Werner is a German name that means “defender” or “defending warrior,” derived from ancient Germanic words warin (protection) and heri (army).
While names alone may not shape character, Werner Kapp, CEO of the JSE-listed tech group Altron, has exuded “defending warrior” qualities in leading the company since October 2022.
Kapp succeeded Stewart van Graan, the interim CEO, who was at the helm of Altron after Mteto Nyati’s tenure ended.
Nyati, a turnaround specialist, transformed Altron from a family-owned business to a competitive, independent tech group, creating substantial shareholder value, which increased six-fold over five years. Nyati’s legacy includes dismantling internal silos, enhancing collaboration and overseeing a profitable restructuring, despite the company’s prior losses exceeding R1bn in 2016.
He left behind a solid foundation at Altron and, today, Nyati is working on Eskom’s revival. With the dreaded load-shedding all but gone, Nyati is doing a stellar job at Eskom.
When Nyati left for Eskom, Kapp stepped in to continue Altron’s impressive journey towards greater success. The “warrior defender” was tasked with preserving and building on Nyati’s achievements at Altron.
Under Kapp’s leadership, Altron’s share price has risen 108% year to date, making it one of the JSE’s best-performing stocks, ahead of WeBuyCars. This success parallels Altron’s notable 100% profit increase, largely driven by its platform business — Netstar, Altron FinTech, and Altron HealthTech.
Kapp’s strategy has, so far, delivered shareholder value. The “warrior defender” seems set on establishing sustainable growth.
Altron’s notable moves in recent years include the 2020 unbundling of Bytes Technology Group, which created R13bn in shareholder value. While the divestiture raised questions about Altron’s future without its UK branch, Kapp has stabilised the group, which now has a market value of R7.69bn.
For the six months ending August 2024, Altron reported a profit of R298m, doubling its previous year’s figures, and a 40c interim dividend per share, up 60%.
While defending the company’s gains like a warrior, Kapp is steering Altron through new growth avenues. The key to Kapp’s approach is to focus on Altron’s strengths and long-standing role in using data and technology to create safer, smarter solutions. Those solutions include 102-million healthcare transactions switched annually, 181-billion internet-of-things interactions processed per month, 20-million smart ID cards embedded with its tech and supporting 140,000 point-of-sale terminals.
Over the short term, Altron plans to improve profits in its tracking and telematics business, Netstar and Altron Systems Integration.
The company’s R359m investments in capital expenditure during this period, mainly targeting growth, will support these profit enhancement strategies.
In the platforms segment, Netstar continues its growth, with connected devices up 26% to 2.4-million and subscribers rising 21% to 1.9-million. Netstar’s retention rate of 90% and recent advancements in artificial intelligence and machine learning have further solidified its market position. It has secured significant contracts, including a global managed services partnership with Orica across Africa and Europe, enhancing safety and efficiency through AI-driven solutions.
With 17 new insurance partnerships and 16 new motor dealers, Netstar’s growth trajectory looks promising.
Altron’s FinTech division has also prioritised long-term investments, increasing rental terminals to generate recurring revenue. Meanwhile, Altron HealthTech, the group’s connected health platform, is expanding through partnerships with CareConnect, Dis-Chem Oncology, and others.
This business now serves a diverse customer base, from doctors to government clients, and continues to innovate with AI-driven data insights, especially in oncology, where it has added 18 new practices.
These developments indicate Altron’s commitment to solidifying its role in essential sectors.
As Kapp positions Altron for sustained growth, there are compelling reasons to consider an independent listing of Netstar on the JSE, allowing it to compete directly with peers such as Cartrack and Mix Telematics. Such a move could unlock further shareholder value by enhancing Altron’s market capitalisation.
Reflecting on Altron’s journey, Kapp’s vision aligns perfectly with the company’s legacy.
Founded in 1965 by Bill Venter, Altron grew from a three-person venture to a 14,000-employee group, pioneering telecommunication, electronics and IT solutions globally.
In 2003, Altron controlled more than 200 companies worldwide, generating more than R11.5bn in annual SA sales. The firm has consistently focused on creating solutions that serve both the private and public sectors, including half of the JSE’s Top 100 companies.
Venter’s legacy, as captured in his book Memos for the Chairman, emphasises the energy, vision, and loyalty that propelled Altron’s growth. This heritage resonates with Kapp, the “defending warrior”, committed to preserving Altron’s identity while guiding it into a new era.
As Kapp continues pushing the envelope to create shareholder value for Altron, I can’t shake off Venter’s words, written on the first page of his book: “Dear Gugulakhe, I hope you will find this book of interest. It portrays Altron’s culture, attention to detail, and motivation over a 40-year period where Altron parlayed a three-man business into a 13,000-strong leader in the ICT field.”
The book was a gift from Venter in 2005, a testament to Altron’s legacy and enduring spirit.
With Kapp’s leadership, Altron has maintained its reputation as a resilient and innovative technology group, standing ready to address SA’s evolving needs. The defending warrior’s journey ahead is not without challenges, yet Altron’s track record and Kapp’s strategy hint at continued success.
• Lourie is founder and editor of TechFinancials.
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