The board and management of JSE-listed technology group EOH have taken proactive steps to ensure the company is prudent in these times of uncertainty.
EOH said in a statement that being systemic to South Africa’s IT backbone creates significant responsibility for the group during COVID-19 to ensure it remains robust in order to continue providing key services to its 5 000 long-term clients. “These include many banks in South Africa and the rest of Africa, telecommunication companies, Eskom, municipalities and government agencies.”
EOH said it is also at the forefront of providing cutting edge medical solutions through companies such as Nuvoteq and TCD.
For this reason, EOH informed investors on Tuesday that has initiated a number of initiatives in this regard.
These initiatives include:
1. The CEO and executive committee taking a reduction of 25%
2. A proposed 20% reduction across the board in cash salaries, with the exception of those earning less
than approximately R250 000 per annum (in consultation with clients and staff)
3. Negotiating rent holidays
4. A review of all fixed-term and consultant contracts
5. Reassessing the retirement policy for those over 65 years of age
6. A review of variable pay elements including reimbursive travel and overtime
7. A review of discretionary spend on travel, entertainment and events
EOH said its core ICT business has been classified as an essential service and will continue operating during the lockdown period.
On 15 March 2020, President Cyril Ramaphosa announced a national state of disaster and on 23 March 2020 a 21-day National Lockdown was announced to run from midnight on 26 March 2020 to midnight on 16 April 2020. For more read: Coronavirus: South Africa to go on Lockdown
“These actions are expected to have a financial impact on the group going forward,” the company said.
“The group has a COVID-19 management team in place consisting of all the representatives from the executive committee as well as key operational and support functions.
“The team monitors the situation on a daily basis and ensures that adequate risk management and mitigation actions are taken, as well as appropriate communication and engagement with clients, staff and other stakeholders.”