Laduma June 2013

June 2013

LADUMA ALCO2 created – page 2 DISTILLERY upgrade – page 4 GRAND GOLD award – page 5 JV in Ghana – page 5

ONE TEAM - ONE GOAL !

MESSAGE FROM THE MD During the first six months of 2013 NCP has been undergoing some change. The implementation of the new supply-chain structure has impacted on many of NCP’s staff and while change can be unsettling it is necessary for the business to keep pace with the demand for continuous improvement and optimisation as required by the ever-changing business environment.

In this dynamic environment, change has become an ongoing process which does not have a finite end. It is important to keep focused on getting the job done while adjusting to change. This requires commitment and leadership by all involved, and I would like to commend the staff of NCP for doing this.

The ongoing use of the new supply-chain planning, forecasting and scheduling tools is starting to become routine and this is allowing for better analysis of our future stock and transport requirements.

With this information we can adjust “the way things are done” in order to improve

service delivery at optimum cost; this will require some bedding down as it involves change, but should now begin to translate into lower distribution costs.

Sales volumes for the first half of the year are similar to last year, but profitability has improved significantly although it is still behind budget due to the delay of some bulk shipments. These will take place during July and a strong second-half performance, supported by the weakened rand, is expected. The local sugar industry is experiencing an excellent season relative to the previous five years, and the resulting improvement in molasses availability will further support our performance.

The first concrete step in the development of an African distribution strategy was taken with the formation of MidlandNCP in Ghana in April. Trading activities will be starting in July and the storage and drumming infrastructure is currently being installed, with the first bulk shipment expected to arrive in October.

We are looking at this initiative to increase the Alcogroup presence in Africa. Further distribution investment in Africa is planned for this year.

Peter Starling

ALCO2 called to life

The CO2 market is presently in an over surplus of allowances situation, and the price has reduced to about 3 Euros/Mt.

The Alcogroup has created a new trading company, ALCO2, which will trade carbon dioxide (CO2) allowances in Europe. This company will be located in our Brussels offices and will be operated by Mr Gauthier Bily, CEO. Gauthier has developed CO2 trading activities since 2005 while at Calyon, Fortis Bank, Axis Alternatives and more recently while he was Head Trader CO2 at Global Commodities.

He will team up with Olivier Barriot who has worked for banks in London and Paris such as Credit Agricole, Société Générale, CIBC World Markets, and Ixis. Since 2008 he was Senior Manager at Axis Alternatives for selected assignments in commodity and environmental markets.

The European Trading Scheme (ETS) for CO2 has led to the development of CO2 trading allowances. To give an idea of the size of the market, over 70 million allowances are now traded per day, while in 2011 some six billion allowances with a total value of 77 billion Euros were traded.

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Olivier Barriot

Certain banks and other operators are exiting these markets, their fixed costs being too high to generate profits at these low price levels. Having the opportunity to attract a very well- known and experienced CO2 trading team and with our lean cost-effective organisation, we are convinced that it was the right time to enter this market; we believe ALCO2 has the potential to become an important actor in this CO2 ETS market.

CO2 trading is linked to energy and environmental services, which could in the future be an important new development for Alcogroup. ALCO2 will also develop synergies with other Alco customers by offering them environmental trading services.

Gauthier is facilitating the registration of Alco2 which will be fully operational in July.

Gauthier Bily

Stay alert, don’t get hurt

Front cover: Seen with the upgraded Bottom Distillery are, from left, Lumeshni Govender, Mervin Kullen, Stephen Kitching, Shon Roopnarain and Judica Somers.

Driving continuous improvement

Meet the leadership team at NCP Alcohols, a phenomenal group of talented, performance-driven individuals who share one goal; to be part of a team that produces and supplies world-class-quality natural ethanol products focusing with passion on building strong partnerships to grow with their customers and suppliers.

Peter Starling Managing Director

Gary Bregovits Operations Executive

Mark Norton-Amor Financial Executive

André van der Westhuizen Supply Chain Executive

Carl Freyer Engineering Manager

Ace Govender Quality Manager

Biddy Harmer Supply Manager (SA)

Mark Immelman National Sales Manager

Stephen Kitching Chemical Engineer

Patrick Madlala Supply Manager (Int.)

