Saudequip, as a member of the JA Delmas Network, has a long history in Senegal. How has the company evolved over time?

JA Delmas has been present in Senegal for 160 years since its establishment by Jean-Anselme Delmas, which is the origin of our company’s original name. Over the past century, JA Delmas has been actively involved in various business sectors in Senegal. In the late 1980s, we shifted our focus to the Caterpillar brand, with whom we have been collaborating since 1932.

Our agreement with Caterpillar extends to 11 countries surrounding Senegal, predominantly French-speaking nations. While our main office is in Bordeaux, France, employing around 200 staff members, our network comprises 2,300 employees located in Africa. Senegal serves as a hub supporting our operations in neighboring countries. Saudequip is currently investing approximately US$10 million in its Dakar facilities to establish a centralized hub for our technical experts, supporting our operations not only in Senegal but also in other regions.

In terms of geographical potential, where do you see the most growth opportunities?

The majority of our business is closely linked to the mining sector. Our local strengths align with the size of the industry in each country. Therefore, currently, Mali and Burkina Faso show the highest level of activity. These countries experienced a significant upswing in their mining industries about 20 years ago and are now more mature markets. Our representatives in Mali and Burkina Faso have around 500 employees stationed in each country, with an activity volume surpassing €100 million.

Mining is also gaining momentum in Côte d’Ivoire and Senegal. Although Saudequip’s turnover in Senegal ranges from €20 million to €30 million, we expect it to double within the next 18 months, primarily due to new greenfield projects. Côte d’Ivoire has historically been a significant market for us, and despite experiencing some political fluctuations, it has now stabilized. The country’s mining industry continues to develop, with four industrial mines and an investor-friendly mining code. As a company, we tend to follow mining investments and engage from the early stages of projects, providing services such as drilling and energy provision.

Apart from the initial supply of equipment, how extensive are the services offered by Saudequip?

In addition to the capital investment in equipment, the real value for us lies in the operational phase of a mine. We provide training for operators and offer maintenance services. While some customers choose to conduct their own maintenance, it has become increasingly common for companies to fully outsource fleet maintenance. This translates into long-term business for us throughout the lifespan of the machines. On average, around 40% of our revenue comes from customers’ capital investment, approximately 50% from parts and services, and the remaining 10% from newer services like equipment rental. In rental scenarios, we not only provide the machines and maintenance but also offer financing options.

Do you expect to see a growing trend towards equipment rental?

Renting equipment is becoming more prevalent in the industry. Since most mining companies are privately owned, carrying the asset through rental companies becomes an attractive option for them in terms of return on investment. The main limitation lies in the rental company’s ability to finance the equipment itself, although obtaining adequate financing is becoming easier as banks are now stronger than in the past.

With a significant portion of Saudequip’s business coming from maintenance services, how does the company ensure rapid response time and minimize logistical challenges?

Senegal’s direct port access provides us with an advantage over many countries, such as Mali, Burkina Faso, and Niger. Caterpillar’s main warehouses are located in Europe, allowing us to receive shipments in Dakar within two weeks. We have a special agreement with the customs authorities, enabling us to clear customs within a couple of days. As a result, we offer our customers direct delivery to their operating sites. Only a limited number of companies have this type of arrangement with customs authorities, and it stems from our long-standing presence in the country.

Moreover, our first solution is to utilize our local inventory. Approximately 90% of parts are available in Senegal. For large mining companies, we even provide on-site inventory.

Are there any planned additions to JA Delmas and Saudequip’s portfolio or new technologies coming into play?

We are currently in an investment and development phase, seeking to expand the range of products and services in JA Delmas’ portfolio. While our primary focus is on Caterpillar machinery, we are aiming to include complementary products such as drilling and crushing equipment. We have partnerships with major original equipment manufacturers (OEMs) in the pipeline for this purpose. Lifting and handling equipment will be another area of diversification. Our strategy is to ensure that we can meet all the needs of a mine site by offering a comprehensive line of products and services. This approach caters to companies’ increasing preference for working with a single supplier. Additionally, we are investing in technology to enhance machine performance monitoring. Currently, we have around 2,000 machines connected to this technology, and by the end of the year, we aim to increase it to 3,000. Any faults will be immediately relayed to us, enabling proactive repairs before major damage occurs.

We are also involved in two projects utilizing drones for surveying sites and providing in-depth analytics on production, efficiency, safety, and compliance. Additionally, we have recently obtained approval from the Senegalese authorities to transport parts using drones, a service we plan to commence later this year.

Do you have a final message for companies considering investments in Africa’s mining sector?

Particularly for West Africa, now is an opportune time to invest, especially in Francophone countries that have developed slightly later compared to other regions. These countries offer relatively unexplored territories with high-grade, easily operable mines, political stability, and strong currencies compared to neighboring countries. The West African CFA franc, linked to the Euro and guaranteed by the French government, provides stability, and financing rates are lower compared to countries like Ghana.

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