| Wed 26 Nov 2003, 13:29 | | AFROX SETS OUT FUTURE STRATEGY |
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AFROX SETS OUT FUTURE STRATEGY
African Oxygen Limited
(Incorporated in the Republic of South Africa)
(Registration number 1927/000089/06)
(Share code: AFX ISIN Code: ZAE000030920
("Afrox")
Press Release
26 November 2003
AFROX SETS OUT FUTURE STRATEGY
In line with its strategy to optimise the growth potential and profitability of
African Oxygen Limited (Afrox), the company today announced the strategic steps
it intends taking to secure future growth as a dedicated industrial business.
This follows the announcement made on 17 November 2003 that it would be selling
off its healthcare subsidiary, Afrox Healthcare, to a BEE consortium.
Commenting on the way ahead, Rick Hogben, Afrox CE, said, "As a stand alone
industrial business Afrox should achieve average real growth above inflation of
between 8 and 10% a year. Our marketing and efficiency enhancing initiatives
have been very successful. This was demonstrated with the release of our year-
end results in October. We recorded a net profit increase of 42% and increased
net cash inflows from operating activities of 34%. This was led by the
industrial business, which contributed 62% of the net profit attributable to
shareholders."
Notable performance achievements came from the Handigas business, which improved
operating margins and gained further business in the automotive industry. The
special products and packaged chemicals operations also continued to grow and
new applications are being researched. Substantial local and export orders were
received from the AfroxPac 35 self-rescuer, contained in the safety services and
products sector. AfroxPac 35 was launched last year and sales this year have
exceeded R90 million.
Hogben continued: "We pride ourselves in being a customer-centric organisation.
In the past two years, we have been remodelling our service offering for
customers. In many ways we are focusing on our roots. The industrial business
is all about the management of a number of businesses each worth around R100
million or more. We aim to turn our core competencies into strategic advantages
by growing the scale and scope of Afrox while improving productivity and
efficiency. We will create shareholder value by expanding new products and
services for local and global markets, driving volumes and productivity, and
seeking value-adding opportunities. We will focus on growing our export business
through widening our range of products and increasing our share in export
markets."
Afrox will also attempt to bring BEE into all new enterprises that are pursued
and the Board is currently investigating ways to empower the group further.
"Afrox has a team of talented people whose passion, energy, diversity and
commitment are integral to our success. We will continue to extend our reach
into South Africa"s neighbouring territories and we see Africa as a growth area
for our products. We will increase the size and scale of our presence in Africa,
which will include a focus on Tanzania and Angola, as well as the other 15
countries in which we currently operate.
"Afrox is part of a global company running on world class business principles,
with a strong international reach. While we have enjoyed some notable
achievements during the year, Afrox is only as good as its next set of results.
Everything we have achieved is in the past tense and 2004 will bring a fresh set
of challenges. We will continue to be driven by a focus on customers,
developing new and innovative product and service offerings, while sustaining
and enhancing the quality of our underlying business; we will continue to focus
on efficiency and effectiveness to help drive performance, so that we can
continue to offer above average service to our customers and above average
returns to our shareholders," Hogben concluded.
-ends-
Transaction sponsor: JPMorgan
For further information please contact:
Afrox (011) 490 0400
Rick Hogben, CEO (011) 490-0504
Chris Fieldgate (011) 490-0430 / 082 495 1481
Ros Beart (011) 490 0712 / 082 891 5149
Brunswick (011) 268 5750
Rob Pinker 083 326 7794
Taryn Proksch 083 273 1301
Gareth Sharp 083 287 3180
Date: 26/11/2003 10:22:05 AM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
