JSE-listed Allied Electronics Corporation Limited (Altron) has announced it will restructure its business, following a R60-million loss.<\/p>\n
The group announced its annual results for the year ended 28 February 2015, reporting a\u00a0revenue decreased of 1% to R27.6 billion and ebitda decreasing by 23% to R1.4 billion.<\/p>\n
Headline earnings per share (HEPS) declined by 50% to 94 cents, while the group reported a\u00a0total\u00a0operating loss of R60 million – from an operating profit of R775 million the year prior.<\/p>\n
This includes an operating loss from continued operations of R26 million, and a\u00a0loss from discontinued operations of\u00a0R34 million, Altron reported.<\/p>\n
According to the group, the business was adversely affected in terms of profitability across most of its major divisions.<\/p>\n
Altron CEO Robbie\u00a0Venter admitted that tough decisions need to be made to improve Altron\u2019s performance.<\/p>\n
\u201cWe need to focus and streamline our group which will mean selling off some non-core assets and adapting our offering to our customers. We are certain that these steps, which will be taken in the near future, will benefit our stakeholders,\u201d he said.<\/p>\n
The group said it has been decided that the company will commence transitioning from a family-managed business to an independent management structure.<\/p>\n
“The board will make further announcements in this regard in due course,” it said.<\/p>\n
Altron TMT, which comprises Altech and Bytes and other groups, also struggled, the group said.<\/p>\n
Notably, Altron announced on 12 May that it was in advanced stages of selling off the GSM subscriber base of Altech Autopage – as the business had been adversely affected by ongoing mobile termination rate reductions.<\/p>\n
The non-GSM part of the business will be retained and housed within other operations.<\/p>\n
However, the decision was taken to dispose of the majority of the Altech Autopage operation during the year and, as a result, this business has been classified as a discontinued operation.<\/p>\n
“Management has committed to a plan to sell this operation in the 2016 financial year, following a strategic decision to focus the group in certain areas where the board believes the group has the resources, competence, and skills to leverage a competitive advantage,” it said.<\/p>\n
Other businesses within the telecommunications division of Altron TMT, such as Altech Netstar, performed better.<\/p>\n
Netstar has developed new telematics and fleet products; Bytes Systems Integration expanded its biometrics offering; and Altech Radio Holding performed well off the back of the Gauteng Broadband Network contract.<\/p>\n
The group’s new VOD product, Altech Node, saw sales that fell below expectation.<\/p>\n
\u201cAlthough we acknowledge it is a start-up business which still has the potential gain traction, initial sales of the Altech Node to the retail market were below expectation.”<\/p>\n
“Altron TMT is well advanced in exploring alternative opportunities and routes to market for this product,\u201d said Venter.<\/p>\n
Altron close to disposal of Altech Autopage GSM customer base<\/a><\/strong><\/p>\n Altron targets ISP services through Autopage<\/a><\/strong><\/p>\n