Latest news with #Section189
IOL News
18 hours ago
- 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
13-06-2025
- Business
- The Citizen
Trade policies past and present haunt South African industry
South Africa's past export subsidies hurt neighbours; today, global trade and weak infrastructure return the blow to local businesses. You have to hand it to Donald Trump: his 'Liberation Day' rampage on imposing tariffs on friend and foe alike focused the attention on international trade and its positives and negatives. If your country has a high-cost or low-productivity labour system – or both – you're always going to be vulnerable to those other nations that can produce the same goods cheaper. That's where tariffs come in: to protect a country – preserving businesses and jobs. If a company cannot compete with imported goods, then import duties and taxes will raise the prices of its competitors to the point where the playing field will be artificially levelled. On the other hand, governments can boost their exporters by putting in place subsidies, whether hidden or open. It is widely thought, in the West for example, that Chinese car exporters, particularly, are able to export their vehicles at comparatively low prices because of government support for businesses domestically. That's the main reason other Chinese products are gradually putting well-known names out of business – the latest being the planned closure of the Goodyear tyre factory in the Nelson Mandela Bay metro in the Eastern Cape. More than 900 workers have been hit with Section 189 retrenchment notices. Chinese competition is a major threat to local businesses, especially those in manufacturing… but it is hardly the only reason many industrialists are throwing in the towel. ALSO READ: Trump tariffs created unprecedented uncertainty — trade expert Nelson Mandela Bay, like many other towns and cities in South Africa, suffers from an ongoing collapse of services and infrastructure. In addition, the backlogs at ports in this country mean exporting is not a quick or simple process. Ironically, back in the '90s, long before the mainland Chinese exporters got a toehold in Africa, companies in this country help destroy industries in our neighbouring countries, thanks to subsidies introduced by Pretoria. Under the General Export Incentive Scheme (GEIS) of the early '90s, SA exporters were able to take full advantage of the end of trade restrictions which followed the release of Nelson Mandela. Subsidised South African exports of tyres, for example, forced the collapse and closure of the Dunlop tyre operation in Bulawayo, Zimbabwe. Battery exports did the same thing to factories in that city. Zimbabwe's David Whitehead Textiles, one of the biggest clothing makers in sub-Saharan Africa, was similarly affected. In many cases, Zimbabwean companies were hit by a double South African whammy: subsidised competitors entering their home markets and tariffs on their exports to South Africa. ALSO READ: 'We want to see Nigerian products on shelves of SA shops' – Ramaphosa [VIDEO] Again, ironically, Chinese imports later forced many of our clothing manufacturers to close. And now, a tyre factory has closed, too. I wonder what the jobless people in Bulawayo would say… Again, the irony is that many South Africans believe Robert Mugabe single-handedly destroyed Zimbabwe's economy and accelerated the flight of economic migrants to a better life south of the Limpopo. But, he had a little help… The GEIS-fuelled assault on our African neighbours was only the start: businesses, from Checkers to MTN set up shop across Africa, often squeezing out local competition because of their sophistication and financial backing. SA business did more damage to the countries of the former 'Front-line States' in five years than the apartheid defence force did in a decade. Trade can be a powerful weapon.
Indian Express
11-06-2025
- Politics
- Indian Express
Supreme Court refuses to reduce sentence of advocate who abused woman magistrate in 2015
The Supreme Court Tuesday decided not to interfere with a Delhi High Court order which refused to reduce the sentence awarded to an advocate for outraging the modesty of a woman judicial officer in 2015, and granted him two weeks to surrender. A bench of Justices Prashant Kumar Mishra and Manmohan recorded that it is 'not inclined to interfere with the orders' passed by the Delhi High Court against advocate Sanjay Rathore and dismissed his plea. In October 2015, the complainant judicial officer was serving as a metropolitan magistrate in the Karkardooma court when Rathore, enraged by an adjournment in his matter in his absence, verbally abused the officer, including using gendered abusive language. An FIR was subsequently lodged at the Farsh Bazar police station. Rathore was sentenced to 18 months of imprisonment under Indian Penal Code Section 509 (intending to outrage modesty of a woman), three months under Section 189 (injury to public servant), and an additional three months under Section 353 (assault or criminal force against public servant to deter them from their duty). It was directed that the sentences should run consecutively, thereby resulting in a total sentence of two years. The Delhi High Court, while refusing to reduce the sentence, however, modified it so that the sentences could run concurrently instead of consecutively. As a result, Rathore was sentenced to a total of one year and six months in prison. The high court, in its order of May 26, emphasised that acts threatening or intimidating a judge, especially through 'gender-specific abuse, is an assault on justice itself, and must be met with firm accountability'. While refusing Rathore any relief, it further recorded in its order, 'The act of outraging the modesty of a judicial officer while she was presiding over court proceedings, seated on the dais and discharging her solemn duty of dispensing justice, in this court's opinion, attacks the very foundation of judicial decorum and the institutional integrity.'
