REPORT INTEGRATED 2019 - about progress - Engen
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
2019
INTEGRATED
REPORT
we are
passionate
about
progress
we are
passionate
about
progress
Our purpose as a company is embodied in our Statement of Purpose, which marks
a new chapter in our journey as Southern Africa’s leading downstream petroleum
company with a presence in 7 countries, and a brand presence in 9 more countries.
“A Progressive Energy and Solutions Partner
Enriching Lives for a Sustainable Future”
Our Statement of Purpose underscores why we do what we do, now and in the future
- a clarion call of our passion to harness the transformative power of energy for the
benefit of all. Delivering energy needs in a responsible manner is now more important
than ever. We are constantly seeking meaningful collaborations to provide solutions
that enrich lives because we believe that it is only when lives are enriched that real
progress is achieved.
That is why we are "Passionate about Progress."
01
4 5
COVID-19
Stepping up
and supporting
Our priority remains the unwavering support of our • Directed R1 million worth of fuel to the Department of
employees, customers and local communities. Health to power the emergency response vehicles of
frontline health workers.
The COVID-19 pandemic and national lockdowns have had a severe impact • Directed R1 million worth of fuel to FoodForward SA to
on the economies of the countries in which Engen operates as well as on the power their delivery vehicles in their quest to expand the
livelihoods of many citizens. The effects will be felt for some time. As Engen, our distribution of nutritious food to vulnerable people.
purpose is to be “A Progressive Energy and Solutions Partner Enriching Lives for a • Directed R2.5m fuel and medical testing equipment to the
Sustainable Future”. In the face of this unique global challenge, we’re committed Gift of the Givers to boost their humanitarian relief work.
to not only living up to our clarion call but also to do so much more. • Partnered with the Gift of the Givers to provide food relief
to the South Durban community, distributing 5 000 food
We fully commend decisive government responses to the pandemic and stand
hampers over a 5 month period.
in solidarity with the various country’s leadership in their respective approaches
• In Gauteng, Engen fuel retailers distributed food hampers
to protect inhabitants. In these challenging times for business and society, it is
and basic supplies to over 7 000 Diepsloot, Alexandra and
only by standing together as citizens of a local and global community that we
Tembisa residents.
will combat COVID-19. We are all in this together and we all have a positive
role to play. • Contributed R1.25m in the National Solidarity Fund,
which comprised a R500k corporate donation and R750k
Engen's business was not spared the impact and we experienced a decline from Engen employees who offered part of their salaries.
in sales volume over the course of the national lowdowns. In response to the
pandemic, we have implemented additional hygiene measures across our While we know it will take much more to alleviate the
business. These ensure that we continue to safely and reliably manufacture stress that many of our stakeholders are facing, we hope our
our core petroleum products and safely deliver our quality products and related contribution makes a small difference to each person who
convenience services to our valued customers. receives the comfort of a helping hand as a result of our efforts.
We have also thoroughly stress tested our business model against various As the Covid-19 virus continues to have a profound effect
scenarios and tested our business continuity plans against the most trying on most people and businesses across the world, Engen
possible scenarios. Our long-term customer centric business strategy is will continue to do all we can to support our customers,
specifically positioned to fuel growth and future-proof our business by employees, suppliers and neighbouring communities through
‘Stepping Out’ with retail non-fuel and new energy sources of growth. We these unprecedented times. While we will undoubtedly
therefore continue to look beyond 2020 with clarity and optimism. overcome the scourge, it will only be achieved by all of us
taking collective responsibility for preventing the spread
As a responsible corporate citizen, we have a duty to step up in times of need.
of COVID-19. That is why we call on the citizens of all the
Therefore, we swiftly moved to support the communities residing close to
countries in which we operate to follow government and
our operations, and society at large who were impacted by COVID-19 and the
health service advice and to take care of themselves and their
national lockdown.
families. We are all in this together.
In this regard, we have sought a multi-stakeholder approach, working together
And while we start emerging from lockdown, and
with a broad range of social partners in these challenging and uncertain times.
notwithstanding signs of recovery, the severe impact of
We have successfully collaborated with government and civil society to bring
COVID-19 on people’s health and employment will continue.
much needed relief to some of the most vulnerable sections of society.
While Engen’s priority remains the unwavering support our
Focusing our response efforts on equipping and support those who are at the employees, customers and neighbouring communities, we
frontline of fighting the virus, we have made amongst others the following will also continue to work supportively to assist in the fight
investments to help fight COVID-19: against the virus, and to support recovery efforts.
6 7
02 03
ABOUT THIS REPORT
ABOUT THIS
REPORT
Thank you for reading Engen Limited’s 2019
Integrated Report for the year ended
INTEGRATED
REPORT
31 December 2019. As a company, we
endorse the principles of transparency
and accountability, and are committed
to reporting on our performance and
prospects in a meaningful manner.
05
8 9
04
ABOUT THIS REPORT
REPORTING SCOPE AND BOUNDARY our robust internal process and good governance practices.
Our Board Audit Risk and Compliance Committee provides
This year marks the 7th year of our integrated reporting
internal assurance annually to the Engen Limited Board on
journey with our emphasis on improving the clarity and
conciseness of the Report.
the execution of the combined assurance plan. The Group’s NAVIGATION ICONS
financial, operating, compliance and risk management controls
Our 2019 Integrated Report provides a holistic overview are assessed by the Group’s internal audit function, which is
of Engen’s key developments, market challenges, our
The following navigation icons are used to link our Capitals and Strategic Priorities
overseen by the Board Audit Risk and Compliance Committee.
strategies and initiatives as well as our approach to Material Matters, Key Risks and Mitigation and Business Review.
EY have audited the Group’s annual financial statements,
to risk and governance for the 12-month period
which were prepared in terms of the International Financial
1 January to 31 December 2019, unless otherwise stated.
Reporting Standards (IFRS). The Key Financial Indicators
In addition, we also offer relevant historical information in
for 2019 and 2018 of the Statement of Profit and Loss and
order to contextualise the key issues discussed.
Statement of Financial Position are set out on page 133. The
B-BBEE scorecard information was verified independently by
OUR CAPITALS
REPORTING FRAMEWORK AQRate Verification Services.
