Review
of operations

Overview and performance matrix

Nature of business

Manufacturer of tiles (South Africa and Australia) and bathroomware (South Africa).


Strategic positioning Target market
Preferred supplier of tiles and bathroomware.
  • Retailers and wholesalers of fashionable and affordable tiles and bathroomware in South Africa, Australia and selected export markets.
Key differentiators
  • Leader in design and fashion, creating desirable products.
  • Low cost manufacturing ensures products are affordable.
  • Local supply ensures an understanding of customer requirements and a short, reliable supply chain. This supports our ‘always in stock’ policy, with consistent volume supply of fashionable well-priced product.
  • Complementary products for bathroom and complete home tiling solutions.
Tile division South Africa: Samca Wall (monoporosa wall tiles); Samca Floor and Pegasus (ceramic floor tiles); Vitro (extruded fully vitrified tiles) and Gryphon (glazed porcelain tiles).
Australia: Centaurus (glazed porcelain tiles).
  South Africa Australia
Key performance indicators Trends 2020 Trends 2019 Trends 2019 Trends 2020
Sales
Production volumes
Average selling price
Margins
Net profit
Closing inventory
2019/20 priorities Scorecard
  • Grow sales volumes through existing and new customers to optimise utilisation of production capacity.
  • Reduce manufacturing and operating costs across the business.
  • Continue to invest in training and latest technology to ensure our products are differentiated on quality and fashion.
  • Implement revised strategies for export markets where competitor activity has increased and local economies are performing badly.
  • Improve delivery metrics through range rationalisation and enhanced demand planning.
  • Commence construction of a tile factory in Africa.
2019/20 major achievements
  • Cost control resulted in improved profit in Australia as there was no lockdown during the year, enabling continuous production and trading.
  • High gloss product range from Gryphon factory extended successfully to larger formats.
  • Capacity extended at Vitro and Pegasus through investment in new technology for larger formats.
  • Larger format tile introduced at Samca Wall.
2020/21 priorities   2020/21 prospects  
  • Grow sales volumes through existing and new customers to optimise utilisation of production capacity.
  • Improved productivity.
  • Cost leadership.
  • Launch EcoTec products which have a reduced carbon footprint.
  • Continue to invest in training and new technology to ensure our products are differentiated on quality and fashion.
  • Improve planning, forecasting and scheduling to improve on-time in-full delivery.
 
  • Despite the challenging sales environment, there are opportunities to improve market share.
  • Improved sales volumes will be driven by leadership on fashion and improved pricing, made possible by cost reductions.
  • Initial higher proportion of consumer discretionary spend in building renovation bodes well for first quarter sales.
  • Consumer focus on local products and improved supply chain should assist sales.
  • Increased customer base in Australia bodes well for higher sales volumes.
Bathroomware division Betta Sanitaryware (Betta) and Betta Baths.
Key performance indicators Trends 2020 Trends 2019
Sales
Production volumes
Average selling price
Margins
Net profit
Closing inventory
2019/20 priorities Scorecard
  • Improve Betta’s sales volumes through enhanced demand planning and alignment of customer requirements and factory capacity.
  • Improve production volumes and yields at Betta.
  • Reduce operating costs across the operation.
  • Complete the new Betta warehouse facility.
  • Continue to develop staff through enhanced training and development.
2019/20 major achievements
  • New management information system implemented to improve daily production volumes.
  • Demand forecasting implemented and warehouse inventory balanced.
  • Freestanding bath production improved with technology developed to produce components in-house.
  • Team skills improved which resulted in improved productivity.
  • New clean-water supply plant and waste-water treatment plant commissioned.
2020/21 priorities 2020/21 prospects
  • Complete the new warehouse facility.
  • Improve Betta’s sales volumes through wider customer base and improved on-time in-full delivery.
  • Continue to develop staff through training and development.
  • Improve Betta’s production yields.
  • Reduce waste and rework.
  • Install and extend capacity in the bath and sanitaryware operations.
  • Improve the distribution model.
  • Opportunities exist to grow Betta’s market share.
  • Export to Southern African neighbours can be grown to improve volumes.
  • Initial higher proportion of consumer discretionary spend in building renovation bodes well for first quarter sales.
  • Alternative client distribution model can improve local sales.

Nature of business

Manufacturer of cement-based adhesives, grouts, water-based paints and related products. Comprises 10 manufacturing facilities in Johannesburg, Durban, Port Elizabeth, Cape Town, Bloemfontein, Mokopane, Windhoek, Mombasa, Lusaka and Harare.


Strategic positioning Target market
Africa’s preferred tiling solutions.
  • Primarily the Group’s retail networks, Italtile Retail, CTM and TopT.
Key performance indicators Trends 2020 Trends 2019
Sales
Average selling price
Margins
Net profit
Stock turn
Closing inventory
Key differentiators
  • A national footprint of manufacturing plants which underpins Ezee Tile’s ‘always in stock’ policy with consistent supply of products.
  • Strong strategic partnerships with key raw material suppliers who provide access to the latest technologies to improve quality while reducing costs.
2019/20 priorities Scorecard
  • Stabilise the new factories in Lusaka and Harare and secure a significant market share in Zambia and Zimbabwe.
  • Improve Ezee Tile’s share of the architectural and specification markets. Adverse market conditions constrained achievement of this priority, but it remains work in progress.
  • Evaluate opportunities to expand into Africa.
2019/20 major achievements
  • Improvements in operational efficiencies through the introduction of improved KPI and benchmark measures.
  • The turnaround of the Mokopane factory through securing cost-effective supply of raw materials and increased production capacity and efficiency.
  • The successful relocation to the new site in Cape Town.
  • The successful launch of European quality tile adhesive “XXL” for extra large format tiles.
2020/21 priorities 2020/21 prospects
  • Develop the product offering of the paint business and secure the majority share of the business at our anchor client.
  • Roll out interactive online training programmes to upskill our clients’ sales staff.
  • Finalise construction of the new flagship factory in Brakpan.
  • Improve the profitability of our new African factories.
  • Leverage our purchasing power, operational efficiencies and manufacturing footprint to substantially increase market share in the tile adhesive market.
  • Launch a range of membrane-based waterproofing solutions for the residential market.
  • The business has created a range of tiling products with antimicrobial properties and will launch a range of sanitisers to protect our clients’ homes from bacteria and viruses.