AxizWorkgroup CEO Pierre Spies will become Pinnacle Group's deputy CEO from July so that he can take over running the company when CEO Arnold Fourie retires.
Fourie, who founded Pinnacle in 1993, was 52 when the company published its 2014 annual report. He has not put a firm date on the handover, notes Pinnacle. It adds Fourie is "determined to see Pinnacle through to a renewed position of strength" before retiring.
Pinnacle took a hammering last year when it announced executive Takalani Tshivhase had been arrested on charges of bribery. The news sent its share spiralling down to about half its value, and prompted Financial Services Board and JSE probes because shareholders were only told 20 days after the fact.
Both investigations were later dropped, and charges against Tshivhase withdrawn. Yet, the company continued to take flak from shareholders in 2014 as, in October, shareholders voted against its remuneration policy, and chairperson Daphne Mashile-Nkosi stepped down. It appointed Ashley ('Oshy') Tugendhaft as acting chairman, a position that has now been made permanent.
Pinnacle has also stream-lined its board, with the result that Tshivhase and Robert Nkuna have stepped down, but continue to serve on the executive committee.
New energy
Pinnacle says, after the withdrawal of the bribery allegations, "management has returned its focus onto the business and all the opportunities that exist in each cluster". It notes it has made key changes to management and new appointments to enhance leadership capabilities. "We are confident this new energy will deliver the expected results into the future."
The listed company this morning published its results for the six months to December, and noted revenue gained from R3.2 billion to R3.6 billion, although its cost of sales leapt to R3.1 billion from R2.65 billion. Its operating profit came in lower at R188.5 million, compared with R246.3 million a year ago, and its net profit dropped from R150.8 million to R125 million.
Pinnacle says it will soon start recruiting a new CEO for AxizWorkgroup, noting Spies has "made considerable contributions to both AxizWorkgroup and the wider Pinnacle group". Spies joined Pinnacle from Tarsus, where he was CEO until May 2013, when he left after 21 years.
Fourie says Spies is the "right candidate to drive Pinnacle forward, unlock the full potential of the group and deliver value to all stakeholders".
Pinnacle notes it will focus on trimming debt and will sell off its property portfolio, including land in Samrand that was earmarked for its future premises, largely through sale and lease back arrangements. It will also wind down its investment in the managed print services business, and the suspension of annual dividend payments will remain in place until its debt position improves.
The listed company has also approved a strategy that sees distribution remaining one of its core competencies. It will focus on improving the margins through product mix and improved procurement, reduction of overheads and driving growth through its ongoing expansion into Africa.
Services is also set to be a core competency and it will explore synergies between its units. Pinnacle expects earnings in the full year to be an improvement on 2014.
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