Sappi CFO Glen Pearce says operational disruptions to be expected from KZN floods

Glen explains that while the material damage has been minimal, staff and supply chains have been affected.

Over the last week, KwaZulu-Natal has been hit with heavy rains and subsequent flooding, making many areas inaccessible and damaging roads, railway lines, infrastructure, warehousing and private residences.

As a result, companies that are based in the province have informed investors that operations have been interrupted as staff are unable to travel to or from work, and the transport of goods and services have been disrupted.

One of these companies is pulp and paper company Sappi. “Sappi is deeply saddened by the loss of life and devastating impact of these floods on the people of KwaZulu-Natal,” CFO Glen Pearce says, extending his condolences to the families of the various communities that have lost loved ones.

He explains that Sappi’s primary concern is for the safety of its staff and contractors, and as a precautionary measure, due to the continued inclement weather, mills will operate with skeleton crews until it is safe for all staff to return.

The group reported that, to date, there has been no material damage to any of the company’s plants, but production will be impacted until the situation normalises. “Our Saiccor, Tugela and Stanger Mills, along with export facilities at the Durban Port, have been impacted,” Glen says. “Production has been stopped, some inventory is damaged, and deliveries to domestic customers have been affected.”

He adds that shipping lines have confirmed that export shipments will also be negatively impacted.

“Although the disruption to production and customer deliveries were outside our control, we will make every effort to minimise the negative impact on our customers,” Glen concludes.