for the past 37 years. However, the future direction of the group was thrown into the spotlight last month when a statement was released announcing the intention of Shoprite to combine its various African retail operations with Steinhoff International.

The purpose of this combination of assets would be to create a ‘diversified African retail business of significant scale and international geographical reach’, named Retail Africa, that would be regarded as Africa’s retail champion.

Steinhoff and Shoprite’s largest shareholders, South Africa’s Public Investment Corporation (PIC) and Titan Premier Investments (Titan) have both issued their support to the idea and discussions are now underway between the board of directors for Steinhoff and Shoprite.

While the proposal is still in its planning stages, the idea is that Shoprite will acquire Steinhoff’s African retail operations (which includes Pepkor Africa, JD Group, Steinbuild, Tekkie Town and subsidiaries of all), and Shoprite will issue new ordinary shares to Steinhoff in consideration, pursuant to which Steinhoff will receive a significant equity interest in Shoprite. “The value for Steinhoff Africa Retail will be negotiated taking into account the best interests of both Steinhoff and Shoprite shareholders,” read a statement from both parties.

The creation of Retail Africa would result in an African ‘Walmartstyle’ business with significant power

46 / www.enterprise-africa.net

in international markets. Steinhoff deals mainly with furniture and household goods and has around 90,000 employees worldwide. The Shoprite Group of Companies is Africa’s largest food retailer and employs some 135,000.

Reactions to the announcement have been mixed but the general theme seems to be one of excitement.

“From Shoprite’s perspective, the Proposed Transaction is expected to position the combined businesses of Retail Africa as the leading multi-format discount retailer on the African continent. Retail Africa, locally bred, will have the required size and scale to compete with any other international retailer, making it a compelling value proposition for Retail Africa’s value conscious African customer base,” Steinhoff and Shoprite said in a joint statement.

“As the largest retailer in Africa, Retail Africa will employ approximately 186,000 people.

It is expected that the Proposed Transaction will further enhance Retail Africa’s position as an employer of choice and it is also anticipated that the Proposed Transaction will not result in any job losses. The combined group’s growth plans could lead to future job creation in various countries.

“The vision to create Retail Africa, which will be a formidable entity, having its roots firmly entrenched in Africa, is shared by both the PIC and Titan.”

THE WIESE EFFECT Chairman of Shoprite Holdings and Steinhoff, South African billionaire entrepreneur, Christo Wiese is said to be one of the initiators of the discussions between the two businesses. The 75-year old is a retail magnate and is involved with many of the continent’s most impressive businesses - he owns 16% of Shoprite and 18% of Steinhoff. However, the formation of Retail Africa would be

one of his crowing achievements, creating an organisation with approximately R200bn ($14bn) in sales.

Should the deal go ahead, Retail Africa will be around twice the size of its nearest competitors by turnover, more than three times bigger than Spar, almost five times bigger than Pick n Pay (including the Boxer, Liquor and Clothing units) and an astounding 18 times bigger than Massmart based on number of stores.

There is also speculation that the proposed transaction could lead to an eventual full takeover by Steinhoff of Shoprite, which commentators say could be worth up to $30bn.

According to the Financial Times, “a complete merger of Shoprite and Steinhoff would bring together a retail empire with more than 9,000 stores on every continent apart from Asia, compared with Walmart’s 11,500 worldwide.”

The statement released by both groups stated: “Steinhoff has entered into an in principle agreement with the PIC and Titan to acquire their interests in Shoprite as part of the Proposed Transaction in the form of a Steinhoff share-for-Shoprite share exchange, subject to an exchange ratio to be agreed which may ultimately result in Steinhoff acquiring control of Retail Africa.”

Back in September 2016, in an interview with Reuters, Wiese said that a tie-up between Shoprite and Steinhoff was ‘only natural’.

“People know that I am 75 years old, and I fortunately have a son who is in business with me, but as a family we are continually looking at consolidating our business interests.

So, it would be, in a way, a natural development,” he said.

Following the retirement of Basson, some see a deal between Shoprite and Steinhoff now likelier than ever. Before his retirement, Basson said: “Given the quality of Shoprite’s current management

SHOPRITE

team and their exceptional track record I foresee that the company will continue to grow from strength to strength. Fortunately, effective succession has always been a key focus for the management team and over the last few years many of the key operational responsibilities had already been successfully handled by the senior management team.” Clearly, he is confident that the company’s future will be well-managed and wellprotected, whatever direction is taken with the proposed transaction with Steinhoff.

Shoprite is already working closely with its sponsor, Nedbank Corporate and Investment Banking, and its legal advisors, Werksmans Attorneys, to weigh up the options and decide on the best way to move forward with the proposed transaction.

Madagascar with the acquisition of Champion supermarket group, and also Mauritius. Score Supermarkets’ Tanzanian operation was also purchased in 2002 by Shoprite. Over the ensuing years, the organisation (now one of Africa’s most trusted and recognised brands) received numerous local and international awards for excellence and continued to grow to reach the position it holds today as Africa’s largest food retailer with interests across multiple retail channels.

Over the years, thanks to a strict commitment to quality products and services at low prices, Shoprite is now one of the most trusted brands in Africa and, in South Africa, more than three quarters of the adult population shops at one of the Group’s supermarket brands. “We have always set ourselves as the supermarket with

the lowest prices and the highest level of customer satisfaction,” says Basson.

While all the talk of the proposed transaction and the creation of Retail Africa has been dominating the news around Shoprite, the business has carried on trading as normal.

With its roots firmly entrenched in South Africa, Shoprite places a big emphasis on CSR and upliftment of the communities in which it operates.

As such, the company has once again committed to the funding of more than 420 school places for young people through its annual ‘Class Of’ competition. Learners from Grade 1 to 12 submit essays or drawings depicting what they want to be when they enter the workplace, and Shoprite offers support to those who dream big and show real creativity, meaning they don’t have to worry

TRUST IN SHOPRITE Since its founding in 1979, Shoprite has focussed on growth through merger and acquisition (M&A) activity.

Steinhoff has also pursued an active M&A strategy, expanding its discount retail model beyond South Africa in recent years, including acquiring Poundland in the UK and Mattress Firm in the US. Shoprite was founded when Whitey Basson purchased an eight Western Cape-based supermarket business from the Rogut family for just R1 million. In 1984, after significant expansion, Shoprite purchased six food stores from Ackermans. In 1990, the business expanded into Namibia, and eventually purchased Grand Bazaars, increasing its presence by four times. in 1991, Shoprite bought the national chain, Checkers, increasing its presence six-fold. The group also grew into Zambia. In 1997, the acquisition of OK Bazaars Group was completed and a handful of other African countries were added to Shoprite’s footprint. 2002 saw expansion in

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INDUSTRY FOCUS: RETAIL

DR CHRISTO WIESE © STEINHOFF INTERNATIONAL

about affordability. This is one of many initiatives that the company is working on to develop the community and an example of how its influence goes beyond the retail environment.

POWERHOUSE If the proposed transaction moves forward, Retail Africa would potentially see more than 50% of its revenue come from food retail, with general merchandise (mainly

48 / www.enterprise-africa.net

clothing) offering the second largest contribution, and furniture third. It will be a powerhouse across Africa and would undoubtedly pave the way for further international expansion.

“It is expected that Retail Africa’s value proposition will provide its shareholders with a sustainable business where the growth and margin improvement opportunities are greater than the current individual businesses,” the joint statement said.

If everyone goes according to

the plans of Wiese, South Africa could soon be home to one of the world’s most prominent retail organisations, creating jobs and economic wealth for the country.

SHOPRITE @Shoprite_SA www.shoprite.co.za

PICK N PAY

A Prize

Pick

PRODUCTION: Emily Ayson

Founded in 1967 by Raymond Ackerman, the Pick n Pay supermarket chain has grown from just four small Cape Town shops to a retail empire of over 1100 grocery stores and 20 hypermarkets across South Africa and the African continent. Pick n Pay has a 49% share in Zambian chain, TM Supermarkets, total ownership of Boardmans and Boxer and subsidiaries in other consumer services such as flights, entertainment tickets and mobile telephone plans. However, such success has not come easily and there have been many challenges along the way. Political turmoil, inflation and the changing landscape of large-scale retailing have been particularly difficult issues. Regardless, Mr Ackerman has valiantly held the helm of the company and has been staunchly dedicated to not only providing quality, affordable goods, but for running an institution that genuinely cares for its staff, customers, country and planet. www.enterprise-africa.net / 51

INDUSTRY FOCUS: RETAIL

PICK N PAY

//

In the words of Mr Ackerman himself, “profits are the bloodstream of our economic world, but social responsibility is woven completely through a businessman’s whole existence”, a sentiment which he has never wavered on. Ackerman has always maintained that the purpose of his business is to conduct trade under three key tenets: customer sovereignty, doing good is good business and maximising business efficiency.

Underpinning these key principles is a commendable set of values in which the welfare of the whole Pick n Pack family usurps the sole impetus to make profit, even during times of economic hardship.

For one, staff are afforded numerous benefits to incentivise efficiency and overall job satisfaction. Pick n Pay provide good physical working conditions, excellent rates of pay and even housing loans to help fund their own living spaces. 80% of staff hold shares in the business and recruitment is only sourced externally in very special circumstances. In October 2016, it was reported that in the first half of the understatedly sluggish financial year, Pick n Pay still managed to create over 2000 jobs and open 74 new stores. However, 2016 is not the only year during which hard economic conditions could have caused disaster.

During South Africa’s apartheid period when food and money were extremely scarce, Ackerman subsidised bread prices to ensure that the basic food was available for purchase, even though the government landed heavy fines upon him. Similarly in the 60s, political leaders put heavy duties on in-demand items which induced price wars, but Ackerman retaliated by lowering item costs

and even buying forward to safeguard prices. 1983 was also a particularly difficult year for the whole of the South African economy, but Pick n Pay still came out on top with a turnover of over R1 billion, a figure which doubled over the following two years.

Much of this success in such turbulent times has been attributed to the loyalty of Pick n Pay ’s customer base; Ackerman and his colleagues have always strived to make a positive shopping experience the absolute priority of the business. Managing Director at Pick n Pay Namibia, Norbert Wurm has vocalised the company ’s acute awareness that “as a result of the pressure on disposable income, consumer spending has changed…consumers are

contemplative about each dollar they spend, seeking out specials and promotions to stretch their monthly income” and that customers are “more aggressively seeking out options that maximise value”. As such, in discussing counteractive measures to potential customer loss, Pick n Pay CEO, Richard Brasher has remarked on how competitive pricing structure has been instrumental for ensured continual custom and has also stated that Pick n Pay will always be on the front line of ensuring that food inflation prices are reduced.

