Xpanda Real Security :: Company Prospectus

COMPANY > Company Prospectus

1. BACKGROUND
1.1 History
The company was started some 36 years ago, in 1974 by Bryan Taylor. The focus of the business at the time was geared towards the production of specialized products sold directly to the end user. The business has developed over the years and additional product portfolios were added including the DIY range sold into the chain stores resulting in the situation today where Xpanda is probably the most comprehensive manufacturer of security products in the world. The business model and focus remains within the ambit of security products manufacture.

The DIY elements remain an integral part of the business and Xpanda has the enviable position of being the market leader of such products within the retail environment with a conservative estimate of 90% market share. Brand strength and awareness is high due to the focused nature of the business and the long-term exposure the brand has had within the South African market.

1.2 Company Overview

The Xpanda Group of Companies offers the widest and most fully comprehensive range of approved anti-burglar protection and deterrent security products in the world.
The product range is vast and covers stock items as well as customized products; These include:

Burglar guards
Security Doors
Driveway Gates
Trellis Doors
Gate Automation
Roller Shutters
Roller Grilles
Sectional Overhead Doors
Domestic Roll–up doors

All these products enjoy success in a variety of applications in the commercial, industrial and domestic markets, and are used in some of the following operations:

Furniture Retailers
Motor Accessory outlets
Domestic Property Developments
Retirement Homes
Government Buildings
Clothing Stores
Major Building contractors
Hospitals
Schools and Universities
Shopping Mall

Distribution
Xpanda occupies a 12000m² site in Pinetown, Durban, South Africa, and products are distributed from there to branches throughout the country and to 28 countries worldwide.

All products are manufactured to ISO 9002 standards.

Manufacturing Capabilities
The plant manufactures over 250 gates, 1500 burglar guards and 150 expanding security doors per day. It has an in house galvanizing division as well as a well equipped polester epoxy – coating plant.

Manufacturing also takes place in Johannesburg, Cape Town, Middleburg and Port Elizabeth albeit on a smaller scale.

General Press

CSI
Securing a Helping Hand

One of the core dictates of any successful business is to ensure both a caring and enterprising approach towards the society and regional economy in which it operates.

Xpanda security is the biggest manufacturer of barrier security in South Africa and with our growth and success in mind, we feel it is our responsibility to assist others who are in need of genuine help as well as those organizations that are inadequately funded but who perform a crucial function in our civil society.

1.4 DIVISIONAL MIX

The current make up of product categories consists of four main categories:

Contracts

Comprise the custom manufacture of a range of security products to suit a wide range of security barrier applications. The contracts division has enjoyed exponential growth with this trend within SA likely to continue due to ongoing security concerns. Current contracts share of turnover comprises some 35%. The category enjoys higher margins due to the direct nature of the business. Due to the long-standing nature of Xpanda’s DIY business market perceptions still exist that the company does not involve itself with the custom made products. This element is being addressed within the communications mix.

Roller Shutter Doors (Rol-a-dor )

Comprises the manufacture and importation of a range of industrial roller shutter and sectional doors. Current Rol-a-dor share of turnover comprises some 15%. The category remains susceptible to commercial and industrial development initiatives and has performed in line with the building over time. Current trends are bullish and recent growths have seen the division maintaining solid performance.

Comprises the range of products sold primarily through retailers and wholesalers, is well established and it is anticipated that growth will be in line with GDP levels. New product initiatives such as the recent launch of a range of SABS safes have buoyed performance within this sector. The current DIY share of turnover comprises some 35%. This is a 5% up from last year.

Export

Comprises a full range of products having been sold through 28 countries with the largest markets being the UK, Canada, Australia and Mauritius. Huge potential exists for growth with our uniquely competitive position. Further resources in terms of international exposure and networking could see this aspect of the business grow at phenomenal levels. Xpanda’s unique ability at flexibility in security barrier solutions put it in an enviable position that no other South African or indeed world operator can match. The learning experiences in international markets have had positive impacts on local production and have established a solid platform for international expansion. This element of the business could indeed see Xpanda as a global player within these markets. The current Export share of turnover comprises some 15%.

2. PRODUCTION

2.1 Production facilities

Xpanda’s head office and main manufacturing plant is situated in Pinetown within easy reach of the Durban Harbor. Capabilities of the plant include the manufacture of the full range of products on offer.

The Pinetown plant holds a SABS ISO 9001 accreditation and a number of the products manufactured hold insurance industry accreditation.

2.2 Logistics

One of the major advantages within the Argent group has been the ability to supply stock to the various branches up to three times a week in some areas. All the branches stock the DIY range of products in an effort to reduce lead times to the stores. We are currently stock holding the full DIY range in Cape Town, Port Elizabeth, East London, Durban (HO), Middelburg and Johannesburg, with plans to include Bloemfontein and Nelspruit in the not to distant future.

3. FUTURE PROSPECTS

Substantial growth opportunities exist within the core security business into the future. Growth in the SA economy will be in line with GDP levels on certain product categories, the contract division remains an area for substantial growth into the future. This aspect of the business enjoys higher than average margins, which will inevitably lead to stronger PBIT performances. Xpanda’s ability to gain shares from trellis door and Maxidor the main opposition in the contracts environment will depend largely on production capability enhancements particularly from a lead-time improvement basis. Xpanda’s range of products in this category give the company advantages into the future and enable it to differentiate successfully.

Yours Sincerely

TIM TAYLOR
MANAGING DIRECTOR