6
OVERVIEW
365 - REVIEW
QUARTER 1 QUARTER 2
Senwes introduced the fifth season of the Nation in
Conversation, South Africa’s premier agricultural talk-
show, at the 2017 Nampo Harvest Day and established
the company and co-sponsors as facilitators for debate
within agriculture.
Senwes Credit, the finance division, revisited its pricing
structures and increased its credit margins in order to
ensure better risk alignment.
Technical upgrading and process improvement in the
silo business resulted in increased efficiency and ser-
vice delivery.
Absa Bank awarded the Golden Partner Award to both
Senwes Equipment, the supplier of mechanisation equip-
ment, whole goods and spares, and JD Implemente, the
agri-mechanisation partner, for excellent financing per-
formance.
Senwes listed its share on ZAR X and trading is being
done in a seamless manner.
The market access division introduced new procure-
ment products to the market with great success. The
contracts traded in the first year of trading outper-
formed the market average by 24,3%. The product
take-up surpassed all expectations and the new sea-
son appetite is already at its maximum.
The loyalty scheme, AgriRewards, finalised the 2017
allocation of R54/ton and the 2018 scheme was rolled
out to other divisions within the Senwes group.
A share repurchase programme was continued in the
financial year, which brought about higher liquidity and
unlocking potential for shareholders. Prodist, the wholesale distributor, focused its product range
on 15 213 lines, which meets 75% of the total retail require-
ments of its customers.
Senwes Grainlink, the silo business, received the largest
summer crop in the history of South Africa during this
quarter. It exceeded the 37-year old maize record of 1981
by 13,9%. The yield per hectare for maize was 6,39t/ha
on average, which is 89,1% better than 1981, whilst hec
tares planted declined by 60,6% since 1981.
Additional capacity of 97 000 tons had to be erected at
seven business units and Senwes now owns 4,7 million
tons (vs. 4,6 million tons the previous year) or 25% of the
country’s total silo infrastructure.
More than half of the summer crop was received at a higher
than required moisture percentage, which proved the suc-
cess of the silo upgrading project.
Senwes Credit expanded its product range to producers
and, in terms of the improved commodity finance product,
producers are now receiving bridging finance for a longer
term, which brings about higher liquidity and buying power
by the producer.
The grain procurement division increased its focus and
growth in new markets which added 11% to the volumes
stored.
Senwes Park, the cricket stadium in Potchefstroom, host-
ed its first international cricket test played by the Proteas,
which significantly increased exposure to the company
brand on international media.
Significant reinvestment in IT-architecture was successfully
completed during this quarter. Total data storage capacity
was increased by 500%, while architectural and hardware
OVERVIEW | THE BUSINESS | STRATEGIC AND OPERATING CONTEXT | CORPORATE GOVERNANCE | FINANCIAL REVIEW
changes increased processing capacity by 28%. These
changes contributed to a 40% increase in the efficiency of
the overall data centre function.
On the back of the implementation of a centralised sup-
port centre for agricultural equipment, Senwes Equipment
expanded the project to a full monitoring programme, in
terms of which Senwes producers can now monitor their
machinery and agri-equipment on a real-time virtual basis.
Senwes Equipment opened an agri-mechanisation branch
in East-London as part of its deployment programme in the
Eastern Cape.
A successful auction of second-hand agricultural equip-
ment was finalised during this quarter in Kroonstad and
36,1% of the provision for second-hand goods was re-
couped in the process. The highest sales of new spares in
the history of Senwes were achieved in October 2017.
Grasland, the lime production company, launched new
lime blends during the quarter, which are better suited to
meet the needs of the clients and ensure more effective
application. New finance arrangements for the season
were also introduced to the market.
The board of directors of the Senwes group underwent
King IV TM training while Senwes was included in the Manual
of Stock Exchanges for the first time.
Senwes proved its reinvestment in the community by
hosting a Christmas party for less fortunate children and
adults. This was the highlight of the year for numerous
adults and children.
A final dividend of 25c/share was paid after approval there-
of at the annual general meeting held on 24 August 2017.