South African industrial group Torre Industries is exhibiting at the 2018 Investing In African Mining Indaba, with the aim of increasing the group’s brand awareness among local and international mining industry players.
The JSE-listed group has nine business units across three segments: parts and components, analytical services and capital equipment. These segments service the mining, automotive, construction, manufacturing and agricultural sectors in 11 countries, nine of which are in Africa.
Torre’s executive deputy chairperson Jon Hillary says, while it is Torre’s second visit to the Mining Indaba, it has a fairly strong history and familiarity with the event, as some of its subsidiaries have exhibited previously. He explains that Torre, as a fairly young company, has grown rapidly, primarily owing to its focus on acquiring assets and incorporating them into the group.
He notes that the process of acquiring nine businesses requires a fair amount of time for their integration and alignment.
However, as previously reported by Engineering News, Torre management believes that its focus going forward will shift away from restructuring to include more cost optimisation and the improvement of efficiencies.
Hillary says Torre is poised for organic and acquisitive growth, citing the group’s positive financial results for the year ending June 30, 2017, which demonstrated that the group delivered improved results in the second half of the financial year, despite the challenging trading conditions in most of Torre’s operating markets.
Gross profit for the 12 months to June 30, 2017, was up 8% to R568-million, while normalised earnings before interest, taxes, depreciation and amortisation remained stable at R121-million. Revenue for the year under review also remained stable at R1.5-billion.
Commenting on those “tough trading conditions”, Hillary notes that both the macroeconomic and political situation in places like South Africa and Zimbabwe is problematic, in terms of the effect on these countries’ economic growth.
Hillary notes that the “political noise” surrounding the South African economy, as well as the dissatisfaction surrounding Mining Charter III, does not foster a favourable environment for mining and increases pressure on the local mining industry. “Quite clearly a solution that is appropriate for all sides while promoting foreign investment security is urgently required if one is seeking to create sustainable employment opportunities in the country.”
Nonetheless, Hillary and Torre believe that there are numerous growth opportunities within the existing business units and notes that there is some peripheral businesses around Torre’s current subsidiaries that management will consider.
One of the core aims of the group going forward is to diversify away from the mining and construction industries because of their highly cyclical nature. Hillary notes that, presently, the analytical segment is heavily focused on mining, but could relatively easily transition into the water, food and beverage, and agriculture spaces.
He adds that Torre is well placed to exploit any margin of improvement in both the mining and construction industries, despite the current challenges.A
side from diversifying some of its business units, the group will still look for bolt-on and standalone acquisitions, as well as geographical expansion. Hillary says management is cautiously optimistic on the outlook for all its current assets, but adds that the group will need to be agile to adapt to market forces.
Torre believes that there are many opportunities for growth throughout the rest of Africa, which is why the networking platform provided by the Mining Indaba is so important. “We have high expectations for our visit and we really want to ensure that people know who and what we are, and what we can offer the mining industry. “We’re looking forward to attending the various panels and presentations, and are hopeful that we can build the business relationships we aim to foster.”
Torre invites all attendees to visit its stand at the Mining Indaba, which will be held from February 5 to 8 at the Cape Town International Convention Centre.