Aug 27, 2008
Electrical wholesaler ARB targets State-owned enterprises for growthBack
Johannesburg|Natal|Africa|ARB|CoAL|Eskom|Housing|Africa|Mozambique|South Africa|Electrical Wholesaler|Mining|Product|Products|Eastern Cape|Increased Government|Craig Robertson|Infrastructure|Power|Eastern Cape|Limpopo|Mpumalanga
© Reuse this
The wholesaler, with CEO Craig Robertson at the helm, reported that despite the power crisis in South Africa, the electrification of rural areas would continue unabated, specifically the electrification of schools, clinics and low-cost housing.Speaking at the group’s results presentation in Johannesburg, Robertson said that parastatals, some of which were already customers of ARB, would be a target focus for the future, as spending from these would become vast.
“We are positioned to take advantage of that spend,” he commented.
The company expected to benefit particularly from increased spend by Eskom as part of their rural reticulation programme of getting electricity to all by 2014.
Robertson explained that the electricity connections in KwaZulu-Natal and the Eastern Cape would double over the next 18 months to three years.
The electrification programme was also expected to start picking up pace in Limpopo province.
Further, government was investing R568-billion on infrastructure over a three-year period, which ARB said would benefit the company, as electricity was required for infrastructure developments.
Meanwhile, after its year-end in June, ARB had established ARB Global, which focused on exporting the group’s offerings into Africa.
“The whole of Africa has to be electrified, and those products will come from the strongest base in Africa, which is South Africa,” said Robertson.
He added that only a small capital investment was required to take advantage of the growth prospects of exports to Africa. He expected ARB Global to see a fivefold growth in revenue in the near term.
ARB was also expanding into Africa at a time when infrastructure developments were increasing on the continent.
In May, the wholesaler opened a branch in Nelspruit, in Mpumalanga province, which the company believed would allow it to enter the Mozambique market, which was part of the Maputo Development Corridor.
In addition, Nelspruit was also situated in the coal-mining Mpumalanga province, which would benefit the wholesaler’s new ARB Mining division.
This division was established after the company’s year-end and was a new focus for ARB.
“There is a global trend that mining houses are now adopting. They are using fewer and fewer suppliers,” commented Robertson.
He added that ARB could offer turnkey solutions to the mining industry with its product offering and the stock levels it kept. The division would especially take advantage of the opportunities in Southern Africa.
Meanwhile, the wholesaler would continue to look at acquisition opportunities, but would consider these carefully.
ARB, which listed on the JSE in November last year, on Wednesday reported a 23,7% increase in headline earnings to R104,1-million for the year ended June 30, 2008, compared with R84,2-million the year before.
Headline earnings a share had increased by 11,8% to 47,1c a share for the year ended June 2008, compared with 42,1c a share in 2007.
Net profit for the year rose by 22,6% to R135,1-million, compared with R110,2-million the year before, while revenue jumped by 28,3% to R1,34-billion for 2008.
Edited by: Mariaan Webb© Reuse this Comment Guidelines (150 word limit)
Other Electricity News
Updated 44 minutes ago Lafarge Africa, Finland's Wartsila and the World Bank's IFC have agreed to build a 220 MW gas-fired power plant in Nigeria to boost electricity supplies, they said on Wednesday. The trio said in a statement their plan was to help fast-track increased power supplies...
Updated 1 hour 48 minutes ago The African hub of the United Nations Sustainable Energy for All (SE4ALL) initiative was aiming to have assisted 14 countries on the continent in developing energy action agendas and investment prospectuses by the end of this year, the African Union’s (AU’s) New...
Updated 6 hours ago National Energy Regulator of South Africa (Nersa) full-time member for electricity Thembani Bukula says the regulator is not anticipating an approach by Eskom for a “reopener” of the current tariff determination, notwithstanding National Treasury’s indication that...
Updated 33 minutes ago In a landmark R1.5-billion deal that precedes it planned listing on the JSE, Pivotal Property Fund has acquired “strategic” land and property assets from Standard Bank Properties, which includes Sandton’s landmark Alice Lane development. “Pivotal has acquired...
Updated 46 minutes ago Lafarge Africa, Finland's Wartsila and the World Bank's IFC have agreed to build a 220 MW gas-fired power plant in Nigeria to boost electricity supplies, they said on Wednesday. The trio said in a statement their plan was to help fast-track increased power supplies...
Updated 57 minutes ago In preparation for South Africa’s imminent migration to digital broadcasting, the Independent Communications Authority of South Africa (Icasa) will hold public workshops to solicit input on the discussion document of impending local content regulations for television...
Recent Research Reports
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.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
This Week's Magazine
The board of UD Trucks Southern Africa (UDTSA) has announced the resignation of MD Jacques Carelse. Long-time UD employee, corporate planning and marketing GM, Rory Schulz, has been appointed as acting MD while the process started to appoint a new MD. The Japanese...
There is a need to start planning another pumped storage scheme in South Africa. Much work has already been done at a site in the Limpopo province and the project was very close to being put out to tender at one stage. In 2008/9 the National Energy Regulator of South...
The Coega Development Corporation (CDC) is preparing to leverage its strategic coastal position to develop the Eastern Cape economy through proposed aquaculture development zones (ADZs), with a proposed R2-billion project aiming to contribute $278-million to the...
Completion of the ongoing construction of the 102 km Zomba–Jali–Phalombe–Chitakale road, in southern Malawi, has been extended from June to December 15 because of persistent rains and difficulties in paying the contractor. The project is being undertaken by Kuwait's...
The Malawi government has awarded South African firm Fischer Consortium the contract to upgrade the Malawi Road Traffic Information System. The Directorate of Road Traffic and Safety Services at Malawi's Ministry of Transport and Public Works says Fischer...