How has M&R performed over the past year and what has underpinned its performance?

While we still had some tough times, M&R’s mining platform delivered reasonable earnings and profits in FY21, and it appears these figures will be higher for 2022. Despite the unpredictability of the global economy, I believe commodity prices will show resilience even as they retreated since last year. Mining companies sit on strong balance sheets, and many have a backlog of planned investments that will be rolled out in the next year. Particularly for copper, nickel, lithium, but also for PGMs, we should see significant greenfield investments because, without these investments, there are not enough metals to support the energy transition.

What are the areas where inflation impacts M&R most?

We are most impacted in terms of wage inflation given the shortage in the availability of talent, which is pushing salaries up. Another inflationary pressure that we feel is in the rise of input commodities we make use of, like steel and explosives, which account for a fairly large part of the costs of a project. That said, inflation impacts our business less than it does mining operations because we are able to pass on the higher costs to some extent by adapting our fees to market conditions.

Could you walk us through some of M&R’s current flagship projects in Africa?

Our biggest African project is the Venetia underground development for De Beers (AngloAmerican) in South Africa. As the principal underground contractor, we have made good progress on building the required infrastructure and the mine is close to delivering its first production from underground. M&R was also recently awarded the contract for the Platreef project, which is majority owned by Ivanhoe Mines. This PGM project, located just outside Polokwane, South Africa, consists of a multi-phased development plan starting with the construction of the underground mine using the existing shaft. We have been contracted to do the initial underground development to access the ore body and began the work to sink the main 10 m-diameter hoisting shaft to 900 m underground.

How is your growth strategy in Africa evolving?

Our approach to penetrating the African market has changed: Traditionally, we focused on Murray and Roberts Cementation Company as our primary driver in the continent, but we are now taking a more global view to how we deliver our services. We noticed that many Sub-Saharan mining operators prefer Australian expertise, which is why we shifted our strategy to combine the relevant expertise of our subsidiaries in Australia and in Africa and offer clients the best global solutions for their projects. M&R’s capabilities range from engineering and design all the way to contract mining, and South Africa has kept us busy with a lot of demand coming from PGMs, but also coal. Outside of South Africa, in Botswana and Ghana there seems to be a growth in activity from mining companies wanting to begin underground operations, so we keep a close eye on those markets.

What are the key considerations within M&R’s ESG strategy?

In each of our projects, Murray and Roberts seeks to ensure both the people and the environment benefit from our presence. We have a strong track record of recruiting local people, and we take great pride in our advanced training infrastructure and methodology. The other thing we do very well is to identify business opportunities where local people can participate. From an environmental standpoint, we support clients to achieve their carbon objectives, and help certain clients transition to electric equipment. As we speak, we have a project where the client requested we use battery-powered underground equipment.

What are your key objectives for 2022-2023?

Up until now, we have operated very much through regional companies; we are now looking forward to creating a much bigger global structure. To that end, we are setting up a global funding platform – by integrating the current funding structures of our various subsidiaries – together with a global strategic procurement platform. We hope this new structure will help us improve our efficiency and develop stronger relationships with our suppliers. We also see ample opportunities to grow our geographical presence, especially in regions like Chile, Peru, but also in West Africa, East Africa, and Asia.