June 2018 Watt Featuring: ACTOM’s commitment to local manufacturing What’s ACTOM (Pty) Ltd www.actom.co.za Always with you Corporate Focus Patience, flexibility and innovation are needed to address challenges The last financial year has been one ment sectors is underestimated and of the most challenging years the will require innovative financial and group has faced. management solutions to build on the Business confidence collapsed return of confidence that followed the early in the year following political change in political leadership. upheaval, which resulted in invest- I would like to thank all stakeholders ment across the private sector being for their hard work and support in an deferred and cancelled. extremely challenging environment and The ongoing mining charter negotia- encourage everyone to remain flexible, tions and corporate governance issues patient and positive as the environment in parastatals, municipalities and other recovers and we address the risks and role players led to a further deteriora- opportunities that present themselves. tion in the market. We must ensure we stick to our Thankfully, the recent political value systems and risk management changes have given impetus to ad- disciplines and not take on business dressing many of these issues, which that we later regret. augers well for business and the Finally I would like to congratulate economy in the medium term. the management and staff for perform- I believe it will take some time to ing well in this environment and ensur- reverse the economic damage done ing the integrity of our order book, cash and the current cooperation that ex- vital in ensuring success. In addition flows and profits has remained intact. ists between business, government, I sense the depth and consequences labour and other role players will be of financial mismanagement in govern- Mark Wilson: Chairman Positive political changes auger well for business growth The political developments at the which provides further grounds for end of 2017 and the start of 2018 optimism is the recent resuscitation by which saw the long hoped-for government of the Independent Power change in the leadership of the Producer based renewable energy ruling party and government have programme. boosted prospects for improved This, together with the govern- governance, economic recovery and ment’s commitment to encouraging greater social stability. local manufacture via its designation Our new president has undertaken programme favouring the purchase various initiatives to restore investor by state-owned enterprises and gov- confidence, with issues of governance ernment institutions, including mu- and corruption that have plagued the nicipalities, of locally-manufactured country over the past few years being products, bodes well for healthy ongo- addressed as a matter of priority. ing development of local industry and These changes give us greater manufacture together with job-creation cause for optimism than we have had and skills development – all of which for a long time. It will still take some ACTOM has long supported, encour- time, however, for them to translate aged and practiced. into a genuinely favourable economic In line with this, early this year climate in which we may develop our ACTOM reached an important mile- businesses in a meaningful and sus- stone in attaining for the first time a tained way. Improved economic and and business units, as well as leading Level 1 B-BBEE rating. This achieve- trading conditions are unlikely to be felt to the closure of our Elmacast foundry. ment followed close on the heels of much before the end of 2018 but may Our divisional management teams the group raising its black-empower- be expected to become increasingly are to be commended for the way in ment and black-women empowerment evident from the beginning of 2019 which they have continued to manage shareholdings to 51,3% and 34,66% onwards. their businesses exceptionally well respectively late last year. For the present, though, we have through challenging times. We are well- We can be rightly proud of both had to continue to adapt to the prevail- positioned as a group for the growth these advances in the group’s status ing depressed conditions that have that lies ahead. and I would like to thank everyone impacted adversely on most of the Thankfully, in addition to the above- involved for their efforts in achieving group’s businesses over an extended mentioned significant changes in them. period. This has unfortunately necessi- the country’s political and economic tated rationalisation in several divisions landscape, another positive change Mervyn Naidoo: CEO What’s Watt June 2018 2 Feature Article What’s Inside ACTOM’s commitment to local manufacturing Pg 3 LHM rebuilds pump motor for pumping station Pg 17 ACTOM attains Level 1 B-BBEE rating Pg 6 CSIR and Metalplus collaborate on laser welding Pg 18 Chairman’s Awards Pg 6 M&C solves motor bearing failure riddle Pg 19 ACTOM joins Proudly SA Pg 7 M&C Zambia installs vent fan test column Pg 21 100% pass rate for Balmoral College matriculants Pg 8 ACTOM Turbo Machines