Altron adopts ‘continuity and change’ stance as five-year strategy unfolds

13th November 2020

By: Natasha Odendaal

Creamer Media Senior Deputy Editor

     

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As telecommunications and technology company Altron nears the close of Year 3 of its successful five-year One Altron growth strategy, CEO Mteto Nyati reflects on the company’s achievements and the ambitions for the next five-year strategy to deliver Altron 2.0.

The evolution of the One Altron strategy is a natural next step – after serving the company well – as the company eyes a future in which it becomes highly differentiated in its offerings.

Led by Nyati and his management team, the One Altron strategy has been prioritising revenue growth, improving profitability, customer experience transformation and employee excellence, with collaboration at its core, over the past three years.

The roadmap is already about a year ahead of its five-year schedule to double its earnings before interest, taxes and depreciation (Ebitda) and reduce its net debt to Ebitda levels by 2022.

Through the strategy, Nyati says the group has been strengthened through the disposal of noncore assets, the rationalisation of operations and the execution of targeted acquisitions in high-growth areas.

The group’s net promoter scores and employee engagement scores have also improved over the past three years.

Following the success to date and keeping the momentum, Altron 2.0 is currently under development and the five-year medium-term plan for the group will guide Altron’s future as it becomes highly differentiated in its offerings.

“The new Altron 2.0 is a combination of continuity and change,” he tells Engineering News & Mining Weekly, highlighting that the new medium-term plan will continue to have ‘Delivering Innovation that Matters’ as its core guiding purpose and will include carefully selected acquisitions which are aligned to the growth areas in local and international geographies.

Its customers and employee engagement efforts will continue; however, Altron will now turn its focus to the tripling of its operating income, delivering leading returns in the information and communication technology (ICT) space, deliver best-in-class customer service, become the best place to work and maintain a net debt to Ebitda of less than 1.

“Margin expansion and a high annuity base will be core objectives,” Nyati notes.

However, another clear goal is to become a responsible Environmental, Social and Corporate Governance company, with new measurements under development to benchmark the company against its global peers.

“Our values and purpose will not change,” he assures, noting, however, that its vision has to be a highly differentiated technology company.

“In preparation of Altron 2.0 for the future, the focus will be on concluding the exit of identified noncore assets to reduce working capital and debt levels with the commensurate increase in profitability metrics,” he says, adding that a head office restructuring will also unveil a fit-for-purpose operation in line with what is required in the new 2.0 structure.

“The executive committee regularly evaluates the various operations against its stated purpose and vision and during the reporting period, it became evident that some of our current offerings do not fit the ICT mould of the future Altron, including the now-held-for-sale Document and People Solutions businesses, as well as the Altron Arrow electronic component distribution operation.”

The areas of growth identified also include an expansion of its security offerings and deepening the relationships with Microsoft and Amazon Web Services in sub-Saharan Africa to capture opportunities in the fast-growing cloud computing space, besides others.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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