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TimesLIVE
an hour ago
- Business
- TimesLIVE
Forensic report urges action against IDT execs over R800m oxygen tender
An investigation ordered by public works and infrastructure minister Dean Macpherson has recommended disciplinary action against top officials at the Independent Development Trust (IDT) over procurement irregularities in the R800m PSA oxygen plant tender. Macpherson released the findings of the independent forensic investigation on Tuesday. The report recommended disciplinary action against IDT CEO Tebogo Malaka, general manager for supply chain management Dr Molebedi Sisi, and other officials. The IDT is a public entity established to deliver social infrastructure such as schools, police stations and clinics and falls under the department. In October last year, the Daily Maverick published a series of articles 'surrounding the R836m oxygen plant tender', describing the IDT as the implementing agent in a multimillion-rand contract with the department of health for the rollout of pressure swing adsorption (PSA) oxygen plants. Macpherson said the tender was intended to deliver life-saving PSA oxygen plants to 60 hospitals across the country. He said it was a project worth R836m, of which R528m had been allocated directly to the IDT for implementation. Investigations by Daily Maverick and amaBhungane revealed that two of the companies awarded tenders lacked the necessary SA Health Products Regulatory Authority (SAHPRA) registration, raising red flags over basic compliance. The Sunday Times reported that later in November, a ghost company with fraudulent documentation had been awarded a R428m share of the PSA oxygen plant tender. Macpherson took his concerns to President Cyril Ramaphosa and called for the immediate suspension of the tender. This led to the department of health withdrawing the contract from the IDT, and announcing its intention to investigate how the tenders were awarded. In January, Macpherson appointed an independent advisory firm to conduct a full, independent forensic investigation into the tender. Reporting back on Tuesday, Macpherson said the report by investigators confirmed that multiple companies awarded work under the PSA project did not have valid SAHPRA licences. 'One company, Bulkeng (Pty) Ltd, submitted a SAHPRA licence belonging to Atlas Copco Industrial SA — without the knowledge or consent of Atlas Copco. This was a clear misrepresentation. It was fraud. Moreover, Bulkeng intended to subcontract more than 25% of its responsibilities to Brutes Air Solutions, but failed to disclose this, in violation of the preferential procurement regulations,' Macpherson said. The investigators also found that the bid evaluation process was deeply flawed. 'The SAHPRA compliance requirement — originally stipulated in the project execution plan and the department of health's memorandum of agreement — was deliberately removed from the final request for proposals. This opened the door for ineligible bidders to participate and win huge contracts. 'Meeting minutes were missing or incomplete, which is shocking but not surprising. Committee appointments were not properly constituted. Bid scores were not properly documented. Price negotiations were not transparent,' he said. Giving an example, Macpherson said the original department of health budget was R216m — but when the IDT issued the request for quotation, prices had ballooned to more than R590m without a single documented approval or value-for-money assessment. Macpherson said Bulkeng's CIDB grading limited it to contracts of no more than R200m yet the IDT awarded it contracts worth R428m, more than double its allowable threshold. He said Malaka, as the CEO of the IDT, failed to exercise oversight as the report confirmed she relied entirely on internal supply chain management staff to assure her that the process had followed proper procurement protocol. She failed to verify any of the documentation. 'She did not act on the red flags raised by the department of health. She did not convene the necessary risk committees to assess the matter. In this, she was not alone,' Macpherson said. The report also singled out Sisi for his role in misleading internal stakeholders and failing to act per his responsibilities. The forensic report recommended that disciplinary action should be taken against Malaka and Sisi. The investigation also recommends disciplinary referrals against several other IDT executives and supply chain management officials. Macpherson said he has written to the Hawks, briefed the minister of health and met the newly appointed IDT board to initiate consequence management.
IOL News
6 days ago
- Business
- IOL News
Karooooo's Cartrack subscription revenue surges as interim dividend rises
Karooooo CEO Zak Calisto Image: Simphiwe Mbokazi/ANA Karooooo reported another set of strong results for the first quarter to May 31 with the number of Cartrack subscribers increasing by 17% while the interim dividend was up by more than 15%. On the JSE Wednesday morning, Karooooo's share price shot up by 5.73% to R920, following the announcement of the results. The share price is up by over 57% over 12 months. The interim dividend of $1.25 per ordinary share was declared versus $1.08 at the same time last year, which was paid due to the strong cash position and good earnings growth, CEO Zak Calisto said in an interview. 'We are pleased to report a strong start to the 2026 financial year highlighted by accelerating Cartrack subscription revenue growth across all regions,' he said. In June, Calisto sold 8% of his shares, but he remains in control with a 58% shareholding and has no intention to change control, he said. 'Every investor presentation I attend, they ask me about liquidity of the shares,' he said. 'We are realizing the benefits of our extensive footprint, and we believe that we remain well positioned to build our customer base,' he added. He said they remained optimistic about further healthy organic growth in all geographies. Southeast Asia presented the largest growth opportunity over the medium-to-long term and was their fastest growing region. Cartrack subscription revenue growth in Southeast Asia accelerated to 30% in the first quarter. Their second fastest growing region was Europe and third fastest South Africa. In South Africa, 'things have picked up, there is good momentum,' and the new head office in Johannesburg was enabling the group to attract good staff. Calisto added the consumer environment had improved and he was optimistic about economic prospects in the country. Karooooo's operating expenses increased 16% to R523m. Cartrack accounted for R497m (Q1 2025: R428m) in operating expenses, including investments in infrastructure and headcount to support territorial expansion and distribution growth. Karooooo Logistics accounted for R26m (R22m) of total operating expenses as investment to scale Karooooo Logistics continued. 'In the 2026 financial year, we aim to accelerate Cartrack subscription revenue growth by further expanding our distribution footprint in existing markets, driving broader platform adoption, and capitalizing on growing demand for video solutions,' said Calisto. Net Cartrack subscriber additions increased 11% to 84 013. Karooooo's subscription revenue increased 18.4% to R1.14bn. Cartrack's subscription revenue increased 18.5% to R1.14bn. Cartrack's SaaS (software-as-a- service) annualized recurring revenue (ARR) increased 18.3% to R4.57bn. Karooooo Logistics's B2B delivery-as-a-service (DaaS) revenue increased 19.8% to R121m. Karooooo's operating profit increased 17% to R352m. Cartrack's operating profit increased 19% to R342m. Karooooo's adjusted earnings per share increased 19% to R8.55. Calisto said that their proven track record of disciplined execution, sustained growth at scale, and highly profitable business model is supported by a solid balance sheet and a healthy cash position. 'We believe our investments in AI, platform innovation and customer experience will drive durable growth and robust results,' he said. Their guidance for the 2026 financial year of earning per share between R32.50 and R35.50, and on other financial metrics, remained unchanged. Karooooo reported cash and its equivalents at R1.1bn at May 31, 2025, up from R838m at February 28, 2025. There were also overdraft facilities of R300m available. BUSINESS REPORT
