Latest news with #Denel
IOL News
20-06-2025
- Business
- IOL News
Denel's turnaround strategy shows promise as it seeks foreign contracts
Denel told Parliament it is looking to secure new revenue streams, improve management, commercial skills, and governance, as well as to source other funding sources. Image: Siphiwe Sibeko / Reuters State-owned manufacturing company Denel told Parliament on Friday that it was making good progress in revenue generation. Briefing the Joint Standing Committee on Defence, CEO Tsepo Monaheng said they were concluding contracts amounting to billions. 'We hope this trend continues. The countries that place orders with us have trust in that Denel has turned the corner. We can't disappoint in terms of non-performance, so performance is critical for us,' Monaheng said. Speaking on the entity's turnaround plan, Monaheng said they have looked at restructuring the business to get cash. 'One of those areas was to ensure we go through Section 189 and have the right people in the business,' he said. Video Player is loading. 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Advertisement Next Stay Close ✕ Although he did not go into detail on the retrenchments, the presentation to the committee indicated that Denel has completed the initial Section 189 process and filed critical vacancies. 'Further Section 189 process is going to be initialised,' reads the presentation. Monaheng told the MPs that Denel has lots of debtors and that debt was still a challenge. 'Even when we make money, the creditors take the money, while the banks demand their payments. It makes it difficult for us to execute the turnaround strategy,' he said, adding that their debts were four to five years old. 'When they threaten us with liquidation, we prioritise them. It hampers our progress.' In its presentation, Denel said it was looking to secure new revenue streams, improve management, commercial skills, and governance, as well as to source other funding sources, including the collection of outstanding debtors such as Armscor. Monaheng said they were looking for partnerships in new markets and develop innovative products. 'We are careful who we partner with.' He told the MPs that the sale of non-core assets and shares in associate companies did not materialise. 'We were not able to sell non-core assets, but we have started a process to make sure they are value-creating,' he said, adding that they planned to achieve shareholder control at Rheinmetall Denel Munition and Hensoldt. Monaheng stated that they were reviewing the cost of sales and operating costs as well as implementing cost containment measures. 'We have to spend better and spend on value creation.' On Denel's business performance, Monaheng said in 2015/16, Denel posted R8.4 billion in revenue, but this went down to R1.3 billion in 2021/22. In 2023/24, they were sitting at R1.3 billion with R223 million in profit. Monaheng said their target was to reach the R8 billion and that was possible if they could get more contracts. 'We have to make sure at operational level, the business is profitable. We want to make sure we move to sustainable profitability.' He reported that during the 2023/24 financial year, R1.4 billion orders were placed with Denel, and this increased to R4.3 billion in 2024/25. 'If we continue on this trajectory, we should realise the Denel we want. This is dependent on the happiness of the customers. We are ready to get more orders. We hope to continue on this trend.' Earlier, Monaheng observed that Denel had asked for bailouts, but things have changed. 'If it operates well, it should fund its operations, and that can be achieved through foreign businesses we get because the margins are better.' He also said one of the reasons that Denel collapsed in the past was due to the weak internal controls. 'We are building to make sure that there are no leakages in the business. We do want to make sure we do what we are supposed to do and we are compliant all the times.' Monaheng stated that Denel had operated without leadership, resulting in instability at the entity. 'We have a full team except the CEO of Denel Dynamics.' While MPs welcomed the presentation by Denel, they were concerned about the scant detail in the presentation. ANC MP Tidimalo Legwase wanted to know about its plan to reach the planned revenue targets. Freedom Front Plus' Tammy Breedt said the presentation was of a high level and filled with lots of fluff and a to-do list. 'We don't see how you will address internal control issues that have been an issue,' Breedt said. She also said Monaheng had, in his presentation, stated that Denel started taking a nose dive in 2020 during Covid-19, but the entity was last profitable in 2015/16. 'What was the reason for the initial five years of Denel not being profitable?' Breedt asked. Defence Minister Angie Motshekga said the term of office for the current board of directors was due to expire. 'We are consulting in government structures and the department in a strong Denel board,' Motshekga said. She also said the board chairperson, Gloria Serobe, has handed a letter asking to be released from the company.