refurbish de-scaler pumps Pg 21 T&D offerings at Africa Utility Week Pg 9 Electrical Products’ Branch of Year awards Pg 22 MicroGen boiler breakthrough order Pg 10 Genlux develops LED floodlight range Pg 23 Static Power celebrates 50th anniversary Pg 11 Key appointments Pg 24 Gibela contracts awarded to ACTOM Power Systems Pg 12 John Thompson’s spends R4-million on CSI projects Pg 25 P&C introduces versatile relay range Pg 14 Ronnie Russell and Neville Lock retire Pg 26 & 27 P&C opens prepayment meters factory Pg 15 Long-service awards Pg 28 Advantages of Web-based SCADA solutions Pg 16 R&M staff members run half-marathon Pg 29 Cover Images illustrating some of the manufacturing capabilities across various divisions within the ACTOM group. Read part 2 of the feature “ACTOM’s commitment to local manufacturing” in the December 2018 edition. ACTOM’s commitment to local manufacturing (Part 1) South Africa’s unemployment rate, progress we have made since 1994, decision-making and the damaging for the first quarter of 2018, was re- the economy has recently stalled. We effects of state capture and corruption. ported as 26.7%. Although slightly are not creating the jobs we need, We must act now – boldly, deci- improved since July 2017 (27.7%), it poverty remains high, investment has sively and collectively – to change the is still a major concern and one that fallen and confidence is low. trajectory of our economy and our has been highlighted as a key focus In part, this is because of the slow- country. area by President Cyril Ramaphosa. down in the global economy. But it is We need a NEW DEAL for jobs, As explained in his documented also the result of poor policy imple- growth and transformation.” “New Deal”: “Despite the remarkable mentation, weaknesses in collective The document then goes on to explain 10 priorities that should under- pin a NEW DEAL for the economy to recover and thrive: 1. Create decent jobs 2. Focus on growth and investment 3. Pursue meaningful economic par- ticipation for the poor 4. Implement macroeconomic policy that promotes growth 5. Transfer ownership and control of the economy 6. Improve access for all to quality, relevant education 7. Revitalise and expand manufac- turing capacity 8. Maximise the impact of infrastruc- ture build 9. Restore state owned enterprises as drivers of economic growth and social development 10. Confront corruption and state capture The manufacturing sector employs This rotor and motor frame was manufactured by ACTOM Electrical Machines. Featured in the approximately 1.8 million people in foreground is Nathaniel Mofokeng and behind the motor frame, Vincent Phala. To page 4 3 What’s Watt June 2018 Feature Article From page 3 lost since 2008 and manufacturing has declined from contributing more than 15% of GDP to just under 12% of GDP. The key factors that have contributed to this decline include constraints in domestic electricity supply, rapid in- creases in administered prices, labour instability and competition from un- fairly incentivised imported products. “The Manufacturing Circle believes that in order to put South Africa on a higher, job-rich growth path, to en- able us to compete and succeed as a manufacturing destination in the global economy, we need to prioritise three clear goals. These include achieving a competitive manufacturing environ- ment; attaining a supportive interna- tional trade position and advancing Jackson Shabangu and William Lebenya working on porcelain insulators for disconnectors at ACTOM’s the reputation of South African manu- high voltage equipment manufacturing facility in Knights, Germiston. The porcelain insulators are factured products,” explained Philippa currently imported, but with an increased acceptance of ACTOM developed and manufactured Rodseth, Executive Director of the composite insulators, opportunity exists for the large-scale manufacture and ultimately export of this Manufacturing Circle. component. Phillipa expanded on elements of South Africa and provides the base- key stakeholders to promote the these priorities by explaining that a load and scale for our key national benefits of manufacturing growth for competitive manufacturing environ- infrastructure including electricity, rail the broader economy. They influence ment requires government interven- and municipal services. It is the main policy and highlight opportunities and tion in the form of coherent, coordinat- driver of tertiary education and the ab- key priorities for manufacturing growth. ed and consistent economic policies sorption of people into the workforce In pursuit of these objectives, the and the regulation and implementation and accounts for just under 12% of Manufacturing Circle also meets pe- of such policies. Advocating efficient the Gross Domestic Product (GDP). riodically with government ministers, spending, cost recoupment and price Manufacturing is also the only viable heads of key state-owned entities, regulation for public infrastructure and means of beneficiating South Africa’s provincial and local government lead- utility services are vital in supporting own natural resources.