Our report is based on the principles and framework A reasonable assurance report by independent auditor’s on
as presented in the International Integrated Reporting selected sustainability information was included in the 2018
Framework (IIRC). The focus is on Engen’s value chain and Engen Integrated Report. We endeavour to conduct this
how we manage the process of value creation across the six exercise every 3-5 years. Therefore, reasonable independent
sustainability capitals as guided by the framework. assurance on selected sustainability information is not
included in the 2019 Engen Integrated Report. 01 FINANCIAL 02 HUMAN 03 MANUFACTURED
The activities of Engen Limited, and of all our operating
subsidiaries, are covered. This includes all operations in
which we have direct control and are able to implement FORWARD LOOKING STATEMENTS
our policies, practices and standards. We report fully on This report contains certain forward-looking statements,
key sustainability performance indicators regardless of
typically with words such as ‘aim’, ‘may’, ‘plan’, ‘will’ and
percentage share ownership. Deviations from this reporting
‘expected’ or other similar expressions. These statements
boundary are clearly stated.
discuss future expectations concerning the dispositions of 04 INTELLECTUAL 05 SOCIAL AND 06 NATURAL
While the financial and non-financial data from our assets or financial conditions or provide other forward-looking RELATIONSHIP
subsidiaries are fully consolidated, the B-BBEE assessment, information into 2020. These forward-looking statements are
along with our employment equity statistics, exclude all non- not guarantees or predictions of future performance and
South African operations. involve known and unknown risks, uncertainties and other
factors, many of which are beyond our control and may cause
MATERIAL MATTERS actual results to differ materially from those expressed in the OUR STRATEGIC PRIORITIES
statements contained in this report. Readers are cautioned
Our report is relevant for stakeholders with an interest in not to put undue reliance on the forward-looking statements.
GROW & STRENGTHEN DRIVE DOWN COST
our performance and prospects against our Statement of
Purpose: A Progressive Energy and Solutions Partner,
GSC THE CORE DDCS TO SERVE
Enriching Lives for a Sustainable Future.
BOARD APPROVAL
The Engen Limited Board is responsible for ensuring the
We apply the principle of materiality in assessing what OPTIMISE ACROSS THE
information should be included in our Integrated Report. integrity of the Integrated Report. In the Board’s opinion, this SO STEPPING OUT OAVC VALUE CHAIN
The information provided focuses on issues, opportunities report addresses all material issues, and presents a balanced
and challenges that impact materially on Engen in ensuring and fair account of Engen’s performance.
a sustainable future, while consistently delivering value and
enriching the lives of our stakeholders. Engen External Communications Manager
Engen Court, Thibault Square. Cape Town, 8001
ASSURANCE PO Box 35, Cape Town, 8000
Our financial statements are independently audited while the Email: gavin.smith@engenoil.com
development of our non-financial reports are supported by Tel: +27 21 403 4312
06 07
INSIDE THIS REPORT Stakeholder Engagement 50
Our Strategy 53
10
Key Performance Indicators 54
Overview of Engen 56
Who We Are & What We Do 10 Performance Review
What We Offer 12 Retail 58
Group Corporate Struture 14 Commercial 60
Where We Operate 18 Lubricants 62
Our Value Chain 20 International Business 64
Our Strategic Alliances 22
23 68
Leadership Statements Leadership
Engen Limited Board 69
Chairman’s Letter 22 Engen Management Committee 75
CEO’s Statement 26
30 70
2019 Highlights Governance
Our Approach 85
Business Highlights 31 Engen Limited Board 85
Financial Highlights 32 Internal Audit 87
Awards 33 Compliance 88
36 77 ENGEN IS SOUTH AFRICA’S
Strategic Review Sustainability FASTEST GROWING BRAND AND
Our Value Creating Business Model 36 Human Capital 95
“COOLEST” PETROLEUM BRAND
Operating Environment and Market Outlook 38 Social & Relationship Capital 103
Risks & Materiality 40 Manufacturing Capital 123
Managing Material Matters 42 Natural Capital 127
Key Risks and Mitigation 46 Financial Capital 132
08 09
ENGEN OVERVIEW
WHO WE ARE & WHAT WE DO
Engen is South Africa’s fastest growing brand* and “coolest” petroleum brand**; an industry trendsetter and customer
focused market leader that harnesses human potential to deliver innovative petroleum products, exciting retail
convenience offerings and digitally enabled solutions.
We leverage our parent company, PETRONAS’ intellectual capital and extensive investments in R&D to deliver
world-class petroleum products.
RETAIL
We operate approximately 1,030 Engen service stations across South Africa, marketing superior petroleum
STATEMENT OF PURPOSE
SHARED VALUES
products and offering unique convenience at over 600 Quickshops and through various prestigious partner
brands. By developing innovative digital solutions and partnering with leading loyalty programmes, we A Progressive Energy and
create a seamless refuel and convenience experience for our customers. Solutions Partner, Enriching Lives
The scale of operations,
facilities and manpower for a Sustainable Future. OWNERSHIP TEAMWORK PERFORMANCE
involved in the day-to-day
manufacturing, logistics COMMERCIAL Progressive
and distribution network of
the Company necessitates As a proud partner to a broad section of South African industry, our fully We are a dynamic Southern African brand that
a culture that prioritises integrated commercial business focuses on the sales and marketing is Passionate About Progress and places EMPOWERED INTEGRITY
Health, Safety and of bulk petroleum products, including: Diesel, Jet A-1, Heavy Fuel Oil, customers at the heart of all the things that we do.
Environment. Bitumen, Gasoline, Kerosene, LPG and Chemicals.
Our passionate workforce Energy
harnesses a history that
We provide a range of energy solutions for our
LUBRICANTS
stretches back to 1897 and
PETRONAS CULTURAL BELIEFS
draws on the legacy of
customers’ Energy requirements with the ambition
those employees in whose to add renewables to our customer offering.
footsteps they tread, to We offer premium lubricant products in South Africa based on PETRONAS’ Fluid Technology
strongly collaborate with Solutions, including: Automotive, Industrial and Marine. These cater for consumers and
Solutions Partner
our business partners and commercial customers. Alongside quality Engen lubricants, we also market various PETRONAS lubricants and We are a provider of products and services, delivering
stakeholders to ensure functional fluids. innovative Solutions to be a trusted Partner that
RESULT MATTER OWN IT!
that we maintain our
delivers value.
proud record of consistent
innovation.
Our continuous service
INTERNATIONAL BUSINESS Enriching Lives
journey anchored on a
We are committed to Enriching the Lives of all
Our International Business houses our retail assets, including 230+ service stations, in FOCUSED EXECUTION NURTURE TRUST
‘customer first’ mindset our stakeholders and to help society to reach its full
drives us to create and six countries, namely: Botswana, DRC, eSwatini, Lesotho, Mauritius and Namibia. It also potential for a prosperous future.
deliver a seamless customer focuses on the commercial fuels and lubricants sectors in these countries, with reseller
service experience so that agreements for lubricants in a number of other sub-Saharan African countries. Sustainable Future
we consistently deliver our
brand promise ‘With us you We create a Sustainable Future by protecting SHARED SUCCESS TELL ME
are Number One’. MANUFACTURING value across Human, Social, Manufacturing,
Intellectual, Natural, and Financial capitals.
We are committed to safely manufacturing and maintaining excellence and reliability in
every product we produce at our three manufacturing plants, while limiting our effect on
the environment.
