Laduma Q1 2011

1st Quarter 2011

LADUMA

TREASURE YOUR SAFETY - some tips ... see page 4 WE CELEBRATED 10 years with Alcogroup ... see page 3 ASSISTING our community ... see page 7

ONE TEAM - ONE GOAL !

MESSAGE FROM THE MD 2011’s first quarter has been eventful for NCP. During February we celebrated our 10th anniversary as a member of the Belgium-based Alcogroup, a decade that has been nothing less than legendary, filled with many milestones and achievements which have moulded NCP into the company we know today. Sales volumes have grown 220% over the past 10 years and our business has developed from almost 100% local market focus, to one where international sales make up 61% of our total sales.

Our anniversary was also an opportunity to consider the various eras NCP has gone through in the 143 years since it was originally established as a small rum distillery on the banks of the Umgeni River in 1868 and to consider the part we have played in this journey.

Over the years the company has established credibility in all spheres of its business and our employees have continued to build on and further develop the pride, passion and commitment that pervade the company and are recognised by our customers, stakeholders and business partners.

Financially, 2010 was ultimately very similar to 2009 as, although revenue grew, margins declined with the continuing pressure of poor local sugar cane crops. The 2010 sugar cane crop was the worst in 15 years which impacted heavily on the

availability of molasses, and forecasts for 2011 indicate that little improvement is expected in the short term.

The era of low global molasses prices and excess local supply is over. The ongoing development of the global biofuels industry coupled with the decline in local sugar production has changed the landscape dramatically and NCP must adjust accordingly. While biofuels development may create future opportunities for us, our priority must be to consolidate and optimise our local production whilst continuing to grow our international markets through co-ordinated trading and further development of sales and distribution opportunities.

Benoit Verbruggen

The start of the year also introduces a change to the NCP Alcohols board: Benoit Verbruggen of the Alcogroup will replace Hartmut Nowak.

Benoit is also a member of the board of Alco Bio Fuel, the Alcogroup’s 150,000 cbm plant in Belgium, as well as Managing Director of Alcomarques, the company responsible for the bottling and distribution of Svedka Vodka.

The participation and support of Hartmut during the integration with Alcogroup and the development of our international business has been hugely appreciated and of great value to NCP Alcohols. Hartmut will continue his association with NCP focusing on global alcohol sourcing.

Peter Starling

Hidden costs in safety incidents When we think of a safety incident in the workplace, we focus on the extent of the injury to the person involved. Sometimes it may be a minor medical case, but it can happen that a worker breaks a bone or loses a finger – or even his or her life. Incidents and injuries can have huge impacts on a person as well as his/her family life; that’s why we pay so much attention to safety. But, how often do we stop to think about the COST to the company, which is considerable.

When a person is injured in the workplace, people have to leave their own work to assist; this results in a loss of production. After the incident, there has to be an investigation again, and this takes people away from their normal productive roles. Then, people have to spend time coming up with and implementing preventative measures.

Says SHEQ Manager Lorraine Mudaly, “The cost of an incident can be huge. Sometimes a ‘temp’ has to be employed to replace the injured person or, if the workload is spread among colleagues, this can increase stress and result in mistakes, or possibly injuries again ......”

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The cost of a serious disabling injury has been estimated at around R40 000.

Mind your step ... a twisted ankle will cost both you and the company dearly.

We ‘MET’ 10 years joyously

NCP Alcohols recently ‘met’ 10 years as part of the Alcogroup – which called for a celebratory luncheon on site.

Staff dressed as per the theme: ‘NCP MET 10’ (the MET being a horse race famous for its fashions). A ‘race’ along the lines of musical chairs was held at each table, with a dummy-like horse’s head being passed around; the last person left from each table went into the finals. It was a joyous and unifying occasion.

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Treasure your SAFETY Time to OBSERVE One of the ways we can improve our safety at work is by simply observing the way our colleagues behave. Are they choosing safe over unsafe practices?

NCP Alcohols is about to roll out an “observed behaviour” programme and is currently educating people and selecting the people who will be doing the observing.