However, it is not just in customer care that Pick n Pay excels, the company also has an incredible dedication to practicing business in a way that

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• We offer a range of after installation service so as to ensure that the branded unitary retains the highest quality.

• We have an excellent knowledge and relationship with the major retail chain stores which facilitates the installation process.

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www.enterprise-africa.net / 53

INDUSTRY FOCUS: RETAIL

is both ecologically and ethically responsible. On a logistical level, Pick n Pay ’s warehouses are built with the environment in mind.

The architectural design allows for maximum natural sunlight to enter buildings, lighting systems have motion sensors or dimming switches and solar panels encase roof spaces. Within the supermarkets themselves, the majority of seafood stock is from sustainable sources and a wide range of Fair Trade and organic foodstuffs are also made readily available. ‘Green Range’ packaging is being used increasingly across stores; these wrappings are 100% biodegradable and are the

54 / www.enterprise-africa.net

only eco-friendly receptacles endorsed by the South African Government. Similarly, standard carrier bags are made from 30% recycled material and in 2009, the introduction of a new longlasting, reusable eco-friendly bag created manufacturing jobs for 60 women.

The drive to help the wider community is also evinced in the fact that Ackerman has long been an advocate for individuals and small businesses in the wider community. In the 1970s, he and his wife founded the Ackerman Family Educational Trust, a fund to help graduates complete their university careers which has

helped 600 students to date. Pick n Pay ’s Small Business Incubator is a scheme that exists to help smaller allied businesses enter the market, providing mentorship and economic and collaborative opportunities for smaller merchandisers and producers.

Ackerman also donates around 6% of after tax profits to various other community development projects, once more remaining true to the values upon which he has founded his business. As such, he has been awarded with several honorary doctorates, the most recent from Rutgers UniversityCamden, who also hailed Ackerman as a ‘global leader ’ in

PICK N PAY

//PROFITS ARE THE BLOODSTREAM OF OUR ECONOMIC WORLD, BUT SOCIAL RESPONSIBILITY IS WOVEN COMPLETELY THROUGH A BUSINESSMAN’S WHOLE EXISTENCE// retail. He was also commended for both his business acuity and his commitment to sustainable and ethical trading and he is seen throughout the globe as an inspirational businessman.

Such a reputation is one that Ackerman is committed to upholding and even after so many years of ups and downs, he remains committed to safely and successfully navigating his business through the everchanging retail landscape.

Contemporarily, there has been a global slowdown in actual store trade due to the rise of internet shopping, yet another challenge being met by Pick n Pay. The company operates online and in 2015, reported a 38% turnover growth in online trade from the previous year. To meet increasing demand, an online picking warehouse was installed in the existing hypermarket in Brackenfell, but a new, large facility is just on the horizon

in Gauteng. With a willingness to adapt to a changing retail landscape but unwillingness to compromise on values, it is no wonder that Pick n Pay remain a stalwart of grocery shopping in South Africa. At the end of 2016 the company announced that it was in its seventh consecutive year of growth, a streak that looks unlikely to be broken in 2017 as customers continue to prize Pick n Pay.

PICK N PAY 0800 11 22 88 www.picknpay.co.za

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www.enterprise-africa.net / 55

JOHN CRAIG

An Original

African Outfitter PRODUCTION:

Timothy Reeder

Alongside a myriad of other factors, increased urbanisation is helping to drive retail in South Africa.

From its foundation in 1947 in Johannesburg as a family owned men’s outfitter, John Craig has grown to now encompass 60 stores nationwide, a local brand which continues to uphold its dedication to classic styling, quality and exclusivity.

INDUSTRY FOCUS: FASHION

//

Over the course of its 60 year lifetime, John Craig has had to evolve with its customer and the changing times in order to continue to deliver in line with its own stringent standards.

The retail sector in South Africa is among the healthiest in the country, and some 60% of the population of African countries predicted to be living in cities by 2050. With this increased urbanisation comes an increased drive behind consumption and significant retail potential.

John Craig profits from this remarkable growth through its ability to offer a variety of brands and stylish fashion - everything from suits and shirts to denim goods and chinos and spanning the entire spectrum of smart to casual.

Bolstering this is an extensive collection of footwear, accessories and gadgets, which combine to mean that its growth and popularity amongst South African men continue to increase today. Such a commitment to quality and variety is one crucial element helping it to combat the increasingly dominant force of globalisation and compete with its more worldwide competitors; to illustrate this, H&M, Zara, Hamleys and Forever 21 have all entered the South African market in recent times.

Gavin Tagg is Managing Director of Retail Network Services, a fullservice specialist retail strategist and leasing company which offers a holistic and personalised service to retailers and developers, with the aim of achieving optimal returns on their shopping centre developments and investments. At an event hosted by the South African Council of Shopping Centres’ (SACSC) in Gauteng last year, Tagg remarked upon the effect of this trend towards urban living which is seeing more and more people coming to live in the country’s economic centres, as they in turn drive a demand for

58 / www.enterprise-africa.net

//ALL PROMISES WERE KEPT IN METACOM’S ROLLOUT PLAN//

more retail infrastructure.

Tagg also highlighted in his recent statement how vital it has become for businesses to build retail brand trust, with brand loyalty having become more important than ever before and retailers now needing to be seen as more than mere traders, rather identifiable bodies with strong principles. It is no coincidence that this boom in retail potential has occurred at the same time that social media has become an important retailer influencer, offering retailers and shopping centres the opportunity to relate to consumer expectations.

“The days of only taking a mass market approach is a thing of the past,” was how Tagg summed up this new approach to the sector. “Personalisation is the new approach. You have to talk to your customers,” he stressed.

The John Craig way of life translates to providing exceptional, timeless menswear for the sophisticated man. This is only achieved through the personalised attention which Gavin Tagg highlights, along with individualised and unparalleled customer service. What has been central to John Craig’s steady, continued development and expansion has been its ability to develop a high-quality range of brands, all of which are made exclusively for the John Craig customer. The Muratti clothing range is the company’s take on classic Italian styling. Ranging from casual to formal garments, Muratti’s success is built on three fundamental rules for South African men: Firstly, Muratti has to be the right fit and tailoring for your build. Secondly, Muratti is both

accessible and practical, and readily available with the right balance of quality, style and affordability.

Finally, Muratti offers true, timeless style, essential in building a solid and lasting wardrobe which can be updated as often as desired.

John Craig is also able to offer its exclusive footwear brand Carano, which boasts a large selection of brogues, lace-ups and slip-ons to sandals meaning that all needs can be catered for. The trademark John Craig quality is on show here with their full leather uppers and outers, with a real focus on providing these stylish products at an affordable price to take care of needs from work to weekend. Its most recent addition to its arsenal has been the brand new classic men’s trouser brand Dobber, which offers comfort, quality and style at the lower end of the price bracket. This is a wide range of chinos to be worn at any time throughout the year and which can be dressed up or down, offering the same valuable versatility to ensure that many occasions can be covered by a single pair.

Of course, the ability to adapt operations to fully maximise the potential of the available technology is key to any company’s continued success. John Craig made headlines in recent years through its implementation of a new Metacom communications platform to 85 stores in South Africa in just three weeks, which will offer increased reliability at a much reduced cost.

“Our parent company’s business strategy required us to consolidate on a single platform,” says Deon van der Wath, Director: Risk Management for John Craig. “When Metacom showed me a three-week

JOHN CRAIG

rollout plan I thought it was overoptimistic to say the least, but they completed the rollout exactly to the timeline and within budget. All the promises were kept. That’s very rare.”

Metacom’s communications infrastructure combines a managed private network with a range of routers and other hardware devices, all of which come together to ensure seamless uptime. According to Metacom MD, Réan van Niekerk, “ADSL is an excellent technology but it’s not a guaranteed service, so all our devices are designed to fail over to cellular networks when necessary.

Each one contains dual SIM cards so there’s a second failover if one network goes down.”

“Having the dual failover will definitely increase our uptime,” Van der Wath goes on to clarify.

“The Telkom network is not always

reliable − copper cables get stolen, for example − and we need a robust network. Without data we can’t run our business; it’s as simple as that.”

With John Craig having just opened its first store in Namibia and with several more currently in the pipeline, Van der Wath explains that Metacom is also the service provider in these new locations. “They have staff based in Namibia and can offer local support,” he states, “which is far more cost effective for us than trying to do it from Johannesburg.”

Van der Wath and his staff also have Web access to a management console, which means that they are able to monitor every branch and its events as they happen, with the management of the network performed by Metacom. “In the past five years, our network throughout Africa has grown to the point where

we are now very confident in our ability to roll out and support secure, reliable networks on very short timescales,” says Van Niekerk.

“We now have many thousands of devices in the field, all actively monitored and managed from our international operations centre.

There’s no other service provider that can offer this kind of reliability at such low cost.”

JOHN CRAIG 011 615-0133 info@johncraig.co.za www.johncraig.co.za

www.enterprise-africa.net / 59

FANCOURT

A Lifestyle

In Paradise PRODUCTION: Colin Chinery

A famed leisure and lifestyle destination, Fancourt South Africa’s leisure complex near George in the Garden Route is also celebrated for its world-class golf courses. And while focused on growing the golf business and hotel occupancy rates, CEO Georgie Davidson tells Enterprise Africa about its strategy of increasing business conferencing and events offerings to grow out of season revenue.

www.enterprise-africa.net / 61

INDUSTRY FOCUS: HOSPITALITY

//

First came the Garden of Eden followed somewhere along the trail by the Hanging Gardens of Babylon. And for the discriminating of the 21st century there is South Africa’s Garden Route, 200k of sublime landscape and natural life between Mossel Bay and Storms River in the Western Cape.

This is a micro world of scenic wonders, white sandy beaches, 700-year-old yellowwoods, elusive forest elephants and mountain hideaways. And for the daring and sporting, the world’s highest commercial bungee jump and international-class golf courses.

Surrounded by the Outeniqua Mountain range are three of the finest - The Links, Montagu and

Outeniqua - all located in the Fancourt South Africa leisure complex seven kilometres from George Airport, and recently voted on CNNGo among the World’s 10 Best Golf Resorts.

