COMPANY NEWS IN BRIEF
Standard Bank boosted by high ratesStandard Bank, Africa’s largest lender by assets, is enjoying strong revenue growth thanks to higher interest rates and solid profit increases from its businesses on the continent.
Its African businesses outside of South Africa contributed 44% of its headline earnings for the 10 months to end-October, and are performing very well, with strong earnings growth, the bank said on Monday in a trading update.
Standard Bank's banking revenue grew by more than 20% over the period. Banks traditionally profit from rate hikes as their massive cash balances earn higher interest. Also, higher interest rates mean they earn greater profit margins on loans.
But aggressive rate hikes have caused strain among its clients, with credit impairment charges (provisions for bad debts) remaining "elevated", said the group. It has also been forced to make bad debt provisions for "specific corporates" in SA. Still, the growth in credit impairment charges has slowed in recent months.
Lending has declined due to the financial stress on clients, along with "competitive pricing pressure" in the local mortgage market. However, new corporate loans for "energy-related opportunities" remained strong.
Standard Bank's non-interest revenue growth was in the low-to-mid teens thanks in part to higher transaction volumes and annual price increases.-Fin24
SABC appoints new group CEO
Public broadcaster SABC has appointed a new CEO, Nomsa Chabeli. Chabeli was formerly general manager of brand and marketing at telecoms giant MTN for four years and marketing director of Massmart-controlled Masscash for a year.
She also served as marketing director of Supersport and DStv, and was chief marketing officer at national marketing agency Brand South Africa for a year. She holds an MBA from Henley Business School.
"The board has confidence in Ms Chabeli's ability to drive revenue generation, strategic growth, innovation and uphold the values that have defined SABC’s legacy. This appointment reflects SABC’s commitment to maintaining excellence in broadcasting and meeting the evolving needs of its diverse audience," the public broadcaster said in a statement.
But a source with knowledge of her time at MTN who spoke to News24 on condition of anonymity claimed "she was a poor people’s manager with little experience of running a business".
Chabeli steps into the top job at the SABC as the embattled broadcaster attempts to recover from years of mismanagement and ongoing financial woes.
The SABC recorded a financial loss of over R1 billion for the past financial year and has been beset by leadership instability. In addition to a high turnover in the top job, it has also lost senior staff.-Fin24
Kellanova expanding its solar power capacity
Kellanova – the cereal giant formerly known as Kellogg Company – says it is investing significantly in expanding its solar and back-up generation capacity as it attempts to soften the blow from load shedding.
No other major investments are on the cards in South Africa at present.
The owner of brands such as Kellogg's Cornflakes, All Bran Flakes and Pringles didn't rule out expansion in the future – if the country's energy issues were to improve. But for now, the company, which has had a presence in South Africa for more than 100 years, has to ensure it can manufacture food safely, even during power outages.
This applies to both food safety standards and the safety of the employees working on the production line.
Zandile Mposelwa, Corporate Affairs Director at Kellanova, said she could not disclose how much was invested in solar panels and other back-up generation power solutions. But about 10% of its energy requirements are being met by solar panels, and the company aims to double this by the end of next year. It also makes extensive use of diesel generators.
Mposelwa was speaking weeks after Kellogg formally underwent a name change after deciding to split into two separate companies. One of these is its North American cereal business WK Kellogg Co, and the other is Kellanova, which will house its cereal and snack businesses in markets such as Latin America, the rest of Africa, SA and the Middle East. Kellanova will still be headquartered in Battle Creek, Michigan, while all its products will keep the Kellogg's brand.-Fin24