Hannes Brits - MBA/MBL Business Turnaround Consultant and Influencer’s Post

ArcelorMittal South Africa (AMSA) warns that government intervention is urgently needed to prevent potentially thousands of job losses in South Africa. In November 2023, AMSA said that winding down its Longs Business was necessary amid a challenging steel environment characterised by low demand in all markets and pressure on prices. Steel and Engineering Industries of Southern Africa (SEIFSA) said the closure would result in 3,500 job losses. However, in early July 2024, the group said that its Long Business would continue to operate – on condition that urgent interventions took place. https://lnkd.in/dmeVsyAc

[Technically insolvent but TRYING TO MANAGE CASHFLOW TO PROTECT SALARIES] [Kudos to the team for getting an unqualified Financial report] [However, the CFO, Yolande van Biljon said in a radio interview on SABC Radio (RSG) earlier this week that there is another dimension to the technical insolvency and that is cashflow. When the radio personality asked whether staff will receive salaries at the end of the month she said that there is still time to make sure that there is enough cash. There are several projects that have been allocated cash and there are times when the timing thereof moves out. This enables management to "borrow" some cash from the ringfenced projects to tide them over but they have to pay it back when there is an inflow of cash in the next month. She also mentioned that people only think about the 3 TV Channels but the SABC also operates 19 Radio channels. This is part of the government mandate placed on the SABC to deliver sport and news in all 11 languages. The cost thereof is roughly R800m. In the light of the SABC's struggle to change its funding model my personal view is that if this is a Strategic Manadate that is forced on the SABC government should be willing to fund the full amount of R800m. The remaining business should pay for itself using advertising, etc and the SABC may therefore have to close the product lines that are running at a loss, to bring the SABC back to profitability. However, the loss-making departments/divisions may also have a strategic component that must be cross-subsidized once the cost is reduced to the bare minimum. The reality is that there is some form of government subsidy in other parts of the world and the government needs to consider this. The basic problem, however, is that the government is also in deep financial trouble and there is no money for any increases in budgets despite the merits thereof.]

One of most concerning observations drawn from the Index is that child hunger remains a major issue.” The index found that one in four of the poorest households reported that children in their homes went hungry in 2023. The Index evaluates four dimensions of food security, namely availability, access, utilisation and overall stability, from 2012 to 2023. The index, developed by economists from the University of Stellenbosch, the group looked at a more specific definition: A country can be said to have food security when there is enough food in a country, its population has economic and physical access to food (it can purchase food and access it physically at convenient locations), there is sufficient diversity in the diet of its population, and there are not periodic dips or deterioration in these dimensions, and they are stable over time. https://lnkd.in/daKECNtV

[Market Share Statistics]

Airbus is cutting jobs as it struggles to take advantage of rival Boeing's woes. [Both the dominant players have problems] The French planemaker is culling 2,500 jobs in its Defence and Space division [Maybe this sector is not very profitable but it is probably because of technology risk that always leads to huge increases in cost due to delays]. In particular, Airbus has faced its own engine troubles and supply chain difficulties. Last week, Airbus said that it delivered just 50 commercial airliners in September — a sharp slowdown from earlier this summer. That made September the second month in a row and the fourth month this year where Airbus deliveries fell compared to 2023. “In recent years, the defence and space sector and, thus, our Division have been impacted by a fast changing and very challenging business context with disrupted supply chains, rapid changes in warfare and increasing cost pressure due to budgetary constraints,” said Airbus Defence and Space chief Mike Schoellhorn in a statement.

Boeing’s strategy of cost-cutting in face of major strike and talent shortage confuses experts