LIFESTYLE LUXURY With a luxury-spa, four restaurants, two five star hotels, 19 manor houses, and the celebrated golf courses designed by a team headed

by Gary Player, Fancourt is the region’s outstanding leisure and lifestyle destination. Landscaped in 613 hectares of lush countryside, the array of on-site and off-site venues and activities is hugely impressive.

Since the estate was transformed into a hotel and golfing destination in 1989, its management

has focused on growing the golf business along with hotel occupancy rates. And like a good golfer navigating his way through fairways and bunkers, Fancourt is succeeding in its strategy of increasing its business conferencing and events offerings to grow revenue in the golf and hospitality slack periods.

“While Fancourt is probably most well-known for golf and hotel offerings, it’s important to remember that these are elements of the business that inevitably have lulls throughout the season,” says CEO Georgie Davidson.

“To combat this and stimulate activity during slower periods, we offer a first-class business conferencing and events service – something the modern hotel can rarely afford to go without ranging from 350 attendee national business conferences to smaller get-aways. It’ has always been our goal to maximise the winter period by getting the volume up and increasing the spend.”

It’s a strategy being driven by local partnerships’ rather than new

GEORGIE DAVIDSON FANCOURT CEO

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FANCOURT

facilities. “This is something we are doing by, for example, using other facilities and conferences that flow over between say two hotels.

We have quite extensive facilities ourselves, and until these are fully utilised we will not be looking to add to them. And while not investing in new products, we will continue to re-invest in our infrastructure but putting a different angle on utilisation.

“I think you need to have a holistic approach to an event and align yourself to the client’s goals.

We are finding more and more the need to understand a company’s values and ethos. For instance, a pharmaceutical company might be more health conscious, which means you might be catering differently and doing more raw foods. You have to be more flexible and more

adaptable to the corporate need.”

Originally from Zimbabwe, Georgie Davidson has an impressive career in the hospitality and tourism industries spanning some 26 years. Appointed as CEO in 2014, she oversees an estate the size of Monaco and a staff of 200. “We get a very good mixture of business, with families and golfers making up the primary mix, and in off season the more corporate events.”

PRIME PROPERTIES And along with its portfolio of leisure, dining, eventing and worldclass golf, the Fancourt estate is also home to some of the Garden Route’s most prime real estate. Catering to a broad spectrum of clients, each property type is tailored to encompass both unmatched style and uncompromising levels

of comfort, with the spacious landscape providing balanced, secure and exclusive living, complimented by modern lifestyle essentials.

“Residential property is a major part of our business, and with people enjoying living closer to the Fancourt facilities, one that is growing and having great feedback.

However, we continue to develop very responsibly. The owners have been involved with Fancourt for 22 years and have always developed responsibly with low-density and will continue to do so.

“We have released a new 45-plus development, currently undergoing the environmental impact assessment and which we hope will be on sale later this year.

We are in no rush, and while it’s a big element of Fancourt, we have no

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INDUSTRY FOCUS: HOSPITALITY

wish to flood the market or in any way develop irresponsibly.”

Meantime Fancourt is continuing to increase the number of golf rounds played on its celebrated courses. Significant growth last year saw the figure reach to 52,000, fast closing on the target of 60,000, part-driven by a strategy that includes - from a residential perspective - member and visitor engagement and encouragement to increase visit frequency, and from the hotel perspective, growing the rounds notably in the low season.

“We have included golf rounds into hotel packages, making them more attractive for a longer stay, which in turn has significantly increased the longer stays.”

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And while The Links, the Number One South African course and the first in Africa to achieve world ranking is “a marketing dream,” says Davidson, “one must always be sensitive.

“The Links is a private club and an exclusive one, so access and capacity is always going to be restricted and one has always to be cognisant with that. So from the marketing viewpoint the focus is more on the Montagu and Outeniqua.

LIFESTYLE ESTATE “From golf perceptive, we are not up to capacity so we are not looking at new courses. I wouldn’t say that golf is a dying force, but it’s certainly a slowing force, and our

focus is on making Fancourt not just a golf estate but a lifestyle estate.

“It’s about family, lifestyle, segments that lend themselves to running, cycling and trail running.

There’s a great deal of this going on in the area, and we are finding more and more residents and visitors are diversifying. They may come to play golf but they might also cycle or run.”

Together with the South African Tourism Association, Fancourt has been successful in forming collaborations and creating a fund for the promotion of golf within the country. “Engaging with our partners, we are beginning to get some traction. We have met with Government who is now committing its support for us. In

FANCOURT

doing so we have almost forged the way for smaller industries to form collaborations, get them recognised and supported by Government.”

One such sector is adventuring.

From mountain walks to shark cagediving, South Africa is an adventure capital of the world, with over 130 adventures and counting. “As a segment of tourism, adventure is huge, but with not having a huge platform it’s not really recognised.

And to get that platform and secure international leverage is very important.”

THE CHALLENGE AND THE PASSION As 2017 rolls out, New Year sales targets are being met. “Our foreign investors continue, and across some areas exchange rates are playing

into our favour. There has been a challenge in areas such as visas and access - greater in the real estate than the residential sector – and we engage regularly with Government on a policy and tourism perspective.

It’s one of the challenges we deal with on an on-going basis. Another is the dearth of skills, something that concerns us moving forward.

It’s a hard-working industry and one you have to be passionate for.”

These issues aside, tourism continues to be a massive South African success. “And it’s still got huge potential. Golf tourism for example, has yet to reach its potential, and we should be leveraging this as a destination.

The tourist industry is dynamic, driven essentially by itself and

also very international; by its very nature, crossing borders. It’s not introspective.

“Yes, there’s certain nervousness about the economy, but I believe this is healthy. We need to be dynamic and move with the times.

The last season was very strong and all the indicators are that it’s still on the up. For Fancourt the forecasts are very positive.”

FANCOURT +27 [044] 804 0000 hotel@fancourt.co.za www.fancourt.co.za

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BANKING ASSOCIATION SOUTH AFRICA

Maintaining and Raising

African Banking Standards PRODUCTION: Timothy Reeder

No matter the business, individual or situation, one thing does not change: money is key, which makes keeping it secure all the more important. The Banking Association South Africa is an industry body representing all registered banks in South Africa, and encompasses both South African and international banks.

INDUSTRY FOCUS: FINANCE

//

The origins of The Banking Association South Africa were in its previous incarnation as the Council of South African Banks (COSAB).

This was formed in March 1992, when four separate associations addressing specific areas of activity in the banking sector were merged. Among these were the Association of Mortgage Lenders, Merchant Bankers Association, the Clearing Bankers Association and the Association of General Banks.

While relevant and effective at the time, COSAB’s committee-driven structure proved to be ineffective as an industry body as the industry itself continued to evolve, and in March 1998 the leadership of the banking sector elected to establish The Banking Council South Africa, an executive driven body structured to address the challenges prevalent in the banking sector at the time.

In March 2005, it was decided that the name of the body would be changed to The Banking Association South Africa, to reflect a more appropriate description of its representative role. Today, the Banking Association is charged with the responsibility of lobbying, influencing policy, guiding transformation, sparking constructive and sustainable change and engaging with stakeholders.

The organisation exists, at its root, to contribute to the enablement of a conducive banking environment, and so a large part of this responsibility ensuring that it participates at the highest level of decision making in the country. To achieve this the Banking Association has structured and organised itself to allow effective participation in cabinet, due to the calibre of both the people and the leadership that interact with Government at various levels and through various structures.

The South African banking sector is still very competitive, despite its very concentrated nature, and it continues to diversify its products and broaden its services within the

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context of international best practice.

Currently, the sector is made up of 17 registered banks, two mutual banks, 14 local branches of foreign banks, two co-operative banks and 43 foreign banks which have approved local representative offices. The Banking Association South Africa represents all banks registered and operating in South Africa, currently equating to 32 member banks. All licensed banks are members of The Banking Association.

South Africa is renowned for having a well-developed and proactively regulated banking system, and one which continues to compare favourably with those of industrialised countries.

The South African banking sector has, as a result, attracted a lot of interest from abroad, seeing a number of top foreign banks establishing offices in the country, with others acquiring stakes in major South African banks. Indeed, the 2015/2016 World Economic Forum Global Competitiveness Survey placed South Africa at 8th spot in Financial Sector Development, out of the 140 countries analysed.

The Banking Association last year welcomed the outcome of Standard and Poor’s (S&P) ratings review, resulting in a sovereign rating for the country. It put this down to the credibility and strength of its various institutions, amidst a climate in which challenging domestic, economic and political circumstances prevail. Cas Coovadia, Managing Director of the Banking Association, described the positive affirmation of the confidence that international investors and institutions clearly have in the leadership at the helm of its economy in both the public and private sectors.

“We will still have a long way to go in order to prove that we are firmly on a sound financial footing and economic trajectory. However, under the leadership of Finance Minister Pravin Gordhan, there are positive signs that we are beginning to chip away at the implementation of budget consolidation and structure economic reforms to boost the economy.

“We are cognisant that this has happened under difficult and trying personal and political circumstances for Minister Gordhan. We commend him for his single-mindedness, in placing the interests of our democracy, country and economy ahead of his own,” added Coovadia.

The Banking Association was keen to point out the implication of S&P’s decision. It saw it to be a reaffirmation of the importance of the collective effort by Government, business and labour to implement various concrete initiatives to avert a ratings downgrade, an outcome it remains resolutely determined to avoid. Additionally, it would help control and further improve public expenditure and debt level, achieve higher levels of economic growth, attract and retain investment, create jobs and reduce unemployment.

“Our collective efforts continue to pay dividends,” Coovadia said. “Junk status or not, we must sustain and intensify our joint initiatives to address the binding constraints and challenges we face. With S&P placing the country on a negative outlook citing concerns about economic growth and the implications of policy implementation does not result in an economic turnaround.” The investment grade credit rating affirmation demonstrated the resilience of the country and the determination of key role players to steer the economy in a positive direction, but the Banking Association hammered home the importance of continuing to work to avoid a ratings downgrade, with ratings agencies such as S&P liable to choose to revise their outlook in either direction.

