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COMPANY PROFILE

2014

OVK

+27 51 923 4500 | www.ovk.co.za


company profile

“We create wealth and cherish agriculture” Editorial: Harriet Pattison Production: Hal Hutchison

A leader in the agricultural field, OVK is committed to its staff and growing a business that is so much more than milling maize. With an efficient financial department, vehicle dealerships and fuel distribution points, OVK continues to make a valuable contribution to the economy of communities along the way...

Agriculture remains big business in South Africa, ranging from intensive crop production and mixed farming during the winter and summer rainfall areas to sheep farming across the more arid regions. Maize continues to be the largest locally produced field crop in the country with South Africa becoming the 7th largest producer of green maize and maize in the world today.

THE MAIZE MARKET With South Africa the main maize producer in the Southern African Development Community (SADC), production can exceed 10 million tons in a good year. Weather can often have a detrimental impact on maize production and due to a regional drought in the early 1990’s, the total production in 1992 dropped to just three million tons but with plentiful rain falling during the later months in 1995 came a

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bumper crop in 1996 nearing 12 million tons. Maize is largely produced across the North West province, the Free State, the Mpumalanga Highveld and the KwaZulu-Natal Midlands. Local consumption of maize is estimated at eight million tonnes each year with the remainder exported. While more than 9 000 commercial maize producers are responsible for the majority of production, the rest is produced by thousands of much smaller businesses. Wheat is the second most important grain crop produced in South Africa and is largely produced in the winter rainfall areas of the Western Cape through to the eastern parts of the Free State. Most of the wheat produced in South Africa is bread wheat, with small quantities of durum wheat being produced in certain areas, used to produce pasta. In Southern Africa, wheat is mainly used for human consumption such as bread, biscuits and breakfast cereals with the remainder used for bird seeds and animal feed.


OVK

OVK The major agricultural company, OVK is headquartered in Ladybrand with a strong presence across the Eastern Cape with numerous trade branches that stretch from Cradock to Dordrecht and up to Arlington. Offering a wide range of agricultural provisions for crop and livestock farming at competitive prices across its branches, OVK also handle the storage, distribution and marketing of its grain including wheat, sunflower, soya beans and oats. The company has recently taken over Dewetsdorp, Edenburg and Hopetown, helping to boost its already expanding footprint. Over the past two decades, OVK has continued to establish itself as a firm leader in the agricultural industry with an exponential 27% increase in turnover from R2.8 billion in 2012 to R3.57 billion, including grain turnover, in 2013. “With the high potential of the region, its farmers

and the diversity of the types of farming in its service area, OVK makes a valuable contribution to the economy of the RSA and to the Free State, Eastern Cape and Northern Cape in particular” OVK say in a statement. OVK has a number of vehicle dealerships with Toyota, Case and New Holland. The Toyota agencies in Ficksburg and Ladybrand sell new and used vehicles and recently the Ladybrand dealership underwent R6 million improvements. OVK also has six highly effective fuel distribution points with Shell, Total and Engen. 30 million gallons of fuel is distributed each year between the points which are located within OVK’s operational area including Fouriesburg across to Hopetown. Bulk fuel trucks deliver the fuel to the company’s 44 trade branches and to farmers and clients, ensuring the service remains efficient and competitive. In addition, OVK also operate its own finance division focusing on harvesting and short-term insurance and owns the

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company profile

Dit neem geslagte om ’n naam te maak!

uppe A10855

Gariep Abattoir in Strydenburg. With OVK owning a 34% shareholding in Cape Town Mohair and Wool, this helps it to maintain a strong presence within the Eastern Cape Province. Founded in 1993, Cape Town Mohair and Wool (CMW) began as a private company, SA Mohair Brokers Limited, and last year celebrated its 20th anniversary within the wool and mohair industry as a world leader in the marketing of wool and livestock mainly via the internet.

THE TWEESPRUIT MILLS

Manufacturers of high quality maize meal and wheat meal, OVK operates in its own Tweespruit Jou familie boer al vir geslagte, Mills. The maize mill, built three decades ago in en jy weet dis nie kinderspeletjies nie. 1974 supplies a large variety of maize products, including samp and mealie-rice under the brand By Monsanto weet ons dit ook. Ons reputasie is, soos joune, ook nie oornag gebou nie. Dis die resultaat van jare se harde werk saam met jou, die boer – name, CHALLENGE and super maize meal under in die laboratorium en op die land. Daarom ondersteun ons ons tegnologie, the OVK brand name. The mill also manufacturers navorsing en ontwikkeling met spanwerk, steun en professionele advies. Dis immers die kombinasie hiervan wat jou help om jaar na jaar volgehoue maize meal for animal food, a variety of pet foods prestasie te handhaaf en geslagte lank sukses te behaal. and bird seeds. The flour mill, opened in 2002, DEKALB® – Dis mos mielies!™ manufacturers various flour products such as Monsanto tel: 011 790-8200 | www.monsanto.co.za white and brown bread flour and cake flour. These Kontak gerus ons kliëntediens by: 011 790-8200 of customercare.sa@monsanto.com DEKALB en Monsanto is geregistreerde handelsname van Monsanto Technology LLC. products retail under the brand name SUPERBAKE. Monsanto Suid-Afrika (Edms) Bpk, Posbus 69933, Bryanston, 2021. To ensure the increase in demand continues to be met today, equipment is updated on a yearly basis skills, expertise and knowledge. and in 2006, the capacity of the flour mill was A10855 Dekalb Electric Wing Corp Advert 125x88 - Afr.indd 1 2014/05/30 Using the Peromnes job evaluation system, OVK increased, helping to ensure a higher quality product participate in the national salaries survey which is produced. With a fleet of delivery vehicles, the guarantees employee salaries are market-related. mill offers nation-wide delivery, distributing across Operating in the agricultural industry, OVK Gauteng and Natal, reaching as far as the Northern maintain a strict health and safety environment, Cape. with regular inspections and tests and a system In the company’s financial statement, Chairman of committees helping to ensure standards are Manie Botha said: “The new wheat mill in Clocolan meticulously maintained. has, in the meantime, been brought into service and The Grain Department is at the centre of the board is confident that the mill will add much this company and is divided into three sections: value for shareholders in the long term. The wheat administration, marketing and operations. With industry is currently experiencing a difficult time, such a fast growing market and a customer base that but we believe that a growing middle class will stretches across producers, millers, grain traders increase the demand for wheat products.” and manufacturers of animal feed, it is essential STAFF TRAINING that OVK stays abreast of the continuous flow of OVK continuously strive towards its company logo: current produce information to effectively advise its “Prosperity creating agricultural organization” and members of any changes. with over 900 employees, training is offered on an “OVK has recently begun to focus more on our ongoing basis to ensure its clients receive the best communication with our members as well as our service and expertise. With the company actively personnel. Management extends an open invitation involved with the AGRISETA and complying with to you to feel free to invite us to your Farmers’ the Skills Development Act, OVK’s strategy is Association, farm or, if you wish to visit our head simple: to train and develop employees ensuring that office, you are very welcome. OVK has always had an each individual feels equipped with the necessary open door policy and I invite you to visit or contact ®

