Feb 17, 2012
Construction companies’ success to be tested in 2012Back
Construction|Africa|Ernst & Young|Projects|Africa|Australia|Maintenance|Product|Programme Management|Service|Services|Africa|Ebrahim Dhorat|Infrastructure|Operations
© Reuse this
Ernst & Young director Ebrahim Dhorat adds that local construction companies will be tested on how robust their operations are and how their strategies fare in an uncertain market.
“With investor attention firmly on current and future volumes, contract implosions, working capital consumption and margin declines, key players are refocusing on their core strengths, growth, capital agendas and optimising operations,” he explains.
Further, he points out that the growth plans of companies incorporate offshore ventures, particularly into Australia, as well as Africa, review and adapt strategies, and the undertaking of assessments to ensure they have the right skills, leadership and integrated delivery models.
However, Dhorat warns that the roll-out of sizeable infrastructure projects could leave less room for midmarket players, with global players required to handle large-scale infrastructure projects, including programme management.
Meanwhile, he says, the necessity for the maintenance and upgrading of existing infrastructure is high.
“Governments and the private sector have realised that the pace and level of an upturn in economic growth would be dependent on investment in infrastructure, and government’s plans should incorporate a long-term view coupled with maximum socioeconomic impact.”
Further, he admits that the sector has been under pressure, with some compa- nies facing Competition Commission enquiries, com- petitive tendering conditions and a reduction in order books.
“Theses challenges were made worse because of reduced government infrastructure spend and unstable financial markets that inhibited private-sector spend,” says Dhorat.
Edited by: Chanel de Bruyn© Reuse this Comment Guidelines (150 word limit)
Other Construction News
Article contains comments
Recent Research Reports
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
This Week's Magazine
The broad-based black economic-empowerment (BBBEE) alignment process in the con-struction sector has begun, dur-ing which the sector codes of the Construction Sector Charter Council (CSCC) will be aligned with the revised Codes of Good Practice (CoGP), which come...
It is second time lucky for Toby Venter. Ten years ago he negotiated to buy the Kyalami racetrack, but “the deal did not materialise”.
Environmental solutions company I-Cat started construction work on its R22-million, 1 949 m2 environmentally sustainable office and warehouse facility, commissioned by I-CAT Environmental Solutions, at a launch event in October. The new sustainable I-CAT campus,...
Effective file synchronisation and sharing across an organisation’s structures can provide the basis for robust mobile-device and document management while maintaining proper backup, version control and content distribution. These are the lessons learned by complex...
Hotel group Carlson Rezidor currently holds the largest hotel pipeline in Africa with 30 hotels and 6 300 rooms under development. The hotel group develops and operates Radisson Blu in the upper upscale segment and Park Inn by Radisson in the mid-market segment. With...