Coovadia described as much when, just weeks earlier, ratings agency Moody’s had made the decision to maintain the country’s sovereign rating, some two notches above sub-investment grade. “Whilst, at this stage, we have done enough to avoid a downgrade by Moody’s, we cannot afford to be complacent,” The he expressed. “Moody’s has cited that

INDUSTRY FOCUS: FINANCE

the country is approaching a turning point after years of falling growth, but it has also placed South Africa on a negative outlook. This requires Government, business and labour to continue to work together with even greater determination to ensure the implementation of plans, to place the economy on a stronger trajectory in the near term.”

Marking nearly 15 years of collaboration, the Banking Association South Africa last year became the first Banking Industry Association in Africa, and only the third globally, to join the United Nations Environment Programme Finance Initiative (UNEP FI) as a supporting partner. BASA achieved a Supporting Institution Status through the partnership, which dates

back to 2002 and the World Summit on Sustainable Development which took place in Johannesburg. Since this time, the Banking Association has played an important role in setting up and supporting the Initiative’s Africa Task Force, in a bid to strategically promote sustainable finance in the South African banking sector.

In 2015, the Banking Association implemented its ‘Principles for Managing Environmental & Social Risks’, which recognise the role that financial institutions can play in the protection, promotion and fulfilment of social, economic and environmental rights in South Africa. In essence, they can be instrumental in setting the standards for conducting and reporting on their operations, business, lending and

investing practices in a sustainable manner. As responsible corporate citizens, members thus commit themselves to following the Principles as set out in their creation.

A key area of emphasis under the new partnership is expected to be UNEP FI’s new Positive Impact Initiative, focused on increasing the availability of finance for the purposes of environmental, social and development goals. this will be sought through the development of impact-based business and financing solutions. “South African banks have played a pioneering role in the region and the renewed partnership between BASA and UNEP FI confirms the country’s stewardship in relation to sustainable finance, opening up new possibilities towards achieving sustainability goals not only locally but also regionally and globally,” explained Careen Abb, Banking Commission Coordinator for UNEP FI. According to the General Manager for Human Settlements at the Banking Association, Pierre Venter: “The sustainable finance market is evolving rapidly. Adopting UNEP FI’s new Supporting Institution status is a strategic decision, which will support the banking sector in South Africa to keep abreast of global thought-leadership in this field, while maintaining a unique focus on how these matters impact the banks in the South African context.” The Banking Association South Africa and UNEP FI have partnered in order to continue building on the relationship already established to date, all while leveraging this new status in the interests of pursuing mutually beneficial objectives in African sustainable finance.

BANKING ASSOCIATION SOUTH AFRICA +27 11 645 6700 www.banking.org.za

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CAS COOVADIA BANKING ASSOCIATION MD

MTN SOUTH AFRICA

Strong

Connections PRODUCTION: Emily Ayson

The ubiquity of mobile telephones and computing devices is both inescapable and indispensable in the digital age. These hubs of technological convergence have become vital conduits through which information can be disseminated, knowledge cultivated and connections forged. The physical capabilities of these articles are developing at an impressive rate and therefore to keep the digital world turning, strong infrastructural systems must also be in place. In South Africa, meeting this unprecedented demand for fast, reliable and affordable internet and telephone networks is a mission being undertaken

by MTN South Africa. With astute business acumen and a dedication to philanthropic endeavours, MTN SA are truly going above and beyond to keep South Africa online, connected and educated.

MTN SOUTH AFRICA

//

Emerging in 1994 as one of South Africa’s only independent communications networks, MTN South Africa has developed a remarkable brand presence, reputation and financial success. Throughout its awardwinning history, MTN SA has been a leader in the implementation and improvement of mobile and internet networks in South Africa, continually meeting the changing and complex needs of customers; in 1995 the company enabled free mobile calls to the emergency services, in 1996 they made SMS available across the network and in 2002 it even installed a solar powered telephone in Lake

Victoria for the use of its fishermen.

Furthermore, MTN’s reach has begun to extend beyond South African borders, with coverage available in Africa, the Middle East and as of 2004, in Cyprus.

Providing first class, affordable call and data plans to individuals and businesses, the company has grown into a household name and currently holds a 37% share in the South African market and boasts over 230 million subscribers in 21 different countries. In 2011, MTN SA undertook the largest network infrastructure development project in the history of the company, bringing 2G network coverage to 98.9% of South Africa and 3G/Edge to 65%. In 2012, it further solidified its position as a national leader in the telecoms field when it introduced high speed 4G internet coverage to Gauteng and Durban, with further expansion into Cape Town, Bloemfontein and Port Elizabeth also on the horizon.

Such initiatives have resulted in MTN SA obtaining numerous awards and in 2014 it secured particularly prolific recognition by winning two Brand Finance Awards; the strongest and the most valuable brand in South Africa. This will come as no surprise when one considers that MTN SA is estimated to have a global value of R43.3 billion and in 2013 was the only South African institution to be included in a list of the world’s most recognisable brands: The Brand Finance Global 500. Proud of MTN SA’s achievements, Chief Marketing Officer Larry Annetts stated: “These awards are testimony to all the hard work that has gone into building this brand which has become synonymous with the ideals and vision that we all seek for this beautiful country. These awards embolden us to raise the bar even higher and provide our valued customers with the service that they have come to expect from us.”

But idealistic vision and brand recognition aside, what does this

all mean for South Africa on a more practical level? As is the case in many developing countries, the existence of internet and telephone networks means nothing if people do not have the spaces or physical tools to access and use such technology, particularly in poorer areas. It is precisely this notion that has caught the attention of MTN SA and the company have been tirelessly and humbly utilising its wares to educate and support South Africa’s less fortunate. The company has been recognised as the largest corporate investor in social responsibility initiatives in SA and during 2015 alone, the company invested R335 million into arts, education and health schemes directed at improving the lives of those in most need.

2014 saw a phenomenal effort to provide unrivalled access to freecirculating information, with MTN SA striking a deal with the overseers of Wikipedia to provide the online encyclopaedia to its mobile users completely free and without need of an internet connection. Former CMO, Brain Gouldie stated: “MTN is passionate about education…Given the pervasiveness of mobile phones in the country, it only makes sense for us to allow for a free access to this much needed resource. Through our products and services we continue to do good for South Africans”, attesting to the real level of care that MTN has for its customers and country.

Furthermore, online-based education has been brought to over 500,000 learners, 11,000 teachers have been trained and 386 ICT centres across the country have been established.

Notably, one of these is at the Bonalesedi Nursing College, providing tomorrow’s medical professionals with the tools and technology to enhance their learning. Similarly, MTN SA also established two safe houses for survivors of gender-based violence in the Eastern Cape, providing them with modernised buildings and much

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INDUSTRY FOCUS: COMMUNICATIONS

needed ICT equipment. MTN SA CEO Mteto Nyati addresses this wonderful scheme and the impact it has had on those that need the most help, by ‘opening up new vistas and avenues for impoverished communities and giving them renewed hope for the future’.

Even with an already remarkable portfolio, MTN SA is still dedicated to maintaining its high-speed trajectory of success. In December, the company and South Africa’s Minister of Communications, Faith Muthambi, unveiled 11 newly refurbished and equipped multimedia centres to schools in Mpumalanga. So far, this endeavour has cost an estimated R5.4million, but for Kusile MtunziHairwadzi, General Manager of MTN SA’s charitable division, this is a small price to pay. Further attesting

to the key role technology plays in the well-being and education of South Africa’s citizens, she says that: “The multimedia centres will go a long way in enhancing the quality of learning and teaching, and will equip the learners and the educators with the necessary tools to meet the challenges of the digital age.”

With the technologies of the connected age being so crucial and ingrained within our everyday lives, there seems to be an unspoken expectation that we should be able to get online anywhere and at any time.

The everyday South African desires to be able to connect, communicate and explore and for businesses, rapid data transmission and access to global markets is vital. It is precisely these needs that are being met by MTN SA with apparent ease and

pleasure. Having worked hard to roll out a reputable service, name and ideological image, the future looks wholeheartedly promising for the company, its customers and indeed its country. In all senses it is quite clear that MTN SA is providing individuals, institutions and businesses with the very thing they need to grow and develop in modern South Africa: strong connections.

MTN SOUTH AFRICA 083 123 3667 customercare@mtn.co.za www.mtn.co.za

//ACCENTURE AND MTN: DRIVING INDUSTRY 4.0 AND THE ADOPTION OF IOT As one of the world’s leading professional services firms, Accenture pushes the boundaries of what’s possible when it comes to solving its clients’ toughest challenges by providing unmatched offerings in strategy, consulting, digital, technology and operations. This highly respected business works with organisations in a range of different industries, and has been named as one of ‘Fortune’s World’s Most Admired Companies’ for 14 consecutive years.

Managing Director for Communications, Media & Technology, and MTN Client Account Lead at Accenture, Nitesh Singh explains that the synergistic focus of the two companies is on developing technology, business and strategy. “As MTN is laying down the underlying infrastructure and digital layers, organisations such as Accenture will help to create an ecosystems of digital markets on top of that. We see the world gravitating towards IoT and digitisation but above that there are digital markets, where there are different types of enterprises and consumers trading and working together. We want to help MTN accelerate the growth of these markets on the continent, break the barriers between countries, governments, etc. by building a digital ecosystem on top of these services.

“A paradigm shift is occurring globally for telecommunications providers and it’s about creating a digital market ecosystem leveraging new virtual layers and/or traditional physical layers that can be monetised otherwise you’ll find that infrastructure and telecoms providers will enable communities and governments but they’re unable to monetise their investment,” says Singh. www.accenture.co.za

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NETCARE

Continued Growth for

Care Giants PRODUCTION: Timothy Reeder

At Netcare, the key word is care. Whether this means ensuring the dignity of its patients and the members of the Netcare family or the participation of its people and its partners in everything it does, Netcare is passionate about quality care and professional excellence in its every operation.

//

Hospital and medical services group, Netcare Limited, is an investment holding company which operates through a number of subsidiaries and employs just shy of 29,000 people. The Netcare Group invests both in growing and in continually improving its capabilities and capacity, while in its partnership with the public sector it is also able to support the effectiveness of the national healthcare systems in which it operates. It is only through a triumvirate of continuous investment in the latest medical technologies, high-level professional expertise and commitment to caring for its patients that has allowed Netcare to become a leading healthcare provider.

