‘Dark’ summer may send generator sales soaring

Ellies Holdings was expecting to boost generator sales as SA geared up for a “dark” summer, with further power cuts expected.

January 7, 2008
‘Dark’ summer may send generator sales soaring

TV RECEPTION equipment manufacturer and distributor Ellies Holdings was expecting to boost generator sales over the next three months as SA geared up for a “dark” summer, with further power cuts expected.

CEO Wayne Samson said the company had ordered triple the number of generators for the first quarter of the year compared with last year’s March quarter.

Ellies, which supplies generators for use in small households through to industrial-sized generators for large corporations, had sold out its stock by the start of last month, he said.

Samson said the company was gearing up “heavily” in the new year to push generators, which it expected to be a growth area for the next five to 10 years. Its recent acquisition of Megatron last month was expected to help it to pursue this growth area.

Ellies, which paid between R48,8m and R180,2m in shares and cash for Megatron, aimed to leverage its acquisition to expand further into the corporate sector.

Megatron operates in the power generation, transmission and distribution sector and either manufactures locally or imports diesel generator sets, transformer substations, medium-voltage fixed-pattern switchgear, low-voltage components, sheet-metal products, power transformers and overhead line hardware.

Samson said the company was importing small generators, but was looking into manufacturing these locally to benefit from synergies.

Prices have recently come under pressure with rising input costs, the Chinese currency losing some ground against the dollar, and a shipping price increase.

Samson said the company was looking into offering rental options or the option of a maintenance agreement with a purchase. Ellies was also looking into growing generator sales in Africa, he said.

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