Fluid-conveyance firm Rare Holding is targeting the South African government’s three-year, R787-billion infrastructure plan for growth, CEO David Scheepers said on Monday.

The AltX-listed Rare is developing technologies through its Xtender programme, aimed at maintaining infrastructure assets and hopes to capitalise on the pipeline maintenance needs of municipal and local authorities participating in State’s infrastructure roll-out.

“The challenges would be unlocking government’s momentum and expenditure. We are very pleased with our order book, and we believe that while the economy is going through trauma, people have to maintain their Infrastructure assets,” Scheepers told Engineering News Online.

He noted that it was a global yard-stick that for every R1 spend on capital expenditure, a further R5 was required for the maintenance of infrastructure, through its working life.

“I don’t believe that in my lifetime, there has ever been the type of opportunities for companies like us, as there is now. The whole emphasis is on maintaining our infrastructure. That is our business, and we are developing new technologies that are driven towards maintaining existing assets.”

In its interim results for the period ending December 2008, Rare reported that the global economic downturn had not affected the group’s results. Headline earnings were up by 51%, while net profit saw a 81% increase.

Headline earnings increased to R12,65-million, compared with the R9,01-million recorded over the same period in 2007.

Profit for the interim period increased to R13,24-million, compared with the R7,32-million a year earlier.

Scheepers noted that it was the company’s diversified offerings that helped buffer it against the economic conditions.

“The beauty of our model is that we are across all disciplines of the industry, we are in the water industry, mining industry, the petrochemical and chemical industries, and we are in government infrastructure.”

In this way, Scheepers said, the company could focus on areas that were less affected by the global economic conditions, such as the infrastructure spend, when resource-based industries were under pressure.

“So, we are operating across all fronts, but more importantly, we are operating on the top-end of demand. We are not selling a product, and we are not reacting to market, but we are in fact creating a market.”

He added that the company’s balance of operations in the oil-rich Angola would also offer an income base when South African operations came under economic pressure.

For the first time since its establishment in 2006, the Rare Angola operations contributed to operating profit.

Revenue for the division was R62,4-million despite the sudden drop in crude oil prices over the period under review.

“The group, together with its strong Angolan business partners, is confident that the risk profile of Rare Angola has been adequately addressed to a ensure sustainable platform.”

Though the depressed oil prices have led to the postponement of some large projects in the petrochemical industry, Scheepers noted that there were still good opportunities emanating from the water, gold and uranium mining sectors as well as high-value infrastructure projects in neighbouring African countries.

The group developed Xtender as a tool for both pipeline maintenance and supply chain management activities.