The group’s strategy provides the divisional businesses with guiding principles and direction to enable them to formulate and implement their business plans, in order to achieve their performance objectives.
THE GROUP'S STRATEGIC OBJECTIVES
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Profitable revenue
growth

The group aims to grow revenue in a responsible and sustainable manner through mutually beneficial long-term partnerships with strategic customers. Revenue growth will be achieved through expansion of existing operations, products and services, growth in market share and entry into new markets.

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Solid returns
on capital employed

Long-term contracts, owning strategic industrial properties and key raw materials, and a continued focus on driving efficiencies sustain the long-term cost structures of the group and support sustainable and improved returns on capital employed.

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Strong cash
generation

Operational strategies are directed towards cash generation and growth is focused towards investment in businesses with consistently strong cash flows.

The group’s performance objectives are realised through five strategic drivers
STRATEGIC DRIVERS
MATERIAL ISSUES
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Market leadership

KAP’s businesses are either market leaders or have the ability to be market leaders, through market share growth in their specific industry sectors.

Opportunities exist to grow market share and to enter new markets.

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High barriers
to entry

The group’s significant experience, scale and specialisation provide a competitive advantage in highly regulated industries. Access to key raw materials, licences to operate, specialist skills and expertise and economies of scale contribute to higher barriers to entry.

Regulated industries have high barriers to entry, presenting opportunities for the group to leverage off this competitive advantage.

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Industry
diversification

The group is diversified across various industries, market sectors and geographies. This diversity enables the group to manage concentration risk and provides a level of protection to stabilise margins.

Economic and business cyclicality is mitigated through diversification.

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Adding value
through specialistion

The group is focused on adding value to its customers through the provision of value-added products and services, thereby mitigating some degree of risk against the volume and price pressures inherent in the commodity markets.

Providing specialist services requires significant and continued investment in technology.

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Leveraging our
African base

Operations are positioned towards servicing customers in emerging markets, with a specific focus on sub-Saharan African countries. The group leverages its industry knowledge and expertise of African markets to provide a competitive advantage.

Infrastructure development and consumer growth in Africa present an opportunity for business development and growth.

RESULTS OF IMPLEMENTATION
Revenue from continuing operations increased by 23% to
R20bn
Operating profit from continuing operations increased by 25% to
R2.5bn
Headline earnings per share from continuing operations increased by
15.4%
Cash generated from operations of
R3bn
Dividend per share increased by
17%
Net asset value per share increased by
17%
Revenue (Rm)
CAGR* 10%
Operating profit (Rm)
CAGR* 18%
HEPS (cents)
CAGR* 19%
* Compound annual growth rate of continuing operations
ENVIRONMENTAL, SOCIAL AND CORPORATE GOVERNANCE FORM THE BASIS OF SUSTAINABILITY
The group remains focused on managing its long-term sustainability for the benefit of its stakeholders.
shareholders

its shareholders and investors, who expect acceptable returns
on investment;

customers

its customers and suppliers,
who rely on its ability to
remain competitive;

employees2

its employees and their communities; and

environment

the environment and its ability to manage its impact thereon.

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Sustainability

The group regularly reviews and adapts its policies and processes to reinforce its ability to be economically viable, socially responsible and environmentally sound, while still remaining competitive.

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Social awareness

The group supports the development of the consumer in African countries by contributing to economic growth through its active involvement in infrastructural services and general business in these countries. The group also supports the communities in which it operates through various community development and employment programmes.

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Transformation

The group observes and proactively aligns day-to-day business practices in South Africa with the broad-based black economic empowerment (B-BBEE) codes. Commitment to the principles of B-BBEE, to make it real and tangible for the group and its employees, is a key priority.

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Skills and talent
management

Multifunctional skills and experience are required for specialised and diverse employment in each business. Access to skills, actively managing talent and employee retention enhance the group’s ability to provide value and quality products and services at competitive prices.

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Human relations

Corporate and employee behaviour is guided by the group’s code of ethics. This code provides employees with summary information on what constitutes unlawful or unethical business practices and provide guidelines on topics that include, among others, basic human rights, anti-corruption, health and safety and nondiscrimination.

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Scarce raw
materials

Raw materials are often scarce and in certain instances subject to commodity and import price fluctuations. Ownership and effective management of raw materials in manufacturing processes secure the long-term supply and pricing thereof.

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Carbon emissions

Significant fuel and energy usage and fluctuations in prices thereof influence the group’s operational cost of services and products. Businesses therefore focus on optimising operational efficiencies and continuously invest in new technologies to manage fuel consumption and energy usage. This not only ensures profitability and competitiveness, but it also manages and reduces overall carbon emissions.

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Waste

Waste production and cost of waste management in upstream and downstream processes impact profitability. Reducing waste and using recycled materials increases efficiencies and margins on manufactured products.

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Water and land

Manufacturing processes are dependent on water, which is in scarce supply. The group aims to reduce and manage water usage and protect natural resources and areas of biodiversity.

RESULTS OF IMPLEMENTATION

19 729
permanent employees

ISO, NOSA, OHSAS and RTMS systems and accreditations are in place in 80% of Unitrans’s specialist logistics operations and in more than 80% of the group’s manufacturing facilities.

R140.9 million
invested in training

Ongoing
B-BBEE
commitment

44 088 ha of
forestry land

CSI projects are focused towards community development, education and childcare

88.2% black
employees

11.8% white
employees

Inclusion on the
FTSE4Good Index

110 000 tonnes of wood fibre residue recycled into energy

Vehicle and chemical waste recycled with certified waste removal agencies

52 069 ha of protected biodiversity land

Latest Euro 5
coaches

R10 million per year saved from thermal energy plant

0% waste to landfill target set at certain manufacturing facilities

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