How we are structured to do business

The Linde Group (owns 50.47% of Afrox)

The Linde Group is a global company, focused on gases, engineering and technology solutions.

Afrox

Afrox operates in South Africa and in eight other African countries, permanently employing 2 142 people across sub-Saharan Africa.
We operate and report according to four business segments.

Corporate and enabling functions

Our business segments are supported by the enabling functions of finance, SHEQ, information systems, communications, procurement and human resources. Further support is provided by the South African-based support services, channels to market (marketing, sales and distribution), customer services, strategy and risk, and performance transformation.

Ag

Atmospheric Gases

Products and services: Atmospheric Gases are gaseous oxygen, nitrogen and argon supplied from various feed gas providers and our air separation units (ASUs). CO2 is obtained via a limited pool of local feed gas suppliers.

Distribution channels: For Atmospheric Gases and CO2, we use bulk liquid tanker distribution or dispatch cylinders via road freight to merchant consumers. We also use our Gas & Gear outlets for direct sales to the end-user. Linked pipelines are often used to service larger industrial customers.

Our merchant and packaged gases (MPG) business manages our supply chain, warehousing and distribution needs for Hard Goods, sale of LPG and the regional sales infrastructure. LPG and filling plants are managed within the MPG structure.

Markets served: Industrial, medical, hospitality and specialty.

Revenue
R2 319 million (2015: R2 110 million)

GPADE margin
37.4% (2015: 32.3%)

GPADE
R868 million (2015: R681 million)

LPg

Liquefied Petroleum Gas (LPG)

Product and services: Packaged LPG, branded as ‘Handigas’, is supplied in smaller cylinders for lower volumes. Higher volume demand is met through larger cylinders or direct delivery to bulk end-users.

Distribution channels: Our cylinder gas is obtained from local refineries or imported directly and transported by cylinder or in bulk. Distribution is managed by our MPG operations.

Markets served: Our smaller LPG cylinders have many industrial and domestic applications, including heating and cooking, making them versatile and useful in all major sectors of the South African economy. Our larger bulk options are primarily used in manufacturing, larger commercial activities, retail and hospitality.

Revenue
R1 797 million (2015: R1 820 million)

GPADE margin
20.5% (2015: 17.6%)

GPADE
R369 million (2015: R321 million)

Hg

Hard Goods

Products and services: Arc equipment, gas equipment, welding consumables and a range of other products. Including strong brands such as Vitemax® and Saffire®.

Distribution channels: Manufactured and imported products are sold through direct and indirect Afrox sales infrastructure to normal and bulk customers. Products are exported throughout Emerging Africa via our network of partners and direct selling through Afrox facilities in-country. Our Gas & Gear outlets further ensure direct access for customers.

Markets served: Our markets include any industry where welding or component products are used. This includes light industry, manufacturing, mining, power generation and construction.

Revenue
R666 million (2015: R788 million)

GPADE margin
34.8% (2015: 34.5%)

GPADE
R232 million (2015: R272 million)

Ea

Emerging Africa

Products and services: Emerging Africa provides the full range of Afrox products and services to Emerging Africa, with the more significant products being LPG, CO2, Atmospheric Gases, Medical Gases and Hard Goods components.

Distribution channels: Afrox subsidiaries and Linde-owned, Afrox-managed businesses outside of South Africa report to a centralised management structure for Emerging Africa. They are distributed via the most appropriate methods based on product and customer preference, be it cylinder or bulk.

Markets served: Industrial markets, including manufacturing, mining, medical, hospitality, retail and various other commercial activities in domestic markets.

Afrox’s Emerging Africa subsidiaries and ownership levels are: Botswana (100%); Malawi (79%); Mozambique (100%); Namibia (100%); and Zambia (70%).

Revenue
R755 million (2015: R755 million)

GPADE margin
40.5% (2015: 41.2%)

GPADE
R306 million (2015: R311 million)


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