22%
OPERATIONAL OVERVIEW:
INPUT SUPPLY
SHARE OF TOTAL
PROFIT FROM
OPERATING
ACTIVITIES
SENWES MECHANISATION HINTERLAND
Senwes Mechanisation is responsible for the supply of
mechanisation equipment and maintenance services.
This supply channel matches the quality of its equipment
- from tractors and planters to combine harvesters and
other agricultural equipment with sustainable support and
unequalled after-sales service. Senwes Village Mechanisation
is truly the farmer’s partner in increasing profits and lowering
input costs through precision farming, especially in a volatile
labour market. Senwes is also the exclusive agent for John
Deere in central South Africa, supplying whole goods, spare
parts and rendering workshop services from 25 outlets and 14
mechanisation workshops. Hinterland was established in 2013
and is responsible for supplying input
requirements to agricultural producers
and the provision of, inter alia, a
variety of hardware and convenience
products to the general public, such
SHAREHOLDING
as irrigation equipment, DIY, hardware,
veterinary medicine, animal feed and
fuel. Hinterland has 60 retail outlets, 7 fuel stations, 5 forecourt
convenience stores and 1 supermarket.
(A DIVISION OF SENWES)
(JOINT VENTURE WITH AFGRI)
50
PERCENT
OPERATIONAL PERFORMANCE
OPERATIONAL PERFORMANCE
The positive growth due to the good pre-planting rains was
affected by the drought conditions towards the end of the year
under review. However, robust activity in the workshops and
especially in spare parts sales enabled us to meet our targets.
Spending in respect of capital goods remains high on the list of
priorities of the producer, especially due to the unpredictability
of the labour situation and the risks associated with it.
Mechanisation market share decreased by 2,5% from 32,5%
to 30%. The decrease in total market share is due to more
aggressive competition by several other brands in this specific
market. However, we currently enjoy a good market share in
the higher John Deere kilowatt range. This unit delivered a
growth of 11%, which is sound, taking into account the drought
challenges towards the end of the year.
Now in its second year of existence, Hinterland remains on an upward
trajectory reflecting growth of 134% in profit, having successfully
navigated the challenges of system and culture integration which
are intrinsic to the creation of a joint venture. Although the Senwes
Village Mechanisation business does not form part of the Hinterland
joint venture, it still remains part of an integrated product and service
offering to the customers in the Senwes Village value proposition.
The Hinterland footprint has been extended to the Eastern Highveld,
the Lowveld and KwaZulu-Natal as a result of the joint venture.
The financial year under review saw the company face a challenging
planting season which was put under pressure by rainfall not
occurring at the right time. The late rains impacted negatively on the
traditionally high sales month of February and resulted in downward
pressure on our bottom line towards the end of the year.
JD IMPLEMENTS
(SUBSIDIARY OF SENWES WITH TOMLINSON FAMILY)
50
PERCENT
SHAREHOLDING
Senwes Mechanisation’s footprint as
an exclusive John Deere agent has
been expanded to the Western and
Eastern Cape through a partnership
with JD Implements. JD Implements
conducts its business through five
outlets.
OPERATIONAL PERFORMANCE
JD Implements has yet again performed exceptionally well. The
main challenges are regional expansion and optimisation of the
business model.
26
Senwes INTEGRATED
INTERGRATED REPORT
REPORT 2015
2015