The Citizen
20-06-2025
- Business
- The Citizen
Denel presents its turnaround strategy to parliament, blames Covid-19 for poor performance
Retrenchments are on the cards for workers at Denel says CEO. The leadership of Denel appeared in front of the joint standing committee on defence. Picture: Reuters Workers at the state arms company Denel could be retrenched as part of the company's latest turnaround strategy. Denel CEO Tsepo Monaheng appeared before parliament on Friday to present his plans to save the ailing company. Since 2019, Denel has received around R10 billion in bailouts from the government. 'We are looking at restructuring the business so that we get cash into the business and one of those areas is to make sure that we go through the Section 189s and have the right people in the business,' he said. Despite Denel's ongoing battles with unions over wages, Monaheng said the company is forced to prioritise paying off its debt. Some of the debt goes as far back as 2019. 'Denel still has a lot of debt even when we make money the creditors take the money and the banks want their money so it makes it difficult for us to execute our turnaround strategy,' he said. He said the company had even considered selling some of its non-core assets to replenish its cash reserves. He said another part of the revenue-generating strategy is to ensure that the company secures more international contracts. 'The countries that are placing orders with us they have trust that Denel has turned a corner and we cannot disappoint by nonperformance, so performance is critical for us.' Monaheng said it is critical for the business to spend money in a justifiable manner as part of the turnaround strategy. 'Denel has incurred a lot of costs and in many cases, it is costs that we cannot even justify. If we had managed our money better at least we would be a break-even business.' He said the company hopes to derive more than 60% of its revenue from international contracts. 'Most of the export contracts if we execute them well the profits are good,' he said. He said another turnaround move is to ensure that customers all over the world trust the products that have been produced by Denel. When was the last time Denel made profit? Monaheng said the last time Denel was profitable was around 2016. 'The problem with loss making is that you are not generating cash so this means you are getting deeper and deeper into trouble because we do not have cash to fund our operations so that is why we had to go ask for money.' Monaheng blamed the Covid pandemic and internal problems for its poor performance over the years. He said the company depends on its foreign contracts which were difficult to obtain during the pandemic. He also pointed out that staffing problems in senior management positions had made accountability difficult. 'The other reason besides Covid that contributed to Denel's collapse in the past few years is the collapse of internal controls. 'So we are fixing that to make sure that there are no leakages in the business and we are doing what we are supposed to be doing at all times,' he said. ALSO READ: Adequate emergency reserves in place for occasional system constraints – Eskom MP's reaction to Denel's presentation Meanwhile, some parliamentarians demanded clarity on when Denel started failing since Monaheng had listed Covid as one of the factors. 'The first presenter said Denel started taking a nose dive in 2020 with Covid and that they have not been able to recover from Covid but it was also said the last time Denel was profitable was the 2015/16 financial year. 'But Covid happened in 2020 not in 2015 so what was the reason for the initial five years of Denel not being profitable?' said the parliamentarian. Wage increases This week workers at the company affiliated to the National Union of Metalworkers of South Africa (Numsa) protested outside the company's offices in Pretoria over the implementation of a past wage agreement They are demanding a 7% salary increase. NOW READ: Victory for Transnet: more cash incoming, union accepts salary increase
IOL News
19-06-2025
- Business
- IOL News
Denel's wage dispute: Workers demand 7% increase after years without raises
Workers affiliated to the National Union of Metalworkers of South Africa picket outside Denel headquarters in Centurion, demanding a salary increase. Image: Oupa Mokoena / Independent Newspapers Denel, the state-owned arms manufacturer, told the National Union of Metalworkers of South Africa (Numsa) that a 7% wage increase is unaffordable and unsustainable in the long term, but offered a 4% increase instead. This was made known on Wednesday during a closed-door meeting between the union leaders and Denel's board members in Centurion, where Numsa-affiliated workers picketed outside the company's headquarters. Regional Secretary Jerry Morulane said the meeting aimed to find a resolution on implementing a 7% wage increase. He said: 'Workers at Denel spent the duration of the meeting picketing outside in order to highlight their demands. The meeting was attended by the executive management, the board and recognised unions.' Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ He said Denel executives had initially approved and communicated a 7% wage increase to employees earlier this year, but the board later intervened, reversed the decision, and unilaterally implemented a 4% increase for the 2025/26 financial year. Numsa members have rejected the proposal of 4% saying the last time workers received an increase was in 2019. Morulane noted that during the Covid-19 lockdown, several state-owned enterprises were restructured under the leadership of then Public Enterprises Minister Pravin Gordhan. He said: 'During that time, as part of the plan to 'save Denel', workers endured many months without any kind of salary. Many of them lost assets, and even homes. Others were forced to take their children out of school. The financial distress caused so much misery, that unfortunately, it is alleged that two employees passed away due to suicide.' He said Denel workers feel they made sacrifices to save the entity and now deserve a wage increase, given their struggles with the cost of living. Acting board chairperson Gloria Serobe explained that Denel cannot afford a 7% wage increase as it would be unsustainable in the long term. She said Denel can afford to implement a 4% wage increase. Morulane said: 'After extensive negotiations, it was agreed by all parties that a task team or 'war room' would be established to find a sustainable way to fund the increase. The task team has been established to look at the practicality of the successful implementation of the corporate plan, which shall in turn, assist in funding the increase demanded by workers.'