*according to Brand South Africa
10 **as voted in the 2019 Sunday Times Generation Next survey 11
ENGEN OVERVIEW
WHAT WE OFFER
OUR CORE BUSINESS SEGMENTS: PRODUCTS, SERVICES and MANUFACTURING
INTERNATIONAL
RETAIL COMMERCIAL LUBRICANTS BUSINESS MANUFACTURING
Markets fuels, convenience and offers Fully integrated business focusing on Undertakes all sales and marketing Offers retail fuels and services in 6 Of the approximately 500 petrochemical products we market, many
a seamless customer experience sales and marketing of bulk petroleum functions of Engen and PETRONAS countries via 230+ service stations, while are manufactured safely in our three manufacturing plants – Engen
at 1 030 service stations, 615 products, lubricants and chemicals in lubricant products in South Africa. also focusing on the sales and marketing Refinery, Engen Lubricants Oil Blend Plant and Zenex Blend Plant.
Quickshops and numerous fast food South Africa. of bulk petroleum products, lubricants
partners across South Africa. and chemicals across Southern Africa.
FUEL PRODUCTS KEY STRATEGIC BRANDS FUEL REFINERY
• Engen Primax Unleaded 93/95 • Engen Dynamic Diesel • PETRONAS Syntium • Engen Xtreme • Engen Primax Unleaded 93/95 • Location: Wentworth, Durban
• Engen Dynamic Diesel 50ppm • Engen Primax Unleaded • Engen Dieselube • Engen Dynamic Diesel 50ppm • Nameplate Capacity: 120 000 bpd
• Jet A1
NON-FUEL • Heavy Fuel Oil AUTOMOTIVE MOTOR OILS NON-FUEL • Certified ISO 9001 (Quality) & ISO 14001 (Environmental)
• Quickshop • Fully & Semi Synthetic • Mineral • Quickshop • Produces EURO 2 unleaded Mogas (93 & 95) & 50ppm Diesel
• Illuminating Kerosene
• Quick service restaurants • LP Gas • OEM Genuine Oil • Quick service restaurants • Product Range: Mogas | Diesel | Jet | LPG | HFO | Bitumen | Aromatic &
• Banking ATMs • Chemicals • Banking ATMs Aliphatic Solvents | Sulphur
• Courier Services COMMERCIAL VEHICLE OILS • Car Wash
• Car Wash
• Bitumen
• Heavy duty diesel engine oil LUBRICANTS OIL BLEND PLANT
INDUSTRIES SERVED: B2B PRODUCTS • Location: Island View, Durban
• Truckstop AUTOMOTIVE FUNCTIONAL • Engen Dynamic Diesel • Certified ISO 9001 (Quality), ISO 14001 (Environmental) & ISO 17025 (Lab Testing)
ENGEN 1APP • Agriculture FLUIDS • Jet A1 • Product Range: Engine, Industrial, Marine, Gear oils
• Aviation
South Africa’s first mobile application • Auto Transmission and Gear • Heavy Fuel Oil
• Coatings • Production Capacity: 33850 m² | 80 000 MT | 1 Shift | 78 staff
that creates seamless on-the-go • Greases • Illuminating Kerosene
• Construction • Storage: Base oil: 28 365 m3 | Additives: 938 m3 | Semi-finished oils: 1 847 m3
refuel and retail experience for Engen • Radiator Coolant • LP Gas
• Fleet
customers. • Brake Fluid • Chemicals Manufacturing Kettles: 4 x 10t (2 trains) | Dosing Kettles: 2 x 500kg + 2x2t
• Manufacturing
REWARDS PARTNERS • Marine INDUSTRIAL LUBES & FLUIDS • Lubricants & Fluids
ZENEX BLEND PLANT
• FNB eBucks • Mining • Hydraulic • Compressor INDUSTRIES SERVED: • Location: Island View, Durban
• Clicks Clubcard • Turbine • Agriculture • Agriculture • Certified ISO 9001 (Quality)
• Edcon ThankU • Marine • Metal Working • Aviation • Product Range: Engine, Industrial, Rail, Transformer, White, Gear oils
• Industrial Gear • Coatings • Production Capacity 30000 m² | 25000 MT | 1 Shift | 32 staff
SERVICES • Construction
• Storage: Base oil: 26000 m3 | Additives: 400 m3
• Fleet
• Fluidlink Finished Products: 1 565 m3 | Manufacturing Kettles: 3 x 800Lt
• Manufacturing
• Marine
• Mining
12 13
ENGEN OVERVIEW
GROUP CORPORATE STRUCTURE
21.2 % Afric Energy
74 % PETRONAS Resources
ENGEN LIMITED Marketing
International
(Pty) Ltd
sdn bhd
4.8% Main Street 1412
(Pty) Ltd
100% 100% 100%
ENPET ENPET
ENGEN
COMPLIANT with
the liquid fuels charter
AFRICA INSURANCE
HOLDINGS
INSURANCE LIMITED
(PTY) LTD
LIMITED (10M)
100% 100% 100% 100% 100% 100% 100% 60%
ENGEN CITYCAT ENGEN PETROLEUM ENGEN
ENGEN ENGEN ENGEN
PETROLEUM PROPERTIES LESOTHO INVESTMENT COMPANY
SWAZILAND PETROLEUM DRC
LTD (PTY) LTD (PTY) LTD HOLDING LTD (MAURITIUS)
(PTY) LIMITED (DRC) LIMITED SA
(LESOTHO) (MAURITIUS) LIMITED
49.0%
100% 70% 100%
100% 40%
ENGEN ENGEN ENGEN
PRODUCING PRODUCING PRODUCING ARTISEA
IMTRASEL REATILE BELGIUM
(PTY) LTD GAZ LTD (NAMIBIA) (BOTSWANA) (MAURITIUS)
LTD LTD LTD
(NAMIBIA) (BOTSWANA) (MAURITIUS)
36.80%
25% 40% 100% 23.5% SEP CONGO
ENGEN ENGEN MER OIL
ENGEN MAUN MARKETING
PALAPYE STORAGE
PARTNERSHIP BOTSWANA
PARTNERSHIP TERMINAL CO
(PTY) LTD (PTY) LTD
(PTY) LTD LTD
14 15ENGEN OVERVIEW
A PROUD MEMBER OF
THE PETRONAS GROUP
Engen is a valued member of the PETRONAS Group, a Fortune 500 company and
our majority shareholder. PETRONAS is a fully-integrated oil and gas company
operating in approximately 70 countries across the globe, employing more than
50 000 people.
As well as drawing on the skills of their human capital, business capabilities
and competencies, our relationship with PETRONAS enables us to leverage
their research and advanced technology. This is evident in our Primax brand of
gasoline, which uses the same technology used to develop the fuel to power the
6 x World Championship-winning Mercedes AMG PETRONAS Formula One team.
We also market products on behalf of PETRONAS Lubricants International (PLI),
the global lubricants manufacturing and marketing arm of PETRONAS. PLI drives
technology as a winning differentiator in responding to the needs of both the
automotive and industrial lubricants market, and continues to invest in world-
class technology, infrastructure and talent.