Today, Netcare can proudly offer over 13,000 beds across its 116 hospitals, with its staff compliment of nearly 29,000 spread across these and its further 90 primary healthcare centres and a similar number of retail pharmacies. Several divisions combine to create the Netcare family, for instance its Netcare 911 arm benefits from its 85 emergency bases and an over

1000-strong paramedics team to carry out its vital work. Netcare’s owned and managed hospitals, meanwhile, are divided between two distinct branches; it has a total of 57 owned and managed hospitals, including four public private partnership (PPP) hospitals in SA and one PPP hospital in Lesotho, while BMI Healthcare in the United Kingdom counts 56 acute care private patient hospitals and three clinics of its own.

These are complemented by Medicross and Primary Cure, which provide family medical and dental centres and primary healthcare clinics respectively.

In January, Netcare heralded the arrival of its state-of-the-art cardiac catheterisation laboratory, commissioned at Netcare Union Hospital in Alberton, Johannesburg.

The facility is equipped with the latest technology for the diagnosis and treatment of heart and blood vessel diseases and conditions. It was an upgrade welcomed by Cardiologists at the hospital, one which will allow them to further improve safety and medical outcomes for cardiovascular patients.

Dr Farouk Mamdoo, an interventional

cardiologist who practises at Netcare Union Hospital, spoke highly of the possibilities the technological advancement would offer. “The facility, which has been completely revamped, is now equipped with a state-ofthe-art GE Healthcare Discovery IGS 730 interventional imaging system, which provides us with the very latest technology to accurately visualise the cardiovascular system and guide minimally invasive procedures. It is the first time that this cutting-edge system has been introduced in a hospital in South Africa,” Dr Mamdoo explained.

Interventional cardiologist Dr Chris Zambakides agreed that the new technology was an important advance for the hospital and heart medicine in the southern Johannesburg region.

“One of the most important advantages of the new technology is that images of excellent quality can now be achieved at lower radiation doses,” Dr Zambakides outlined. The first procedures undertaken in the new catheterisation laboratory have recently been completed, following extensive training to the interventional cardiac team and

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INDUSTRY FOCUS: HEALTHCARE

their becoming wholly familiar with the new system and its usage.

“The procedure was a tremendous success and the patient was able to return home just a couple of days after it was completed,” Zambakides said of its first forays with the technology.

Netcare Union Hospital’s General Manager, Esmé Abrahams, also clarified that such developments give patients access to the very latest in technology and medical care available in the field of cardiovascular medicine. “The new laboratory is equipped to international standards and served by some of the country’s leading cardiac experts, thereby further extending the level of clinical treatment we are able to provide to patients from the region,” she went on to conclude.

The close of 2016 brought with it too some exciting developments in Netcare’s service offerings. In December the Netcare Christiaan Barnard Memorial Hospital opened its doors to patients in its new home, a custom-designed 16-storey facility which houses state-of-the-art medical technology. “With the opening, our vision of a world class healthcare facility reflecting the spirit of excellence, innovation and sanctity of life cherished by the hospital’s namesake, Professor Christiaan Barnard, became a reality.

We look forward to this new chapter in the hospital’s unfolding story, which has thus far been rich in leading-edge medical advances,” stated Netcare CEO, Dr Richard Friedland.

The move represents a relocation from the premises it had occupied in the city centre since 1983 to a brand new premises on the foreshore, adjacent to the Cape Town International Conference Centre. Coinciding with the 49th anniversary of the world’s first human heart transplant, the hospital’s official launch was held on December 3rd, with tribute paid to this historic moment in world medicine at the event and attended by a number of dignitaries including the MEC for Health in the Western Cape, Dr Nomafrench

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Mbombo, and surviving members of the first human heart transplant team.

This purpose designed hospital is set to become a landmark in the City of Cape Town, due in no small part to its ideal new location which is easily accessible from all major freeways into the city.

The Christiaan Barnard Memorial Hospital offers a full range of medical disciplines, many of which are highly specialised, to the full spectrum of local, national and international patients.

61 of its 248 beds are of the intensive, high care variety for adults, children and neonates, with equipment also including 11 theatres and two cardiac catheterisation laboratories. The new hospital building has been designed to international safety standards and incorporates sophisticated green principles and technology at its heart, to ensure that sustainability is an ongoing concern. Considerable emphasis has also been placed on optimising infection prevention and control and enhancing patient wellbeing. It is a living tribute to its namesake, Professor Christiaan Barnard, who performed the world’s first heart transplant in 1967 and who left a legacy of clinical excellence and innovation in South African medicine.

Netcare had much cause for celebration at the release of the 2016 version of its annual financial results.

This success was seen across both of its principal operational domains thanks to continued strong demand for private healthcare in South Africa, and a raft of NHS e-Referrals driving UK activity growth. In its headline figures, Group revenue showed an increase of 12.1% to R37 796 million, with normalised profit looking even healthier: after taxation it was up 19.1% to R2 906 million.

Dr Friedland commented that the South African operations had delivered solid results, activity which benefitted hugely from the previous year’s investment in 584 new beds, while in the UK, he said, BMI Healthcare posted a credible performance in

what remains a challenging trading environment. Friedland summed up the year’s results with the following: “Overall demand for UK healthcare services continues to increase.

However, revenue per case is being impacted by a change in mix to lower tariff NHS work and more day and outpatient procedures.” Growth in NHS caseload continued as well, rising by 6.6% overall.

Friedland also stated his expectation that demand for private healthcare services in SA will remain resilient, despite low growth both in the economy as a whole and in levels of formal employment. He highlighted that, increasingly, medical schemes are introducing sizeable lower cost options which will put further pressure on margins in the 2017 financial year. “Therefore,” he explained, “it is imperative that we continue to seek efficiencies in our cost base and invest in IT and other technology projects that will partially mitigate margin pressure.”

In South Africa, capital expenditure in 2017 will be in the region of R1.7 billion, which includes the construction of 49 new beds, finalisation of the relocation of the Netcare Christiaan Barnard Memorial Hospital to the Cape Town foreshore and a substantial expansion of Netcare Milpark Hospital, as well as growing the oncology, day clinic and sub-acute networks. Furthermore, BMI expects to spend approximately £44 million on capital expenditure projects in 2017, which will have as their focus higher complexity procedures, new service lines, enhanced hospital infrastructure and technological developments.

NETCARE 0860 638 2273 ir@netcare.co.za www.netcare.co.za

Redefining

Neonatal Care

Care for preemies like never before.

The new Dräger Babyleo TN500. draeger.com/babyleo and #babyleo

TANESCO

Lighting Up Lives

In A New Era PRODUCTION: Timothy Reeder

Tanzania Electric Supply Company Limited (TANESCO) owns the vast majority of the electricity generating, transmitting and distributing facilities across the Tanzania Mainland. It was one of two private enterprises to be established at Dar es Salaam in 1931, and today seeks to be an efficient and commercially focused utility supporting the development of Tanzania.

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INDUSTRY FOCUS: ENERGY

//

At the turn of the century the first public electricity supply in Tanzania, at the time known as Tanganyika, was established by German colonialists at Dar es Salaam. In 1931, the Government handed over the undertaking at Dar es Salaam as well those elsewhere in the country to private enterprises, with one of the newly established companies the Tanganyika Electric Supply Company Ltd (TANESCO). Founded on 26th November 1931, it was joined by the Dar es Salaam and District Electric Supply Company Ltd (DARESCO).

TANESCO’s commercial operations commenced in 1933 in its operation of a diesel power station at Kange, on the outskirts of Tanga, which was designed to supply the town, and by 1936 it had constructed a 90-metre dam across the Pangani River and

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commissioned two generators totalling 5MW. At the same time, over 400km of supply lines were erected, and in 1947, 1952 and 1959 three more sets were installed, which combined to bring the total capacity up to its present total of 17.5MW. Following Tanganyika’s gaining independence in 1961, the government registered its interest in purchasing shares from the private company, such as it was at the time, acquiring the company in its entirety by 1975 and becoming its sole shareholder.

Today, TANESCO is a parastatal organisation under the Ministry of Energy and Minerals. The company generates, transmits, distributes and sells electricity to the Tanzania Mainland, and sells bulk power to the Zanzibar Electricity Corporation (ZECO) which is in turn sold it to the public in the islands of

Unguja and Pemba. TANESCO now boasts a workforce of nearly 5,000 individuals, of which around 800 are employed at the head office, 450 at hydro plants and the remainder across its 23 regional offices, a team composed of extremely qualified personnel trained both locally and abroad.

Ever since the country’s achievement of Independence, TANESCO has striven to continually implement new power projects in order to meet the increasing industrial, power supply demands across the spheres of commerce and rural townships. Exemplifying this were its studies to develop the country’s hydroelectric resource in order to reduce the cost of generation using imported diesel oil. Another major landmark came in 1962 when the construction of the 21MW Hale hydropower station on the Pangani River, upstream

TREATED TIMBER PRODUCTS (TTP) SPECIALIZES IN THE PRODUCTION OF TRANSMISSION, TELEPHONE, FENCING AND BUILDING POLES. TTP was established in 1939 and is now the largest producer of Utility Poles in the Southern Hemisphere. With our six treating plants strategically positioned near Durban and Maputo harbours, we are able to serve the local and export market with comparative ease.

Our transmission poles are pressure treated with either Creosote or Copper Chrome Arsenic (CCA) to meet the South African National Standard SANS 754:2013, Tanesco S11 and Kenya KS516 or any other recognized national VY PU[LYUH[PVUHS ZWLJPÄJH[PVU TTP carries a large stock of treated and untreated poles, giving us the ability to meet large orders at short notice.

+27 (0) 33 342 2679 export@treatedtimberproducts.com www.treatedtimberproducts.com

INDUSTRY FOCUS: ENERGY

from Pangani Falls commenced, with an associated transmission line from hale to Dar es Salaam. This power station was commissioned and formally opened by President Nyerere in 1964 while, at the same time, supplies were extended to virtually all of the sisal estates in the Pangani area by the addition of branches at Kilosa, Kimamba and Lushoto.

TANESCO has also made the electrification of rural areas and small townships a major priority in its operational lifetime, since the declaration in 1965 by the Tanzanian Government of a policy in support of this aim. It was agreed that if TANESCO was required to provide power supply to more economically precarious townships, this would be subsidised by either the Government, the local authority or prospective large consumers in the areas. Following this decision, feasibility studies were conducted

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on several townships and, as a result, the Government electricity installations at Nachingwea and Mpwapwa were taken over by TANESCO. New branches at Singida and Shinyanga were established and, in 1966, power at both Musoma and Tukuyu was newly commissioned, followed but the establishment of supplies to Mafia Island, Himo and Marangu in 1969.

