Telkom CEO’s pay hits R14.5 million

Telkom Group CEO Sipho Maseko has been handsomely rewarded for completing a successful turnaround of the company’s fortunes over the past three years.

An integrated report on Telkom’s website showed that Maseko earned R14.51 million in the financial year ended 2016, up more than R2 million from 2015, when he picked up R12.3 million.

The chief executive earned a guaranteed package of R7.44 million, and an additional short term incentive pay of R6.13 million.

Group CFO, Deon Fredericks, earned R9.5 million, up from R8.67 million in 2015. His guaranteed package amounted to R5.25 million.

Telkom Group chief operating officer, Dr Brian Armstrong, earned R8.82 million, including a R3.34 million incentive bonus, while chief technology officer, Alphonzo Samuels, garnered R8.13 million, including a R3.5 million bonus.

Collectively, 11 prescribed officer’s remuneration amounted to R27 million, and included R17.6 million in bonuses adding up to a total of R48 million – from R44.1 million in 2015.

Read: How much money the “average Joe” CEO earns in South Africa

Maseko was appointed as company lead on 1 April 2013, and embarked on a three-year turnaround strategy which the company said it completed successfully upon delivering its annual results for 2016, in June.

The company has however been ruthless in pursuit of attaining its turnaround goals, cutting its workforce by more than a third since 2013 – 7,000 jobs.

During the past year, Telkom said that 3,878 employees accepted voluntary severance packages (VSPs) and voluntary early retirement packages (VERPs) and a further 437 employees were affected by outsourcing.

As a result, employee expenses reduced by 10%, the company said.

Speaking at a presentation of the group’s results in Midrand, Maseko pointed out that since 2013, the company has seen its headcount decline from 21,210, to 19,200 in 2014, to 18,330 in 2015, and to 13,770 in 2016.

Maseko said that the actual number has reduced even further to approximately 12,500 currently. As a result, employee expenses have declined from R9.28 billion in 2013, to R7.91 billion in 2016.

The company reported a 15.5% increase in headline earnings for the year ended March 2016, while operating revenue climbed 13.9% to R37.3 billion.

Normalised profit after tax reached R4 billion, compared to R3 billion for the previous period, while group net revenue was up 4% to R28 billion.

The board declared a dividend of 270 cents, up 10% on the previous year’s total dividend – its first since 2011.

Shares in Telkom hovered around the R15 mark when Maseko took the reins of the company. On Monday, 25 July, 2016, shares in the group traded at R66.50.

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Telkom CEO’s pay hits R14.5 million