Sello Moloko, the chairperson of Telkom’s board, will step down from the role no later than March 2023 due to “workload reasons”, the company said on Wednesday.
Telkom, which has attracted several suitors in the past few months, said it had already started a process to identify a suitable replacement for Moloko.
“Mr Moloko was appointed as an independent non-executive director of the board on 20 March 2018 and became chairperson of the board in June 2019,” the company said.
“He served as a member of the remuneration committee and chairperson of the nominations committee. These board committees will remain duly constituted following Mr Moloko’s resignation.
“The board and management are grateful to Mr Moloko for his valuable contribution and leadership particularly during the challenging economic times imposed by the Covid-19 pandemic.”
News of Moloko’s resignation came hours after Business Day reported that the Prudential Authority wanted the executive to step down as chair of Telkom and focus his attention on Absa, which he also chairs.
Absa announced a year ago that it had appointed Moloko as its next chairperson, bringing an end to Wendy Lucas Bull’s near 10-year stay at the helm of the financial services giant.
Moloko, who has 30 years in the financial services industry, officially started chairing Absa in April. He has previously chaired the boards of Alexander Forbes for 10 years and has also chaired the boards of Sibanye-Stillwater and General Reinsurance Africa Limited (a Berkshire Hathaway company), among others.
He leaves Telkom at a time the company is considering several takeover bids. MTN has since withdrawn from merger talks with Telkom.
Meanwhile, Telkom interim results for the six months to September show a group that has grappled with several issues.
Group revenue declined marginally by 0.7% to R21.1-billion while profit plunged 52.9% to R641-million. Its service fees increased 21% to R1.9-billion “mainly attributable to higher diesel consumption due to increased loadshedding and higher consultant costs, mainly relating to mergers and acquisition transactions and key strategic projects”.
The company also said cash generated from operations declined 37.1% to R2.8-billion largely attributable to the 53.5% decrease in profit before taxation and the deterioration in working capital mainly due to the timing of cash flows as a result of an increase in post-paid mobile handset sales and purchases.
Telkom Group CEO Serame Taukobong said the company’s commitment to return cash to shareholders remains a key element of its capital allocation framework.
“Telkom is in the final year of the three-year dividend policy suspension period. The board remains committed to reinstating the dividend policy at the end of 2023 [financial year] and is reviewing the policy,” Taukobong said.
“Telkom aims to continue to create value and generate sustainable positive free cash flow to reward shareholders in the medium term once our working capital cycle stabilises in line with new demand patterns and evolving customer requirements.”
For more business news from Sunday World, click here.
Follow @SundayWorldZA on Twitter and @sundayworldza on Instagram, or like our Facebook Page, Sunday World, by clicking here for the latest breaking news in South Africa. To Subscribe to Sunday World, click here