PETRONAS also provides the technical expertise responsible for designing,
developing and delivering the fuel, fluid and lubricant technology solutions that
have powered the Mercedes AMG PETRONAS Formula One team to the 2014,
2015, 2016, 2017, 2018 and 2019 World Driver and Constructor Championships.
This technical partnership ensures that the products we as Engen offer our
customers, have withstood the ultimate Formula One testing ground.
PETRONAS IS A FULLY-INTEGRATED
OIL AND GAS COMPANY OPERATING
IN APPROXIMATELY 70 COUNTRIES
ACROSS THE GLOBE
16 17ENGEN OVERVIEW
WHERE WE OPERATE
CORPORATE OFFICES FUEL TERMINALS
ENGEN ALSO HAS A South Africa SA- Gauteng SA- North West Botswana
BRAND PRESENCE Cape Town
Bloemfontein
Alberton (Alrode)
Johannesburg
Klerksdorp
Rustenburg
Gaborone
Francistown
IN 9 OTHER Durban (Westville) (Langlaagte) Vryburg DRC
COUNTRIES. Johannesburg (Sandton)
Port Elizabeth
Pretoria (Waltloo)
SA- Limpopo Kinshasa
SA- KwaZulu-Natal Hoedspruit Lubumbashi
Botswana Durban (Wentworth) Makhado Eswatini
Gaborone Ladysmith Mokopane Mbabane
• In March 2019, Engen
2 transferred operations DRC SA- Western Cape Lesotho
SA- Northern Cape
in nine countries to VIVO Kinshasa Cape Town (Montague Maseru
Kimberley
Energy. Eswatini Gardens)
Upington Mauritius
• VIVO Energy are licenced to Mbabane Mossel Bay
Port Louis
utilise the Engen brand for SA- Free State SA- Mpumalanga
Lesotho Namibia
15 years. Bethlehem Nelspruit
Maseru Grootfontein
Bloemfontein Secunda
1 5 Mauritius Keetmanshoop
6 Kroonstad eMalahleni
Port Louis Lüderitz
3 SA- Eastern Cape Ondangwa
Namibia
East London Walvis Bay
4 NO. OF FUEL STORAGE Windhoek
Port Elizabeth
7 COUNTRY
STATIONS DEPOTS
Windhoek
Port Elizabeth (Ocean) Windhoek Airport
1. Botswana 59 2
2. DRC 66 2 MANUFACTURING
LUBRICANTS/CHEMICALS DEPOTS
PLANTS
3. Eswatini 6 1
4. Lesotho 10 1
Engen Refinery (Durban) Johannesburg (Isando) Gaborone Kinshasha
5. Mauritius 33 1 Lubricants Oil Blend Cape Town (Epping) Lubumbashi Maseru
Plant (Durban) Durban Chemical (Island View) Port Louis Windhoek
6. Namibia 59 7
Zenex Blend Plant Durban (Jacobs) Mbabane
(Durban)
7. South Africa 1 030 24 + 3 CHEMICAL
18 19ENGEN OVERVIEW
OUR VALUE CHAIN
At the heart of our value proposition lies our integrated value chain. We seek to continually improve
our inbound logistics, processing, outbound logistics, and sales and marketing, to ensure we operate
safely, reliably, efficiently and responsibly.
MANUFACTURING TRANSPORT MODES CUSTOMERS
SOURCING INBOUND LOGISTICS PROCESSING OUTBOUND LOGISTICS SALES & MARKETING
Crude and finished Crude and finished Fuels, petrochemicals and Storage facilities, rail, pipeline, ships and road Product, tailored product and
product sourced product shipped to lubricants produced at our three transport used to take product to customers convenience services marketed to
local storage manufacturing plants. customers
RETAIL
LOCAL CONVENIENCE
West Africa • CRUDE SHIPPING CRUDE PIPELINE TRANSFER
CENTRES
Saudi Arabia •
SOURCE TANKER STORAGE
AVIATION
ROAD TRANSFER
IMPORTED
PRODUCT DEPOT/
REFINERY TERMINAL
LOBP/ZBP RAIL TRANSFER MINING
SHIPPING TANKER
LOCAL SHIPPING TRANSFER
STORAGE CUSTOMER INDUSTRY
STORAGE
60%
ENGEN
REFINERY
+ 30%
OTHER OIL
COMPANIES
+ 10%
IMPORTS
PRIMARY DISTRIBUTION
• Pipeline- 42%
• Rail- 4%
• Road- 8%
• Shipping- 33%
• X-Pump- 13%
Approximate annualised average of Engen's product inventory from source.
20 21LEADERSHIP STATEMENTS
OUR STRATEGIC ALLIANCES CHAIRMAN’S PASSIONATE ABOUT PROGRESS
In 2019, Engen adopted a new Statement of Purpose – A
LETTER
Progressive Energy and Solutions Partner, Enriching Lives
for a Sustainable Future - to replace our vision and mission
statements. This new single statement is our unified rallying
call to drive action towards a higher purpose, succinctly
expressing why we do what we do. It encapsulates our future
business focus and the impact we wish to have as a company.
BUSINESS PARTNERSHIPS
Engen is a dynamic Southern Africa brand that places
customers at the heart of our business. In pursuit of growth,
our Statement of Purpose will guide our efforts to strengthen
our existing portfolio and to future-proof the organisation
beyond fuel with the ambition to add renewables to our
customer offering.
We also remain firmly committed to improving the quality
of life for all our stakeholders while creating and protecting
value across the six sustainability capitals. This will ensure
that the benefits we create can be sustained over the longer-
term, measured in terms of shareholder value creation,
societal progress and environmental sustainability.
Ultimately, our purpose will be realised when our stakeholders
see us beyond just being a provider of products and services
but instead trust us as a partner that creates value, delivers
products that customers need, and provides opportunities to our
employees to develop their careers and grow with the company.
As a purpose-led and values-driven petroleum company,
we play a critical role in moving society forward, thereby
facilitating economic growth, and job and wealth creation.
AUTHORITIES Ahmad Adly Alias
This is a key responsibility and one we do not take lightly,
which is why we are Passionate About Progress.
It gives me pleasure to introduce Engen’s
2019 Integrated Report. The report presents
an overview of Engen’s strategic framework OUR STATEMENT OF PURPOSE
for long-term value creation. It also provides WILL GUIDE OUR EFFORTS
a concise review of how performance and TO STRENGTHEN OUR
governance over the past year is delivering on
this strategy.
EXISTING PORTFOLIO AND
TO FUTURE-PROOF THE
ORGANISATION.
In 2019, Engen demonstrated its ability to deliver on its strategic
growth objectives, with outstanding safety performance and solid
operational and financial results. This performance is encouraging
against the backdrop of a challenging economic environment.