Observing people has three steps: 1. Observing: Identifying unsafe behaviour and logging it on the system.

2. Trends: Examining the behaviour to see if it could lead to an incident.

3. Goals: Setting goals and putting plans in place to achieve the goals, including creating awareness to prevent injuries or incidents.

HACCP helps us keep hygienic As we are a manufacturer of the food products vinegar and alcohol, it is critical that everyone keeps to a high standard of hygiene and does not allow our products to become contaminated.

NCP Alcohols uses the Hazard Analysis and Critical Control Points (HACCP) system to identify areas of risk and put counter measures in place – and thereafter to monitor.

And successfully so, as the site was recertified in mid-March to be SANS 10330 -listed.

Lorraine Mudaly, SHEQ Manager

Under HACCP, there are four areas to pay attention to: 1. Chemical: for example, contamination could take place during the cleaning of lines or vessels.

2. Physical: this is concerned with keeping foreign objects out of the process, eg metal filings, wood, glass, etc.

3. Microbial: be hygienic, wash hands and prevent, for example, bacterial contamination.

CORRECT ... Prenisha Pandarum demonstrates the correct way to descend a staircase. Rather do two trips if necessary, but make sure you always hold the hand rail on stairs.

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4. Allergens: Although these haven’t been identified in NCP Alcohols processes, it can be introduced into the product by the persons handling the product. An example of an allergen is peanuts.

In-service training yields savings

The new students ... front from left, Tricia Naidoo (Mechanical Engineering), Janice Pillay (Laboratory), Tatym Myles (Laboratory) and Preshina Pandarum, Training Co-ordinator; and back, Sibusiso Ntombela (Electrical Engineering) and Evern Govender (Instrumentation).

This year, NCP Alcohols has taken on five students from the Durban University of Technology to do their 13-month in-service training on site.

The five students are studying for a national diploma at DUT. NCP Alcohols works closely with DUT and is pleased to be able to provide workplace experience for learners in disciplines where skills are scarce.

Says Preshina Pandarum, Training Co-ordinator, “In addition, the company has kept on two of the 2010 students on a short-term contract, whom we felt had gone the extra mile and shown initiative.”

During 2010, student Sherlene Moodley devised an alternative method to test a compound in the Laboratory, cutting the time involved in half and cutting out the use of hazardous chemicals in the testing. The saving is estimated at R400 a day.

Traditionally,initial analysis of final beers in the laboratory required a fair amount of time, but student Rashina Purdhen developed a way of cutting out time and cost while getting more accurate results. The savings are about R677 a week.

Time now for integrated reporting A discussion paper, the King Report on Governance for South Africa 2009 (King III), released in January this year indicates that listed companies should connect financial and sustainable information so that stakeholders could make an informed assessment of their long-term sustainability and how sustainability issues pertinent to the business have been incorporated into its strategic direction.

This suggestion is part of a global trek towards persuading businesses to report on their total and not just financial performance. Companies are increasingly pressured by investors to look at longer-term horizons and at external factors such as economic, social and environmental impacts. How a business could enhance the positive and minimise the negative impact it might have on the socio-economic life of the community in which it operate is where the value of corporate communication becomes evident.

Prof King, the main author of the document, explains that

an integrated report should provide stakeholders with a meaningful and concise overview of the organisation. “An integrated report is not simply bolting the sustainability report to the financial report. It incorporates, in clear language, material information from these and other sources to enable stakeholders to evaluate an organisation’s performance and to make an informed assessment about its ability to create and sustain value.” He stressed that the guidance offered in the discussion paper could be used by any organisation, not only listed companies.

“As companies integrate and connect the financial, economic, social, and environmental aspects into their businesses, they are likely to become more innovative and competitive and recognise new business opportunities. Integrated reporting is an evolution of corporate reporting. It is an idea ‘whose time has come’.”

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NCP’s Operations Controllers are the best on the East Coast and we know why. They are bright, brave and have a passion for operating our plant diligently, 24 hours a day, 365 days a year come what may.

