Aveng Manufacturing: The pros and cons of globalisation

The effects of globalisation are far-reaching and can impact positively or adversely on a business.

In October of 2016, Aveng, the listed construction and engineering group, reported that operating conditions in South Africa and other markets in sub-Saharan Africa, Australasia and south-east Asia remained difficult because of the continued global economic downturn and associated intense competition.

Aveng’s chairman Mahomed Seedat said the group had in recent times experienced improved tender activity levels in mining, Australia, New Zealand and south-east Asia as new opportunities came to market.

However, Seedat told a general meeting of shareholders that the group’s two-year order book decreased by 5 per cent from R28.1 billion at the end of June to R26.6 billion at the end of September.

However, on a more positive note, the order book for South Africa and the rest of its African construction and engineering operating segment, rose from June by 13 per cent to R7.4 billion in September, according to Seedat.

He added that Aveng Grinaker-LTA, which forms part of the South Africa and rest of Africa construction and engineering segment, had established a solid base for profitable growth, led by a stable and disciplined management team.

“The planned return to profitability is on track, while even greater attention will be given to driving the transformation following approval of the Kutana transaction,” he said.

Earlier in October, it had been announced that Aveng Grinaker-LTA had agreed to sell an initial 45 per cent economic interest in the company to black woman-owned investment group Kutana Construction for a maximum of R756 million effective from February 1, 2017.

The transaction was tied to an agreement announced during October, that seven listed construction companies had agreed to collectively contribute R1.25 billion over 12 years to a socio-economic development fund and for each of the signatories to the agreement to undertake further transformation initiatives.

Seedat indicated that Aveng’s manufacturing and processing segment continued to be impacted by the lack of rail construction projects in the Southern African Development Community and the curtailment of rail maintenance work.

“Over 125 years Aveng has evolved in character, capability and reach. Its origins lie in modest construction projects but the company now boasts expertise in steel, engineering, manufacturing, mining, concessions, public infrastructure and water treatment. This South African consortium continues to make its mark across the globe,” states the Aveng Manufacturing website.

Aveng Manufacturing manufactures and supplies construction products to the construction sector, services and engineered solutions to mining, water, oil and gas and construction clients, and rail construction and maintenance services to the transport sector.

The Group is divided into five divisions:

Aveng Infraset manufactures a diverse range of precast products for the development of infrastructure. These include products such as pipes, culverts, retaining blocks, paving, rooftiles, pre-stressed poles, masts and railway sleepers.

Aveng Manufacturing Duraset is a supplier of engineered support solutions to the mining and geotechnical industries. With very well established research and development facilities, manufacturing plants and commercial services for each of our market focused divisions; Aveng Manufacturing Duraset has positioned itself over time as a well branded and leading supplier of safety critical products to the mining industry.

A comprehensive range of steel rock reinforcement tendons (roofbolts), cable anchors and stand-up support products are produced by Aveng Manufacturing Duraset’s ISO 9001:2000, Nosa 5 Star factories. Strata control products are supplied to the gold, platinum, coal and copper industries, including export to 22 countries; Africa, Europe, Russia, Chile and Canada among others.

Aveng Manufacturing Duraset maintains a very strong research and development effort focused on improving mine safety and reducing total cost of ownership. This ongoing programme is strongly rooted in the practicalities of mining and is carried out in conjunction with mining groups, ensuring that solutions address root causes which facilitate subsequent transfer of technology.

Dynamic Fluid Control Pty Ltd. (DFC) was founded in 2001 on seven of the most well known and established brands in the local and international valve industry.

The company concentrates on its two prime markets of water and mining. The two resulting entities respectively known as DFC WATER and DFC MINING & INDUSTRIAL act as the marketing, service and research and development arms of Dynamic Fluid Control. Each entity is managed and serviced by a highly dedicated team focused on customer satisfaction and the selling of solutions!

Aveng Manufacturing Rail Services is southern Africa’s leading rail track construction and maintenance contractor. More than 50 years of experience, combined with a skilled, talented team and a full complement of state-of-the-art equipment, ensure that we provide you with world class solutions every time.

Based to the east of Johannesburg, Aveng Rail has been a major contributor to the railroad network, a critical element of Africa’s transport infrastructure, in South Africa, Swaziland, Namibia, Botswana, Zimbabwe, Zambia and Mozambique.

According to the official website the company is expanding its footprint into other parts of Africa and the Middle East and, working with sister company McConnell Dowell Construction, also into Australia and South East Asia.

It has been a challenging couple of years for Aveng Manufacturing, but restructuring its services is playing a part in maintaining a business with a long tradition in quality.