Corobrik to spend R800m on 100 million-bricks-a-year factory
COROBRIK, the non-listed leading manufacturer and supplier of bricks and pavers, is investing R800 million in a new factory in Driefontein near Carletonville in Gauteng as part of a wider capital investment programme to upgrade and expand its manufacturing facilities in South Africa.
Dirk Meyer, the chief executive of Corobrik, said yesterday the new mega factory was being built adjacent to its existing Driefontein factory and was the biggest project of its kind in the world this year, with the possible exception of China.
Meyer said the contract for the new factory had been awarded to German equipment supplier Keller. It was scheduled to become operational by the end of 2020.
He said the existing Driefontein factory produced 50 million bricks a year. The new factory would produce 100 million bricks a year using a third of the energy at a much higher quality with more flexibility to produce bricks of different sizes.
Meyer said the new factory would be more automated, but Corobrik did not expect this to have a significant impact on staff numbers. The company has a headcount of almost 3 000.
“We have enough of a portfolio of operations that we can offer staff to relocate. In the past three or four years, we have done significant technological upgrades, but have not retrenched anyone,” he said.
Meyer said Corobrik had 13 clay brick factories with 14 kilns in South Africa, plus two concrete operations based in Durban, one of which was dedicated to paving and retaining walls.
“We sell close to one billion bricks a year. If you break that down to 250 working days a year, its about four million bricks a day that go out of our gates,” he said.
Meyer said the investments Corobrik had made and was making in upgrading its operations illustrated the confidence it had in South Africa’s economy.
He said a R65m upgrade of its Rietvlei factory was commissioned at the end of January this year. In the past three years, Corobrik had invested about R120m in selective upgrades at various factories.
“It’s really a continuous process of investment in the business. We are looking at driving cost down, improving quality and bringing in some new products to the market.”
Meyer said the factory project at Driefontein was not the end of the company’s capital investment programme.
“We see another Driefontein-type project pretty soon. We are also quite interested in the concrete industry, so we are looking at various options.”
Meyer said Corobrik preferred to grow organically rather than through acquisitions.
He said Corobrik had established a staff trust in 2008 that owned 26 percent of the share capital of the company, with the remaining 74 percent held by Mainstreet, a consortium of private individuals.
Meyer said the staff trust had yielded huge benefits in terms of industrial relations, while giving Corobrik an effective black shareholding of more than 40 percent, which meant it exceeded any of the requirements of the mining charter.