The Star
09-06-2025
- Automotive
- The Star
Goodyear South Africa's restructuring puts over 900 jobs at risk
Yogashen Pillay | Published 2 hours ago Goodyear South Africa's announcement on Friday to discontinue its manufacturing operations in Uitenhage, Eastern Cape, has sent shockwaves through the region, with over 900 jobs at risk due to a Section 189 notice served to the National Union of Metalworkers of South Africa (Numsa). The decision, communicated by Goodyear's Managing Director Paul Gerrard, has raised alarm among unions, and economic analysts, who fear the closure could devastate the local economy amid high unemployment. Mziyanda Twani, Numsa Eastern Cape Regional Secretary, said on Friday that the union is dismayed by Goodyear South Africa's announcement to discontinue its manufacturing operations in South Africa. 'The union has been served with a Section 189 notice from Paul Gerrard, the Managing Director of Goodyear Tyres in South Africa. The manufacturing plant is located in Uitenhage in the Eastern Cape, and the company envisages that at least 907 employees will be affected by the plant closure,' Twani said. Twani added that as a region, Numsa was deeply worried about the impact on workers and their families in Uitenhage. 'It is becoming a ghost town given that ContiTech, which is part of Continental, closed down and it is also in the same tyre and rubber industry. At the same time, it may not be easy to replace these jobs. The Eastern Cape has a very high unemployment rate at 41.9% according to StatsSA.' Twani said that while the outlook is bleak, as Numsa, "we stand ready to do everything we can to defend the jobs of our members and to negotiate fair severance packages. The dates of the first consultation will be communicated in due course". Chris Harmse, consulting economist of Sequoia Capital Management, said he is concerned about the move. 'One of the issues could well be that the African Growth and Opportunity Act (Agoa) could be ending due to the strain on South African and American relations. This could well have led to Goodyear South Africa wanting to scale down operations at its Uitenhage plant. The Agoa most major part is made up of 60% of the motor industry, with the next largest part being the agriculture industry. We hope that if Agoa does end, other major companies don't look to scale down business,' he said. Goodyear South Africa is the heart of business in Uitenhage. 'Another issue is that the cost of doing business in South Africa is becoming too high, including issues with electricity, water, and failing infrastructure. We could see businesses looking to move their operations to other parts of Africa and to countries like Botswana and showing a preference to use Walvis Bay in Namibia for doing business South Africa already faces steep economic challenges. We are seeing that South Africa's GDP is being revised downwards, and this does raise concern about doing business in South Africa,' he said. Nduduzo Chala, the managing executive at South African Tyre Manufacturers (SATMC), said that he is concerned about Section 189 at Goodyear South Africa. 'However, we must remember that Goodyear South Africa has entered a consultative process, and there will be an opportunity for the government, trade unions, and other stakeholders to voice their concerns. It is not set that they would retrench over 900 workers and end operations at the manufacturing plant in Eastern Cape. We just have to wait and see how the process unfolds.' SATMC is concerned about the possibility of the plant closing. 'It's not a great situation for us as SATMC, workers, and the Eastern Cape community, but we have to see what happens during the consultative process,' Chala said. Dr Eliphas Ndou, an economist and author at Unisa's Department of Economics, said the manufacturing sector's contribution to GDP has become smaller over time. 'The sector faces many challenges, including low-cost imports and a decline in local manufacturing competitiveness. The decline in the latest BER business confidence index shows that most businesses are not satisfied with prevailing business conditions. Hence, the development in the tyre manufacturing sector is a clear message to the government that wants to grow the economy, create, and keep employment to fast-track the implementation of structural reforms that will improve the local manufacturing sector's competitiveness, including tyre producers.' Ndou added that the structural reforms may help to significantly improve the tyre manufacturers' competitiveness by ensuring the availability of reliable power and water supplies, and not an above-inflation increase in administered prices. 'These factors are crucial for the local industry's competitiveness.' BUSINESS REPORT Visit:
