Craig Venter, CEO of JSE-listed Altech, has taken a decision to forego his bonus for the financial year that closed at the end of February, and will not receive a salary hike this year either.
Altech recently reported its annual results and said revenue from continuing operations was higher, at R10.2 billion, from R9.6 billion last year.
While it made a R357 million profit from continuing operations, it reported a R1.6 billion loss from discontinued operations and a loss of R1.28 billion overall. Altech said although its revenue increased, operating profit was lower than that of the previous year, mainly due to losses incurred in Altech's operations in East and West Africa.
At the end of September, Altech agreed to sell its 75% stake in West Africa, because the entity required additional investment and it was costly to run from SA. Subsequently, in January, Altech swapped its troubled East African stake for equity in Liquid Telecommunications, a telecommunications company focusing on developing markets.
Selling these units will see the termination of operating losses of R165 million in East Africa and R39 million in West Africa, totalling R204 million. Although its East Africa operations were housed within a separate legal entity that had autonomy in terms of how the business was managed, Venter says he is still accountable. "The buck stops with me."
Welcome move
Altech welcomed the decision by Venter to forego his bonus for the 2012/13 financial year. "The board appreciates Venter's decision as it clearly demonstrates that he continues to place the interests of all stakeholders above short-term considerations," says chairman Moss Leoka.
In 2012, the latest available annual report, Venter's basic salary was R5.2 million. Venter also received a pay freeze in the past 12 months of the previous financial year and the current year.
"The board is pleased to see that the CEO has demonstrated faith in the future of the business, aligning his interests with the long-term interests of stakeholders by taking a short-term financial set-back," says Leoka.
Altech's realignment and disposal of its African interests comes at a time when new strategic partnerships are also being forged to put the company on a growth path. Altech is seeking to cut costs through back office synergies and will spend the next 12 months focused on commercialising new offerings in the pipeline.
"On behalf of the Altech board, I would like to reiterate the board's confidence in Venter. We are certain that we will see benefits from the strategic realignment of the business to maximise shareholder value, which was spearheaded by Venter," says Leoka.
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