1 / 20

SENTECH PRESENTATION

This presentation discusses Sentech's strategy for rolling out wireless broadband access, funding strategies, PFMA classification, and staff retention and development. It outlines the phases of coverage, cash flow projections, and the way forward for implementing the strategy.

segars
Download Presentation

SENTECH PRESENTATION

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. SENTECH PRESENTATION TO THE PORTFOLIO COMMITTEE ON COMMUNICATIONS Date: 07 March 2008

  2. AGENDA 1. Sentech strategy, timeframes and targets in rolling out wireless broadband 2. Funding strategy for the general operations of Sentech 3. PFMA classification of Sentech 4. Retention and development of staff

  3. TEAM MEMBERS Chairperson Mr. Colin Hickling Chief Executive Officer Dr. Sebiletso Mokone-Matabane Chief Financial Officer Mr. Siddique Cassim Chief Operating Officer Mrs. Beverly Ngwenya Executive: Regulatory & Govt. Mr. Dingane Dube Affairs Specialist: Stakeholder Relations Mr. Monde Ndleleni

  4. Broadband wireless strategy • 2003 business model: combination of retail and wholesale, urban and rural. The strategy not successful due to funding and high gearing. • MyADSL rated MyWireless as best product in terms of speed and reliability.

  5. Broadband wireless strategy • 2005 Business model (BOTT): combination of retail and wholesale, urban and rural. • R1,2billion debt funding secured. Business structure not approved.

  6. Broadband wireless strategy • 2007 Business Model: wholesale, combination of urban and rural. • Rollout to schools, hospitals, clinics, Thusong post offices and Government.

  7. Broadband wireless strategy Sentech Ltd Network Owner and Operator Other Public Sector USALs Socio-Economic Customers PTNs Sentech’s Wholesale Customers National Provincial Local VANS ISPs Other Value Added Service Providers

  8. Broadband wireless strategy • Phase 1 Coverage Area: Urban and under serviced areas within the urban areas • Phase 2 Coverage Area: Secondary towns • Phase 3 Places of Interest • Phase 4 Rural Areas • Phase 5 Densification

  9. Broadband wireless strategy

  10. Broadband wireless strategy Cash flow Cash flow trend Annual Cash flow Rand 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

  11. Broadband wireless strategy • Total capital requirement is R4.4 billion of which the fiscus requested to fund R3.125 billion • No debt funding • Wholesale price: R100 private sector; and R75 public sector. • Cash flow positive from year 6 • Supports Sentech’s return to profitability within 6 years

  12. Consolidated: Existing Business and NWBN

  13. Total Funding Requirements from National Treasury

  14. Broadband wireless strategy

  15. Broadband wireless strategy • Rollout of wholesale national broadband wireless network: catalyst in the market and using ICT for development. • DOC: Sentech rollout to Dinaledi Schools and hospitals, clinics, Thusong Post offices and Government Departments within coverage area (Apex of priorities). • National Treasury allocated and transferred R500million, subject to following conditions: exit retail and focus on wholesale, business plan should be sustainable and raise the additional funding from the market.

  16. Broadband wireless strategy • If Government allocation only R500million, and the difference raised from the market: • Sentech roll-out first in lucrative markets to service the debt • The promise of lower connectivity prices will be reviewed • Millennium Development Goals will be achieved at a very slow pace, as rural areas will be covered later • The entire business and financial model will change

  17. Broadband wireless strategy Way forward: DoC and National Treasury must agree on: • Policy: business model/priority areas • Funding: debt equity ratio to be set by Shareholder

  18. PFMA CLASSIFICATION • Public Finance Management Act (PFMA) is a very good legislative tool for the state to exercise proper supervision over State-Owned Enterprises (SOE’s), of which Sentech is one. • Sentech is currently classified under PFMA Schedule 3B. • Other entities reporting to the State in this category includes, amongst others, Accounting Standards Board, Legal Aid Board, and Financial Services Board. • The constraints on the day to day running of an SOE impacts on the ability to timeously respond to business opportunities . • In order for Sentech to operate effectively, it is imperative that the Sentech Act be amended to classify the Company as a Schedule 2 entity under the PFMA.

  19. Staff retention, training & development • Skills shortage • Retention strategy: retention bonuses and training, both locally and internationally • Sentech School of Technology: • Internal staff training • Learnerships • Internship programme

  20. THANK YOU

More Related