22 23LEADERSHIP STATEMENT
ENGEN CONTINUED WITH ITS the highest accountability and transparency through a deep-rooted
culture of accountability, respect, efficiency, ethical thought and
LOOKING AHEAD I WISH TO EXTEND IMMENSE GRATITUDE
IMPRESSIVE SAFETY action, and a values-driven approach to everything we do. Penning this note amidst COVID-19, the worst pandemic in over
a century, 2020 is expected to be mostly unchartered and fraught
TO MY PREDECESSOR, DATO’
PERFORMANCE RECORD We have laid solid foundations set by our framework that endorses with numerous challenges. The social, economic and commercial SRI SYED ZAINAL FOR HIS
OF RECENT YEARS. ethical values, good corporate governance, and risk management
practices that are in line with our strategic business goals. Our ability
aftershocks will be unpredictable, with no precedent in dealing with a
demand contraction resulting from the crisis.
CONTRIBUTION AND SERVICES.
to do so is significantly enhanced by having a skilled and diverse Board
with an appropriate mix of race, experience and perspective. And I We will have to brace ourselves for these extraordinary times and a
am proud that the Engen Limited Board has maintained its focus on likely severe national and global economic slowdown. The long-term
ENCOURAGING SAFETY PERFORMANCE fostering high standards of corporate governance. impact of the COVID-19 pandemic will redefine markets and result in
structural shifts. Engen must remain agile to survive and thrive in the
APPRECIATION
We continue to maintain an unwavering focus on safety and As the Chairman of a ‘purpose-led’ organisation, the board and I ‘next normal’ and the greater market turbulence that will ensue. On behalf of the Engen Limited Board, I extend sincere gratitude to
sustainability. Our top strategic priorities include embedding a culture strive to ensure that our governance structures are more responsive the South African Department of Mineral Resources and Energy for
of zero harm, as well as promoting sustainable practices across our to the broader environmental context. This is important if we are to I remain inspired by the resolve of the Engen team and am certain that their continuous support and guidance. We also thank all the other
operations and activities. truly deliver a seamless customer experience for all our stakeholders, management and employees will stretch their limits and rise to the state ministries, agencies and regulators who have an interest in our
including employees, customers, business partners shareholders, challenge. The strategy that Engen has put in place will serve us well business for their input and support.
It is pleasing to report that during the year under review, Engen regulators and society. to strengthen performance, build resilience and win in the marketplace.
continued with its impressive safety performance record of recent Immense appreciation is offered to the Engen Management Committee
years. We have been without a fatal incident since 2017. In the year
AWARDS ACKNOWLEDGEMENT for their role in driving Engen’s commendable performance in 2019.
I also acknowledge and thank my colleagues on the Engen Limited
under review, along with zero fatality, we achieved 0.33 LTIF and 0.45
TRR. In addition to the reduction in the number of incidents seen in While Brand SA declared Engen the “FASTEST GROWING BRAND” in On behalf of the Engen Limited Board I wish to extend immense Board for their valuable contribution.
2018, there were zero major incidents in 2019. South Africa in 2019, we were also proud recipients of several other gratitude to my predecessor, Dato’ Sri Syed Zainal for his contribution
and services during his tenure as Chairman. Dato’ Sri Syed retired To fellow Engen’s employees, all of whom are “Passionate about
prestigious awards, indicative of the special place Engen occupies in the
While our recent safety performance is commendable, we will not on 30 June 2020. I am honoured to take up Engen’s chairman role, Progress”, and who continue to play the most important role in
hearts and minds of our valued customers. Our awards in 2019 include:
reduce our efforts to drive a culture of zero harm. The Engen Limited effective 28 July 2020. ensuring Engen delivers on its new Statement of Purpose – my heartfelt
• SUNDAY TIMES TOP BRANDS (“FAVOURITE” Petrol Station) - a gratitude goes out to you. Engen’s impressive safety, environmental,
Board expects to see further improvements in Engen’s health, safety
testament of our brand strength and recognition by our South operational and financial performance outlined in this report indicates
and environmental performance going forward. Please turn to page
African customers. that Engen is staffed by the right people, with skills and mindset to
105 for more on our safety performance and to page 127 for more on
• SUNDAY TIMES GENERATION NEXT (“COOLEST” Petrol Station) successfully deliver on the Company’s strategic objectives.
our environmental performance.
- in recognition of our standing amongst South Africans aged
between 8-23. Finally, I wish to record my warmest appreciation to all our stakeholders,
CONTRIBUTING TO SOCIETAL WELL-BEING • TOP COMPANIES SA – REPUTATION INDEX “Winner Oil & Gas” particularly our customers for their continued support of Engen. With
– acknowledgement of our efforts to be a responsible and ethical us you are Number One!
At Engen we define achievement not just within the narrow confines
of business growth and financial returns, but also in how we enrich the corporate citizen.
lives of the people, wherever we operate. We continue to be committed • PMR GOLDEN ARROW AWARD "ADMIRED PETROLEUM/ DIESEL AHMAD ADLY ALIAS
to our corporate social responsibilities, ensuring that Engen’s efforts BRANDS" (Namibia) – Appreciation by Namibians of the services Chairman
deliver impactful value that is sustainable. we provide. (appointed 28 July 2020)
• ASK AFRIKA ORANGE INDEX 2018/2019 (“BEST SERVICE” Petrol
We recognise that Maths and Science education remains crucial Stations) – Acknowledgement for our service excellence in South
in propelling the country forward. In view of this, our long-standing Africa.
Engen Maths and Science School programme continues to provide • ASK AFRIKA ICON BRANDS 2019/2020 (“BEST SERVICE” Petrol
supplementary classes to Grade 10-12 learners in nine centres across Stations) – Highest score in the Oil/Engine Oil category.
South Africa, with encouraging results. In 2019, the matric class Dato’ Sri Syed Zainal
• TOP EMPLOYER CERTIFICATION by the Top Employers Institute -
attained an overall pass rate of 96% against a national average of Benchmarking our people practices against the very best
81%, with 70% of our 413-member matric class attaining a bachelor
pass. Turn to page 113 for more about this and our other CSR initiatives. I would also like to acknowledge Phembani for their support, guidance
WE WILL HAVE TO BRACE OURSELVES and valuable contribution in ensuring the effective stewardship of
MAINTAINING GOOD GOVERNANCE FOR THESE UNPRECEDENTED Engen’s ambitious strategic agenda.
We seek to create trust through ethical leadership and a commonly
accepted and lived set of values. As a collective, we strive to uphold
TIMES.
24 25LEADERSHIP STATEMENT
CEO’S TURNOVER FOR THE YEAR INCREASED
As a forward-looking company that is ‘Passionate About Progress’,
we have recognised the changing trends touched on above. After a
BEING “PASSIONATE ABOUT PROGRESS”
vigorous process, we developed and implemented our new ‘Beyond BY 3% TO R89.2 BILLION.
