DI­ALLING UP A WIND­FALL

Pay­ing R219m to just three ex­ec­u­tives of Cell C, af­ter the cel­lu­lar op­er­a­tor nar­rowly avoided hit­ting the wall, seems a lit­tle rich

Financial Mail - - EDITOR’S NOTE - @ro­brose_za roser@fm.co.za

There are some dis­tinctly un­happy staff at Cell C’s swish head­quar­ters in Midrand who are fum­ing over dis­turbingly lav­ish pay­ments made to CEO Jose dos San­tos and his com­rades in the ex­ec­u­tive suite.

A se­ries of let­ters have been fly­ing around in re­cent weeks between “rep­re­sen­ta­tives of 391 Cell C em­ploy­ees” and the board of the coun­try’s third-largest mo­bile phone op­er­a­tor, which claims to now have 16.3-mil­lion sub­scribers

What sparked the ex­change was Cell C’s fi­nan­cials for the year to De­cem­ber 2017, which, in­ter­est­ingly for a com­pany that claims it wants to list within two years, are not on its web­site. Those ac­counts show how pay­ments to ex­ec­u­tives vaulted more than four­fold last year — from R50.9m to R219.2m — at a time when staff say the busi­ness is slash­ing ex­penses in ev­ery other cor­ner.

It means that of the R1.49bn spent on all 2,272 em­ploy­ees last year, nearly 15% went to just three peo­ple — Dos San­tos; chief strat­egy of­fi­cer Robert Pasley; and Ty­rone Soon­dar­jee, who re­signed as Cell C’s FD in May.

Now, it’s cer­tainly clear that, fi­nan­cially, good things hap­pened for Cell C last year. For the year to De­cem­ber, a “re­cap­i­tal­i­sa­tion” by Blue La­bel Tele­coms (which ended up as a 45% share­holder) and Net1 UEPS (which ended up with 15%) in­jected R7.5bn into the com­pany, which al­lowed it to re­duce its net debt from an im­pos­si­ble R18.9bn to a merely steep R5.9bn.

Its rev­enue grew 7% last year to R15.7bn and it made a R267m net loss, if you strip out the one-off

What has irked staff too is that Cell C’s fi­nan­cials show it set aside R357m as a ‘suc­cess fee’ to cer­tain ex­ec­u­tives

123Rf/di­nozzz

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