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Afrimat moves to ‘General Mining’ sector of the JSE

Afrimat has announced that its sector classification on the JSE will be reclassified from the Basic Materials, Construction sector to the General Mining sector. FTSE Russell announced that the quarterly classification change was made after the market close on Friday, 17 March 2023 and will be effective on Monday, 20 March 2023.

Andries van Heerden, the CEO of Afrimat, states that the move is sensible given where most of the group’s earnings are now generated, and that the new classification will also better the position of Afrimat amongst its peers in the marketplace.

“After we listed in 2006, Afrimat was focused on aggregates and quarries, with our Construction Materials segment being the only contributor to profitability. We then embarked on a conscious diversification strategy to broaden our product offering through a multicommodity portfolio to ensure the longterm success and sustainability of the business,” says van Heerden.

“This involved expanding into Industrial Minerals and later into Bulk Commodities, which now includes the mining, processing and sale of iron ore and anthracite. We are adding phosphate, rare earth elements and vermiculite to our product offering through the development of Glenover mine. The newly formed Future Materials and Metals segment will house the Glenover operation.”

Van Heerden explains that as a result of the diversification strategy, the group’s Construction Materials segment now contributes less than 20% towards operating profit. “The Bulk Commodities segment generates the majority of our revenue and operating profit and therefore, a sector change was required.”

An extract of The Industry Classification Benchmark Ground Rules defines General Mining as, “Companies engaged in the exploration, extraction or refining of minerals not defined elsewhere within the Mining sector. It also includes companies engaged in diversified metals and mining, marketing of mining commodities, and providers of contracted drilling services.”

Van Heerden indicates that Afrimat will continue with its diversification strategy to consistently deliver exceptional results.

“This strategy, coupled with the innovation of traditional products and inputs, has effectively protected Afrimat against lower economic growth rates in South Africa. Deeper diversification into bulk and other commodities will help position the group as a Rand-hedge, able to earn foreign currency.” a

Vis Reddy appointed chairman of SRK Consulting (SA)

SRK Consulting (South Africa) has appointed Vis Reddy as its new chairman, following an eight-year term as managing director.

Reddy has also assumed the role of regional coordinator for Africa, on behalf of SRK Global – as part of the company’s strategic expansion into African markets. He explains that his focus will build on the work of previous chairmen in promoting innovation, technology, excellence and collaboration which also align with the company’s strategic focus areas.

“The international SRK network has grown considerably, and it remains important to work as one team to leverage our one-stop-shop capabilities,” he says. “We have always strived to be a leader in our field, and to serve clients in a diverse range of skills and offerings as markets evolve.”

SRK will celebrate five decades in business next year, and has grown to about 1 600 employees in over 40 offices worldwide. a

CCUS projects – the goto solution for cement decarbonisation

In 2023, continuing the trend from last year, the industry focus is on CO2 reduction measures and technologies (alternative fuels, alternative raw materials), a main priority in operation plans of all the cement players.

But these short-term actions will not be enough to reach the CarbonZero target, which is why all the companies are working (with different intensities) to develop carbon capture utilisation and storage projects (CCUS) technologies integrated in the cement production.

Antonio Clausi, global director, Heidelberg Materials Competence Centre Cement is speaking about this sector revolution at CarbonZero Alternative Fuels and Raw Materials Global Conference and Exhibition 2023 on 26-27 October, InterContinental Hotel Dieu, Lyon, France.

With his background as a chemical engineering graduate from the University of Trieste, Italy, Clausi’s expertise and passion are embedded in his role of heading the organizational efforts into Decarbonisation through the development of new technologies such as carbon capture amine-based, oxyfuel, calcium looping and LEILAC.

Additionally, he is leading the Industry 4.0 innovative direction with activities related to advanced automation, expert system, artificial intelligence, predictive maintenance, and the digitalisation of production processes. a

Construction sector waits for game changing action

As the construction sector holds on for the more effective implementation of government’s infrastructure expenditure programme, the recent national budget speech held both promise and uncertainty. Speaking at AfriSam’s regular Budget Breakdown event in Johannesburg this month, Dr Azar Jammine said if government puts its spending plans into action, it would be a game changer for the economy.

Dr. Jammine said he was encouraged by the growth from R812-billion to R903-billion in the estimates for public sector infrastructure expenditure from the 2023/24 to 2025/26 financial years.

“These numbers are so big that if we were to see their full implementation, it would be a game changer not only for the construction sector, but for the entire economy,” he said. “Where the real hope lies in government getting its act together and starting to implement its capital projects.”

He noted the importance of how Finance Minister Enoch Godongwana dealt with plans to restructure Eskom’s capital debt, as any worsening of the energy crisis could undermine the economic predictions in the budget speech. If loadshedding was exacerbated, he felt that the country may not even reach its meagre 0,9% growth target for the year. In such a scenario, government’s own spending plans would be further dampened by lower tax revenues.

The question he posed was whether there was the political will within the governing party to allow Eskom’s debt restructuring to take place. Such a move was inevitable, however, as he foresaw a complete realignment of politics in the general elections of 2024.

Focusing on the construction industry, Dr Jammine once again painted a sobering picture – but highlighted the sector’s potential to deliver economic benefits. He reminded his audience that construction provides 7,8% of the country’s employment, even though it makes up just 2,6% of GDP.

“Implementing government’s infrastructure projects would spark massive job creation, and the economy would grow by 5-6% a year,” he said. As it was, business confidence among building contractors continued to deteriorate, although last year this deterioration had slowed.

Commenting on Dr Jammine’s presentation, Richard Tomes, Sales and Marketing Executive at AfriSam said: “Although the operating environment remains challenging, one of the positive elements AfriSam has noted is the increase in the infrastructure spend budget allocation, and we remain hopeful that the implementation of the infrastructure projects will gain momentum and start delivering true value for the construction industry.”

Considerable overcapacity was still evident in the non-residential building sector, especially commercial office and retail space. The value of non-residential building plans passed averaged just about R1-billion in value compared to R3billion in 2016. The brief recovery in the residential building sector – as homeowners renovated for home offices – had tailed off. Cement demand suffered negative growth in 2022, and was expected to improve only marginally over the next few years, he said.

About this annual event itself, Tomes remarked that AfriSam’s purpose is to make valuable information available to the various stakeholders that interact with its business. “With many of us operating in the same industry, material matters such as the external environment we operate within not only relates to AfriSam but also to our stakeholders’ businesses.” a