Needs empowerment to attract Eskom business
AFRICA ????? CELLULAR TOWERS (Actowers) is, as my colleague Shaun Harris noted in a recent Portfolio Punt (17 July), one of those small caps that contains its share of risk but could spice up a portfolio due to its exposure to the fast-growing African cellphone market. Actowers hopes to broaden its exposure to power generation and has tendered for various Eskom projects. However, it acknowledges it needs to work on its black economic empowerment credentials.
CEO, chairman and 47,45% shareholder Chris Krüger promises in his latest annual review that Actowers will “continue to review our empowerment credentials as a matter of priority, especially in light of the newly established Electric Transmission Towers division”.
The annual report provides an adequate level of disclosure and leaves the shareholder feeling generally comfortable that the company knows where its challenges lie and that it’s doing something to face them.
Expect to see the appointment of some independent, non-executive directors this year (it currently only has one non-executive, against three executives), as Actowers moves to bring itself in line with the Corporate Laws Amendment Act of 2006. But don’t expect the roles of chairman and CEO to be split: AltX listings rules don’t require that and the company doesn’t deem it necessary.
It always feels out of kilter when directors of small companies earn as much as their large listed counterparts. But that’s not the case at Actowers. Including his bonus, Krüger took home R1,8m, while operations director David van Staden was paid R665 750 and financial director Jacques de Villiers earned R810 719. De Villiers saw his salary jump twoand-a-half fold year-on-year. But that’s hardly surprising; it’s doubtful anyone paying their financial director just R233 050 would be able to keep him very long.
Other fees that went up significantly this year are those of its auditors, Nexia HBLT Chartered Accountants, which increased to R425 360 from R109 030 in 2007. That’s probably because the group now consists of three subsidiaries (one acquired, the others established organically), instead of just one and has expanded geographically into markets such as Madagascar, Congo (Brazzaville) and Uganda.
All four directors receive gold stars for their full attendance at board meetings; which isn’t something you often see.