Franck Maubert Exports Manager

Zinhle Mdadane Production Manager

Ashraf Moosa Financial Accountant

Lorraine Mudaly Rodgers Niranjan Louie Pillay Safety, Health, Procurement Manager Utilities Manager Environment and Quality Systems Manager Do the do’s, not

Elaine Wilson Marketing Manager

the don’ts

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World class, we’re doing it again ...

With the ‘Bottom Distillery Upgrade Project’ in its final phase, all eyes are on the target dates of 24-26 June when the final switch over will take place. That’s when the old Bottom Distillery will be switched off, and the reconfiguration and tying-in of new lines will happen. After that, it should take two to three days to start up the distillery and produce on-spec potable ethanol at capacity.

a capacity increase of 57% on Bottom Distillery production.

The potable column turned out to be complicated to build as it contained portions of re-engineered old column sections, and only once complete could the total length of the column be appreciated.

One of the bigger challenges during the project, interestingly, was getting the Said, Stephen Kitching, the Project potable column out of the workshop of Manager, “Not only will we then have an the manufacturer (LHL) in New Germany. additional 11 000 kl of product per year, Eventually, the riggers had to lift the entire but the quality will be improved with a back of the truck with the less than 10 ppm potable column on it over a small BOTTOM product. This will bring the retaining wall using two Bottom Distillery into line crane trucks, to get it out DISTILLERY with the Top Distillery – the gate. world class.”

E C U WILL PROD Then came 19 December Y Said Stephen, “Special 2012, when two new IT L TOP QUA thanks should go out to the columns were to be L project team, especially for installed. The topping O N ETHA those members who have column was installed had to deal with the some of first. The plan was then to lower the steel the smaller detail which is less fun to do structure down over the top of the column, but the project doesn’t happen without but some platform clashes prevented this. it. In particular Lumeshni Govender has The wind then picked up, preventing the played a crucial role in making things potable column from being lifted. The happen and then following through.” crane returned at 6am the following morning and after a few complications Although NCP engineers started five had been sorted out (eg the potable years ago looking at various options column was heavier than anticipated), for renewing and upgrading the Bottom both the potable column and the steel Distillery, a commitment to start the structure were lowered into position. project with the current design and scope was made in January 2012. The design By the end of May, the project had not allowed for upgrading the potable suffered any safety incidents and was section of the Bottom Distillery as well as within budget.

One of the two columns is lowered into position at the ‘Bottom Distillery’.

Getting the two new columns to site was a challenge – one was 28 metres long, and the other 29 metres long.

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Say ‘no’ to carelessness

Only the BEST is good enough for our customers Patrick Madlala is congratulated by MD Peter Starling.

Alcogroup in distribution joint venture in Ghana

NCP Alcohols were awarded Grand Gold for our Ethanol 96% and Light Spirits 43% by the Organising Committee of the Monde Selection International Quality Institute for the 2013 World Quality Selections.

The Alcogroup has concluded a distribution joint venture in Ghana with Midland International Ghana Ltd. The venture, known as MidlandNCP, has been set up in line with the Alcogroup’s strategic development which focuses on Africa.

The continent has, due to its demography and rising standards of living, an average 7% Gross Domestic Product (GDP) growth rate – which offers an important development in terms of ethanol sales.

The Alcogroup, including NCP Alcohols, Alcotra and Alcodis, has to date the largest market share in ethanol sales in Africa and the development of such a distribution network is a priority in the group’s strategy.

MidlandNCP will be 55% owned by Midland International Ghana and 45% by the Alcogroup. The Midland International Ghana shareholder is a subsidiary of the Pinnacle group, which also owns Kasapreko, the largest bottling company in Ghana.

Following the shareholders agreement, both Midland International and the Alcogroup will have an equal number of board members and the general manager will be nominated by the Alcogroup.