A rise in tariffs recently claimed casualties among TANESCO’s senior staff. Back in October, the state-owned power company had pushed for an 18.19% increase on its prices, a request which it explained was necessary in order to clear the company’s debt and to meet government expectations.

January of this year eventually saw Tanzania’s energy regulator agree to up energy tariffs by 8.53% as a response to the request, resulting in the dismissal of TANESCO’s Managing Director by Tanzanian

president John Magufuli, who stated that the price hike would hinder his government’s efforts to industrialise the country. “Our industrial drive will not succeed if we keep on increasing electricity tariffs,” Magufuli declared. About 40% of Tanzania’s population of around 50 million has access to electricity and the government is aiming to push that rate up to 75% by 2025. Despite reserves of over 57 trillion cubic feet (tcf ) of natural gas, Tanzania has been facing chronic power shortages over the past decade due its reliance on drought-prone hydro-power dams.

The proposed price increase was withdrawn by the Tanzanian president as he sought to further enforce his anticorruption policies, while simultaneously he removed Felchesmi Mramba from his position as Director of TANESCO. In his place was appointed former Senior lecturer at Dar es Salaam’s

TANESCO

state university Tito Mwinuka, a decision declared by the directorate of Presidential Communication.

“It’s unacceptable that while we are making plans to build manufacturing industries and ensure more citizens have access to electricity, someone else uses his position to increase power tariffs,” clarified President Magufuli in a recent statement.

Dr Mwinuka was under no illusion as to the challenges which he is set to face in his unexpected new role. “By its very nature, TANESCO is not an easy company to run,” he stated, “but I cannot afford to let the president and Tanzanians down.” Dr Mwinuka explained that his priorities lay in expanding the country’s power production capacity, with a view to having surplus power available to sell to neighbouring countries. “Without efficiency in all that we do, it will all be a waste of time and I was not

appointed to come and waste time here,” he asserted.

In collaboration with KENYA Transmission Company (KETRACO), TANESCO recently put pen to paper on a contract to secure the construction of a 414km, 400kV transmission line stretching from Singida, via Arusha, to the Namanga border. Signed through the Power Interconnection Project (KTPIP), it includes all associated substation equipment on the Tanzanian side and around a further 96km of 400kV transmission line from Isinya in Nairobi to the Namanga border, to connect with the Tanzania portion.

The transmission line is equipped with a power transfer capacity of up to 2000 MW in either direction.

The objective of this initiative is to improve the supply, reliability and affordability of electricity in the Eastern African region through cross boarder exchanges of cheaper, cleaner surplus

power from bordering countries.

Through promotion of power trade at regional level, it will additionally help to contribute to the development of Eastern Africa at a socio–economic level, whilst improving the power supply to Tanzania from short to medium terms with imports from Ethiopia.

The trio of the African Development Bank, the Japanese International Development Agency (JICA) and the Government of Tanzania are the chief investors in the $309M project, divided between $258.82M to be spent on the Tanzanian side and $50.45M on the Kenyan aspect of the development.

TANESCO +255 022 2451130 info@tanesco.co.tz info@tanesco.co.tz

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HIK ABALONE

Sustainability is Key

in Walker Bay

PRODUCTION: Manelesi Dumasi

One of South Africa’s prominent abalone farming operations is built on respect for the environment and sustainability – both environmentally and economically. Because of this, it is a business that is growing, creating jobs, bringing in foreign exchange, and contributing to a South African market that is internationally renowned for excellence.

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South Africa produces and exports some of the world’s most important products, from metals and minerals to fruits, vegetables, wines and cars, the country is known for excellence when it comes to producing valuable products that importers are desperate for.

There’s a spread across the country, with different industries taking up residence in different locations. The automotive sector is largely centred in the Eastern Cape, wine usually comes from the Western Cape, the mining hubs surround Witwatersrand, North West, Gauteng and the Free State, and KZN is known for its garment industry. But there is one small area of the Western Cape that is creating a unique and highly sought after product – Walker Bay-produced South African abalone.

Regarded as some of the world’s highest quality produce, South African abalone is in high demand in Asia where China, Japan, Korea, Singapore and Taiwan all enjoy eating this type of sea snail that belongs to the Haliotidae family. Often served braised with mushrooms and vegetables, or in soups, a high price is paid for ethically sourced abalone, specifically from Walker Bay, close to Hermanus.

One of the leading companies in

the industry, pioneering sustainability in abalone farming, is HIK Abalone. Based in Walker Bay since its inception in 1997, HIK Abalone’s focus has been creating superior products, through sustainable farming methods, mainly for the export market.

“We’re based in a secluded area along the coastline of South Africa near the tip of the continent where to two oceans meet,” the company says. “Walker Bay is the main hub of abalone farming in South Africa due to the pristine water and ideal conditions for growing our distinctive South African abalone.

“At HIK, we don’t just grow abalone, we grow it sustainably and to us, sustainability is much more complex than just environmentally friendly practices. We believe that sustainability consists of three overlapping principles namely; environmental impacts, economic viability, and social responsibility.”

Because of serious demand for abalone, natural stocks began dwindling in the 80s and 90s and so farming has been encouraged in markets around the world. China is the biggest producer, and the Far East is the biggest market.

Production is cheaper in China and so

the quality of SA products have to remain first class to attract customers.

SUSTAINABILITY The HIK Abalone business takes its name from its three founders, Rick Haw and Peter Inglis of H&I Construction and biologist Roger Krohn. From day one, the focus has always been on sustainable production. Following the decline in the wild population of abalone, be it through ignorance or illegal activity, aquaculture environments where population growth is encouraged and controlled have become popular.

Some expert suggests that up to a third of South Africa’s exported abalone products could now come as a result of illicit activity.

HIK Abalone’s facilities currently produce more than 160 tonnes each year and are designed for sustainable farming.

The farming process is split into two main sections – the Hatchery and the Grow-out. In the hatchery, eggs take 10 months to grow into 10 millimetre spats. This process is divided into four important departments - broodstock,

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INDUSTRY FOCUS: MARINE

larvae, settlement and weaning. In broodstock, only abalone exhibiting superior performance characteristics are selected as brood animals. They are fed their natural diet of kelp and then fertilized eggs of the highest quality are selected to move to larvae. In the larvae phase, strict quality control and monitoring conditions are vital so that best quality larvae are then selected for the next phase in production.

When entering the settlement phase, the larvae, which have developed into veliger larvae, will be offered microalgae grown on polycarbonate plates as a food source. The larvae will attach to the plates, lose the ability to swim, and metamorphose into baby abalone, or spat. They will feed on the algae for three to four months and are then moved to the next development phase.

Now in the final phase in the hatchery, weaning, the spat are moved to a diet of Abfeed. They quickly grow to reach 10 millimetres and are strong enough to handle the grow-out environment.

In the grow-out, abalone spend 36 – 45 months growing to market size.

Stocks are continuously monitored to ensure health of the animal and cleanliness of facilities.

“The farming of abalone is one of the ways of trying to reduce pressure on wild abalone populations which are still under threat,” the company explains. “At HIK, we farm our abalone in strict compliance with current

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environmental legislation and focus on everything, from what we do with our waste management to ensuring that the quality of the sea water that we return to the ocean does not harm the environment. We also work to minimise disease risk and genetic impact on the species through strict control of bio security and animal health.

“At HIK we are often complemented on the beauty of our abalone and people who know and love it sometimes call it pearl white or double white because of the colour of both the meat and shells of our products. We hope that when you buy and taste our abalone, you’ll taste not only the pristine conditions that we grow them in but also remember that our abalone is being tendered and grown in the most sustainable ways so that we will be able to provide you with exceptional quality abalone, well into the future.”

OCEAN ECONOMY With quality product, quality process and quality service comes quality customer relationships and this is turn leads to repeat business, and growth.

HIK Abalone is a business that has been growing since inception and has been bolstered by the governments adoption of Operation Phakisa – a programme focussed on quickly but effectively developing its ocean resource. In 2013, President Zuma returned from a state visit to Malaysia where he was inspired

by the Big Fast Strategy used by the Malaysian government to achieve economic results quickly. Since the establishment of Operation Phakisa, the government has invested in projects in marine transport and manufacturing, offshore oil and gas exploration, the aquaculture work stream, and marine protection services and ocean governance. President Zuma has said: “I have great pleasure to announce that government has unlocked investments amounting to about R17 billion in the Oceans Economy, thanks to Operation Phakisa. And since the inception of Operation Phakisa: Oceans Economy, over 4500 jobs have been created in the various sectors.”

HIK Abalone is proud to be a creator of South African jobs and currently employs more than 100 people in Walker Bay. Over the past few years, marketing activities have been stepped up in key Asian markets to ensure a closeness with customers and up-to-date market knowledge. Away from ‘sales and profit’ talk, the company is extremely connected to the local economy and local environment. “HIK is always looking for ways to ensure that the community we’ve built around our farming is as well taken care of and as sustainable as the abalone we farm. Over and above good labour practices and fair wages, we invest deeply in adult education programmes that employees can access during work time as well as additional individual training, a fully equipped clinic for our workers and their families and active support for various local small enterprises, crèches and schools, sports teams and other community projects,” they say.

But of course, all of this investment comes full circle and contributes to a thriving business. In February last year, the industry in South Africa reported a boost in sales thanks to the celebration of the Chinese New Year where demand peaked as the market in China and other Asian countries was stimulated by a festive season. This is testament to South Africa’s product quality and at HIK Abalone, quality is and always will

HIK ABALONE

be a driver of development - ‘Through innovation and teamwork we produce the finest quality abalone in the world’ is the company’s vision.

Going forward, growth and market development will undoubtedly be targets, and the company’s unwavering focus on sustainability will continue above all else. “Ultimately, HIK is a business but our sole aim is not only to make money for shareholders but rather we now undertake to grow the entire local economy while also supporting the natural and social environments.”

HIK ABALONE +27 (0)28 313 1055 info@hik.co.za www.hik.co.za

In June 2016, the value of abalone was demonstrated when the South African police Services arrested 10 men in connection with a large scale illegal abalone smuggling operation.

According to police, the illegal syndicate had made R500 million in the Eastern Cape and other parts of the country.

“The joint operation was executed by SAPS specialised forces and swooped on seven addresses simultaneously. The suspected abalone-smuggling syndicate, which has links in China, has been a subject of intense investigations,” said the Hawks spokesperson Brigadier Hangwani Mulaudzi.

