State-owned aerospace and military company Denel has sent out letters to its aeronautics staff stating that it will only be able to pay a portion of their salaries for the month of April.
The company is still battling financial and liquidity challenges.
Denel says it met with organised labour to reflect on the available cash.
The state-owned entity has been facing financial and legal challenges for years.
This is not the first time Denel has sent out letters to its staff notifying them of liquidity challenges potentially affecting their salaries.
The Commission of Inquiry into State Capture hears Denel-related evidence:
In 2020, Denel said it had been impacted by COVID-19 which hampered its operations.
Employees earning above R1 million will only receive 40% of their salary.
Those earning above R250 000 will get 50% and those who receive below R250 000 will receive 100% of their salary.
Despite a turnaround strategy and intervention from the Department of Public Enterprises, Denel remains embedded in serious liquidity problems and significantly exposed to risk.
In the video below, Denel’s CEO Danie Du Toit speaks about the company’s turnaround strategy:
