"Although the South African banking sector has, to a large extent been insulated from the impact of the crises, our customers will inevitably find it more difficult and more expensive to fund projects which may, if the current conditions continue, impact on our order books in the medium term," said Angus Band in a statement made at the group's AGM.
Aveng's two-year order book has increased to R27bn as at the end of September compared with R25,8bn at the June 2008, fundamentally reflecting buoyant trading environment.
"While there is little doubt that South Africa will not emerge unscathed from the global financial crises, our view, as stated in our year-end prospects statement, has not changed that Aveng is well placed to deliver material earnings growth in 2009," he Band said.
Although public infrastructure spending remains intact in South Africa in the lead up to the 2010 World Cup, lower commodity prices may dampen demand for infrastructure projects for mining houses, Band said.
Band added that lower steel prices and declining vehicle sales would impact negatively on the group's manufacturing and processing cluster.
"The price of steel into the automotive industry has risen by 20% recently, which will mitigate some of the impact," he said.
He added that Aveng was well placed to take advantage of any acquisition opportunities that may become available as a result of more realistic price expectations of vendors.
"We continue to co-operate with the Competition Commission in their investigation into the steel reinforcing industry including reinforcing steel and infrastructural products," he said. - Tiisetso Motsoeneng, I-Net Bridge
Readers' Comments
Have a comment or question about this article? Email us now..
Property News
Click here for more property news articles.
Need a blog?
Start your own blog with a free blog from 24.com.
Print
