Reunert comprises a diverse group of companies both in terms of size and business activity. Broadly speaking, the group is strategically linked through its electrical, electronic and ICT engineering capabilities in either their core competencies and/or the markets they serve.

GROUP STRATEGY
GROWTH AREAS

Reunert’s strategic initiatives support future growth, higher rates of return and maximised shareholder value creation. These growth areas have strong market fundamentals and potential for scalability.

The targeted growth areas are:

  • expansion of our ICT Segment into digital integration solutions
  • investment into renewable energy eco-system and ownership of renewable solar assets
  • international revenues supported by permanent presences in geographies of strategic value
STRATEGIC IMPERATIVES FOR 2023

Reunert’s strategic imperatives for 2023 refer to those initiatives that received significant management attention for the year under review. They relate to the steps taken in the year to further the objectives of the Group strategy

Growth areas

Reunert’s selected growth areas are:

Increasing solar energy asset ownership and sales of large containerised storage solutions.

Increase in international revenues supported by expansion of the Group’s footprint through an in-country presence in geographies of strategic value.

Expanding the digital integration solutions offerings in the ICT Segment.

Core competitive advantages

  • Reunert embraces values-driven leadership supported by its Group Values and Code of Ethics
  • The Group operates in diverse electronic/electrical and information communication technology markets, and in each it is focused on enabling customers' purpose
  • Reunert has a federal business model.
    Head Office provides strategic oversight and the common core competencies required by the business units in the Group such as company secretarial and tax. This allows business units to retain their individual entrepreneurial drive, thereby increasing their agility, responsiveness and resilience.
  • The Group has well-known and respected brands, including:
    CBI-electric
    Reutech
    Nashua
    ECN (Electronic Communications Network)
  • Major business units are either first or second in the chosen markets they participate in
  • Reunert has well-managed operations, strong cash flows and business units that collectively show resilience through macro-economic cycles
  • The Group's largely ungeared balance sheet creates the capacity to both execute capital projects and mergers and acquisitions opportunities
  • Reunert has a strong focus on long-term shareholder value creation – its key metrics reflect a shareholder focus, such as total shareholder return, profit, growth and return on capital employed over the economic cycle

The strategy review process

The Group undertakes a biennial comprehensive strategy review and an implementation review in the intervening year. In 2023, the Group's management teams conducted a strategy review.

Our systematic approach to developing strategy

ANALYSIS

ANALYSIS

Reunert and business units' executives analyse the operating environment to evaluate strengths, weaknesses, opportunities, threats, resources, and capabilities.

DEVELOPMENT

DEVELOPMENT

The Executive Committee (Exco), with input from the business units' management, collaboratively develop the Group strategy for the Board's approval. Segments and business units cascade operational strategies aligned with the Group's strategy.

ANNUAL REVIEW

ANNUAL REVIEW

Business unit executives review and validate strategies annually. They identify any changes or additional initiatives required to drive the business strategy. Three-year financial forecasts are updated with new plans and initiatives. The annual budget process includes strategic key performance indicators (KPIs), which are incorporated into the management's responsibilities for the year.

BOARD OVERSIGHT

BOARD OVERSIGHT

Every year, the Board either assesses the strategy's implementation or approves strategy revisions. Through this process, the strategy evolves to respond to changes and new opportunities in the operating environment. The Risk Committee determines material risks to be included in each year's review.

Group strategy objectives

SHORT-TERM OBJECTIVES
NEXT ONE TO TWO YEARS
  • Investment into renewable energy through the Lumika Renewables joint venture, to build a portfolio of solar assets and products
  • The integration of the IQbusiness acquisition to support the continued growth of the Solutions and Systems Integration Cluster
  • The release of loan funding currently held in the Rental-Finance Cluster to redeploy capital into higher yielding growth opportunities and improve the capital structure
  • Establishing new international offices to accelerate the Applied Electronics Segment’s international revenue growth
  • Improving our environmental, social and governance (ESG) disclosure through alignment with relevant guidance frameworks
MEDIUM-TERM OBJECTIVES
NEXT TWO TO FIVE YEARS
  • Improving Reunert’s investment case through:
    • Continued investment into renewable energy and expanding our renewable energy offering
    • Expansion of our ICT Segment offering through acquisitions and organic development of new products and service offerings
  • Increase our international revenues by:
    • Continuing our geographic earnings growth of the Applied Electronics Segment through the expansion of physical presence in our key markets
    • Product launches and increased market share of circuit breakers, specifically in Australia and the USA
  • The continued release of loan funding currently held in the Rental-Finance Cluster to redeploy capital into higher yielding growth opportunities and improve the capital structure
LONG-TERM OBJECTIVES
FIVE TO TEN YEARS

Improve Reunert’s investment case through continued focus on achieving the six pillars of our strategy, being:

  • Diversification of revenue streams:
    • By growing market share in targeted export geographies where we have a competitive advantage
    • Through organic and acquisitive growth in the Renewable Energy and Solutions and Systems Integration Clusters
    • Augmenting traditional revenue streams with new complementary products and service revenues
  • Innovation through continued investment in research and development spend to develop new products and services and reduce costs
  • Efficiency through the sustained optimisation of its business units and delivery of strong cash flows
  • Our customers through the continuous development of customer-centric products, services and solutions
  • Our people by driving a high-performance culture with engaged employees
  • Transformation of its business units to ensure their full participation in the markets they serve

Strategy highlights

Find additional information on our strategy in these documents:

Material matters influencing value creation

Reunert's selected material matters could substantively affect the Group's ability to create and preserve value in the short, medium and long-term.

In 2023, the material matters remained unchanged. However, some of the levels of impact that each material matter exerted on the Group have changed. Material matters are discussed throughout this report.

Appropriate group oversight

STRATEGY
The Board approves Reunert's strategy. The Expo develops and monitors long-term strategy implementation plans, associated risks and mitigation measures, and performance standards based on input from business units.
SIGNIFICANT MATTERS
The Board approves significant matters, including major acquisitions and disposals. The Expo evaluates operations, mergers and acquisitions activity, Human Resources, governance matters and other Group-wide issues.
PERFORMANCE
The Group Chief Executive Officer (Group CEO), Group Chief Financial Officer (Group CFO), and Segment CEOs evaluate segment performance using a variety of metrics, including designated key performance indicators. The Board receives and reviews operational performance reports.
DELEGATION OF AUTHORITY FRAMEWORK

The Board-approved Delegation of Authority Framework reserves certain decisions for the Board and its various committees while delegating the daily operations to Exco members through the Group CEO, Group CFO or other members of Exco.

The Board is satisfied that the Delegation of Authority Framework supports role clarity and the effective exercise of authority and responsibilities.
OPERATIONAL EXECUTION

The business units make operational decisions and put their unique strategies into action. Each business unit is responsible for its own sales and marketing strategy, customer programmes, supply chain management, efficiency enhancements, and product and service innovations.

Each business unit is also accountable for the regulatory compliance of its operations and the management of HR.