After presenting dire financial results to shareholders this week, JSE-listed Allied Electronics (Altron) has developed a strategy incorporating joint ventures, key acquisitions, disposals, international expansion and cost savings to pull its Telecommunications, Multimedia and Information Technology (TMT) division back from its decline.

The end of February 2015 marked the completion of the first full financial year for Altron TMT as a converged unit – becoming a key contributor to its parent company’s financial performance.

However, TMT’s headline earnings declined 19% to R461-million, with earnings before interest, taxes, depreciation and amortisation falling 16% to R1.2-billion. Revenue for the year remained flat at R19.4-billion.

The division had been hit by a tough market, ongoing mobile termination rate (MTR) reductions, lower international orders as a result of a delay in African digital terrestrial television (DTT) migrations, a National Union of Metalworkers of South Africa-led strike and the subpar performance of the recently launched Altech Node in the retail market.

TMT’s other units, including Altech Netstar, Bytes Systems Integration and Altech Radio Holding performed well during the 12 months to February.

Altron TMT CEO and group executive Craig Venter assured shareholders on Thursday that the division had a “clear roadmap” for the future.

“I am confident that we are on the right track with regard to our growth strategy, particularly with respect to accessing new markets, and that we are fully geared to take advantage of opportunities as and when they arise,” he stated.

Over the past year, TMT had been streamlining its asset portfolio, as well as noncore, “less relevant” businesses, including LaserCom, the Bytes UK Document Solutions business and the 850 ATMs owned by Bytes Managed Solutions.

The group, in turn, sought out acquisitions that would provide growth, including that of InterActive Technologies, now housed under Bytes People Solutions, and FleetPro for the division’s Altech Netstar unit.

Further, the group absorbed Health-Soft to “broaden the scope of services” that Med-e-Mass currently offered in the healthcare industry.

“In terms of accessing new markets and international expansion, we have seen a number of moves on this front,” said Venter, pointing to the acquisition of Brand New Technologies and Pinpoint Communications, which enabled the company to gain a foothold in other regions, including Australia.

Altech Netstar was also moving into Africa as the demand for innovative fleet and telematics technologies and solutions increased.

Meanwhile, Venter was optimistic of gaining traction with the production of set-top boxes after its UEC business was selected as one of the manufacturers and suppliers for the South African DTT tender, with volume allocations expected “imminently”.

The group would also dispose of the subscriber base of the underperforming Altech Autopage at an “acceptable, market-related valuation”.

“While the decision to dispose of these subscriber bases has been based on, among others, the impact of the ongoing MTR reductions, and continued industry and consumer deflationary pressures, Altech Autopage has been a significant revenue generator to the group since its inception and I am exceptionally proud of what the Altech Autopage team achieved in that time,” Venter reiterated.

In an effort to gain momentum on TMT’s latest, but unsuccessful, product, the Altech Node, TMT planned to pursue a “strategic alliance” after “interest” was shown by a “number of players” in the communications and multimedia arena in the fully-converged home gateway console, which offered movie entertainment, television series and business content, Internet access and wireless smart home solutions.