Johannesburg - The board of Denel Saab Aerostructures has moved swiftly to dispel media rumours regarding "concern over the stability" of the aerostructure manufacturing company as a
result of the recent resignations of DSA's chief executive officer, Lana Kinley, and chief financial officer, Sasa Methola.
The DSA Board has confirmed that both Kinley and Methola resigned last week. The Board has reiterated however, that they will both remain in office until further notice.
"The DSA Board will discuss the resignations and issue of succession so as to ensure continuity at the company at its meeting on Friday, 22 January 2010. Further information will be made available after this meeting," says Talib Sadik, Denel Group CEO.
Denel has confirmed that operations have not been affected by the resignations and that it remains "business as usual" at DSA.
DSA has additionally confirmed that plans to effect the company's turnaround continue to be implemented, with the consultation process regarding contemplated retrenchments having begun. The company has however denied that the retrenchments are partially as a result of the failure of the South African Government to place expected orders.
"DSA is an export business," explains Sadik. "As such, export order cover determines the sustainability and ultimate profitability of the business. While the delay of the main A400M programme and a decrease in DSA's empennage work on the Gulfstream G150 Business Jet have had a negative effect on DSA's revenue stream, the business has experienced a number of other challenges, including weaker global demand as a result of the global economic crisis. This has resulted in DSA needing to be resized accordingly."
DSA embarked on an aggressive turnaround strategy in March 2009 to streamline the company's processes and maximise efficiency. This has already resulted in significant operational improvements and correspondingly bolstered the company's competitiveness. Implementation of the strategy is ongoing, and expected to yield further positive results.
Denel has furthermore described earlier media statements linked to the DSA retrenchments regarding the government's financial support of the parastatal as "regrettable" - as the incorrect figures were subsequently stated in the press.
"The Denel Group has received R3.5bn in financial aid through
recapitalisation and R1.85bn in government guarantees over the past four years, and not R8.82bn as reported in the media," says Sadik.
- I-Net Bridge