There is a lot at stake. In the immediate future it’s the jobs that will go and for the country's long-term future, it’s the loss of skillsLANDMARK OFFICE: An artist’s impression of Group Five’s head office at Waterfall Business Estate.
Within a decade, the industry’s invincibility has been smashed to smithereens. Falling order books, tight liquidity and paper-thin margins have brought it to its knees. The JSE construction and material index’s underperformance in relation to the JSE all-share index in the past decade bears testimony to this.
At the moment, public investments in roads, water and power are the key drivers of civil construction in SA. As seen in Group Five’s Kpone project, there is a huge cost to delayed delivery of projects and poor execution. In the year ended June 2018 alone, Group Five’s losses on the Kpone project were R1.3bn. In the prior year, the loss was R649m.
Group Five also wants to exit manufacturing, hence the recent sale of Everite and Sky Sands to a consortium comprising private equity companies Trinitas Private Equity and Agile Capital for R480m.
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