The Chief Executive Officer of Denel Land Systems (DLS), Stephan Burger, has resigned after a 36 year career at the state-owned defence conglomerate, and is being replaced by acting CEO Ismail Dockrat.
Group CEO of Denel Zwelakhe Ntshepe announced the resignation today. In a statement, the company said “Stephan has been a loyal member of the Denel family and a great asset to the company for the past 36 years. He started his career as a Design Engineer at the then Vektor in 1981; and progressed through various positions including the position of Manager for Rapid Fire Development in 1985, Senior Manager in the Engineering department in 1989 to Executive Manager for Marketing from 1993 to 1994.”
In 1994, the turnover at Vektor grew to R130 million, with a staff turnover of 900 people. Burger moved through various leadership positions until he was appointed Chief Executive Officer at DLS in 2004. “Under his leadership DLS achieved remarkable milestones, and grew from a R280 million turnover to a R3-billion turnover division. He has been an asset to the growth of the company and it is always a sad moment to lose one of our own,” Denel said.
“However, another equally capable and experienced colleague will be acting in the position of Chief Executive at DLS with immediate effect. The Chief Executive of the Denel Maritime division, Ismail Dockrat, is well qualified to act in this position until the Group is in a position to appoint a permanent CEO for DLS.
“Ismail comes into this acting position with a wealth of leadership experience and is known in Denel and across the industry as having played a crucial role in the successful turnaround of both the former Denel Aviation and Denel Aerostructures divisions, as well as in the establishment of Denel’s nascent cyber security and warfare capability, now known as Denel Sovereign Security Solutions. Dockrat has made significant strides in the creation of the maritime division, which will enable Denel to meet the recommendations of the Defence Review 2014.”
Denel said that under the leadership of Dockrat, Denel has positioned itself to develop local South African capacity through research and investment in maritime systems, as well as in the commercialisation of the naval dockyard in Simon’s Town.
“We have been a global name in landward and aerospace defence for many decades and a leader in the development of long-range artillery and mechanised infantry vehicles. It is therefore a natural next step for Denel to establish a presence in the maritime environment. The maritime capability therefore will remain one of the key capabilities the company is prioritising because modern defence forces require the different branches to interact with each other for maximum effectiveness in modern-day conflict.”
Burger leaves DLS in a healthy financial situation. The company’s profits increased from R139 million in 2015/16 to R174 million for 2016/17 on the back of a number of important contracts, according to the latest Denel annual report.
The company earned R2.675 billion in revenue in 2016/17, of which R1.955 billion came from export contacts. This compares to R2.603 billion in revenue in 2015/16 and R1.762 billion in export revenue.
Local developments included the “buy-off” of “three artillery platforms for the South African National Defence Force (SANDF); the commencement of industrialisation and production of the Badger infantry fighting vehicle family for the South African Army; the development of the lightweight DMG-5 (SS-77) machinegun; and the achievement of a major contract milestone with the successful installation of a Military Image Interpretation Computer Systems (MIICS) and associated training system for the South African Air Force in the Joint Air Reconnaissance Intelligence Centre (JARIC) at AFB Waterkloof.”
Internationally, Denel Land Systems achieved major milestones with the Malaysian AV8 programme with delivery to the client of LCT30 light combat turrets, anti-tank guided weapon turrets and remote controlled weapon station turret (RCWS) systems.
DLS subsidiary Mechem also did well in the last financial year, with large explosives clearance contracts; canine contracts and deliveries of Casspir armoured vehicles.
However, Denel as a group is struggling to pay suppliers and the salaries of its 4 000 employees, as it faces cash problems. Much of this was due to a badly managed liquidity crisis, which was not helped by management changes in 2015.
Although Denel Land Systems has some big contracts, it has been tarnished by its association with Gupta-linked company VR Laser. It has been alleged that contracts for the Badger infantry fighting vehicle for the SA Army were diverted from Denel subsidiary LMT to VR Laser. The matter ended up in court, and many LMT personnel left the company, along with other resignations across Denel.