TONGAAT HULETT – PROFILE
The business as it stands today arose from the merger of the Tongaat Group Limited and the Huletts Corporation Limited, and its operations date back to the mid-1800s. The company has a primary listing on the Johannesburg Stock Exchange which dates back to 1952, and a secondary listing on the London Stock Exchange.
Details of the business’s ongoing activities in partnering with its stakeholders together with initiatives undertaken in dealing with these stakeholders are set out here. The business’s key stakeholders include shareholders, governments, third party farmers and their representative bodies, suppliers, communities, employees and people impacted by company operations and its growth and development activities.
SUGAR OPERATIONS
Mozambique
The Mozambique sugar operations comprise the expanded sugar mills and estates surrounding Xinavane and Mafambisse. As at 31 March 2014, 22 072 hectares of Tongaat Hulett land was farmed under sugarcane with 6 155 hectares under private grower and community-based schemes. Sugar production capacity at the Xinavane mill is now more than 240 000 tons in a 32-week crushing season, while the Mafambisse mill has an existing 90 000 tons of sugar production capacity. The two operations have a combined installed milling capacity in excess of 330 000 tons of sugar per annum. The sugar estates are irrigated and are located in areas with favourable growing conditions, resulting in high cane and sucrose yields. These favourable agricultural conditions, close proximity to ports, and the technical support from South Africa, position the Mozambique operations well for further growth.
South Africa
The company’s South African sugar operations, on the KwaZulu-Natal north coast and in the Zululand region, operate four sugar mills at Maidstone, Darnall, Amatikulu and Felixton. These mills have an installed capacity to crush more than 8,5 million tons of cane per annum, which is equivalent to over 1 million tons of raw sugar. Cane supplies come from a combination of own estates (predominately rain-fed), large-scale commercial and small-scale farmers in rural KwaZulu-Natal. The operation’s central refinery in Durban produces some 600 000 tons of high-quality refined sugar per annum, with the primary product being the leading Huletts® brand. The South African sugar product range offers a total sweetener solution including a range of high-intensity sweeteners.
The animal feeds operation, Voermol Feeds, is located at the Maidstone mill in Tongaat, KwaZulu-Natal. Tongaat Hulett manufactures and markets a range of energy and supplementary feeds to the livestock farming community through its Voermol® brand, using bagasse and molasses. Voermol Feeds is the market leader in the molasses and pith-based animal feeds industry in South Africa.
Zimbabwe
The sugar operations in Zimbabwe consist of Triangle and a 50,3 percent stake in Hippo Valley Estates, representing a combined installed sugar milling capacity of more than 640 000 tons. As at 31 March 2014, the Zimbabwe operations are supplied by 44 833 hectares of sugarcane land (own estates and private farmers) with a potential to produce in excess of 4 million tons of sugarcane. The total refined sugar installed capacity is 140 000 tons and the Triangle ethanol plant has an installed capacity of 40 million litres over a 48-week production season. The Huletts Sunsweet® brand is the leading sugar brand in the county. The Lowveld in Zimbabwe, with excellent topography, climate and established water storage and conveyance infrastructures for irrigation, is recognised globally as a highly competitive sugar production area.
Swaziland
Tongaat Hulett’s Tambankulu sugarcane estate in Swaziland is situated in the north east of the country and comprises 3 838 hectares of fully irrigated estates. The estates have consistently achieved excellent sucrose yields and deliver cane to the nearby Simunye and Mhlume sugar mills. The estates have the capacity to produce a Raw Sugar Equivalent (RSE) of 61 000 tons per annum.
Botswana and Namibia
The Namibian operation has the capacity to pack and distribute 80 000 tons of sugar per annum while in Botswana, Tongaat Hulett has a 60 000 tons per annum packing and distribution operation. Tongaat Hulett will benefit from future growth in consumption in Botswana and Namibia with its leading Blue Crystal® and Marathon® brands.
Renewable energy
The eight sugar mills in Mozambique, South Africa and Zimbabwe all generate electricity from fibre in sugarcane (bagasse) during the sugarcane crushing season. In some instances these operations supply electricity to the grid. In Zimbabwe, Triangle has an ethanol plant, which provided supplies to the fuel pool during 2013/14. Tongaat Hulett is well placed to benefit from evolving renewable energy dynamics with the potential to replace it’s existing power stations with latest-technology, higher efficiency electricity plants, as well as the opportunity to convert its export sugar to ethanol.
STARCH AND GLUCOSE OPERATION
Tongaat Hulett’s wet-milling operation is the major producer of starch and glucose on the African continent. Established in 1919, the starch operation has grown to be an important supplier to a diverse range of South African and African industries. Operating four wet-milling plants, located in Kliprivier, Germiston and Meyerton in Gauteng and Bellville in the Western Cape, Tongaat Hulett converts more than 600 000 tons of boughtin maize per annum into starch and starch-based products. The business manufactures a wide range of products, from unmodified maize starch to highly refined glucose products, which are key ingredients for manufacturers of foodstuffs, beverages and a variety of industrial products. The company’s Amryal corn starch, Hydex and Vaalgold Gluten 60 are some of the leading starch, glucose and animal feed ingredient brands in South Africa. The business operates a dedicated Sorbitol facility which is located in Chloorkop in Gauteng and has distribution networks and facilities in Zimbabwe, Australasia and the Far East.
LAND CONVERSION ACTIVITIES
Urbanisation is continuing and accelerating in KZN. Tongaat Hulett presently owns 8 200 developable hectares of land that it has identified for conversion from agriculture to other uses. All of this land is situated in the primary growth corridors of the KZN Province and has strong government policy support for conversion at the appropriate time.
Land conversion takes place over a number of years, and the land is used to optimal productivity throughout the conversion process, remaining under sugarcane until the final transition to development takes place.
Tongaat Hulett has long recognised the conversion of agricultural land to other uses in a proactive and optimised manner as a central strategy through which it creates substantial value in cooperation with and for many stakeholders. Through its longestablished core competencies, relationships and track record that cannot easily be replicated, Tongaat Hulett has been part of the establishment of an exceptional platform for investment and value creation from the growth and competitiveness of Durban, Umhlanga, Ballito and the KZN north coast region.
