Operational overview
 

CBI- electric

 
 
   
Electrical engineering

 

The CBI-electric group of companies recorded a strong performance during 2011. All operations performed well in spite of the tough economic environment that has persisted over the past few years. The segment successfully managed to secure new customers and markets despite the impact of the continued downturn in global demand. All businesses in this segment posted profitable performances.

 

Performance indicators       2011  
  2010  

Economic  

         
Revenue   Rm     3 336,0     2 961,3  
Operating profit   Rm     592,1     521,1  
Total assets   Rm     1 580,8     1 494,8  
Capital expenditure   Rm     30,3     23,1  

Environmental  

         
Petrol & diesel consumption   litres     719 854     746 505  
  GJ     31 808     33 013  
Electricity consumption   kWh     42 065 890     42 783 432  
  GJ     151 437     153 858  
Water consumption   kilolitres     209 601     218 594  

Social  

         
Total number of employees       2 541     2 908  
Training spend   Rm     3,3     2,5  
Community investments   Rm     4,9     3,6  
Enterprise development spend   Rm     8,1     5,9  

 

 


Revenue for CBI-electric improved to R3 336,0 million (2010: R2 961,3 million) whilst operating profit increased to R592,1 million (2010: R521,1 million). Diversification was a key focus area for the segment during the year. CBI-electric continued servicing existing markets and benefitted from good progress in introducing value-added services for clients. As well as complementing the products produced at our factories and assembly plants, offering value-added services not only contributes to revenue, but helps to strengthen our customer relationships. This strategy enables us to fully utilise the skills and knowledge of our employees in pursuit of growth.

Pleasingly, an excellent performance against safety, health and internal environmental targets accompanied this strong financial and operational performance across all group companies. In July 2011 a number of our factories were affected by an industry wide strike over wages and conditions of employment. A total of 45 333 hours were lost to industrial action – 3% of the total hours worked for the year. The potential impact was, however, mitigated by building up strategic stock in advance of the strike.

A new three-year agreement was signed with the National Union of Metalworkers, guaranteeing union members increases of between 7% and 10%, as well as other concessions. It is envisaged that this agreement will ensure a measure of labour-relations stability until at least mid-2014.

Total tonnes materials used in manufacturing     2011  
  2010  
2009  
Copper     13 056     12 394   12 952  
Aluminium     7 398     5 500   5 410  
Steel     1 978     1 947   1 302  
Galvanized steel     6 301     6 315   6 131  
PVC     4 091     4 123   4 002  
Brass     62     57   28  


Consumption of electricity, water and petrol continued to decline with only diesel use increasing slightly compared to 2010. Our investment in human capital through training increased to R3,3 million (2010: R2,5 million) while enterprise development spend rose to R8,1 million (2010: R5,9 million).

The strong results recorded by the CBI-electric businesses confirm their resilience in tough times. We anticipate respectable prospects for these businesses in the medium to long term, supported by developments such as the South African government’s commitment to infrastructural investment and the rollout of services, particularly in the energy and telecommunications sectors.

To ensure its sustainability as a low-cost producer, the business will focus strongly on continued improvements in operational efficiencies. Opportunities to grow electrical markets in Africa and Australia will be pursued.