VENTURES: The Measure Of Quality
Recent Western Cape Business News
OTTERY-based Bowler Metcalf can no longer be regarded as a plastic packaging specialist.
The recent profit performances by its bottling subsidiary Quality Beverages has seen Bowcalf adding a new dimension to its traditional packaging business.
It’s certainly no exaggeration when vice chairman and financial director Michael Brain notes: “The meteoric growth of Quality Beverages continued.”
Quality’s revenue rose 26% to R331 million in the year to end June with bottom line profits more than doubling to R15.3 million.
Brain says the performance vindicates Quality’s marketing strategy and branding initiatives. The core Western Cape market grew market share, while the newer Gauteng division improved to a breakeven position.
Brain says the upturn in brand loyalty of Jive, Aqua Blue, and Planet has been most encouraging. Growth in the higher LSM market also augurs well for Quality.
It seems Quality is determined to capitalise on opportunities in Gauteng – its first shift away from the traditional client base in the Western Cape with a R30 million investment in new production facilities.
Brain says Quality’s new 7 500sq m Boksburg factory started production last month. “A continuous improvement in this lucrative market is likely as we replicate the proven Western Cape model.”
Brain concedes competition will be stiff. “But we believe our proven niche and exceptional products should show a profit within 24 months.”
Bowcalf is also putting its money where its mouth is by buying the minority share in Quality Beverages for R23 million.
This development is perfectly understandable considering just how big Quality has become in Bowcalf’s life.
Bowcalf’s total revenue is now split almost 50:50 between the plastics packaging and bottling operations – although there is some inter-segmental revenue.
Obviously the plastics operations are far more profitable, but it’s still early days in Quality’s development into a national soft-drinks bottler holding a very viable niche.
And the more the bottling operations grow the more the plastics operations benefit.
Brain says the concomitant benefits to Bowler Plastics with regard to bottles, crates and caps supply follow naturally.
Altogether a rather nice arrangement then…
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