Here they are, all 28 of them!

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Assisting communities NCP is active in supporting community-based groups in the area, as well as assisting local schools and vulnerable children, boosting their quality of life.

During the first quarter, the company helped 15 families in the Sea Cow Lake and Kenville area, as part of the community’s 1860 commemoration of the arrival of the first residents in the area.

The company is committed to youth development and will provide a limited number of bursaries during 2011 to high-achievers at Kenville Primary School that are in need of assistance.

Shaleene Harichand (NCP), in blue, during the 1860 commemorative celebrations handing support vouchers to Raihnu Saikoolal, Deputy Principal of Kenville Primary School.

NCP is sponsoring “Friday sandwiches” for learners at Kenville Primary School that are in need of a meal at school. Each day of the week has a different sponsor.

Mpume Sello, owner of MPS Foods cc, handed the first Friday sandwiches to Krishen Kassie (Principal) and Raihnu Saikoolal (Deputy Principal).

An Ode to Us These pleasant words, below, are

by Ashika Jithoo, Operations Controller in the Vinegar Plant, to celebrate NCP’s 10th birthday with the Alcogroup.

I have a Poem About my second home It’s the place where I work Oh, I hope you don’t think that I’m a Jerk ‘Cos soon one day, it will beget me a “Merc.”

Friends, I kid you not; Most people think that a lot Coming to work Has more than just one perk Friends meet With a friendly greet A smile on their faces Before they pick up their paces

Earlier this year NCP was in a position to donate used computers and printers to the Kenville Primary School’s computer laboratory.

There’s much to do For me, and for you From Marketing to Sales Our plan never fails; When we get together You may think its forever Teamwork is the key In Production too, this you may see Many great men have worked here before And never once did they think it such a bore; Alas, lovely Women and Men NCP has just MET TEN.

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WE ASKED AND YOU SAID ...

“If you could make a difference in the lives of those who are less fortunate than you – who would it be and what would you do?”

Who: All living entities, especially those that are looking for fulfilment and the meaning or goal of life. How: By giving them the opportunity to hear and take the Holy Name of the Lord.

ASHIKA JITHOO Operations Controller: Vinegar

I would sponsor a decent education for someone with potential who has been disadvantaged.

RAJ MOTHI Transport Co-ordinator

I am involved in helping the kids at the Aryan Benevolent Home; some of them are crippled, many were previously neglected.

STEPHEN KITCHING Chemical Engineer

I would select people with physical disabilities, tell their story to the community in order to raise funds to make their lives easier.

NTOKOZO CIBANE Operations Controller

SHALEENE HARICHAND Cost Accountant

Set up a training centre for kids with disabilities so that these kids can learn a trade and eventually be self-sufficient and part the work force.

The unemployed and illiterate women of Ndwedwe Mission, especially the widows and single parents who are struggling.

ROBBIE TAYLOR Mechanical Superintendent

I’d like to help worthy apprentices find work, and wish other companies – or someone – could help appies like our Yash and Paul.

Green fingers bring benefits One of our Operators, Ranjith Umrao, really understands how to extract value from the land, benefiting not only himself but anyone who works at NCP Alcohols.

Ranjith, who has worked at NCP for 31 years, has put a piece of vacant land between the site and the Umgeni River to good use, growing many kinds of vegetables, including green beans, calabashes, cabbages, tomatoes, loofahs, mielies, tiny beans, pumpkins, and lettuces.

Of course, his crops need to be cared for, and Ranjith is there an hour before work every day, weeding and planting; he does not water, rather relying on the rain. He recently had a good crop of mielies and sold about 100 to the staff.

Says Ranjith, “Everybody wins out of this: I keep fit and earn a bit extra, people around me get fresh vegetables, and the greenery helps prevent the soil from eroding into the river.”

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Ranjith Umrao with one of the pumpkins in his garden next to NCP Alcohols.

Issued by NCP Alcohols (031) 560 1111 and Partners in Publishing: (031) 563 7815

RODGERS NIRANJAN Procurement Manager