2020’ strategy in 2019. ‘Beyond 2020’ will focus on our development of
STATEMENT
IS THE UNDERLYING PHILOSOPHY OF OUR ‘Foodvenience’ and in the longer-term the development of new forms
of energy. This will strengthen performance, build further resilience
APPROACH TO BUSINESS. and ensure that we continue to win in the market place. financial performance.
Placing the customer’s lens at the very centre, ‘Beyond 2020’ seeks
to achieve commercial and operational excellence. It is anchored on COMMERCIAL EXCELLENCE
four key areas – Grow and Strengthen the Core; Stepping Out; Drive
A SEAMLESS CUSTOMER EXPERIENCE Retail
Down Cost to Serve; and Optimise Across the Value Chain. These are
enabled by our People and Business Processes; B-BBEE Accreditation; Our retail business had a good year in 2019, with a strong focus on
Being “Passionate About Progress” is the underlying philosophy
the PETRONAS Cultural Beliefs and Digital Enablement. Underpinning creating a seamless customer experience on our forecourts and in our
of our approach to business. In order to lead the game and ensure
this is a firm focus on Health Safety, Environment and Quality. Quickshops. We pumped 3.9 billion litres of fuel in 2019, welcoming
sustainability, we must be uncompromising in our pursuit of exceeding
149 million customer visits to our South African forecourts.
our customer’s expectations.
The implementation of our strategy has had a visible impact on our
business during the period under review and we aim to accelerate Alongside delivering our quality fuel, we placed a strong focus on
Our key objective is therefore to seek innovative solutions to ensure we
the pace of transformation going forward. In 2019, we continued growing our footprint and providing the public with a clean and safe
consistently deliver a seamless customer experience. This will ensure
to future-proof our organisation by upgrading our existing assets, environment at our service stations. We built 19 new service stations at
that we remain resilient and relevant in meeting the demanding and
embracing new technologies and investing in the right people to drive strategic locations and added a further 20 Quickshops, while 86 of our
rapidly changing needs of our customers. Being “Passionate About
the company forward. Please refer to page 52 for more on our Strategy service stations were refreshed to improve the consistency of our image.
Progress” translates into further innovation, the leverage of technology,
and page 54 for our Key Performance Indicators. A further 127 Engen service stations were upgraded with LED lighting.
and the introduction of new products in the market.
With a firm focus on improving the turnaround time of our interactions
OPERATING ENVIRONMENT OUR FINANCIAL PERFORMANCE with customers and providing hassle-free services, we also boosted
our rewards offering by successfully adding the Clicks ClubCard loyalty
Our pursuit of commercial and operational excellence continued Against the backdrop of a challenging operating environment, Engen
programme to our market leading ecosystem of loyalty partnerships.
in 2019 against a challenging backdrop. The global economy was achieved a commendable financial performance in 2019. Our Gross
In addition, we capitalised on digital technology and developed
negatively impacted by a confluence of trade tensions between the US Profit increased by R1.56 billion from the previous year. This was
the Engen 1app, South Africa’s first mobile application that creates
and China, growing tensions in the Middle East and volatility in global mainly due to improved operating performance across the board.
seamless on-the-go refuel and retail experience for Engen customers.
energy prices. Domestically, the South African economy saw negligible Turnover for the year increased by 3% to R89.2 billion, while operating
growth, depressed customer confidence and limited infrastructure profit was up 11% to R2.87 billion. This continued focus on our customers and creating a seamless
spending, with businesses cautious in their outlook. customer experience was positively reflected in our Net Promoter
Despite the challenging economic environment in South Africa and
Score for retail in 2019. Our score of 57.1 was up from 42.4 in 2018
Our biggest market, South Africa, continued to evolve in 2019, with record high fuel prices, our sales volumes in our biggest market showed a
and 29.5 in 2017 and affirms our customer lens focused strategy and
intensifying competition and advances in technology continuing to 4% upward trend to 7,133 billion litres. In our six affiliate countries, that
Yusa' Hassan delivering a seamless customer experience. Please refer to page 58 for
shake up the traditional petroleum business model. Increasingly fuel- form part of our continuing operations following the sale of operations
more on our Retail performance.
efficient motor vehicles have lessened the demand-growth for petrol in nine countries to VIVO Energy in 2019, we experienced volume decline
and diesel, while technologies like e-hailing and e-commerce are primarily due to the loss of key commercial customers in Namibia. Commercial
Engen continues to lead the South African
transforming the way our customers travel and consume. Society is In 2019, our Commercial business achieved encouraging 8.6% volume
petroleum downstream market as well also demanding more sustainable practice from business. Please refer
Increased provisions for anticipated credit losses, higher depreciation
costs as a result of the capital expansion programmes in our Retail, growth in South Africa to 3.01 billion litres by securing new supply
as many of the markets in which we do to page 36 for more on our operating context. contracts, despite the competitive business environment. Profitability
Commercial and International businesses and the introduction of IFRS
business across Southern Africa. And while 16 leases and increased insurance premiums as a result of higher was also up with our gross margin after transhipping increasing from
we remain focused on entrenching our OUR STRATEGY asset valuations at our refinery resulted in our expenses increasing R1.5 billion to R1.6 billion. This was achieved through intensifying our
position through growth and a strengthening Our Full Potential Strategy, launched in 2016, is proving successful.
by 10% in 2019. In addition, we incurred higher commission costs in focus on providing exceptional customer service, which was reflected
2019, mainly in our South African retail business, due to increased in an improved NPS score.
of our core, we are also determined to Significant milestones include the implementation of a new sales activity and the introduction of a loyalty programme with a new
evolve in order to stay true to our new organisational structure in 2017, encouraging digital enablement, roll out partner, Clicks ClubCard. Amidst a muted South African economy, which severely impacted
statement of purpose - A Progressive of the PETRONAS Cultural Beliefs, and a significant improvement in our key industrial sectors such as construction, retention strategies
employee NPS score. We have also successfully partnered for growth by Our financial position is currently largely ungeared, which presents were heightened. We placed a strategic focus on growth sectors and
Energy and Solutions Partner, Enriching transferring operations in nine countries to VIVO Energy. Many other gains maintained or rationalised declining segments. Please refer to page 60
an opportunity for the funding of significant projects envisioned in
Lives for a Sustainable Future. are touched upon further in my statement. our Beyond 2020 strategy. Please refer to page 132 for more on our for more on our Commercial performance.
26 05
27LEADERSHIP STATEMENT
International Business OUR INVESTMENT IN PEOPLE IS CRITICAL due to the absorption of learners through Engen’s Disability Learnership
Programme. Please refer to page 93 for more on our Human Capital.
