JOTUN PAINTS SA: Jotun Displays Boldness with Quick SA Recovery

Leading the way in paint systems and products that protect and decorate surfaces, The Jotun Group is beginning to see green shoots in the market following a period of uncertainty driven by the Covid-19 pandemic.

Globally, Jotun is an industry leader, with commanding market share across all markets in which it operates. A privately held Norwegian company with more than 12,000 people around the world, Jotun boasts 38 production facilities in 23 countries, with 67 companies in 47 countries, and representation in more than 100 countries.

President and CEO, Morten Fon, said in September that, despite rising raw material costs and challenging economic conditions, the company had performed well for the first eight months of 2021.

“We are satisfied to have achieved another record result in a challenging period. Despite high raw material prices and continued uncertainty surrounding the pandemic in individual markets, Jotun has delivered a solid performance in most business areas,” he said.

In South Africa, forced lockdown in March 2020 hit the business with sales and manufacturing closed. But Managing Director South Africa, Trevor Maughan tells Enterprise Africa that his market is experiencing an uptick as confidence returns to the market in the year of Jotun Paints South Africa’s 25^th anniversary.

“We have recovered very well from the impact of the pandemic. We have seen a strong recovery in sales and profitability, mainly because there has been a recovery in the market and we have captured market share.

“During the first lockdown, we had no production and very little shipping. We then became an emergency supply service company and we restarted supplying coatings to industries including energy, shipping and more. That gave us some relief as an approved service provider,” he says.

DARK TIMES

With many turning to DIY projects during lockdown, the demand for paint rocketed, but getting supplies out to consumers was a challenge. For Jotun Paints SA, focus is not around decorative products. Locally, the company operates a B2B model, supplying protective coatings to specific specialised industry segments.

“We offer performance coatings solutions,” says Maughan, “we don’t sell decorative paints and you would not generally see our paints on shelves as a consumer. We are a B2B supplier and we work as a leading supplier of marine coatings to the New Build, Dry Dock and Seastock (on-board maintenance) markets in South Africa and surrounding countries. Protective coatings are sold to companies active in industries related to energy, infrastructure, offshore and hydrocarbon processing industries.”

But two major hurdles halted much of the company’s work – even in these important industries.

“In March 2020, we went into full lockdown with no one allowed to leave their homes. The impact on business in the second half of 2020 was significant, with a reduction in sales and revenue. It has eased over the past months as we have dropped through the lockdown levels,” explains Maughan.

Then, in July, came the political unrest, with rioting and looting wreaking havoc across KwaZulu-Natal and Gauteng. “That impacted the business temporarily to some degree,” admits Maughan.

Thankfully, Jotun Paints South Africa, and the wider group was able to call on a history that goes back almost a century to find solutions. This is a business that has been through up and downs and has experience dealing through economic cycles. The focus remained on being the best and delivering tried-and-tested products to customers that are looking for solutions to their problems.

“We are in well-established markets and we have a well-established range of products so we did not try and develop new business segments.

“We have a reputation as being a supplier of high-quality, high-performance products. We are not the cheapest in the market but our customers purchase from us they know they get high levels of product quality and great service value,” details Maughan. 

CAUTIOUSLY OPTIMISTIC

‘Jotun remains well-positioned for further profitable growth, and the company continues to adhere to its long-term growth strategy and investment plan’, the company said in its media release at the end of the third quarter.

In South Africa, plans are in place to grow business and expand the reach of the brand while consistently serving clients with quality products and service.

“We plan to secure greater market share in South Africa in exciting market segments. We want to expand into new market segments in South Africa, and we want to expand with sales and revenue growth in the export countries that we are focussing on,” explains Maughan.

Currently, Jotun Paints South Africa is headquartered in Cape Town, with a production facility on site. The company also has warehouses and offices in Johannesburg and Durban, servicing all of the country’s major metros and surrounding areas.

Outside of South Africa, Jotun exports, through distributors, to several countries in Southern Africa including Angola, Mozambique and Namibia.

The company’s international exposure helps it to deliver exceptional products, developed to specific international standards so global customers know what they are getting in South Africa or anywhere else they operate.

“We are a global supplier and we have the benefit of a global organisation when it comes to things like research and development and product availability. We also have local manufacturing and supply chains, and that that gives us an added benefit. Some of our competition have this, but some have either pulled out or reduced operations in South Africa. We still have the benefits of global support with local activity,” says Maughan.

“We manufacture to international specifications and we don’t change the recipe locally. You can buy the same paint in the UK, USA, China or South Africa,” he adds.

PERMANENT VALUES

Success and optimism within Jotun comes from a long-held and powerfully supported set of corporate values. The company, across all operations, fosters Loyalty, Care, Respect and Boldness as its most important principles. But, more recently, the company has added environmental sustainability to its mandate.

“We have a very strong corporate culture based on a strong set of values and we believe that is very special,” says Maughan.

“We have a strong environmental commitment,” he adds. “We are looking, as part of our Jotun GreenSteps programme, to support a more sustainable environment by reducing carbon emissions and reducing energy usage in our plants.”

This process will result in a ‘more colourful world through taking greener steps’ the company states.

In September, it was announced that cargo vessels using Jotun’s Hull Performance Solutions (HPS) reported a 20% lower carbon intensity on average in operations compared to non-HPS peers in 2019 and 2020, according to MRV data published by the EU. This success for the marine division was hailed as a breakthrough by Stein Kjolberg, Global Category Director for Hull Performance at Jotun who said: “Vessels using Jotun’s HPS typically have farsighted owners and operators that are willing to invest to achieve the most efficient operations. They are not too focused on the immediate cost of dry docking or short-term returns. They know the resulting fuel savings will eventually outweigh the upgrade cost of antifouling and other similar investments many times over. The fact that fuel savings translate directly into lower carbon emissions will further add to the return on investment in that stakeholders in the shipping industry will more strongly prefer and reward vessels with lower carbon emissions moving forward.”

In South Africa, this mandate will be taken forward with passion. Maughan, who has been with the company for 13 years and in SA for five, is certain that environmental commitment is a vital drier of future business.

“Jotun is committed to continually improving its environmental performance,” he says. “The Jotun GreenSteps programme coordinates the company’s efforts to support a more sustainable environment through reduction of VOC emissions, hazardous materials, energy consumption, carbon emissions and waste.

“Through the Jotun GreenSteps programme the company embraces initiatives to better protect the environment. This includes developing products that minimise impact on the environment, the way in which products are manufactured, and providing customers with paints and coatings that will reduce their carbon footprint and protect their property.”

Now promising to do more for the environment, as well as guaranteeing products that will enhance and protect projects, Jotun Paints South Africa is well-positioned to thrive after a challenging period. Searching for increased market share with every transaction, Jotun remains hungry across southern Africa, and will constantly pursue opportunities to maximise its global position. Now is an exciting time for this colourful and robust business.  

“We are without doubt a leading player in the South African market,” concludes Maughan