LITHON HOLDINGS – Positive, Significant, Impactful: The Lithon Way

“Our aim is to make a significant impact in the lives of people and communities.” This is the key driver underpinning Lithon Project Consultants and the main reason behind Adriaan Grobler’s starting the firm in 2002, when he elected to follow what he felt was his true calling and how he could best make a difference.

Drivers of infrastructural and social change, Lithon means ‘cornerstone’ in Greek, and the group of companies has some to be known for its strongly value-driven approach and an unbending focus on people.

Grobler is a self-styled ‘visiopreneur’, which he describes as someone who sees a better future and takes action to achieve it. “Call it a dreamer and a doer all in one,” he says. Lithon Project Consultants reflects this in its turnkey, holistic service offering, through which it strives to turn clients’ dreams into reality.

“We are people-focused and aim to make the management of your project as seamless as possible by offering a full-spectrum project management service,” it outlines, “ranging from conceptualisation to completion.”

This is a significant selling point for Lithon Project Consultants – deep experience in the industry coupled with the ability to offer a complete solution that stems from feasibility studies and project planning through to design, tender preparation, site supervision, project management and many more related services.

“We are now one of the top five firms in Namibia,” Grobler proudly states of the firm’s rapid and sustained rise.

ECONOMIC IMPACT

Over its lifetime Lithon has completed with trademark aplomb more than 200 projects, with many others in various stages of development. It has not been without its setbacks, however, and recent months have provided some of the sternest challenges yet. “Starting up and growing a business is easier than keeping it going sustainably year after year – and that is where we are right now,” Grobler explains.

Owing largely to a brutal drought that wiped out livestock and left over half a million of its citizens without access to sufficient food, Namibia’s economy contracted by 1.9% in 2019. “It has become clear that the impact of the drought on livestock and crops is likely to be more severe than earlier anticipated,” the National Bank stated, referring to southern Africa’s worst drought in a century.

Lithon Project Consulting has felt the effects of the contracting economy more keenly than most. In February 2019, a lot of the discussion centred around its involvement in the development of the new Otavi Rebar Manufacturing Plant, close to Namibia’s Etosha National Park.

The steel plant will use scrap metal sourced from around Namibia and its neighbours to produce some 300,000 tons of billets and rebar each year. The products are vital for the development of local manufacturing, building and construction industries, and the plant has a projected revenue stream of US $205m in the first year of operation. On completion, it is suggested that the new plant will employ some 300 people.

“It will be tough. If we manage to achieve it, I will be very impressed,” Grobler admitted last year. “Projects of this nature are complex, especially on the legal side, so there is a chance that delays can creep in.

“All companies in Namibia are going through a tough patch right now and the economy is not strong. We are all hoping for a quick turnaround, but we have accepted that it will be a tough journey,” he added – presciently, it transpires.

Twelve months ago, Grobler was hopeful that all arrangements would be finalised to allow the plant to be in operation by the end of 2021. The mishaps and delays which can dog projects of this scale and scope have reared their head, however, as Grobler apprises us of the revised status of the mega-project.

“It is ongoing, and we are just awaiting the financial close, which we are still in the process of obtaining,” Grobler tells us. “We have been forced to rethink the project somewhat after a shift in focus from our original investors in Switzerland.

“They are still involved, but we are looking for alternative financial investors, and we remain hopeful that during the course of this year we will get this financial closure,” he goes on. “We have lost at least six months on this financial closure stage, but we are now in talks with both Nedbank and the World Bank as potential equity investors, and we will be able to shed more light on where we go next with Otavi Rebar in the next month or so.”

LOCAL FOCUS

Despite the difficulties heard from all players in the Namibian market, its economy is on the mend and the central bank forecasts that it will recover to growth of 1.5% this year and of 1.4% next year.

Finance Minister Calle Schlettwein was unequivocal in October of Namibia’s determination to attain economic recovery, sustainable growth and fiscal sustainability to promote economic progress and social transformation, highlighting some key strategies that would be used as a vehicle of economic recovery.

Adriaan Grobler has felt this shift in confidence: “Things are slowly turning around, and at least the government is spending a bit more now. Construction was probably the biggest sector that has collapsed in the last two or three years, when the government stopped spending.”

Lithon boasts a strong presence across Africa, taking in South Africa, Ghana, Angola, Kenya and Nigeria, but Lithon is clearly prioritising local projects to consolidate its business. “At the moment our focus is very much here in Namibia,” Grobler says of its core market.

“This is basically because of the economy and cashflow; it takes a big financial commitment to push out into Africa, and there are obvious risks involved, so we are holding back on these moves and focussing much more back here on Namibia. We foresee that this year for us will be a growth year.”

Grobler goes on to delineate exactly what these Namibian plans mean for Lithon in the immediate future. “We are busy with the updating of the Hosea Kutako airport, Namibia’s principal airport, which is a big one for us – that is in its first phase.

“We have been appointed project managers for the undertaking and we have just completed the feasibility for the total upgrade,” Grobler reveals proudly. “Hopefully, towards the end of the year we will have received a decision on that.

“Another major one is the upgrade of Eros, Namibia’s second airport. This has been delayed for almost two years on the government’s side due to funding but we have just completed the tender, and so will likely appoint a contractor very soon. This looks set to be a really profitable project, and these are going to keep us busy this year.”

Grobler delves a little more into the financial hurdles his firm is having to overcome. “In the last two years the government has stopped spending, so a lot of the private clients have been a focus area,” he says.

“The banks are still very conservative at the moment, too, which means that people are struggling to get finance for projects. That is probably the biggest challenge at the moment.”

OPTIMISTIC FUTURE

While the year since Enterprise Africa last heard in-depth about Lithon may not have brought exactly the results it had envisaged, the truth is that this group of companies has staved off the worst of the economic constraint which have proved fatal for so many, and can now look forward with hope. “We are lucky that we have sufficient work for the next year and onwards, whereas many others have really jangling nerves at the moment,” Grobler observes.

“It has been a tough fight, but in this financial year ending April our revenue increase from the previous year was 60%, and we were able to reduce our running costs which leaves us in a profitable situation at the moment as a company.

“It takes time to recover from a two or three year slump like we have just experienced, but we are one of the few firms that are positive,” he adds. “We have our expansion strategy in place for this year and we are focussed on starting to expand our business and further optimising our services.

“In the next six months, we have to maintain our focus here at home; improve our cashflow and turn around that area. Then we can start to lift our eyes again up further north,” Grobler explains.

Having faced up to and overcome the arduous recent times, Grobler is beginning to feel the buoyancy which has always characterised Lithon. “We are doing well and looking forward to an excellent 2020,” he rounds off, displaying the typical Lithon optimism and positivity, qualities which have enabled the company to enjoy nearly two decades of sparking change and influence in Namibia and surely many more to come.