Economic value added
Value added statement
The measure of the value created by the group is the amount of value added by its diverse manufacturing, distribution and other activities to the cost of raw materials, products and services purchased. This statement shows the total value created and how it was distributed.
| 2007 | 2006 | |||
| R millions | % | R millions | % | |
| Revenue from continuing operations | 17 126 | 13 913 | ||
| Paid to suppliers for material and services | (12 707) | (10 296) | ||
| Value added | 4 419 | 3 617 | ||
| Income from investments* | 136 | 144 | ||
| Total value created | 4 555 | 3 761 | ||
| Value distribution | ||||
| Employees | 2 736 | 60 | 2 492 | 66 |
| Capital providers | 445 | 10 | 335 | 9 |
| Finance costs | 56 | 53 | ||
| Dividends to Altron shareholders | 216 | 176 | ||
| Dividends to minority shareholders in subsidiaries | 173 | 106 | ||
| Central and local government | 606 | 13 | 440 | 12 |
| Company taxation | 493 | 338 | ||
| Secondary taxation on companies | 58 | 35 | ||
| Rates and taxes; licences and levies | 34 | 49 | ||
| Skills development levy | 27 | 25 | ||
| Subsidies granted by the government | (6) | (7) | ||
| Corporate social investment (CSI)** | 14 | 10 | ||
| Reinvested in the group to maintain | ||||
| and develop operations | 754 | 17 | 484 | 13 |
| Depreciation and amortisation | 235 | 213 | ||
| Retained profit | 589 | 318 | ||
| Deferred taxation | (70) | (47) | ||
| 4 555 | 100 | 3 761 | 100 | |
| Value added ratios | ||||
| Number of employees*** | 11 871 | 11 874 | ||
| Revenue per employee (Rand) | 1 442 675 | 1 171 720 | ||
| Value created per employee (Rand) | 383 708 | 316 742 | ||
| Corporate social investment % of profit after tax | 1.3 | 1.3 | ||
*Income from investments includes interest received, dividend income and share of associatesf profits.
**CSI includes education, training and social upliftment projects.
***These are permanent group employees.
Altron is at the forefront of supporting the government’s thrust to develop South Africa’s infrastructure for the benefit of its citizens. We do this through our core businesses of telecommunications, power electronics and multi-media, and information technology. Through various products and services, Altron is contributing to bridging the digital divide, the creation of a knowledge economy, technological innovation and the economic growth of South Africa.
Research and development
Intellectual property
Innovation is a primary driver of value creation for Altron in certain sectors of its business, particularly the high-tech operations. The trademarks, patents and registered designs held by the Altron group include:
The Altron group’s expenditure in respect of trademarks, patents and registered designs, including litigation matters and the protection and enforcement of its intellectual property rights worldwide amounted to over R1 million during the year under review. As part of its research and development costs, this expenditure is essential, given the high-tech environment in which the group operates. This amount includes the renewal of Altron’s trademarks, patents and designs, as well as defensive company names and domain names, where appropriate. When new products are developed, the protection of the new technology or aesthetic and functional designs will be considered and, where they are novel, patent and registered design applications will be filed.
In a landscape where multiple new, diverse and powerful technologies can appear with breathtaking rapidity, it is crucial that the group differentiate itself through innovation in order to defend more closely existing markets and to quickly exploit new ones.
Consequently, particularly in high-tech business environments such as Altech, there is a strong focus on nurturing and stimulating innovation and new ideas across the group, from new product development to acquisition opportunities. Altech hosts regular strategy sessions that focus on new product development, and substantial funds have been allocated to global product, market and technology research in order to disseminate the best of breed innovation from around the world, with the intent of catalysing internal innovation.
Aberdare, in co-operation with the South African Bureau of Standards (SABS – the national standards organisation) serves on a number of International Electrotechnical Commission (IEC) cable working groups, one of which deals with the development of test methods for cables in fire situations. Aberdare works closely with the South African Council for Scientific and Industrial Research (CSIR) and various major universities and technikons in the quest to continuously upgrade its product range and manufacturing capabilities. Aberdare is determined to retain its position as a leader in the cable industry through the development of cost-effective solutions to common problems faced by many of the world’s developing nations, and by working closely with customers to meet their every possible need.
