Five months later, a tissue paper factory, also from Italy, will start operations in Phoenix, KwaZulu-Natal.
"We bought the factories and will be loading them onto a ship from Italy to install them here," Novus CEO Stephen van der Walt said on Thursday. At full production by April 2017, the plants will contribute more than 200 full-time jobs in SA, he said.
The acquisitions are part of an aggressive strategy by the printing company formerly known as Paarl Media to diversify from a heavy reliance on printing newspapers and magazines, whose circulations have been steadily declining. It also prints promotional materials for the retail sector.
The company plans to generate more than half its revenue from non-core manufacturing products and services in the next five years. "What we are developing (as non-core business) today may be the core business in the future, five to ten years from now," said van der Walt. Novus had a capital expenditure budget of R500m over the next two financial years, of which it has spent 40%.
"We're investing heavily to service the upper and top end of the food-labelling market.
In addition to its core business of printing newspapers, including Business Day and the Sunday Times, Novus also prints beer and food packaging labels.
Net profit fell 13% to R365m in the year ended March, its maiden results since the company listed in April. Naspers owns 62% of Novus.
The tissue paper factory imported from Italy is the second such plant for Novus and will be installed next to its Correll tissue paper factory in Phoenix, acquired for R144m last year.
Last month Novus bought Digital Print Solutions, a printing house based in Cape Town.
Asked why the company was developing noncore businesses instead of strengthening its core functions, Van der Walt said: "At some point in the development of a business you have to look back at what you've achieved and decide how to move forward."
Novus has developed solid newspaper-printing technology that will continue to serve it well, but there was no denying that newspaper circulation was in decline. "We have achieved great technology and our long-term strategy is to develop other things," he said.
These include servicing the producers of fast-moving consumer goods, particularly outside SA, he said.
Formal retailing is still in its infancy in the rest of the continent and local retailers venturing there need promotional and marketing materials. Retail inserts and catalogues contributed 29% of group revenue. Sales totalled R4.3bn.
"There are many growth opportunities in Africa and they are limited in SA," said Van der Walt.
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