http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.14Change: -0.15
R/$ = 12.05Change: -0.20
Au 1200.03 $/ozChange: -6.12
Pt 1139.50 $/ozChange: -16.00
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Letters Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
Sep 28, 2010

Gijima negotiating with DHA over cancelled contract, profit up

Back
Gijima CEO Jonas Bogoshi speaks about the company's dispute with the Department of Home Affairs
 
 
 
Engineering|Expertise|Africa|Flow|Mining|PROJECT|Projects|Roads|Systems|Africa|Flow|Services|Solutions|Systems
Engineering|Expertise|Africa|Flow|Mining|PROJECT|Projects|Roads|Systems|Africa|Flow|Services|Solutions|Systems
engineering|expertise|africa-company|flow-company|mining|project|projects|roads|systems-company|africa|flow-industry-term|services|solutions|systems
© Reuse this




JSE-listed Gijima on Tuesday reported a modest rise in full-year profit to R154-million, despite its revenue declining by 2,4% to R2,9-billion, which it attributed to muted market conditions and the impact of a contract dispute with the Department of Home Affairs (DHA).

The company's headline earnings a share increased to 16,44c a share in the year ended June 30, 2010, from 11,39c a share in the previous financial year.

Gijima CEO Jonas Bogoshi told Engineering News Online that the company's results were a testimony of its business model to improve working capital management and operational efficiencies.

The information and communication company also shifted its focus to higher margin services, accompanied by multi-year contracts, while increasing its market share in the public sector to 48% from 44% the previous year.

However, one such R2,45-billion multi-year contract, Who Am I Online (WAIO), that Gijima inked with the DHA at the end of 2007, had gone sour in April this year, when the department declared the contract invalid reportedly owing to failure to perform.

Gijima disputed the DHA's findings, and is currently negotiating with government. "As a company, we need to work hard to find a resolution that will be in the best interest of government and Gijima and both parties are now at a level where that may realise."

Bogoshi said that current negotiations were more focused on the budget allowed by the National Treasury for projects such as the WAIO, rather than issues originally stated by the DHA.

Over the past three years, the department had spent almost a R1-billion on the WAIO project.

Gijima believed that even if the contract were not resumed, it would probably not have a cash flow impact or the effect would be minimal.

However, Frost & Sullivan ICT industry analyst Protea Hirschel said that although the company was pursuing all options to resolve the issue, the cancellation of such a large contract could cast a "cloud of uncertainty" around the company's ability to deliver on complex projects.

Nevertheless, Gijima had secured a number of new public sector clients in recent months, including the Department of Rural Development and Land Reform, as well as a multi-year project for the South African National Roads Agency Limited to bring tolling to Gauteng's freeways. Bogoshi also pointed out that none of the company's private sector contracts have been cancelled to date.

Meanwhile, Gijima CFO Carlos Ferreira said that the company anticipated that public sector spending would remain constrained in 2011, while private sector spending might show slow improvement.

He predicted an overall growth of between 0% and 4% in the ICT industry for the next financial year.

However, Bogoshi noted that Gijima had plans to increase its market share in Africa, and other parts of the world during its 2011 financial year.

"Our newly developed mining software had proved popular on the African continent and we intend to use this as a base to further expand our services and offerings into the continent.

"Some of our software solutions developed for the South African public services sector can also be applied in the rest of the continent, and we intend to explore these possibilities and to step into that gap."

Hirschel agreed that potential growth plans into Africa could prove profitable for the company. "Providing services to government in Africa that are looking to update identity systems would allow the group to leverage its extensive internal expertise in identity management solutions and complex e-government deployments.

"However, Gijima may have to work harder in this sector to overcome questions potential customers may have because of the WAIO debacle," she concluded.

 

Edited by: Mariaan Webb
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other ICT News
Competition in South Africa’s mobile market is starting to ease, global ratings firm Standard & Poor’s (S&P’s) Paris-based telecoms and technology director for the Europe, Middle East and Africa region Mark Habib said this week. Speaking to Engineering News Online...
Information and communications technology (ICT) distributor DCC is making Windows- and Android-operating systems tablets available through retailers and education equipment suppliers to provide school children with affordable, high-performance education tools. The...
JOSE DOS SANTOS Gated communities and high-density residential areas with a large demand for high-speed data would be priority areas
South Africa's third-largest mobile operator Cell C will invest R8-billion over the next three years to roll out long-term evolution (LTE) infrastructure for targeted customers across the country.
More
 
 
Latest News
South African mining and energy adviser Ted Blom has raised a litany of concerns about the state of power utility Eskom and has warned of runaway costs and shortfalls in coal and water, as well as rail capacity. Blom was surprised by the recent buoyancy shown by...
JSE-listed Astrapak will sell specialised packaging systems manufacturer Knilam to Mapflex SA for R17.7-million. The proceeds would be used to reduce Astrapak’s current level of gearing.
The last of the 26 mooring units comprising the Port of Ngqura’s automated mooring system (AMS) have arrived at the port and are expected to improve port efficiency and safety, further driving the Transnet National Ports Authority’s (TNPA’s) objective of establishing...
More
 
 
Recent Research Reports
Steel 2015: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2015 report provides an overview of the key developments in the global steel industry and particularly of South Africa’s steel sector over the past year, including details of production and consumption, as well as the country's primary carbon...
Projects in Progress 2015 - First Edition (PDF Report)
In fact, this edition of Creamer Media’s Projects in Progress 2015 supplement tracks developments taking place under the Renewable Energy Independent Power Producer Procurement Programme, which has had four bidding rounds. It appears to remain a shining light on the...
Electricity 2015: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2015 report provides an overview of State-owned power utility Eskom and independent power producers, as well as electricity planning, transmission, distribution and the theft thereof, besides other issues.
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
 
 
 
 
 
This Week's Magazine
Sappi Southern Africa CEO Alex Thiel
Forest products group Sappi has confirmed the selection of its 25 MW biomass-to-power project, to be erected at its Ngodwana mill, in Mpumalanga, as a preferred bidder under the South African government’s Renewable Energy Independent Power Producer Procurement...
Information and communications technology (ICT) distributor DCC is making Windows- and Android-operating systems tablets available through retailers and education equipment suppliers to provide school children with affordable, high-performance education tools. The...
Another cement manufacturer is set to enter the Ugandan market, raising hopes that prices will come down and spur growth in the construction industry. National Cement, a Kenyan manufacturer, has unveiled plans to invest $195-million in a new manufacturing plant in...
With growth rates exceeding that in the developed world – at an average of between 4% and 5% between 2002 and 2014 – African countries provide investors with ample reason to tap into booming consumer demand says Manufacturing Circle executive director Coenraad...
The South African Chamber of Commerce and Industry’s (Sacci’s) Business Confidence Index (BCI) decreased by 3.7 index points month-on-month to 89.1 in March.
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks
Subscribe Now for $96 Close
Subscribe Now for $96