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BLUE LABEL INTEGRATED ANNUAL REPORT 2015
starter packs and data, such as prepaid electricity,
water, ticketing and a variety of financial services;
•
•
Total dividends paid to shareholders, including
dividend No 6, amount to R0.9 billion; and
•
•
R392.2 million returned to shareholders via a
12% share buyback in 2011.
Our pipeline of corporate action remains active. In
delivering on our stated M&A strategy, we consider
acquisitions that are earnings enhancing, add to our
product line, distribution network or geography and
which are of a strategic or defensive benefit.
In September 2014, the Board received an
unsolicited written expression of interest to acquire
100% of the Group. Over the ensuing months it
became apparent that the potential acquirer was
not advancing its proposal timeously and by mutual
agreement, the engagement terminated in
December 2014.
Since early 2011 we have regularly reported on the
litigation proceedings surrounding the cancellation
by Telkom SA SOC Limited of the Multi-Links
contract in Nigeria. In December 2014 the Chairman
of Telkom and I jointly announced our agreement to
resolve the disputes on the basis that all claims,
counterclaims and allegations would be withdrawn,
with each party responsible for payment of its own
costs. I am pleased that we resolved the dispute on
an amicable basis.
Through the Social, Ethics and Transformation
Committee, expenditure on uplifting communities
reached R5.3 million for the year. The spend was
mainly directed towards co-founding a new
initiative, being the construction and operation of
the Protea Glen Boys & Girls Clubs, which offers
after school care and extramural activities to the
local disadvantaged community. In addition, we
provide ongoing support for expanding the parkrun
SA franchise, promoting grassroots running, with a
quarter of a million members registered to date.
Our journey of reporting on financial risks,
performance and opportunities as well as many
non-financial parameters, steadily progresses. As we
mature, we understand the need to balance our
levels of disclosure, while recognising areas of
market and price sensitivity.
Looking ahead, South African Distribution is
expected to gain further momentum from its
enhanced bouquet of products, including mobile
handsets and tablets. Edgars Connect, with its
increasing number of standalone stores, is an ideal
CHAIRMAN’S REPORT
CONTINUED
avenue for the retailing of cellular products and
services, hardware and accessories requiring SIM
connection. Sales of prepaid water tokens are also
expected to gain momentum. Ticketing by TicketPro
continues to increase its range of ticketing and
access control services and solutions. Its technology
offering and distribution reach affords it a
competitive edge as it steadily grows its market
share. A planned domestic and international money
transfer solution will enhance the Group’s offerings
in the financial services sector.
On the international front, the Group expects a
significant increase in revenue streams at Oxigen
Services India due to its shift to financial services and
new proprietary micro-ATM roll-outs. At Blue Label
Mexico, the distribution of additional products and
services, over layered by improving revenues from
the existing products, positions the business well in
its drive towards reaching profitability.
After nearly eight years of service to the Board,
Neil Lazarus SC, resigned on 27 January 2015 in
order to pursue other business opportunities. Neil
joined the Board as a non-executive director at
the time of our JSE listing in 2007. He actively
participated at Board and Committee levels and
made exceptional contributions in supporting the
Group’s governance, legal and corporate finance
functions. On 18 August 2015, we welcomed Yusuf
Mahomed as an independent non-executive director
to the Board and we look forward to engaging in a
long and valuable working relationship with him. He
brings a wealth of cellular industry experience as a
long-standing board member of Cell C and a
founder director of 3 C Telecommunications.
I wish to thank my fellow Directors, the
management team led by Brett Levy and Mark Levy,
all employees and other stakeholders for their
support over the past year.
Larry Nestadt
Chairman
23 October 2015