Our operating context

The environment in which we operate helps us identify our material issues – those that could affect the delivery of our strategy as well as our ability to create value in the short,medium and long term.

In 2016, weak economies, volatile currencies, policy uncertainty and skills shortages were the major themes in our macro environment. On pages 28 and 29 we discuss the implications of these on Nampak’s value creation, as well as our strategic responses to them in the year. Among other important factors that continued to define our operating context were the dynamics of the packaging sector globally, in Africa and South Africa:

Factors that influence the use of packaging

  • Economic growth and disposable incomes
  • Urbanisation and levels of health awareness
  • Population size and growth rate
  • Ease of use and serving sizes
  • Consideration of the environmental impact of packaging

The global packaging industry

  • Worth US$870 billion per annum
  • Major customers: FMCG firms
  • Main end-markets: food, beverages and home and beauty care
  • Environmental concerns encourage innovation
  • Demand for convenience foods drives development

Africa's packaging industry

  • Worth US$22 billion per annum
  • Supported by growing middle class
  • Higher margins justified by perceived risks
  • Competition limited but growing
  • We expect packaging demand to grow by a CAGR of between 5 and 10% to 2021

South Africa's packaging industry

  • Worth US$4 billion per annum
  • Growing competition, including imports
  • Consolidation of customer base
  • Increasing regulatory requirements
  • We expect packaging demand to grow by a CAGR of between 2 and 5% to 2021

Our investment case:

  • Africa’s largest packaging group
  • Leading market positions in Africa, United Kingdom and Republic of Ireland
  • Comprehensive plan to improve performance
  • De-leveraged balance sheet
  • Optimised organisational structure
  • Strong relationships with multinationals
  • Invaluable partnerships

Our major partners

  • Bericap
  • Crown
  • Elopak
  • Mauser
  • Silgan
  • Wiegand-Glas

Our customers:

  • ABInbev
  • British American Tobacco
  • Castel
  • Clover
  • Coca-Cola
  • Diageo
  • Distell
  • Dulux
  • GSK
  • Heineken
  • Kansai Plascon
  • Kingsley Beverages
  • Namibia Breweries
  • Nestlé
  • Oceana
  • Orange Grove Dairies
  • Pioneer
  • RCL Foods
  • Reckitt Benckiser
  • Refriango
  • Rhodes Food Group
  • SC Johnson
  • Tiger Brands
  • United National Breweries
  • Unilever
  • Woodlands Dairy