Reliance and impact on key capitals > Manufactured capital

Manufactured capital

Manufactured capital is the infrastructure, plant and equipment that we use to produce our products. It includes assets that are produced by other entities and those manufactured internally and excludes intellectual capital such as software. The management of these assets is a key business imperative and is considered an essential element in achieving manufacturing excellence and operational performance. Our high-tech, state-of-the-art rolling and semi-fabrication assets are central to our operations. The implementation of asset maintenance and care policies will improve asset utilisation and profitability.

 

2014 areas of focus 

How we fared 

Invest in a new plant for used beverage can recycling Construction of the R300 million plant is on track, within budget and expected to be online in the third quarter of 2015 
Implement compliance requirements for ISO 55000 Certification  Initial compliance requirements have been implemented with Phase 2 of the full compliance requirements underway 
Ramp up can body stock production  Ramp up of can body stock is in progress and on track. Commercial qualification with customer completed in 2014 
Development and implementation of an asset risk maintenance policy and governance structure  The development of the asset risk maintenance policy has been completed with the implementation phase currently underway 

2015 and beyond focus areas 

Continue the ramp up of can body stock to full requirements 
Utilise our asset base to its full potential to achieve maximum contribution  
Complete the construction of the recycling plant for the recycling of the all-aluminium can ramp up

 

KEY CAPITAL RELIANCES

Local aluminium smelters

Hillside aluminium smelter (source of primary aluminium for Hulamin’s remelt and casting operation)

Bayside casting facility

Bayside aluminium smelter and casthouse (source of one-third of Hulamin’s requirements for rolling slab for the rolling operation)

Hulamin operations

Remelt and casting Hulamin’s remelt operations consist of:

  • Three slab production lines, fed by reverberatory melting furnaces, with a slab capacity of around 240 000 tons per year
  • An aluminium reclamation operation
  • Two twin roll casters, which are able to process scrap and primary metal into coil, with the capacity to produce 20 000 tons of coil per year

Rolling
Hulamin is a conventional flat rolled aluminium products producer and operates hot, cold and foil rolling mills. Finishing equipment includes coil coating lines, slitting, sheet cut-to-length lines, cleaning and tension levelling and foil finishing facilities. A state-of-the-art plate plant is equipped with a range of equipment including sawing, stretching and plate cut-to-length lines.

Extruding
Hulamin manufactures the majority of the extrusion dies for its two extrusion plants. Heated billet is placed in an extrusion press which pushes the softened metal through the die to produce the desired profile. Finishing options include powder coating, anodising and fabrication.

Scrap processing

Hulamin operates an aluminium reclamation operation which consists of a shredding line, de-coater and induction furnace which is used to process light and coated scrap to produce aluminium sows that are fed into the three slab production lines.

A R300 million investment in a scrap sorting, processing and recycling facility was approved in 2013 and will be online in the third quarter of 2015.

Asset management strategy

The purpose of the asset risk management strategy is to provide a structured approach to the implementation of an asset risk management system, based on ISO 55000 and ISO 31000 principles. Our asset management strategy is aligned with international best practice. The focus is on asset care, operation and maintenance while considering the asset performance and the effect of external factors.

Key areas of focus:

Business risk assessment

To identify potential assets that pose a high risk to the overall business objectives.

Operation task criticality

To determine activities related to assets that can cause harm to people and the environment while performing these activities.

Equipment criticality analysis

To identify the most significant equipment and determine the most appropriate approach to the development of maintenance tasks.

Spares criticality analysis

To determine inventory categories and develop an approach for a specific spare or material.

Asset acquisition risk management

To determine issues that should be included in the specification of the asset such as training, integration of systems, energy considerations, critical spares and technology.

 

IMA

Hulamin has developed an Integrated Manufacturing Approach (IMA) to ensure that it achieves its goals and objectives. IMA is Hulamin’s operational excellence programme and defines the manner in which to standardise, improve and sustain Hulamin. The programme consists of four pillars, namely standardised business processes, controlled manufacturing processes, reliable equipment and improvement projects.

The IMA is a continuous process of uplifting standards, improving systems and sustaining them. This allows us to deliver value to the customer and to increase the value of Hulamin.

The reliable equipment pillar of IMA manages our impact on manufactured capital. It allows us to:

  • Capture and analyse our maintenance history
  • Identify improvement opportunities
  • Learn from our failures
  • Measure our performance
  • Standardise on best practice processes
  • Sustain the improvements we made

Asset care

The asset care team ensures that equipment is kept in good, functional condition and contributes to safe working conditions and prevents environmental damage.

Our dedicated asset care team is focused on furthering the:

  • Development and implementation of Asset Risk Management policies and governance
  • Development and implementation of centralised work planning and control
  • Development and implementation of improved material management systems

Our reliance on manufactured capital and our approach to the management thereof allow for us to extract the benefits and value of our assets.

 

operational statistics for 2014

Repairs and maintenance

R203 million

(2013: R177 million)

 

Group production

214 000 tons

(2013: 211 000 tons)

Rolled Products

196 000 tons

Extrusions

18 000 tons

Additions

R305 million

(2013: R131 million)

 

Disposals at cost

R59 million

(2013: R1 million)

 

Carrying amount

R2 697 million

(2013: R2 515 million)

 

 

Recycling plant on track

Hulamin has invested in the infrastructure needed to recycle Used Beverage Cans (UBCs) and other end-of-life and customer scrap in the most effective and environmentally responsible manner. The recycling centre is estimated to cost R 300 million, which will further advance our manufactured capital. The construction of this plant is within budget and on track to meet the initial deadline of the third quarter of 2015.

 

strategic asset base

The strategic assets of Hulamin can be separated into three key areas of which all are important to the overall state-of-the-art facilities that contribute to produce our products.

 

group assets 

Remelt and casting equipment

Melting and holding furnaces are used to melt and blend primary aluminium, alloying elements and scrap aluminium. The casting launder and moulds are used to solidify the molten aluminium into rolling slab. There are three slab production lines with a capacity of 240 000 tons per year.

Infrastructure

Buildings, roads, pipelines and other services essential for production.

Recycling plant

Coated and painted scrap is also processed via the aluminium reclamation operation which consists of a shredding line, de-coater and induction furnace. The processed scrap is fed into the slab production lines above. 

Strategic spares

Spares, which are essential to production, are on hand in the event of breakdowns and urgent repairs. 

HULAMIN ROLLED PRODUCTS  

Mills

Hulamin has state-of-the-art rolling mills, which roll the slab into coils. The hot mills roll heated slab, substantially reducing it thickness and multiplying its length by up to 24 times. The cold mills further roll the hot-rolled coils to achieve the required gauges and properties. 

Slitters

These items of equipment form part of the finishing processes. These high-tech machines allow for a high-quality product that meets customers’ specific needs. 

Plate plant

The aluminium plate plant is a technologically advanced process that includes heat treatment, sawing, stretching and cut-to-length lines. 

Coating

Coils can be coated with paint or lacquer using rollers and then oven-cured. The coil coating process is designed to ensure highly consistent quality. 

hulamin extrusions  

Extrusions

Billet presses push softened metal through dies to create desired profiles, which are then finished by either coating, anodising or fabrication. Hulamin has two extrusion plants, both of which boast these advanced technologies.