The darkest hour …

It must be disconcerting, as an executive, to be brought in to sort out what you know to be a tricky turnaround situation, only to discover on arrival that matters are a great deal more challenging than previously advertised.

This appears to have been Edwin Hewitt’s experience since being appointed CEO of Distribution & Warehousing Network (Dawn) on

April Fool’s Day last year — a date some feng shui believers might have suggested avoiding — but he has been remarkably frank in admitting to the scale of the challenges and in detailing what he and his team have been doing to address them.

Having indicated that 2018 would be the first year in a three-year turnaround period, Dawn has had to delay its plans in order to undergo an intensive examination of the issues it faces and to strengthen its management team, all against the backdrop of a macro operating environment that continues to deteriorate.

The likely timing of a return to profitability has taken a backward step, with trading conditions across the board worsening from an already low base.

Going concern remains a significant worry, despite the company raising R358m in a rights issue in 2017, but it has managed to reduce net debt to equity from 93% at the start of the year to a much healthier 8% at its year-end. The challenge for the year ahead will be to accelerate the delivery of the turnaround plan and start putting in place a strategy for a successful future, while grappling with market conditions that are expected to remain brutal.