IOL News
09-06-2025
- Automotive
- IOL News
Goodyear South Africa's restructuring puts over 900 jobs at risk
Concern has been raised as Goodyear South Africa serves Section 189 notice to workers' unions National Union of Metalworkers of South Africa on restructuring at their manufacturing plant in Uitenhage Eastern Cape, putting over 900 jobs at risk. Image: David Paul Morris Goodyear South Africa's announcement on Friday to discontinue its manufacturing operations in Uitenhage, Eastern Cape, has sent shockwaves through the region, with over 900 jobs at risk due to a Section 189 notice served to the National Union of Metalworkers of South Africa (Numsa). The decision, communicated by Goodyear's Managing Director Paul Gerrard, has raised alarm among unions, and economic analysts, who fear the closure could devastate the local economy amid high unemployment. Mziyanda Twani, Numsa Eastern Cape Regional Secretary, said on Friday that the union is dismayed by Goodyear South Africa's announcement to discontinue its manufacturing operations in South Africa. 'The union has been served with a Section 189 notice from Paul Gerrard, the Managing Director of Goodyear Tyres in South Africa. The manufacturing plant is located in Uitenhage in the Eastern Cape, and the company envisages that at least 907 employees will be affected by the plant closure,' Twani said. Twani added that as a region, Numsa was deeply worried about the impact on workers and their families in Uitenhage. 'It is becoming a ghost town given that ContiTech, which is part of Continental, closed down and it is also in the same tyre and rubber industry. At the same time, it may not be easy to replace these jobs. The Eastern Cape has a very high unemployment rate at 41.9% according to StatsSA.' Twani said that while the outlook is bleak, as Numsa, "we stand ready to do everything we can to defend the jobs of our members and to negotiate fair severance packages. The dates of the first consultation will be communicated in due course". Video Player is loading. 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Advertisement Next Stay Close ✕ Chris Harmse, consulting economist of Sequoia Capital Management, said he is concerned about the move. 'One of the issues could well be that the African Growth and Opportunity Act (Agoa) could be ending due to the strain on South African and American relations. This could well have led to Goodyear South Africa wanting to scale down operations at its Uitenhage plant. The Agoa most major part is made up of 60% of the motor industry, with the next largest part being the agriculture industry. We hope that if Agoa does end, other major companies don't look to scale down business,' he said. Goodyear South Africa is the heart of business in Uitenhage. 'Another issue is that the cost of doing business in South Africa is becoming too high, including issues with electricity, water, and failing infrastructure. We could see businesses looking to move their operations to other parts of Africa and to countries like Botswana and showing a preference to use Walvis Bay in Namibia for doing business South Africa already faces steep economic challenges. We are seeing that South Africa's GDP is being revised downwards, and this does raise concern about doing business in South Africa,' he said. Nduduzo Chala, the managing executive at South African Tyre Manufacturers (SATMC), said that he is concerned about Section 189 at Goodyear South Africa. 'However, we must remember that Goodyear South Africa has entered a consultative process, and there will be an opportunity for the government, trade unions, and other stakeholders to voice their concerns. It is not set that they would retrench over 900 workers and end operations at the manufacturing plant in Eastern Cape. We just have to wait and see how the process unfolds.' SATMC is concerned about the possibility of the plant closing. 'It's not a great situation for us as SATMC, workers, and the Eastern Cape community, but we have to see what happens during the consultative process,' Chala said. Dr Eliphas Ndou, an economist and author at Unisa's Department of Economics, said the manufacturing sector's contribution to GDP has become smaller over time. 'The sector faces many challenges, including low-cost imports and a decline in local manufacturing competitiveness. The decline in the latest BER business confidence index shows that most businesses are not satisfied with prevailing business conditions. Hence, the development in the tyre manufacturing sector is a clear message to the government that wants to grow the economy, create, and keep employment to fast-track the implementation of structural reforms that will improve the local manufacturing sector's competitiveness, including tyre producers.'