The police confirmed that more arrests would be made and were happy that they seemed to have ‘broken the back’ of the illegal abalone trade in the country.

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CALGRO M3

Calgro M3 Continues

to Make a Difference

PRODUCTION: Karl Pietersen

Leading SA property development company, Calgro M3 has announced new partnerships and diversification strategies that are helping to bolster its offerings and secure its strong financial position.

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INDUSTRY FOCUS: CONSTRUCTION

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It has become clear over the past two decades that South Africa faces a housing shortage that is not improving.

Each year, more homes are built, by both government and the private sector, yet large percentages of people remain without access to adequate housing. Last year, reports suggested that the housing backlog stands at more than two million units with around 12 million people still searching for housing solutions.

And this number continues to grow.

With general population growth bolstered by migration from other parts of the continent, a lot of hard work remains ahead if the country is going to solve its housing problem.

A lot of focus remains on affordable, low-income housing and this is hugely important but it’s largely government-assisted housing programmes that cater in this space thanks to most developers choosing to focus on the higher end of the market, being less price-sensitive and more lucrative.

There’s also significant barriers to entry and S&P Global Ratings states that ‘a weak macroeconomic environment, still-high household indebtedness, and rising interest rates burden the South African housing market’.

But there have been some success stories where private sector organisations, along with government, have managed to gain traction in the market, providing solutions in the affordable housing sector. One company in particular has made it its mission to develop quality affordable housing and associated infrastructure and that company is Calgro M3.

Founded in 1995 by brothers Derek and Deon Steyn, Calgro M3 started life as Calgro Homes. Both brothers were quantity surveyors and in 1996 the team was bolstered when third brother, Douw, also a quantity surveyor, joined the

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company. In 2000, Ben Pierre Mulherbe and Brand Malherbe were busy building a similar company, M3 Developments. A year later, Calgro Homes and M3 Developments were tendering for a residential housing project in Gauteng and realised they could be successful tendering as a joint venture. After further consideration, both companies realised that formalising their relationship would be extremely beneficial, and Calgro M3 was born.

By 2002, Calgro M3 had completed its first 1000 houses, aimed at the affordable market, and diversified into mid-to-high income residential market. In 2007, the company listed on the AltX board of the JSE and through the next four years, Calgro M3 produced more than 17,000 units across various projects. In 2012, the company listed on the main board of the JSE and was now securing Billion Rand projects all over the country.

Understandably, the company’s leadership is proud of what has been achieved to date. “As the market leader in the integrated development segment of the residential market, we continue to play a leading role in the delivery of housing in line with Government’s targets, set to eradicate informal settlements and provide housing to its people.

“For Calgro M3, establishing sustainable business practices starts by recognising our broader responsibilities as an organisation in society. We strive to enhance our product offering, setting new standards for sustainable integrated developments, to the benefit of all stakeholders, including the communities we operate in,” the company states.

Calgro M3 is a property developer specialising in integrated developments aimed at the entrylevel consumer. The company adopts a turnkey approach - a land

owner, developer and contractor with internal town planning, marketing and project management capacity.

BUILDING PARTNERSHIPS Last year, in a move to alleviate the shortfall of housing units in the low-to-mid-cost segment of the residential market in South Africa’s metros, Calgro M3 announced a partnership with real estate investment trust SA Corporate Real Estate.

The partnership will realise the formation of AFHCO Calgro M3 Consortium, a new company owned 51% by SA Corporate Real Estate and 49% by Calgro M3. AFHCO intends to build a substantial residential portfolio in metros to improve access to rental options.

Calgro M3 Managing Director, Wikus Lategan said: “The current housing shortfall in metropolitan areas is estimated at a mammoth two million units. Despite Government’s commitment to closing the gap, spending on infrastructure for housing development is under pressure, and this joint initiative will assist Government in improving living conditions for ordinary South Africans.”

Rory Mackey, Managing Director at SA Corporate Real Estate said: “The intention is to build a substantial residential portfolio in the next few years, with the ultimate goal to reach property investments in the residential market in excess of R10 billion.

“In order to safeguard the sustainability of the process, we are committed to enhancing the quality of life for all our residents and creating homes that they can take pride in.”

Lategan is understandably excited about the exciting prospects that lay ahead for the partnership.

“Entering into an agreement

CALGRO M3

//WE STRIVE TO ENHANCE OUR PRODUCT OFFERING, SETTING NEW STANDARDS FOR SUSTAINABLE INTEGRATED DEVELOPMENTS, TO THE BENEFIT OF ALL STAKEHOLDERS, INCLUDING THE COMMUNITIES WE OPERATE IN// with SA Corporate, by far one of the most successful REIT’s when it comes to residential exposure in South Africa, will ensure that Calgro M3’s strategic decision to enter this market is undertaken with a reputable partner who will drive the management, marketing and growth of the Company,” he said.

CONSTANT IMPROVEMENT In October, Calgro M3 released its interim results for the six months ended 31 August 2016. A largely positive set of results, the company is clearly reaping the benefits of various diversification strategies that have been implemented.

“The Group’s strategy to diversify within residential market sectors and its ability to timeously adapt to a changing environment is paying off and growth will be restored in the second half of the year,” Lategan commented.

“Calgro M3 is passionate about making a meaningful difference.

We believe that Government needs the assistance of the private sector to fulfil its mandate and for this reason Calgro M3 is assisting in the development of homes that can either be bought, rented or used by Government for fully subsidised or social housing. We are adamant that this is a formula that will benefit the country as a whole.”

The results revealed an 82.5% improvement in operating profit and earnings before interest and tax up 11.4%. Other highlights included group revenue increasing by 25.7% to R720.2 million and cash generated from operations increasing from R32

million to R94.2 million.

Operationally, Calgro M3 will continue to invest in initiatives that benefit local communities and the wider South African economy by creating jobs. “We remain extremely proud that the Group will launch various new training and skills development programmes over the next 6-12 months to add to the upliftment of communities that will drive sustainability in the medium to long term,” Lategan said.

With growth levels expected to

return to pre-2008 levels in south Africa by 2020, the short-term future for Calgro M3 will not be without its challenges. But this is a company that has experienced ups and downs and always carved out a leading position for itself. When the economic situation stabilises further, ease of doing business will likely return to the market; and this is a market that certainly needs it. The housing shortage remains and it will remain for some time yet, but Calgro M3 is one of the rare shining lights in the industry and will be one to watch as we move through 2017.

CALGRO M3 0861 CALGRO (225 476) info@calgrom3.com www.calgrom3.com

Delivering sustainable infrastructure that improves our world.

“DOING GOOD WHILE DOING BUSINESS”

Contact www.bigenafrica.com, or the office most convenient to you: Pretoria (012) 842 8700; Johannesburg (011) 802 0560; Bloemfontein (051) 430 1423; Cape Town (021) 919 6976; Durban (031) 717 2571; East London (043) 748 6230; Gabarone gaborone@bigenafrica.com; Kuruman (053) 712 2882; Mahikeng (018) 386 2111; Mthatha (047) 532 5234; Nelspruit (013) 755 1421; Polokwane (015) 297 4055; Richards Bay (035) 753 1235; Rustenburg (014) 597 3655; Windhoek +26 461 237 346.

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CROSS FIRE MANAGEMENT

Saving Lives,

Protecting Property PRODUCTION: Karl Pietersen

Fire is one of the biggest threats to a business. it can cause loss of business, injury, and even loss of life. Now more than ever, it’s vital to partner with a company that can provide your business with effective fire management and prevention solutions. Cross Fire Management is that company.

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Most of the fires that start in a business environment are usually avoidable. These extremely damaging situations are, unfortunately, mostly caused by human error. Electricity (neglect or misuse of wiring), waste material (ineffective storage and disposal), smoking (poorly discarded butts and matches), and cooking and heating appliances (not switched off or poorly placed) are some of the most common causes of fires in the workplace. How do you combat

business-disrupting fires? The obvious answer is training people to act responsibly in the workplace, but you’re also going to need a system to provide peace of mind for when a fire strikes unexpectedly.

Fire safety and fire management systems are expensive and require ongoing maintenance and care, but it pays to have a system in place that can protect your business; after all, some reports suggest that more than 70% of businesses that experience a serious fire never re-open or end up

closing within three years of the fire.

In South Africa, in just the past couple of months, there’s been stark examples of what a fire can do to business. In January, Metrorail reported that many trains in Cape Town were running late thanks to a fire that damaged wiring that regulates signals. Extra staff and specialist technicians were called in to deal with the backlog and repair the signalling system. The famous Vergelegen wine estate was seriously spoiled by wildfires in Somerset

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INDUSTRY FOCUS: FIRE PREVENTION

West with some reports suggesting that 40% of the estate had sustained damage. The same winery reported Millions of Rand worth of fire damage back in 2009 in a similar situation.

Also in January, the Goudini Spa resort, near Worcester, reported four of its buildings had been destroyed by fire. Reports suggest that the fires in Somerset West caused more than R50 million worth of damage.

Although many of these situations were caused by wild fire, the damage to buildings and equipment could have been avoided with a quality fire management system.

One of the country’s leading suppliers of tried and tested fire management solutions is Cross Fire Management. Founded nearly three decades ago, the company has a proven history working in the fire prevention industry and has put its experience to work in some of South Africa’s most prominent shopping centres, office blocks, and other multipurpose buildings.

Cross Fire Management offers

specialised design, supply, fabrication, installation, servicing and maintenance of systems including automatic sprinkler installations, medium and high velocity deluge water spray systems, dedicated fire water supply pump and tanks, fire and smoke detection and evacuation systems, fire suppression gas installations, and many more.

Today, the company is a trusted partner for developers and property managers and lives by its motto of ‘saving lives, protecting property’.

ALL CHANGE AT THE TOP When Cross Fire Management first featured in Enterprise Africa back in 2015, founder and then-CEO, John Cross explained that he was set to retire and would pass control of the company to MD Catherine Stewart and the other directors. Cross himself was instrumental in building the company from the ground up.

Having previously operated in the fire prevention industry with a multi-

national organisation, he set out on his own in 1990. At the time, South Africa was a different place to what it is today and the business environment was challenging. “It started with us just doing maintenance work and revamps. In 1998, we got our first really big order from Carnival City Casino and from there things just grew and grew,” he explains.

