Amap says simple opportunity, not greed, pushed directors
Amalgamated Appliance Holdings (Amap) is under preliminary investigation by the Financial Services Board (FSB) following director dealings ahead of a profit warning last week by this manufacturer and distributor of small appliances.
It may not amount to a full probe if the FSB's directorate of market abuse is satisfied with the company's explanation that the transactions were above board.
Sheldon Cohen, director of corporate services, said the bulk of the transactions were by directors of Amap's subsidiary companies who were not privy to the top-level information of the business.
There had been what Cohen described as "pent-up demand" to realise options vested by the directors, as Amap had been trading under cautionary over talks to buy the local furniture-making unit of Steinhoff International. When the negotiations subsequently ended over disagreement about valuation, a small window of opportunity opened for the directors to trade.
Cohen said only two directors who sold shares were on Amap's main board: Spiros Scafidas and George Bernhardt.
Scafidas, a former executive director, had been retained by Amap as a non-executive director following his emigration to Perth, where he was attempting to purchase a house. "He did not know about the trading statement," said Cohen.
Bernhardt, the group's manufacturing director, had been involved in some discussions about the trading statement. But he had instructed his stockbroker to sell shares at the end of March. FSB regulations stipulate that if a director becomes privy to information after giving instructions to execute a deal, they do not have to stop the transaction.
Cohen holds that Amap's talks about the trading statement began only in the first week of this month.
When, at the half-year period at the end of December, sales were flat, Amap executives hoped it simply signalled a weaker Christmas. Because January and February were traditionally slower months, they had to wait for March and April figures to see if a trend was unfolding. Flash results for these months came through only in the first week of May.
According to Amap's profit warning, which says earnings and headline earnings will be between 35 percent and 45 percent lower, the slowdown was particularly evident in the consumer electronics division. Compounding the problem was margin pressure and deflation in flat-screen TV prices.
TELKOM MEDIA The Independent Communications Authority of SA (Icasa) will from next week start the hearings on pay TV, but already some companies that have applied for a licence are behaving as if they have already been given the go-ahead to operate.
Telkom Media is one of the 18 companies that have applied for a licence. The purpose of these hearings is to find a suitable competitor to pay TV monopoly Multichoice.
Telkom Media, which is partly owned by Telkom, yesterday appointed former head of e.tv and SABC TV news, Jimi Matthews, to run its 24-hour news channel.
The company plans to roll out internet protocol television next year. But it forgot to mention that it would only offer those services if it wins the licence. Talk about overconfidence: this gives an impression that Telkom Media has already been tipped that it will get the licence. It plans to pump in about R8 billion to roll out its services.
Telkom Media is the only company that has been vocal on its plans. But what if it doesn't get the licence?
What is going to happen to the people who have left their jobs to join an entity that, at the moment, does not have the mandate to operate?
Or should we expect legal battles like those of the dominant mobile operators, who most of the time threaten legal action if the regulator wants to intervene on tariffs?
Telkom Media should slow down until Icasa makes its decision.
SAA In spite of the growth of the low-cost airlines, there is still a growing number of people willing to pay more to fly in the full-service airlines' business and first class seats, particularly from Africa, according to the latest economic survey by the International Air Transport Association (Iata).
It describes premium travel between Africa and "various regions" as "showing robust growth". Industry sources said it was a well-known fact that in most of Africa, the first seats to be sold on any international or regional flight were in first class and business class.
This helps explain why, although we are still waiting to hear details of SAA's proposed new route network in which unprofitable routes will be axed, it has confirmed that a new route from Johannesburg to Libreville, the capital of Gabon, will definitely be started sometime this year.
The Iata report shows that demand for premium class seats worldwide increased by 8.3 percent in March, compared with a year-on-year rise of 4.3 percent in February.
Lufthansa now has three premium class-only services between Germany and the US, which it says are doing well. British Airways and its local franchise holder, Comair, have upgraded their business classes to differentiate them more from their low-cost competitors.
In that context, it may also explain why SAA has been undercutting its own low-cost division, Mango, with some of the special offers on its website.
SAA's advantage to business travellers is in the frequency of the flights it offers on its most popular routes: those between Johannesburg and Cape Town and between Johannesburg and Durban.
But even with the rise in domestic airline travel, SAA cannot hope to fill its economy class on so many flights, unless prices are slashed to avoid a complete loss on empty seats.
