Andrew Waller's half-year update

Andrew Waller's half-year update

June 29, 2021

As South Africans, we find ourselves amid another COVID-19 wave with our medical facilities overwhelmed, and further controls put in place with the adjusted level 4 restrictions.

A vaccinated population will help us return to normality and we hope that the rollout gains momentum.

To date, Grindrod has reported 318 positive cases, 286 recoveries, and sadly 6 deaths due to COVID-19 complications. Our thoughts and prayers are with the families and friends of our colleagues who succumbed to the disease. We have managed to curb the spread of the virus within the organisation by following strict protocols.    

From an operational aspect, management has applied the learnings from the 2020 lockdown ensuring that each business unit runs as cost-effectively as possible.   

Grindrod remains focused on facilitating trade along export and import corridors specifically for bulk commodities, breakbulk cargo, and containers.

The demand for commodities has driven the trading performance of our businesses in the first half of this year. Chrome and magnetite in the Port and in our Matola terminal, iron ore in our rail business, and graphite in our Northern Mozambique operations.  A strong citrus season has contributed to the growth in our coastal shipping and container depot businesses.

Management continues to work with their teams to find tailored customer solutions, adjust to market and political influences, and create efficiencies in logistic supply chains.

Some examples of this include:

  -  Automation in Maputo Port providing efficiencies in receiving cargo, and the completion of infrastructural expansion and rehabilitation projects.  

  -  The container business introduced customised solutions for shipping lines to alleviate the impact of congestion within Southern African ports.

  -  The demand for project cargo prompted the utilisation of Maputo Car Terminal for storage.

  -  Due to the insurgency attacks in Northern Mozambique and the suspension of the gas project, our integrated service offering for the liquefied natural gas project has been put on hold, and austerity measures have been put in place. These activities as well as further development on the Palma Intermodal facility will only resume once the security situation has been certified as safe.

  -  We resumed our logistics service from Balama to Nacala, transporting graphite by road from the mine to our intermodal facility in Nacala and on to global markets. 

  -  Six of Grindrod’s locomotives stationed in Freetown Sierra Leone have been deployed to haul iron ore from Tonkili Mine to Pepel Port. The New Tonkolili Iron Ore Project,  recommenced operations in September last year.

  -  We have agreed to sell Grindrod Fuelogic (South Africa and Namibia) and Grindrod Automotive to specialist road transportation businesses aligned with the fuel and car carrier industries respectively. We are confident that the skills and expertise of the new owners in these specific industries will steer the businesses to success. 

  -  The Bank focused on driving revenue opportunities and continued to maintain strong capital and liquidity ratios.

We recently provided a company update for our investors before entering into a closed period on 1 July 2021 until our interim results announcement on 27 August 2021.  For more information on this, please refer to the investor relations section of the website – Investor presentations.

We remain committed to the execution of the growth strategy, providing logistics solutions to our customers, creating trade opportunities throughout sub-Saharan Africa, and creating a focussed SME bank with an effective retail platform.

Thank you to our customers, suppliers, investors, business partners, and staff for your continued support.

Stay safe.