ENGEN’S CONCERTED EFFORTS TO
Our Year-on-Year volumes in our affiliate countries remained stable at
1.80 billion litres from 2018 to 2019. Overall there was an increase TO BUILDING AN EMPOWERED, PROGRESS TRANSFORMATION HAS
in profitability as gross margins after transhipping went up from ENABLED AND AGILE B-BBEE & TRANSFORMATION BEEN ACKNOWLEDGED WITH
WORKFORCE. INDEPENDENT CERTIFICATION
R1.4 billion to R1.8 billion. This remarkable performance was delivered
As a company mindful of the role we play in broader society, we remain
by focusing on the customer to provide exceptional service.
OF LEVEL 1 B-BBEE STATUS
fully committed to the transformation imperatives of South Africa, and
In further highlights, we contributed N$2.8 million to help support playing our part in helping build an equal and inclusive nation. I am
drought-stricken farmers in Namibia; celebrated record profit after tax therefore proud to report that Engen’s concerted efforts to progress
by a challenging domestic economic environment. These high impact
of USD$15 million in DRC; and became market leader in the Mauritian transformation has been acknowledged with independent certification
challenges continue to threaten refining profitability. Please refer to
bunker business. Please refer to page 64 for more on our International of Level 1 B-BBEE status for the company.
page 123 for more on our Manufacturing performance. While good progress was made in 2019, it is incumbent upon us to
Business performance.
I have no doubt that through continued consultation and collaboration remain agile and to work towards an even better understanding of
Supply the needs of our customers, while widening our offerings, creating
Lubricants with our stakeholders we will contribute to the accelerated
As an internal measurement, we endeavour to continually improve on participation of historically disadvantaged people in the economy. greater cross-selling of our products and services, and adopting strong
Our sales and marketing in South Africa continued an upward trajectory
OTIF (On Time In Full) as a key gauge for customer service. In 2019 our Engen will therefore continue to prioritise and strategically invest in sustainability practices for continued growth in the year ahead and
in 2019 with 81.9 million litres of lubricants sold. This performance was
overall OTIF score for fuels was 93%. We had an encouraging year in the following key transformation areas: beyond in the fast-evolving landscape.
in part due to continued growth in synthetic sales and improvement of
improving our OTIF performance for our Lubricants customers. Our OTIF
our sales forecast accuracy over the course of the year. 1. Skills development of black people; We must also maintain a strong focus on the management of our
average in this regard improved to 82% in 2019, up from 72% in 2018.
2. Business support to black-owned entrepreneurs; and operations to achieve world-class performance in manufacturing and
We moved to entrench our market position by promoting our Power
We also secured tankage capacity in the VOPAK Growth 4 at IV Precinct 3. Supply chain transformation that promotes inclusion of black distribution, never taking our eye off health, safety and the environment.
Brands and extending our network penetration through our Route to
and Lesedi projects at Heidelberg in the Inland area to facilitate ease entrepreneurs.
Market initiative, with 6 High Street Distributors appointed in 2019.
of importation of finished products whilst also ensuring an improved
security of supply in the crucial inland region of South Africa. This While we recognise that our Level 1 B-BBBE status is not the end of our APPRECIATION
We also continued to leverage Fluid Technology Solutions technology,
tankage is expected to be commissioned in the second half of 2020. transformation journey, we are proud to have achieved this important My sincere gratitude is extended to our valued customers, for driving
which is a winning differentiator in responding to the needs of our
milestone. Please turn to page 116 for more on our Enterprise us to be the best we can and without whom we would not exist. Thank
customers, OEM partners and the industry. Please refer to page 62 for
We continue to further investigate securing tankage at Coega in the Development and Transformation. you for your continued trust in our products and services.
more on our Lubricants performance.
Eastern Cape once industry is moved from Port Elizabeth and the Port of
Appreciation is also extended to the Engen Limited Board for their
OPERATIONAL EXCELLENCE
Port Elizabeth is permanently closed. Please refer to page 125 for more
on our Supply performance.
DIGITALLY ENABLED insight and guidance, and the belief placed in my leadership team
In implementing our Beyond 2020 strategy, we have moved to advance and I in 2019. A special word of thanks is given to former chairman
Manufacturing
our technology systems to accelerate growth. We took a major step Dato Sri Syed Zainal for his exemplary leadership during his tenure
Our refinery progressed in 2019, especially in safety performance, PEOPLE & CULTURE forward in 2019, with successful development of the Engen 1app, as and especially for his insights and support in the development of our
reliability and competitiveness, to enhance our status as a reliable and ‘Beyond 2020’ Strategy.
Our investment in people is critical to building an empowered, enabled well as the adoption of Salesforce Automation, a revamp of our customer
an excellent manufacturer of petroleum products.
and agile workforce that embodies our world-class work culture. Extranet, Digital HR and Digital procurement, amongst others. As we
To my colleagues on the Engen Petroleum Limited Management
A number of high-risk activities, including an Alkylation Outage and Having the right people in our workforce is crucial to our ‘Beyond 2020’ increasingly focus on technology to drive our growth, we need to build
Committee, thank you for your support and unwavering commitment.
Reformer Regen, were undertaken, all of which were managed safely strategy. Accordingly, we continue to invest in developing our people a workforce that is competent and capable of utilising that technology
I would also like to honour Mr Adnan Adams, who retired on 30 June
and without any incidents. To reduce costs and meet our outage to drive our business forward. effectively to play their part in executing our growth strategy.
2020 after 14 distinguished years on the MC. Adnan significantly
objectives, we also completed our first ever inspection utilising a contributed to Engen’s growth, his wisdom and exemplary stewardship
In order to create a ‘Generative Culture’ by doing the right thing even when
drone for internal inspection of the Fluid Catalytic Cracking Unit (FCCU)
no one is watching, Engenites apply the core principles and ideals of the OUTLOOK & COVID-19 having enhanced the overall excellence of our Supply Chain division.
regenerator. This ensured a cost and schedule saving, and reduced risk
PETRONAS Cultural Beliefs in their working lives. We have implemented Southern Africa’s economy is expected to remain challenged in 2020, Most importantly, my thanks go to all Engen employees across seven
to personnel.
programmes to apply these across the company and in 2019 we welcomed more so in light of the COVID-19 Pandemic. Consumer sentiment, countries for their continued effort to drive the ongoing success of
Overall plant reliability was 98.5% while Overall Equipment 13 Culture Champions and 75 Culture Influencers into our ranks. already low pre-Covid-19, is likely to continue to be extremely our company. You are instrumental in ensuring that we deliver on our
Effectiveness (OEE) was 88.38%. In 2019 our Refinery also increased cautious. Demand for fuel will also continue to be dampened by more core purpose of generating superior value for all our stakeholders. Our
We also continue to make progress with employment equity. Our
Hexane production by 400%. efficient vehicle technology and changing transport trends. Alongside impressive safety, commercial, operational and financial performance
workforce currently comprises 55% black, 20% coloured, 15% Indian
this the rapid growth of the digital landscape will continue to change for the year under review indicates that Engen has the right people,
However, despite an excellent track record of operational efficiency, and 10% white. Hiring of underrepresented groups (African Males
the buying habits of consumers. skills and mindset to successfully deliver on our Beyond 2020 ambitions.
our refinery continues to be negatively impacted by the external and Females) at Senior and Middle Management level significantly
global refining environment contributed by a volatile energy market progressed in 2019, compared to 2018 and overall representation We will however continue to explore opportunities for growth and Yusa’ Hassan
that is characterized by major shifts in supply and demand dynamics, of underrepresented groups (African males and females) went up. sustainable performance improvement, driven by our four-pillar Managing Director and CEO
excess global capacity, regulatory burden and further compounded Furthermore, overall representation of people with disabilities increased strategy – Grown and Strengthen the Core, Stepping Out, Drive Down
Cost to Serve, and Optimise Across the Value Chain.
