Engen boosts African service station networks

Engen, South Africa’s multinational fuel retailer and convenience store provider, has reported sustained growth over the past two years for its retail operations in sub-Saharan Africa (SSA) and the Indian Ocean Islands, and in April 2013 announced a similarly bullish outlook for the year ahead.
With the conclusion of batch acquisitions in seven countries, as well as its on-going program of rolling out new retail sites, Engen grew its SSA retail portfolio from 410 sites to 440, a 7% increase over the 2011 financial year which ended in December, said Frederick Kotze, GM of Engen’s International Business Division (IBD).
In 2011, it built seven new service stations from the ground up – three each in Botswana and Mauritius, and one in Namibia. In addition, it tore down and rebuilt six more in Burundi, Namibia, Reunion, Mauritius, Malawi and Gabon. Finally, four proposals for property acquisitions were approved on which to build new service stations, Kotze said.
Over 2012, the company expected to stream 14 new-to-industry sites, a growth of 3%. Six of these have thus far been built in Botswana, Burundi, Reunion, Malawi and Mauritius. Of the nine currently under construction and six for which board approval has been received, six are expected to be completed in the coming months – one each in Botswana, Namibia, Gabon, the DRC, Mauritius, and Zambia. The remaining three are expected to stream in the first quarter of 2013.
In addition to fuel and lubricants sales, Engen also derives a sizable portion of its income from convenience stores, termed “alternate profit opportunities.” The company is pursuing branded convenience partnerships with Corner Bakery and Famous Brands, which has in its stable Wimpy, Steers and Debonairs. As of November 2012, there were 502 retail sites in the network. Engen Quickshop is a market leader in South Africa already.
Tremendous growth is planned on the convenience side for this year. Quickshops are expected to increase by 15, a 12% increase, Corner Bakeries by 22, a stunning 92% increase over 2012, and Wimpy’s by 1, doubling the current number. One Woolworths Food Zone is planned as a pilot in Mozambique. Engen also introduced ATMs in Botswana, and opened its first Quickshop/Corner Bakery in Mauritius. Reunion will open its first five Quickshops and three Corner Bakeries by the beginning of 2013.
Kotze said the group is pleased with continuing good prospects on the continent, and selected markets show world-beating economic growth.
(April 18, 2013)