Article from http://www.busrep.co.za/
Drive first class with www.southafrica-carhire.com
It may not amount to a full probe if the FSB's directorate of market abuse is satisfied with the company's explanation that the transactions were above board.
Sheldon Cohen, director of corporate services, said the bulk of the transactions were by directors of Amap's subsidiary companies who were not privy to the top-level information of the business.
There had been what Cohen described as "pent-up demand" to realise options vested by the directors, as Amap had been trading under cautionary over talks to buy the local furniture-making unit of Steinhoff International. When the negotiations subsequently ended over disagreement about valuation, a small window of opportunity opened for the directors to trade.
Cohen said only two directors who sold shares were on Amap's main board: Spiros Scafidas and George Bernhardt.
Scafidas, a former executive director, had been retained by Amap as a non-executive director following his emigration to Perth, where he was attempting to purchase a house. "He did not know about the trading statement," said Cohen.
Bernhardt, the group's manufacturing director, had been involved in some discussions about the trading statement. But he had instructed his stockbroker to sell shares at the end of March. FSB regulations stipulate that if a director becomes privy to information after giving instructions to execute a deal, they do not have to stop the transaction.
Cohen holds that Amap's talks about the trading statement began only in the first week of this month.
When, at the half-year period at the end of December, sales were flat, Amap executives hoped it simply signalled a weaker Christmas. Because January and February were traditionally slower months, they had to wait for March and April figures to see if a trend was unfolding. Flash results for these months came through only in the first week of May.
According to Amap's profit warning, which says earnings and headline earnings will be between 35 percent and 45 percent lower, the slowdown was particularly evident in the consumer electronics division. Compounding the problem was margin pressure and deflation in flat-screen TV prices.
TELKOM MEDIA The Independent Communications Authority of SA (Icasa) will from next week start the hearings on pay TV, but already some companies that have applied for a licence are behaving as if they have already been given the go-ahead to operate.
Telkom Media is one of the 18 companies that have applied for a licence. The purpose of these hearings is to find a suitable competitor to pay TV monopoly Multichoice.
Telkom Media, which is partly owned by Telkom, yesterday appointed former head of e.tv and SABC TV news, Jimi Matthews, to run its 24-hour news channel.
The company plans to roll out internet protocol television next year. But it forgot to mention that it would only offer those services if it wins the licence. Talk about overconfidence: this gives an impression that Telkom Media has already been tipped that it will get the licence. It plans to pump in about R8 billion to roll out its services.
Telkom Media is the only company that has been vocal on its plans. But what if it doesn't get the licence?
What is going to happen to the people who have left their jobs to join an entity that, at the moment, does not have the mandate to operate?
Or should we expect legal battles like those of the dominant mobile operators, who most of the time threaten legal action if the regulator wants to intervene on tariffs?
Telkom Media should slow down until Icasa makes its decision.
SAA In spite of the growth of the low-cost airlines, there is still a growing number of people willing to pay more to fly in the full-service airlines' business and first class seats, particularly from Africa, according to the latest economic survey by the International Air Transport Association (Iata).
It describes premium travel between Africa and "various regions" as "showing robust growth". Industry sources said it was a well-known fact that in most of Africa, the first seats to be sold on any international or regional flight were in first class and business class.
This helps explain why, although we are still waiting to hear details of SAA's proposed new route network in which unprofitable routes will be axed, it has confirmed that a new route from Johannesburg to Libreville, the capital of Gabon, will definitely be started sometime this year.
The Iata report shows that demand for premium class seats worldwide increased by 8.3 percent in March, compared with a year-on-year rise of 4.3 percent in February.
Lufthansa now has three premium class-only services between Germany and the US, which it says are doing well. British Airways and its local franchise holder, Comair, have upgraded their business classes to differentiate them more from their low-cost competitors.
In that context, it may also explain why SAA has been undercutting its own low-cost division, Mango, with some of the special offers on its website.
SAA's advantage to business travellers is in the frequency of the flights it offers on its most popular routes: those between Johannesburg and Cape Town and between Johannesburg and Durban.
But even with the rise in domestic airline travel, SAA cannot hope to fill its economy class on so many flights, unless prices are slashed to avoid a complete loss on empty seats.
Article from http://www.busrep.co.za/
Drive first class with www.southafrica-carhire.com
Labels: South Africa - Airlines