28 292019 HIGHIGHTS
2019 HIGHLIGHTS BUSINESS HIGHLIGHTS
RETAIL COMMERCIAL
3.9 bn
Litres Fuel Pumped in SA
3.01 bn
Litres Fuel Sold in SA
19 8% volume growth
service
stations built Increase in NPS Score
20 14.7 LUBRICANTS
Quickshops NPS
added Improvement
Clicks Clubcard
Loyalty partnership
81.9ml
Lubes Sold in SA
Launched
PETRONAS
Durance
PEOPLE AND 6 High Street Distributors appointed
TRANSFORMATION
INTERNATIONAL BUSINESS
R10m
INVESTED IN
LEARNERSHIPS
R1.8 bn 9.6ml
& BURSARIES
65.77 %
Total Procurement Spend
PROFITABILITY LUBRICANTS SOLD
with Black-Owned Companies Bunker Market
Leader Mauritius
43
Graduates
Offered Full-Time
Employment
30 312019 HIGHIGHTS
FINANCIAL HIGHLIGHTS AWARDS
2010-2020
SALES VOLUMES REVENUE SA’S “COOLEST”
PETROL STATION 2010-2019
8.9bn litres R89.2bn
2018: 9.6 billion litres* 2018: R86.2 bn
SA’S “FAVOURITE”
OPERATING PROFIT TOTAL ASSETS PETROL BRAND 2011-2019
R2.8bn R40.8bn “FASTEST
GROWING
2018: R2.5 billion 2018: R43.3 billion
BRAND”
- BRAND SA (2019)
ROACE DEBT EQUITY RATIO
9.9% 0.09% Top Companies SA
REPUTATION INDEX
2018: 8.2 %
2018: 0.23% - “Winner Oil & Gas” (2019)
PMR GOLDEN ARROW AWARD
"ADMIRED PETROLEUM/
DIESEL BRANDS"
* included volumes of nine countries transfered to VIVO Energy
32 33STRATEGIC REVIEW 34 35
STRATEGIC REVIEW
OUR VALUE CREATING BUSINESS MODEL
Our business model is designed to create a sustainable future whilst enriching the lives of our stakeholders. We do this through the
effective management of our resources and relationships in order to deliver optimal outcomes. While our business model has been
successful at creating sustainable value, we are acutely aware of the highly-competitive nature of the markets in which we operate, and
the impact that regulatory and technological changes can have on our competitiveness. Accordingly, our business model is built to allow
us to respond rapidly to changes in our operating environment.
INPUT VALUE CREATION PROCESS OUTPUT
CAPITAL RESOURCES STRATEGIC PRIORITIES MATERIAL MATTERS PERFORMANCE VALUE CREATED FOR STAKEHOLDERS
FINANCIAL CAPITAL relates to • HEALTH SAFETY AND REVENUE INVESTORS
the source of our capital derived from
operations and equity.
ENVIRONMENT R89 billion • Consistent return on investment
• R1,241 million dividends paid to shareholders
• Net Profit: R1.69 billion • CUSTOMER
• Value Retention: R2.16 billion EXPERIENCE
• PERFORMANCE NET PROFIT CUSTOMERS
HUMAN CAPITAL is
represented by our people, their
MANAGEMENT R1.69 billion •
•
Fuel customers with our quality petroleum products
Ensure reliable and security of supply to our customers
knowledge, skills and experiences. • HUMAN • Provide services and convenience at our Engen stations
• No. of employees: 3 385 CAPITAL • 8.9 billion litres of fuel sold
• Zero work-related fatalities RETURN ON
• SOCIAL AND AVERAGE • On Time, In Full = 93%
MANUFACTURED CAPITAL refers RETAIL COMMERCIAL + IBD RELATIONSHIP CAPITAL • Customer (Retail) NPS improved by 14.7
to our physical and digital infrastructure. CAPITAL EMPLOYED
• Engen stations: >1,250 • GOVERNANCE & 9.9% DEALERS, CONTRACTORS/SUPPLIERS AND B2B
• Quickshop: >700 • Develop local businesses and provide spin-off employment
BUSINESS ETHICS
• Refinery 120 000bpd GROW & • Provide long-term partnerships for sustainable growth
STEPPING
GSC SO
• LOBP and ZBP
STRENGTHEN • Cultivate capabilities of our business
• Total Terminals: 46 OUT SA VOLUME
THE CORE GROWTH
INTELLECTUAL CAPITAL refers to
intellectual assets such as our brand and 4% EMPLOYEES
franchise value, research and development, • Create rewarding employment
OPTIMISE
innovation capacity, reputation, as well as DRIVE DOWN • Provide opportunities for progression and development
strategic partnerships. DDCS COST TO SERVE OAVC ACROSS THE OUR RISKS SUSTAINED • Provide equal opportunities and career progression
• Engen range of fuel VALUE CHAIN • R 2 230 million* paid for salaries and benefits
• Engen/PETRONAS range of lubricant MARKET
• Engen 1app • LEGAL AND REGULATORY LEADERSHIP • R10 million invested in bursaries and learnerships
• 30% female representation
SOCIAL AND RELATIONSHIP • VALUE CHAIN No.1 in SA
CAPITAL reflects the strong relationships • CYBERSECURITY AND AUTHORITIES
which we have with all our stakeholders who
have contributed towards fuelling our growth. DIGITAL STRATEGY ON TIME • Compliance with regulatory requirements
• Dealers: >1,000 IN FULL • R646 million Taxes paid to Government
• Business partners/suppliers/contractors/
• HEALTH SAFETY AND • Indirect fuel taxes and levies
•
•
Vendors: >650
Authorities
ENVIRONMENT 93%
• OPERATIONS COMMUNITIES
NATURAL CAPITAL refers to • STRATEGIC • Provide local economic opportunities through employment,
the electricity, fuel, water and other business partnerships and entrepreneurship
natural resources required to deliver • Provide socio-economic upliftment through CSR
our products and services to our
customers. LUBRICANTS MANUFACTURING
• Total electricity usage: 13m GJ
• Total water usage: 3m kL
GOVERNANCE
36 37You can also read