The Citizen
19-05-2025
- Business
- The Citizen
Ex-Denel chairperson, former CEO to study docket of corruption
They are accused of playing a role in the irregular approval and establishment of a Denel Asia joint venture between 2014 and 2018. Two former Denel senior officials have been given time to study the docket before their next appearance in court for corruption Former Denel Board of Directors Chairperson, Lungisani Daniel Mantsha and his co-accused Zwelakhe Nhlanganiso Ntshepe, a former Group Chief Executive Officer, appeared in the Pretoria Specialised Commercial Crime Court last week. Docket Investigating Directorate Against Corruption (IDAC) Henry Mamothame said the matter was postponed to 30 July 2025. 'The case was postponed for them to familiarise themselves with the contents of the docket and compare it to the docket disclosures provided by the state in a USB, to that of the original docket, prior to the start of the trial. 'Their R30 000 bail was extended and they are expected back in court when the matter resumes,' Mamothame said. ALSO READ: Former top Denel officials granted bail in corruption case Charges Mantsha and Ntshepe are accused of being involved in the irregular approval and establishment of the Denel Asia Joint Venture between VR Laser South Africa (VRLSA) and the private Hong Kong company Denel Asia. Mamothame said the duo allegedly disregarded a directive by the finance minister stipulating that all transactions relating to Denel should be subject to the approval of the finance and public enterprises ministers. 'This was following the finance minister issuing a guarantee to Denel in the amount of R1.8 billion. They are also accused of receiving gratification for their alleged involvement in facilitating the deal. 'It was further discovered that confidential information relating to the affairs of the Board of Directors was disclosed between July 2014 and May 2016,' Mamothame said. Denel Mamothame said there were further discoveries of disregard for the Public Finance Management Act stipulations by allegedly awarding bursaries without the required authority to do so. Denel, a South African state-owned aerospace and military technology conglomerate, is said to be a 51% shareholder in Denel Asia, while VRLSA holds 49%. ALSO READ: AFU seizes properties, bank accounts worth millions from ex-DRC defence attaché
The Citizen
05-05-2025
- Sport
- The Citizen
Ebotse resident swims, cycles and runs to victory at Ironman SA
Upon retirement, most people opt for a laid-back lifestyle to relax after years of hard work. Not Ebotse Golf and Country Estate resident Alan Charles Robertson. Instead, the 65-year-old former biathlete, modern pentathlete and longtime Denel employee decided to speed up, work hard and push his body to the limits. Victory on debut Robertson recently clinched first place in the men's 65-69 category at the Isuzu Ironman Nelson Mandela Bay Championships in March. He completed the 3.8km swim in 01:35:49, before cycling the 180km distance in 07:56:35. He then completed the marathon in 05:23:12, clocking a combined 15:21:22 for victory. 'I didn't go and break myself because 15 hours is a long time. I knew I was going to go for 15 hours. I went out to finish and just went out with constant speed in each of the events,' he said. It was his first full triathlon and it was made special by the fact that he did it with his son-in-law, Nathan Pearson beside him, while their family was on the route supporting them. 'I've been fortunate that at 65 years, I don't take one tablet. That's quite good when a lot of your friends have passed away. I can still do the Ironman and I'm blessed to have Nathan as my partner. That's what counts – doing it with your whole family.' Early career Robertson took up endurance sports early in his life. He's a former national U17 and U19 biathlon record holder, setting the milestones in 1977 and 1979. He took up triathlon in 1980 and won the national champs in 1981. He then joined the army and was introduced to modern pentathlon. He was a Springbok for over 11 years. His career highlight was second place in the American national championships in 1981. Afterwards, Robertson transitioned into karate. He opened the Goju Karate Academy and was president for 25 years. He still participated in the triathlon, doing several Olympic-distance triathlons with his children, Warren and Claire. Family affair After Claire married Pearson, it wasn't long before Pearson and Robertson developed an unbreakable bond that culminated in the duo frequenting the Ironman 70.3 competitions around the country for the past four years. 'We trained together with his son, Warren, for our first triathlon in 2021. Alan had just retired and because I own my own business, it was a natural transition for us,' Pearson said. While he was a strong cyclist, learning to swim took serious work but his father-in-law was right beside him to give him lessons. 'I was only strong in cycling. Because Alan had a background in swimming, he coached us. He knew how to train. That knowledge was like a parenting relationship you can't pay for.' Pearson did his first full Ironman last year and he was on hand to see Robertson cross the line in Gqeberha. They swam together and came out of the water in tow but afterwards, it was every man for himself. 'This has become our bread and butter. I was excited for Alan when he came first because I knew he wanted the podium,' Pearson said. The duo will continue to swim, cycle and run together and are looking forward to the SEESA Jozi Triathlon at CR Swart Dam in September. Also Read: Schoeman in a class of his own at Jozi Triathlon Also Read: Van der Merwe and Grobler win TSA sprint titles At Caxton, we employ humans to generate daily fresh news, not AI intervention. Happy reading!
