IF the disruptions caused by the prolonged Covid-19 pandemic was the only thing Ottery-based plastics packaging specialist Bowler Metcalf had to endure…
The group in its interim period to end June also had to grapple with load shedding, material shortages, material price volatility and supply chain interruptions as well as a dour business environment.
But Bowler has shown over the decades that its lean and mean business model can withstand a bit of pressure. So no huge surprise then that the group registered a sprightly 14% growth in turnover to R636 million and that profit from operations was up an impressive 24% to R111 million.
CEO Friedel Sass pointed out that the packaging business had matched its prior best performance of 2017 in real terms. “Our ability to optimise situational circumstances has maximised the possible benefits from a good mix of products, productivity enhancements and continuous cost control.”
But it’s not all batten down the hatches…Bowler is looking to bolster operations with various capital expenditure projects worth some R110 million. Sass said around R75 million was already spent during the interim period with the balance to be completed in the second half.
A chunky R38 million was spent on the property portfolio with two upgrades in Epping and Philippi.
Sass said that during July Bowler’s Extrusion Blow moulding plant was seamlessly relocated into the enlarged Philippi site. “With this relocation and infrastructure build, the company is positioned to expand its container and injection business with the necessary focus and space.”
He added that operational capital expenditure in the packaging segment topped R37 million – which was mainly earmarked for technology and capacity expansion.
Sass indicated that while the recent events in South Africa had dampened the green shoots of hope for a rapidly reviving personal care market, management remained determined to expand its share of the market during 2022 by optimising its available capacities and expanding relevant technologies.
He said favourable returns were expected from four rooftop solar energy generation projects. What’s more two additional business line expansions are likely to happen in the coming financial year. Sass said these investments were budgeted at R75m with a further R25m likely to be spent on systems, equipment and technology.
Meanwhile Caxton & CTP reported that its packaging operations had a pleasing half year performance to end June, improving profitability. Executive director Terry Moolman noted that once the lockdown restrictions eased and the bans implemented on certain categories had been lifted, there was a relatively quick return of demand, especially in the alcohol and fast-food sectors. He did concede some of this demand was attributable to filling supply chains and the response to consumer pent-up demand.
“The question remains how sustainable this demand will prove to be.”
Moolman did disclose that Caxton & CTP’s label operations in the Western Cape – that serve the wine, spirit and food market – had shown growth and improved profitability as the ban on alcohol consumption was lifted during the period.
