New management’s attention is firmly on a turnaround for Adcorp
The recruitment company has blamed an acquisition spree since 2012 and ‘a track record for paying attractive dividends out of borrowed funds’ for its financial woes
Adcorp ended its interim period with current liabilities outrunning current assets by R184m, thereby breaching agreements with bondholders.In June, activist shareholder Venture Capital Partners ousted Adcorp’s incumbent management. Gloria Serobe was appointed chairwoman, leading to CEO Richard Pike getting replaced by former MMI Africa and Asia CEO Innocent Dutiro and Cheryl-Jane Kujenga taking the role of chief financial officer.The new management has managed to secure a R1bn loan "at more favourable terms", enabling it to pay out existing lenders demanding their money back, while leaving funds for future working capital requirements, Adcorp said in its interim results statement released on Monday.Adcorp fell into an after-tax loss of R50m for the six months to end-August from the matching period’s R136m profit. Interim revenue declined slightly to R7.75bn from R7.89bn.The new management team blamed the group’s R2bn acquisition spree since 2012 along with "a track record for paying...
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