Nampak is ramping up production of aluminum cans as Africa’s biggest producer of beverage packaging responds to consumers’ global retreat from plastic.
The Johannesburg-based company is also putting greater emphasis on cardboard cartons and developing a type of renewable plastic lid made from sugarcane, Chief Executive Officer Andre de Ruyter said in a phone interview. That’s due to a growing concern about the impact of plastic on the environment, particularly on items such as single-use straws.
“Consumer sentiment against plastic packaging that cannot be recycled is very clear,” de Ruyter said. “Aluminum is a valuable metal and so people have incentive to recycle it.”
Nampak and other container makers are able to boost aluminium-can production alongside expansion into fast-growing regions such as Africa, where demand for canned and bottled drinks is rising as people start to buy packaged goods for the first time. Nampak is spending R100 million ($7.2 million) on a new food-can line in Nigeria, while that country’s GZ Industries is opening a factory in South Africa.
Nampak shares declined 5.1% to 14.75 as of 3:40 pm in Johannesburg, after the company announced a 7% rise in full-year operating profit. The firm resisted a resumption of dividends due to a long-standing issue transferring cash from Angola and Zimbabwe and an ongoing effort to sell its glass business.
© 2018 Bloomberg L.P