TMG’S SUCCESSFUL COSTCUTTING EXERCISE
It is always amazing to see what a totally new management team can do with an established business, and Times Media Group is just such a case. Since Blackstar did the deal that saw Andrew Bonamour take over as CEO, the changes have been swift, with attention initially focused on reducing the cost base, which previous management was either happy with or felt was not possible to reduce. Latest results show a R20m saving in staffing at senior and head-office level and the intention to sell the non-core divisions. Most impressively, the R1.15bn debt raised in September last year has already been reduced by 22% to below R900m.
Times Media Group ers still have a strong case as yields locally are around 8%, with US yields around 2%. The equity buyers have been coming here because they could get great returns, but if we see continued upside in US markets, those investors can now get return without having to make the trip to SA. Hence less inflows and a rand that’s unlikely to return to the sub 7 to the dollar levels?