Replacement Parts Services and Solutions:
Industrial (“RPI”)
RPI consists of the core businesses previously reported under the Engineering Solutions Group. This segment focuses on the import and local manufacture of products, services and solutions for all industries in Southern Africa. RPI offers world class solutions and products with the aim to improve the efficiency of our customers and ensure that they remain globally competitive.
The shortage of steel, the significant increase in freight charges and the local increase in fuel prices, has resulted in the higher cost of product. Due to contract pricing at most of our major customers, we could not pass these increases on, which has put pressure on our gross margins.
During the year under review, we have continued with the rollout of the Africa Maintenance Equipment (“AME”) empowerment model in terms of which, specific BMG and Industri branches were sold to B-BBEE entities. A total of 12 AMEs have been established to date and this concludes the rollout plan. BMG has also sold its 100% of shareholding in Rustenburg Engineering and Foundry through a management buyout.
In respect of the year under review:
> Revenue increased by 8.4% from R4.09 billion to R4.44 billion. Our revenue is, however, still trailing the pre-Covid revenue levels by 7%
> The sustainable operating profit increased by 1.3% from R243 million to R247 million
> The net operating assets decreased marginally by 1.9% from R1.7 billion to R1.68 billion
> The return on net operating assets for the financial year was 14.7%, an increase of 0.4% from 14.3%