profile
drone starting in July. Now we can’ t know whether this is the start of a new trend or will prove to be a once-off occurrence, but the point is that the technology is out there and we’ re seeing the fourth industrial revolution playing out around us. We must keep our eyes open for disruptive technologies that could change the world as we know it completely in specific industries.
RG: In your opinion, what are the trends to keep an eye on in the cement industry? AvH: Well the cement and quarrying industries are very closely related, and we all know that some consolidation is necessary. I think we’ re going to see some interesting happenings in the cement industry over the short term, with the Afrisam – PPC merger and possibly some other interesting moves that will help cement companies to strengthen their balance sheets. Some of these companies were, in my opinion, reckless a few years ago in terms of how they went about introducing debt on their balance sheets, and now that has come home to roost, so it’ s going to be very interesting to see how this plays out and how these companies come up with strategies to survive a very over-geared balance sheet.
Interestingly enough, this is happening against the backdrop of an emerging economic recovery, we saw the resources industry coming back, we see government continuing to grow its infrastructure spend, albeit perhaps not at the rate we would like to see. When it comes to demand for cement, at current forecasts we’ ll be in an overcapacity situation until probably about 2020, after which we will start seeing supply and demand dynamics changing again so supply is slightly less than demand. It’ s going to be very interesting to see how that plays out and whether cement companies use
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technology to improve their productivity. I know some companies are investing in technology to increase their efficiency, and in so doing they are also creating more capacity. So it’ s going to be very interesting to see how the dynamics change, but I think the buyers’ market for cement is going to come to an end in two to three years from now.
RG: What advice would you give someone looking to emulate Afrimat’ s success? AvH: I think the most important thing is that you can never afford to become complacent. Afrimat is a South African company and we want to make a contribution to the country. We are, hopefully, strategically in tune with what is going on around us and we try to make the necessary adjustments in time, and so far this has worked well for us. At the same time, we are aware that things can change very quickly and we can never be complacent. I always warn my guys that we are probably at best only 18 months away from bankruptcy at any given time – one the wrong decision can wipe us out in 18 months or less. So you’ ve got to be careful, you can never be arrogant about your success. We are extremely grateful for what we have; we’ ve been very blessed over the past decade. And we’ re looking forward to the next 10 years. n
36 _ QUARRY SA | MAY 2017