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The Construction Sector Updated Report Available
BY Carole Veitch
South Africa
24 October 2016
R 2 040.00 (ZAR)  
estimated $ 148.03 (USD) *
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The South African Construction Sector


With total annual income in excess of R392bn and supporting over 500,000 direct jobs in the formal sector, building and construction activities play a vital role in the South African economy. The country’s nine largest construction companies are involved in major infrastructure development projects, while medium-sized companies are generally active in construction activity relating to road works, bulk water infrastructure and water and sanitation projects. Approximately 95% of companies operating in the local construction sector are classified as small and micro enterprises, and focus mainly on the residential building market.


A sector Under Pressure


The beleaguered sector remains stifled by the prevailing economic slowdown, and government’s failure to implement the roll-out of mega-infrastructure projects has prompted larger construction companies to concentrate on foreign markets. Role players across the various grades of works cite the following challenges as constraining factors: an increasingly competitive market; delayed payments; labour disruptions; poor productivity; the shortage of skills and the resulting lack of adequate quality control; the rising cost of construction materials; and low profit margins. For the major players further issues include the spectre of collusive conduct, damage claims for anti-competitive behaviour, and the impending exit from the sector of construction titan, Murray & Roberts, a company that has been an integral part of the South African building and construction landscape since 1902.


Report Coverage


The report on the South African construction industry and related activities, which includes scaffolding solutions and structurally insulated panel systems (SIPs), describes current conditions and recent developments. Profiled in the report are 51 companies, including the country’s largest construction and engineering companies based on market capitalisation, Wilson Bayly Holmes-Ovcon Ltd (WBHO), Murray & Roberts Holdings Ltd, Raubex Group Ltd, Calgro M3 Holdings Ltd, Group Five Ltd, Aveng Ltd, Stefanutti Stocks Holdings Ltd, Basil Read Holdings Ltd and Esor Ltd.


Page
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 4
2.2. Geographic Position 5
3. SIZE OF THE INDUSTRY 6
4. STATE OF THE INDUSTRY 19
4.1. Local 19
4.1.1. Corporate Actions 23
4.1.2. Regulations 26
4.1.3. Enterprise Development and Social Economic Development 30
4.2. Continental 33
4.3. International 36
5. INFLUENCING FACTORS 38
5.1. Government Initiatives 38
5.2. Economic Environment 39
5.3. Rising Input Costs 40
5.4. Labour 40
5.5. Supply and Quality of Building Materials 44
5.6. Health and Safety Concerns 45
5.7. Technology, Research and Development (R&D) and Innovation 45
5.8. Environmental Concerns 48
5.9. Cyclicality 50
5.10. Corruption 50
6. COMPETITION 51
6.1. Barriers to Entry 53
7. SWOT ANALYSIS 53
8. OUTLOOK 54
9. INDUSTRY ASSOCIATIONS 55
10. REFERENCES 56
10.1. Publications 56
10.2. Websites 57
APPENDIX 1 59
The Construction Industry Development Board (CIDB) Grading Designation 59
APPENDIX 2 60
Green Building Practices 60
COMPANY PROFILES 61
AMEC FOSTER WHEELER SOUTH AFRICA (PTY) LTD 61
ARNOTT PANELS (PTY) LTD 63
AVENG LTD 66
B AND E INTERNATIONAL (PTY) LTD 70
BASIL READ HOLDINGS LTD 72
BILFINGER INTERVALVE AFRICA (PTY) LTD 76
BLUHM BURTON ENGINEERING (PTY) LTD 78
BOSCH STEMELE (PTY) LTD 80
CALGRO M3 HOLDINGS LTD 82
CAPE FORMWORK CONTRACTORS (PTY) LTD 85
CATO RIDGE ELECTRICAL CONSTRUCTION (PTY) LTD 87
COLAS AFRICA HOLDINGS (PTY) LTD 89
CONSTRUCTION MAINTENANCE SERVICES (PTY) LTD 91
DIABOR (PTY) LTD 93
DURA SOLETANCHE-BACHY (PTY) LTD 95
ESOR LTD 97
EXR CONSTRUCTION (PTY) LTD 100
FAIRBROTHER GEOTECHNICAL ENGINEERING CC 102
FLUOR SOUTH AFRICA (PTY) LTD 104
GAUTENG PILING (PTY) LTD 106
GEOMECHANICS (PTY) LTD 108
GIURICICH BROS CONSTRUCTION (PTY) LTD 110
GLENKEY CONSTRUCTION (PTY) LTD 112
GROUP FIVE CONSTRUCTION LTD 114
HATCH AFRICA (PTY) LTD 122
HAW AND INGLIS CIVIL ENGINEERING (PTY) LTD 125
INTASTOR CONTROLLED ENVIRONMENTS (PTY) LTD 128
ISCMATLA (PTY) LTD 132
ISOWALL SOUTHERN AFRICA (PTY) LTD 134
KAEFER ENERGY PROJECTS (PTY) LTD 136
LIVIERO BUILDING (PTY) LTD 138
MAZOR GROUP LTD 141
MOTHEO CONSTRUCTION GROUP (PTY) LTD 144
MURRAY AND ROBERTS HOLDINGS LTD 147
NMC (PTY) LTD 151
PERI FORMWORK SCAFFOLDING ENGINEERING (PTY) LTD 154
POWER CONSTRUCTION (PTY) LTD 157
RAUBEX GROUP LTD 160
RO-AL CONSTRUCTION (PTY) LTD 164
ROBOR (PTY) LTD 166
SA SCAFFOLDING CC 169
SOUTH AFRICAN NATIONAL ROADS AGENCY SOC LTD (THE) 171
STEFANUTTI STOCKS HOLDINGS LTD 174
TIBER CONSTRUCTION (PTY) LTD 179
TOP FIX (PTY) LTD 182
UNI-SPAN FORMWORK AND SCAFFOLDING (PTY) LTD 185
VIVA FORMWORK AND SCAFFOLDING (CAPE TOWN) (PTY) LTD 187
VNA PILING CC 189
WACO AFRICA (PTY) LTD 191
WILSON BAYLY HOLMES-OVCON LTD 195
WK CONSTRUCTION (PTY) LTD 200