Workforce Holdings to consolidate after acquisitions
WORKFORCE Holdings aims to complete restructuring over the next few months as it consolidates in the wake of recent acquisitions made in line with its efforts to diversify due to the stagnant local economy.
The workforce solutions group explained its new structure as it released its results for the year to June, which showed annual profit increasing by roughly 11% to R46 million.
It said the structure would consist of the appointment of an executive committee, exco, reporting to the chief executive and the board.
“To reflect the changed nature of the group resulting from the diversification policies we have adopted over the past four years, we are forming clusters to manage the different business segments as well as their support,” the group said.
“The staff outsourcing cluster experienced a difficult six months as result of legislative, political and economic factors and produced results that were disappointing.
“Our training cluster showed a significant contribution to the group profits, as a result of both acquisitions and organic growth with good margins.”
Workforce concluded the new acquisition of the Dyna Training Group in June.
“We will continue to look at other opportunities which have been offered to us.” The Prisma and KBC acquisitions had been bedded down, it said.
Workforce was concerned about the government’s failure to follow up on some of its own initiatives or sustain them, which had had a ripple effect on its industry.
“The economy remained very strained in the post-Zuma era with low-economic growth, lack of foreign and local capital investments (and) the continued failure by the government to proceed with investment in terms of the national development plan. These factors, accompanied by extremely low levels of business confidence, impacted our business results.”
However, the group got a leg up from the government’s employment tax incentive (ETI) and tax breaks in terms of Section 12H of the Income Tax Act, which allows an employer to claim a “learnership allowance”.
This enabled Workforce to receive a tax credit of R3m in the review period.