JOHANNESBURG - The failure of the SA National Roads Agency (Sanral) to put out any tenders has resulted in listed road construction and rehabilitation-focused company Raubex retrenching 517 employees at a cost of R24 million in the six months to August.
Raubex chief executive Rudolf Fourie confirmed yesterday that the group would have to make further retrenchments in the second half of its financial year.
Fourie said the planned retrenchments would, however, be less than the current ones, but he was unable to state the exact number of people who would be affected. Raubex jobs have declined by 14 percent to 7 722 at end-August from 8 953 in the previous year. Fourie said Sanral had made a lot of statements about resolving the impasse with the National Treasury and there would be “a flood of contracts” to the market, but they had “not seen one yet.”
“This is the first time in my 35 years in business that in a six-month reporting period Sanral has not brought out one single job,” he said. Fourie said Sanral had announced it wanted to upgrade the N3 between Durban and Maritzburg at an estimated cost of R20 billion and an N2 Wild Coast corridor upgrade would cost about R14bn. “That together is R34bn that Sanral wants to spend in the next five years. If this work all comes to the market, there is no capacity in the market to take up that work. It’s all been wiped out this year alone,” he said.
He said the Sanral work accounted for R2.3bn of Raubex’s order book at end-February 2015, but this had dropped to R962 371 by end-February this year and R562 736 by end-August. Fourie said Sanral’s contribution to the order book would probably be “nought” by February next year. He said this was what had impacted Raubex in the six months to August and Raubex’s two road construction businesses were both loss-making. The revenue of the road surfacing and rehabilitation division declined by 23.1 percent to R1.36bn.
The JSE’s shares in Raubex declined by 0.27 percent yesterday to close at R18.70.