Accéntuate's head office in Johannesburg's industrial Steeldale is nondescript. But don't let that fool you. The company's strategy and leadership, not least its favourable trading conditions, warrant market attention.
That Accéntuate smashed its maiden forecasts as a listed entity last year is nothing short of amazing. It is not uncommon for small companies to miss their own earnings forecasts to the disappointment of shareholders.
With a price:earnings ratio of about 8, down from 14 last October, it is fair to say the company is under valued.
WHAT IT MEANS
 Group management includes three brothers
Infrastructure spend is fanning demand
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Could it be that the investment community is slow to factor in positive prospects for a company that has become the first in SA to operate across the aluminium, chemicals and glass sectors?
Chairman Malesela Motlatla and CEO Fred Platt are both entrepreneurs. Manne Dipico, the vice-chairman at mining house De Beers and former Northern Cape premier, is Motlatla's deputy.
Platt's involvement with the company began in 1997, when he became human resources boss at Safic, founded by Willie Coetzer as a chemical cleaning-products maker in 1980.
No more than three years after joining the chemicals business (now under the leadership of his brother, Eric Platt) Platt was named Safic MD. He has since diversified its income base; introduced empowerment partners and other initiatives in the spirit of economic sustainability; steered the enlarged entity through listing and, as part of an experienced team, carved it an enviable place in the infrastructure development and supply arena.
Accéntuate has been trading on the junior exchange, the AltX, since November 2006. That it was floated ahead of Platt's 40th birthday was no coincidence.
"I believe in planning," says the man steering the organisation that last year boosted turnover 12% to R210m - a smidgeon off initial projections.
"Many AltX companies are running out to buy quickly. Our strategy is different. We draw blocks long in advance, identify opportunities, then follow. We spend five years planning before executing. We've identified our business model and know what we want. We just have to narrow it down and then go to the market. We want to be a blue-chip company one day," he says, hinting at further acquisitions in the short to-medium term.
Two years before listing, the firm and black investors bought into the 55-year-old FloorworX Africa (then Marley Flooring) from a Belgian player. Marley's MD at the time was Platt's older brother, Donald, who (for corporate governance reasons) had no clue his sibling was part of the consortium eyeing his business.
Does being family and colleagues create conflict?
"Good, open communication is key. Regardless of being brothers, we're colleagues and treat each other with respect and professionalism," says Platt (the CEO). Having Marley and Safic in the same fold, he says, resulted in a combination of good management, corporate governance and entrepreneurial flair.
"It's a good mix. These combined qualities gave our business credibility."
Last year, the listed entity snapped up Centurion Glass & Aluminium (CGA) for R75m, further diversifying its portfolio and entrenching itself in the lucrative infrastructure-development space which remains largely fragmented.
Construction is the industry to be in right now as the state splurges hundreds of billion on infrastructure development, partly due to the 2010 soccer World Cup. As a company that provides construction and infrastructure supplies, the organisation is poised to benefit handsomely. And its commitment to transformation stands it in good stead when it comes to state contracts.
Despite increases in interest rates, power cuts, oil price hikes, and rising input costs and competition from Indian and Chinese importers, government's development infrastructure spending programme is fanning the demand for its products.
And its prospects extend beyond SA's borders.
FloorworX has landed an R8m flooring contract at a Nigerian hospital. The unit, which runs a huge centralised factory in East London, already exports to Zambia, Kenya, Uganda and other destinations with the Alex Kerrod-led CGA also deriving some of its income from other parts of Africa. Angola hasn't escaped the Steeledale-headquartered company's attention.
The company's product range extends beyond the traditional construction sector which, for investors, means its business model will outlive the current boom.
"We're not in brick and mortar construction but supply finishing products. The flooring, glassing and aluminium businesses in which we operate, gives us a foothold across the infrastructure development sector," says CEO Platt. "With the subsidiaries we own, we're able to exploit existing synergies and capabilities. We aim to expand our product range and geographic foothold."
After shooting the lights out with a 100% surge in profit before tax and a 63% jump in earnings per share last year, Accéntuate has certainly started on a high note. This isn't to imply that days of sterling performance are over, especially as the company's organic and acquisitive strategy takes shape.
"When the market turns around, there will be spending on renovations. When construction activity slows down, the scope for maintenance and upgrading will increase. So, either way, we're always going to be in business," Platt says.
"We're boxing above our weight," he says of the group's expansion strategy which includes organic and acquisitive growth. "We know there'll be sustainable growth over the next few years and are positioning ourselves to extract growth within our group. We've also identified a list of potential acquisitions."
It helps that the firm has no gearing on its balance sheet.
But Accéntuate is focused beyond achieving returns on its investments.
Environmental sustainability, black economic empowerment and good governance also rank highly. The firm is also investing in human resources, which Platt describes as company's key asset.
As a veteran in the human resources discipline, he is talking from experience.
"Good people help you prosper, but bad people can become a big liability."
The organisation also stands out for having a structure that frees the chairman, along with the CEO and chief financial officer (Ré Voogt), from day-to-day functions, allowing them to focus on expansion and strategy.
"How can you focus on growth if you are worried that suppliers aren't delivering and that sort of thing? We have strong MDs tasked with operational duties."
As it pushes ahead with growth, the firm is exploring four acquisition possibilities. Says Platt: "We want people who see acquisitions as a launch pad (enabling growth to happen). When we get into any transaction, the aim of both parties should be to grow. The deal should add value to both."
With a new brand (to reflect growth beyond the chemicals business) and a new game plan, Accéntuate's focus now falls on aspects like equity, product and service excellence, black economic empowerment, as well as earnings. In regard to the latter, the firm aims to lift profit 45% and revenue 25%.
With the construction boom and new mines opening, Accéntuate is well-placed for growth.
