Denel is confident that its current turnaround plan will ensure the long-term sustainability of its business.
The Group Chief Executive Officer, Danie du Toit, says the company is pursuing business to strengthen market access and enable the development of new technology. Systems and processes are in place to strengthen governance, improve programme management, drive efficiencies and grow revenues.
Mr Du Toit confirmed the announcement made by the Minister of Public Enterprises, Pravin Gordhan that full salaries will be paid to Denel employees in June. This follows an earlier statement that the company is only able to pay 85% of salaries this month due to liquidity constraints.
Denel has successfully secured the remaining balance of 15% and it will be paid to employees by Friday, 28 June.
The Shareholder, the Board and management are continuously working to find sustainable solutions to the liquidity crisis facing Denel. However, it is still facing challenges. Government is aware of the fact that Denel is highly leveraged and in need of recapitalisation to rebuild the business.
Du Toit apologised to Denel employees for the inconvenience caused for not honouring the full salary obligation for June. He also thanked them for their understanding and constant support during a difficult period. Management will always strive to meet the company’s obligations in line with employment contracts.
“I am confident that working together towards the long-term resolution of the current challenges we will ensure the long-term sustainability of our business,” he said.