In the same year, just as the company was blossoming, Cross was held up in a hijacking and was shot by criminals as he pulled up to his own house. Left with five bullets, one which damaged his spinal column, Cross was told by doctors that he would be paralysed from the waist down but, aged 43 and leading a growing company, he undertook serious rehabilitation and managed to get back on his feet. His story is legendary in the industry and the fact that the company achieved such success following such a setback is testament to the drive and determination of the Cross Fire people.

CROSS FIRE MANAGEMENT STAFF

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CROSS FIRE MANAGEMENT

The company has expanded into Africa and is always investing in people development to remain at the forefront of the industry. “We pride ourselves on the service we provide. We didn’t want to become the biggest but we did want to be the best in the industry.

“We have branches in Johannesburg, Cape Town, Durban and Ghana. We have been dabbling in Africa; in Nigeria, Mozambique, Zambia and Angola.

“We’ve been very fortunate and we have a great client base that come to us and we get a lot of repeat work from certain developers.

“We’ve got a good vibe in our company – it’s very different to any other fire protection company. We do a lot for our staff and we have a good team,” admits Cross.

Fortunately, even with the

retirement of Cross, the company still has the experience and reputation to attack new projects and new markets.

As for demand, the region’s mid-tier construction industry is still forging ahead with many developments in building, mining, energy and retail and, of course, these developments need the correct fire protection to ensure business sustainability. At sites with Cross Fire Management installed solutions, there has never been a serious issue and all problems have been managed successfully.

“The big fires that have happened in SA have been in warehouses that don’t have the correct fire protection,” says Cross.

Having recently completed major installations at the Ballito Shopping Centre near Durban and in large retail centres in Ghana, the company remains well-positioned

for future growth and with ongoing maintenance contracts sure to keep the pipeline full for some time, this is an organisation that is proven to be an industry leader, and a partner that can help mitigate against serious loss as a result of fire. As the company enters its 27th year, it’s in the strongest position in its history and is now the go-to choice for fire protection and management solutions.

CROSS FIRE MANAGEMENT 086 112 7677 info@crossfire.co.za www.crossfire.co.za

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MONTIGNY

Powering Development

in Swaziland PRODUCTION: Manelesi Dumasi

After a strong 2016, Swaziland-based Montigny is now focusing its attention on ambitious plans to build a biomass power plant that could end up supplying 30% of the country’s electricity demand in a clean, safe and renewable manner.

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Montigny is an important company, operating in the southern African forestry industry. The business focuses on plantation growing as well as sawmilling and has experienced significant growth and expansion since its official establishment in 1997 (its roots in Swaziland trace back much further). In its early days, the company traded timber and operated a relatively small sawmill operation and supplied just one mine. Today, the company is a diversified forestry organisation, home to numerous employees, operating four sawmills, caring for more than 40,000ha of tree plantations and producing a wide range of products including planks, charcoal, paper, chippings and more.

One of Montigny’s main focus

points is sustainability. A theme that runs throughout the company, this is something that is pushed from the very top. Montigny places a big emphasis on using all parts of the trees that it cuts. Executive Director of the Montigny Group, Andrew Le Roux says: “What makes us stand out from our competitors primarily is the way in which we add value to every part of the tree.

Our point of departure is not to maximise, or justify, our processing operations. Rather, what we do is look at every tree and decide how to best extract value from it. We see our trees as our primary assets and it therefore makes sense to work out how best to maximise value from them.”

2017 looks to be an exciting year for Montigny as many longstanding projects come to an

end and further initiatives are announced. Back in 2015, Le Roux told Enterprise Africa that the company was looking to further open up markets in South Africa and Mozambique, the purchase of the Sappi Usutu Forest Products was completed, talk of a new dry mill was heard, and the company was also seriously investigating the use of its residue and chippings products for energy production.

WOOD POWER Biomass power plants are becoming increasingly popular around the world because of their easy-tofuel nature, their relatively small environmental impact and the fact that these power plants take up a much smaller land footprint than other types of generation facility. Sawdust, wood chips, peat

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INDUSTRY FOCUS: FORESTRY

moors, bark chips, rape, wheat straw, bagasse, palm oil residues and other agricultural by-products including forest residue, paper and sawmill residue, animal farm litter and recycled materials can all be used to power this type of plant and, in a country like Swaziland which is powered mainly by hydropower, any addition to the mix is welcomed.

Last year, Montigny announced that it had plans in the pipeline for a 35MW biomass power plant that could be up and running in just three years’ time. In a real boost for the economy, reports suggest that this power plant could supply around 28% of the country’s total electricity demand.

The primary feedstock for the power plant would be Montignysupplied wood from its Forestry

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Stewardship Council (FSC) certified plantations. This is something that Le Roux has been exploring for some time. Back in 2014, he said he believed that the company had the ability to become a renewable energy supplier of choice.

Discussing the plans with Renewable Energy World, Montigny’s Head of Strategic Initiatives, Kelly Cure said that the main hurdles yet to be overcome will be the choice of partners to help realise the development.

“Our company focuses on sustainably maximizing the value of our forests, while leaving a positive impact on Swaziland and continuing to grow as a leader in the region.

“We now understand that our plantations can sustainably supply nearly 30% of the country’s energy.

Our estimates indicate that we will be

able to supply 30 of the 35 MW to the national grid and use the remaining five MW internally,” she said.

“The biggest challenge thus far has been agreeing the right partners to take this long-term venture forward with, although we are getting closer to the decision point.

“We are quite hopeful that by working with the local utility, Swaziland Electricity Company, the regulatory body Swaziland Energy Regulatory Authority, the Ministry of Natural Resources, Members of Parliament and our community that we can enable this promising project to progress.”

Swaziland has abundant natural resources and, according to those at Montigny, has the ability to operate as a 100% renewable powered nation.

Support from the private sector will be vital driving this idea forward.

MONTIGNY

STRONG BUSINESS FOUNDATIONS Montigny’s focus on its core business and being sustainable, has allowed the company to flourish financially. Sitting on turnover of E700 million just two years ago, the company now boasts turnover of around E1.7 million.

Montigny Investments CEO, Neal Rijkenberg told the Swazi Observer that this growth is expected to continue.

“We are expecting to continue growing our turnover by an additional half a billion Emalangeni per annum for the next four years, so that by 2020 we expect to have a turnover in excess of E3.7 billion per year.

“Montigny is a 100% Swaziowned business and started from nothing 20 years ago. If we can have an impact on the GDP like this, then

it more than proves that Swaziland is a great place to invest,” he said.

Of course, as turnover grows and the business continues to expand and diversify, the employee count will grow, further boosting the Swazi economy and entrenching the Montigny name as one of the country’s most important organisations.

At the end of 2015, 180 jobs were created by Montigny in Bhunya, following the deal with Sappi, to work in the local sawmill.

After the company completed construction of Southern Africa’s largest sawmill late last year, it is expected that more jobs will come through very soon. Rijkenberg has said that as many as 3000 jobs will be made in the next four years.

“When we reach 100% employment, then the pressure builds on the

private sector to industrialise, leading to an increased demand for skills, and much higher salaries and wages,” he told the Observer.

Capping off a strong 2016, Montigny was recognised by King Mswati III for the positive influence it is having on the local economy and local markets. Creating jobs, growing FDI, powering industrial development and doing all of this in a sustainable manner, Montigny is certainly a company rooted in Swaziland and providing an example for all companies looking for inspiration.

MONTIGNY +268 2452 5000 www.montigny.co.sz

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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.

//TABLE OF ALL EVENTS: INVESTING IN AFRICAN MINING INDABA Cape Town International Convention Centre Feb 6-9 NEXT GENERATION OPTICAL NETWORKING AFRICA Cape Town International Convention Centre Feb 14-15 EGYPS - EGYPT PETROLEUM SHOW 2017 Cairo International Convention & Exhibition Centre Feb 14 -16 AFRICABUILD LAGOS 2017 The Landmark Events Centre, Lagos, Nigeria Feb 14 - 16

16TH METRO FM MUSIC AWARDS FEB 25 | DURBAN The South African Broadcasting Corporation’s (SABC) radio station METRO FM, is proud to announce the launch of the 16th METRO FM Music Awards.

The awards show will take place on the 25th of February 2017 at the Durban ICC. The event will be broadcasted live on SABC 1.

Metro FM has been supporting local music for the past 15 years, and local music has been constantly growing within those 15 years, it will now grow for the 16th year.

For METRO FM, being the Number one commercial radio station in the country means we are at the forefront of determining the local soundtrack and this will be reflected yet again at the 16th Metro FM Music Awards.

INVESTING IN AFRICAN MINING INDABA FEB 06 | CAPE TOWN The world’s largest gathering of the most influential stakeholders in African mining – investors, mining

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professionals, government officials, financiers, and mining service providers.

More than 6000 delegates come from global mining and exploration companies, international investors, African and non-African governments, and a wide range of service providers including mining equipment companies, mining services provides, law firms, investment banks and financial services firms, engineering and research services, tax and accounting, and business/technical consultants.

AFRICABUILD LAGOS 2017 FEB 14 | LAGOS AfricaBuild Lagos will bring together Nigeria’s key construction professionals with international manufacturers and suppliers from around the world. The event is the premier international construction event in West Africa and is an ideal entry point to the largest economy in Africa and the 7th most populous country in the world.

AFRICA PHARMACEUTICAL SUMMIT 2017 Kenyatta International Conference Center Feb 15 - 16 AFRICAN FINE COFFEE CONFERENCE & EXHIBITION 2017 Durban International Convention Centre Feb 15 – 17 16TH METRO FM MUSIC AWARDS Kenyatta International Conference Center Feb 15 - 17 NOG - NIGERIA OIL & GAS 2017 Abuja International Conference Centre - Eagle Square Feb 27 – Mar 03 MEETINGS AFRICA 2017 Sandton Convention Centre Feb 28 – Mar 01

KUMBA IRON ORE

At Kumba, we are committed to supporting initiatives that have a positive impact on the local economy. The supply agreement that we signed with ArcelorMittal South Africa in 2014 does just that.

It has allowed us to continue the reliable supply of iron ore to the local steel industry at mutually beneficial prices, which in turn has helped the local economy thrive by enabling the continued production of steel.

MICHELLE BESNAAR Kumba Iron Ore Employee

SIGNED, SEALED AND DELIVERING

Results such as these have fuelled Kumba’s determination to be the developmental partner of choice for projects that benefit our country. www.angloamerican.co.za