Trellidor shrinks in South Africa as growth lies outside

Trellidor’s latest results revealed that, despite the company’s roots lying in South Africa, it may need to look outside the country for growth.

Trellidor was founded in South Africa, starting out in 1976 as a company called L and L Metal Finishings. 

The business initially focused on a process called powder coating, which is a technique for painting metal surfaces.

In the late 1970s, Trellidor shifted its focus to manufacturing security barriers, particularly developing a strong, retractable steel security gate. 

This gate design proved successful and became the company’s main product line. 

Trellidor continued to innovate and improve its security solutions, even achieving certification for industrial-grade high-security gates.

Today, Trellidor is a leading manufacturer of custom security barriers in South Africa and Africa, with a presence in other parts of the world including Israel, Europe, and North America. 

On 7 March, Trellidor released its interim results for the six months ended 31 December 2023.

Trellidor reported an interim revenue of R292.2 million – a 6.9% increase from the previous period’s R273.3 million.

The company reported that its Trellidor segment experienced strong demand in the UK market, but the South African market experienced weak demand. 

This caused the Trellidor segment to experience a revenue increase of 14.6% to R204 million from the prior period’s R178 million.

The company’s Taylor decorative products lost 11.5% of its revenue compared to the previous period, having generated R73.8 million. 

Trellidor’s cornicing and skirting distribution segment, NMC, generated 14.9% less revenue than the previous period. It generated only R15.2 million compared to the previous period’s R18 million. 

The muted revenue performance was amplified in the company’s net income, which saw a 29% decrease from the prior period. 

Net income fell from 25.6 million in 2022 to R17.46 million in 2023. 

Trellidor’s net income for the period was heavily affected by a R3 million foreign exchange loss due to its UK operations, lowering its profits from R20.28 million to the reported R17.46 million.

Over the past twelve-month period, the group reported a net loss of R1.55 million.

Trellidor has seen little growth in its revenue since 2016 and experienced a slight downward trend over the period.

The company has experienced significant headwinds in the South African market, losing 14% of its revenue from the prior interim period. 

However, Trellidor experienced strong growth in the international market, collectively increasing its revenue by 170%.

Unfortunately, the international market only constitutes 28% of the company’s overall revenue. 

The strong growth experienced offshore might cause Trellidor to increase its presence in these regions at the expense of the South African market.