Austro Group‚ a provider of industrial power and woodworking equipment‚ says there will be no "material impact" on the business after it suspended Charles Jacobs‚ a director of Austro and the chief executive of Austro's wood subsidiary‚ pending a disciplinary enquiry.
Monday's (19 November) suspension came months after Tania Le Roux resigned as acting group financial director in August. Her resignation came a day after the company released a statement saying it had "resolved" to provide financial assistance to entities or persons related to the company.
The group said on Tuesday (20 November) that Jonathan Freed‚ the managing director of New Way Power‚ Austro 's other subsidiary‚ was managing the wood division.
"Accordingly operations will continue in the ordinary course of business‚" it said.
"The board of directors of Austro is satisfied that there will be no material impact on the business as (the division's) management team under the guidance of Jonathan has sufficient expertise and competence to ensure a seamless continuation of that business."
Non-executive director and majority shareholder David Brouze said the group had made significant write-offs and had faced "difficulties" over cost controls.
"It's a bit of a legal process‚" he said.
He said the company could not comment further and a more detailed announcement would soon be made.
Austro released its financial results for the year ended August. In the results it said the southern African outlook for the industrial sector remained weak‚ but it was focused on growing revenue from new African markets.
While revenue for the year increased 7.9% to R417m over last year‚ Austro made a total comprehensive loss of R154.4m in the period‚ from a profit of R6.4m last year.
The group also said its wood division provided for an onerous lease for one of its premises‚ which had been sub-let.
Jacobs said he could not comment on his suspension.
"Within weeks there will be a very comprehensive statement issued by me‚" he said.
Source: AFP via I-Net Bridge
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