The MidlandNCP board members are: Peter Starling (Managing Director of NCP Alcohols and in charge of the Alcogroup’s activities in Africa), Benoit Verbruggen (Director and Executive Committee Member of the Alcogroup), Dr Kwabena Adjei (Owner of Pinnacle), Obed-Owusu-Kissi (CEO of Pinnacle), and Samuel L Adetola (CEO of the Capital Group) as the independent chairman of the MidlandNCP board.

Patrick Madlala, who has been appointed by the Alcogroup as the first general manager of MidlandNCP, says, “My new position comes with great responsibility as this is an important development in terms of ethanol sales for us as a group. I am up for the challenge and look forward to expanding our African market share.”

It’s COOL to work safely

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Who ‘nose’ best?

One of the more esoteric aspects of alcohol production is nosing, which is the sniffing out of imperfections in the product.

While NCP’s current champ is Ace Govender, a nose-off challenge is to be held between Mark Immelman representing the Commercial team and Nomvula Dlamini representing Operations.

The result will show who “nose” best when it comes to smelling out the best of the best for our clients.

Both Mark and Nomvula feel that they have the upper “nose” when it comes to sniffing out quality.

To view the pair in action, make sure you are in the foyer between 08:30 and 09:00 on 13, 14, 18 and 19 June to see the nose-off of all nose-offs taking place right under our noses!

Mark Immelman and Nomvula Dlamini see who has the best nose for impurities.

Efficiency begins with proper filing ...

Get Organised Filing Project was called into life by the NCP Alcohols executive team to find a logical way to keep the company’s electronic and paper filing organised. This drive will also include a tidy desk and drawer drive. Filing is not the greatest pastime but it is crucial for the proper functioning of a company’s administration.

New and better Training Academy set up A new, quieter and more spacious Training Academy is now in use. The room is wired for computer training, and computers can easily be installed when required. The venue also has wi-fi.

Says Gary Bregovits, Operations Executive, “In addition, we have outsourced the management of our training to MLG, which will ensure that the standard of training is high and training credits acknowledged.”

The class of 2013 in the new Training Academy.

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Safety is MY responsibility

We’ll be raising the bar on safety The April shutdown has come and gone. Giving praise where it is due, Carl Freyer, Engineering Manager, said, “NCP staff delivered a safe and effective performance this year – a very big thank you to all. Due to additional pre- and post-shutdown activities, some maintenance staff worked long hours for 16 consecutive days and without a single safety incident and special thanks must go to them.

“However, a contractor was injured when he lent sideways while up a ladder, and fell.

We have had a safety talk on the safe use of ladders and scaffolds, now we need to keep an eye on contractors in future to have incident-free shutdowns.”

Carl Freyer

Recycle and save

We all know recycling makes sense, so here’s a request that we ALL try just a little harder to put our cans, plastic and glass in the bins which are marked, well, cans, plastic and glass.

There are three recycling stations on site, one at CMS Loading, one outside the Boiler area, and one outside the Canteen.

Wilson Madlala, Assistant Storeman, shows his ‘can do’ attitude ...

Take paper for example. Every ton of paper recycled saves 17 trees and uses 40% less energy. And remember, a modern glass bottle in a landfill will take more than 4000 years to decompose. Think about that!

Donate - and make a difference The staff at NCP Alcohols have traditionally supported the Blood Bank, so it was no surprise in early June when they visited our site again and 12 people donated a ‘pint’ of blood each.

Said Sue Stewart, focal point between the SA National Blood Service and NCP, “This was particularly pleasing because June is National Blood Donor month, and stocks of blood need to be built up before the July holidays.”

Since September 2010, NCP people have donated 123 ‘pints’ of blood, including the above. (A ‘pint’ of blood is 500 ml.)

Sue Stewart is scared of needles but realizes that donating blood is a free gift and can save a life.

She donated her 67th ‘pint’ of blood when SANBS Staff Nurse Aletta Knipe and the Blood Bank came to NCP recently.

Don’t be a fool, use the proper tool

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Teams getting things done WITH MAGIC T U O G IN H C REA

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Don’t learn safety by accident

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