®

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9:22 AM


OVK

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company profile

me or any of my management team” Managing Director Stefan Oberholzer said in a statement.

PLANNING THE FUTURE During the past financial year OVK implemented a loyalty scheme where R10.1 million was returned to clients throughout the year. Even with the establishment costs of the new Tweespruit wheat mill, the OVK Group still achieved a profit before tax of R112.7 million, which is slightly less than the previous year’s R125 million. The Group’s turnover increased by 27% from R2.8 billion to an impressive R3.57 billion, including the grain turnover, in 2013. The dividend together with the loyalty scheme amounts to more than R31 million, which OVK paid

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out to its shareholders and clients. With the significant reduction in accounts in arrears and the implementation of the loyalty scheme and term loans, as well as the conversion in April last year of R33 million of shareholders’ loans to shares in OVK Operations can be seen as some of the highlights of the past financial year. During the year the diversification of the company, both geographical as well as within the business, was emphasised. Despite the arid conditions within the eastern Free State, the irrigation areas still performed well as a result of higher grain prices. An analysis of the business indicates that there are even more divisions within OVK which make a significant contribution to OVK’s profitability and that the


Milltrans

Saam bereik ons meer Hand in hand with the Agricultural Industry and OVK, Willard Batteries has been pushing the boundaries for sixty years. Whether it’s the latest Willard Super-Safe range with roll-over technology or batteries for high performance, off-road, agricultural and everyday vehicles, Willard Batteries caters to your every need. Now with a 25 month warranty on the IQ range, Willard Batteries offers a variety of options to choose from and will redefine the way you experience batteries forever.

Willard Batteries. The power of technology.

“The impact of the renewed and sustained drive towards a more ‘green’ way of living in South Africa has been Sextremely PECIALIST positive on our business” RANGE T TM

WARRANTY

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company profile company is less dependent on an individual sector within the agricultural environment. The income from general trade increased by 8.2% from R1 271 million to R1 376 million. As a result of increasing pressure on margins, as well as available production credit the net profit of this department was negatively affected with a decrease from R47,0 million to R45,2 million. The net profit was 3.3% of turnover in 2013 compared to the previous year of 3.7%. Despite this challenging environment, OVK strive to remain competitive to benefit its clients and shareholders and with the future developments of the

new branches in Barkly East, Elliot and Prieska. With a vision to be the leading and successful agricultural company in the supplying and marketing of agricultural requisites and services, OVK ensure its company remains committed to these duties through its ethical and professional corporate management team and well-trained and efficient employees. A bright future lies ahead for this leading agricultural company and OVK intend to grow its expanding footprint throughout the Eastern Cape and maintain servicing the investments in its enterprise consistently and effectively.

.

Engen-OVK partnership goes from strength to strength Engen, South Africa’s leading petroleum products

Service partner

company, enjoys a successful and growing

“Engen and OVK have come a long way together,”

business partnership with agricultural retail group

agrees Hannes Michau, at OVK, headquartered in

OVK, which goes back to the early 1990s, the

Ladybrand in the Eastern Free State.

companies say. “Over time Engen became a true service partner, 20 years of growth

demonstrating technological leadership and

Paul Leask, sales manager: agricultural

customer-centricity. They’re everywhere and

cooperatives at Engen Lubricants, says the

availability is never an issue, with many distribution

relationship started small but went from strength

partnerships and their own extensive retail network.”

over the years. Agricultural focus “In the early days, Engen was a relatively minor

The agricultural sector has been a strong growth

supplier of fuels and lubricants to a few of OVK’s

industry for Engen’s lubricants business over the

smaller branches, but the partnership began to

years, with one in every two SA farmers depending

develop with their takeover of several Senwes

on the company’s local expertise and technical

branches in the Southern Free State,” he says.

excellence, says Leask.

In time, Engen’s lubricants business with the

This focus is borne out by Engen’s long-standing

company began to show significant growth, and

association with leading players such as OVK,

Engen formed a dedicated agricultural lubricants

and its role in co-managing events like the recent

sales team to service a future key customer and

NAMPO Harvest Day show (in partnership with

sector.

Grain SA since 1978).

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Milltrans

“The impact of the renewed and sustained drive towards a more ‘green’ way of living in South Africa has been extremely positive on our business” jun 14 PAGE 9


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