South African industrial chemicals and explosives manufacturer AECI is set to expand its explosives arm, AEL Mining Services, into regional and international markets in 2012. The rest of Africa, Asia Pacific and South America have become the focus of the company’s growth strategy for its specialty chemicals cluster.
“Countries such as Morocco and Mozambique hold significant growth opportunities for AEL and the company is well positioned for this, as Africa will be the future hub in terms of resource growth,” says chief executive officer Graham Edwards.
“Our specialty chemicals cluster is based in South Africa and we are looking to expand into Central Africa in line with AEL’s footprint, from there moving to West and East Africa,” he says.
Graham Edwards says that while the manufacturing and mining production sectors appeared to be recovering, recent volatility suggested that this recovery remained fragile.
However, AECI says its latest financial review proves it is delivering pleasing results in a trading environment challenged by currency and commodity volatility, labor strikes and heavy rainfall that impacted on opencast mining operations in some areas.
The company is looking to continue the growth momentum in its underlying businesses in 2012, especially its explosives and specialty chemicals businesses, which were the biggest drivers behind the growth recorded in the latest financial results.
“We foresee steady volume growth, depending on European and US demand growth that is seemingly starting to come through, while China’s so-called ‘soft landing’ from its property bubble, which is resulting in the loosening up of its bank requirements, add to some optimism,” Graham Edwards said.
Growth from the company’s acquisitions during 2011 is also expected. Multinational company T&C Chemicals and farming and veterinary equipment supplier Instavet were among AECI’s purchases, with further acquisitions being investigated now.