Edward West
Sappi Southern Africa plans to invest R10.8 billion into its KwaZulu-Natal operations over the next five years, it announced Thursday.
This announcement was made at the KZN Investment Conference in eThekwini this week - the investment pledge by Sappi was the second biggest out of total investment pledges of R76bn.
Sappi is deeply rooted in the province, with three operational paper and pulp mills in Umkomaas, Stanger, and Mandeni, as well as 165 000 hectares of forest plantations. The international paper and packaging group creates thousands of employment opportunities, both directly and indirectly.
The last time Sappi made a significant investment pledge in the province was in 2018, notably a R7.7bn Saiccor Mill upgrade and expansion project.
The group is also one of the largest users of the Durban Port, moving about 120 containers per day to export its dissolving pulp, primarily to India, Europe, China, and other Asian countries.
“We saw this as an ideal opportunity to pledge our support, demonstrating our confidence in the future of the province as a premier destination for investment. This conference also served as a vital networking platform to express our appreciation for the work done to date in addressing some of the logistical challenges we face,” said Alex Thiel, the CEO of Sappi Southern Africa, in a statement.
He said that they would continue to grow the forest sector value chain, empowering local communities through Enterprise and Supplier Development initiatives, by supporting more than 4 000 timber growers through the Sappi Khulisa Enterprise Supplier programme.
Another 102 SME suppliers in the region benefited from more than R250 million spent on their development, in addition to having the opportunity to become suppliers, along with the many other suppliers in the province who support our operations through their products and services.
Thiel said that at the conference they were also able to discuss ongoing concerns, such as the delayed rebuilding of the South Coast Railway Line and the availability of railway equipment, which the group believes may hinder companies operating in KZN from reaching their full potential.
Earlier this month, the international wood fibre products group reported that its financial performance for the year to September 30 had exceeded its management’s expectations, and the fourth-quarter dividend more than doubled, with a standout performance in the South African operations.
Despite the market continuing to be affected by global economic and geopolitical tensions, supply chain instability, and fluctuating input costs, adjusted earnings before interest, tax, depreciation, and amortisation (EBITDA) for the first quarter of 2025 was expected to be “significantly above that of the prior year.”
BUSINESS REPORT