"APE Pumps is a well-established pump business and had a facility that needed upgrading and equipment that needed renewing. We combined the two workshops, which will provide additional capacity and allow the two subsidiaries to increase turnover and profitability and also allow APE Pumps to be able to secure larger tender projects," PSV CEO Abie da Silva told Engineering News, in Johannesburg, last week.
He added that the company is spending about R8-million on new capital equipment and R1-million on the refurbishment of the facility.
"An approved capital investment programme will, firstly, allow PSV Services to eliminate the outsourcing of machining of material and, secondly, the additional equipment will expedite turn around and delivery times for APE Pumps," said Da Silva.
On other potential strategic acquisitions, he added that the company had sent out a cautionary notice for a specialised engineering business.
"The deal will be finalised in the next two months and we will be in a position to elaborate more."
PSV starts its new financial year on a confirmed order book of R110-million as of end of February.
All current contracts are progressing well and amounts to R250-million, include a five-year pump maintenance and spare supply contract, a three-year petrochemicals service contract and a three-year petrochemicals spares supply deal.
As a result of the massive fuel price increases in South Africa and the fact that many older pumps are not able to cater for a fuel price greater than four digits a litre, it is expected that PSV's Petrologic subsidiary will receive orders for the updating of these old fuel pumps.
PSV has successfully benefited from the cross selling of services to large international clients. The company was recently awarded a contract to manufacture swirl tube separator assemblies under licence for Shell Global Solutions International, becoming only the second company in the world to manufacture these swirl tube assemblies.
The company will continue to exploit opportunities arising from the upsurge in infrastructural and power generation spend in South Africa.
"We remain close to Eskom and are especially excited about their update and extension programmes, some of which we are already tendering for. We are encouraged by opportunities in the market place, which our group will be able to capitalise on," concluded Da Silva.