Cape Town – Defence manufacture Denel has reaffirmed that they paid their employees salary at the end of December according to CEO Zwelakhe Ntshepe.
Speaking at a briefing about governance of State owned Enterprises (SOEs) with the minister of Public enterprises Lynn Brown, the minister was giving an update of SOEs of Denel, Eskom and transnet and others. CEO of Denel, Ntshepe provided a response from several reports that accused the SOE of not paying the staff during the month of December and being in the brink of bankruptcy. He said to the committee that, ” You have to understand Denel’s expenditure a month is more than R600m,”. Majority of that money goes to paying banks their loans, employees salaries and suppliers he explained.
If Denel does not pay of the banks this would mean that the manufacturer would go into default and possible a liquidity crisis. The CEO was adamant that the SOE will not default from their payments even though their profits are small. Even though the company managed to pay creditors and workers their salary, the short term money supply will not solve the long term issues.
Ntshepe said that the company is looking for a long term solution and added, “…with our executive authority and with the auditors and I think we have moved very positively.”
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