IOL / COMPANIES / 12 DECEMBER 2018 - 06:30 / SANDILE MCHUNU
DURBAN – Africa’s largest technology service provider, EOH Holdings, is confident that it has overcome the problems of the past year and is setting its sights on growth plans after it delivered a refined strategy that will take the group into the next financial year.
The group said the new structure also presented opportunities for better cross-silo-selling as well as significantly enhanced and improved collaboration, business unit empowerment and accountability to enable a fully customer-centric approach that focuses on holistic solutions over products.
Chief executive Stephen van Coller said yesterday that the key objectives in the next year would be restoring value through enhanced internal processes and policies while ensuring adequate funding to deliver the growth plan.
“Following a strategic review during my first 100 days in office and assessment of our business, we have refined and expanded the reporting and management of business into four distinct operating units. This will allow us to better support these businesses as they need a different focus, capital structure and management,” Van Coller said. The four businesses are EOH ICT, Nextec, Software and international business.
Van Coller said the software had uncovered many significant opportunities to unlock value, while the international business still required focused attention and was at an early stage of being implemented with an enhanced ability to ensure a better global delivery model.
EOH also benefited recently from a strategic partnership worth R1 billion with the Lebashe Investment Group by increasing its black economic empowerment (BEE) to 29 percent, with Lebashe now holding 62.76 million shares in EOH.
The transaction has allowed EOH to retain its status as a Level 1-rated BEE company.
“We are pleased that our partnership with Lebashe continues to advance successfully. Not only has our BEE shareholding increased, but the additional R250 million cash injection allows us to direct additional funds to improve our balance sheet, while enhancing the long-term strategic partnership between EOH and Le-bashe,” Van Coller said.
EOH has received a capital injection of R750m so far from Lebashe and is expecting to receive the outstanding R250m during the first half of 2019.
He said other benefits of having Lebashe on board were the expertise and experience it would gain from the Lebashe board members on the EOH board. “If you look at someone like Jabu Moleketi, his experience working for the government will help us to understand government business,” he said.
Going forward, the group said it had experienced difficult trading conditions in the first three months of the financial year, which had been exacerbated by the constrained South African economy as well as the government’s public sector austerity measures.
Despite these challenges, the group had enhanced its focus and remained a key partner to its diversified client base, it said.
It added that, excluding its long-outstanding public sector debt, group working capital management had improved.
Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER