F O C U S I N G O N

F I R S T Q U A R T E R

2013

Successand challenges

The Brics Summit

Knowledges h a r i n g

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Editor’s Note

Welcome to the first edition of Denel Insights this year! Inthis issue we focus on our recent successes andchallenges and illustrate the efforts we make to alignourselves with government imperatives.

We also proudly reflect on our growing role as an industryleader on the African continent and in South Africa.

Among the highlights of the first quarter was the Brics summitwhere Denel’s work with alliance partners such as Braziland Russia was showcased to the world as a model of“South-South” co-operation.

There were some 600 media representatives attending thesummit and defence industry seminar in Durban and werelished the opportunity to shine, however briefly, on theglobal stage.

We continue to work on our business models - which haveyielded notable results in the past – and implement theturnaround strategy which focuses on revenue growth, costoptimisation, greater efficiencies and transformation.

This edition, again, reflects the wide spectrum of Denel’sactivities as it performs as a proudly South African companywhich delivers world-class technology, products andservices and contributes to the country’s broaderdevelopmental objectives.

Enjoy the read,

Pam MalindaActing Group Communications Manager

Message from Riaz Saloojee, Group CEO

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The year is proving to be a productive one. Weare growing revenue and consolidating andexpanding our markets.

The challenge for 2013 is to maintain themomentum. The turnaround is not yet completed. Thefinancial challenges have not yet subsided. Wehave to continue on our path to run lean andefficient operations, to achieve more with less and toextract the maximum advantages from our resources.

Priorities include focusing on stakeholder relationsand continuing with our unique contribution tobuilding a knowledge economy with ongoing youth

and skills development initiatives. This is somethingwe take very seriously and is proving to be verysuccessful.

On March 12 we reported to the ParliamentaryPortfolio Committee on Public Enterprises on thestatus of the companies in the group, progress madewith regards to major opportunities, HR andtransformation matters as well as the strategic focusof Denel.

On HR and transformation, Denel’s labour turnoverrate was within the target range of 5-7% and an in-depth exit interview is conducted with all employeeswhen they leave.

Retention in particular of young black engineers andtechnicians is a focus area for management.

There is a special focus on women and people withdisabilities and a succession plan and skillsdevelopment to fast track the development of ACIs.

Our progress is definitely being noted andapplauded. Both our shareholder – through theDepartment of Public Enterprises – and theParliamentary structures we report to havecommented favourably on our business. Anindependent survey recently named Denel as the“best-run state-owned enterprise” in the country. Weare also receiving increasing recognition for ourefforts from the media and commentators.

As importantly, we continue to receive positivefeedback from our clients across the scope of our

business activities. Major players in the defenceindustry – such as Airbus Military – have commentedfavourably about the quality of our products andservices

Earlier in 2013, Denel’s Exco held a session toreview the company’s strategy implementation overthe last year and to develop key interventionsnecessary to take the company forward.

Exco also reviewed the strategic objectives that mustbe achieved over the next three years and confirmedthem as:

• Doubling of revenue;• A strong balance sheet;• An optimised cost structure;• Five percent of turnover invested in Research &

Development; (modernised technology);• To maintain a Level 3 B-BBEE rating, and• Be a credible South African company.

In addition, the strategy of ensuring internalefficiency drives across the group aimed atachieving further business efficiencies and increasingsynergies will be continued. Skills development willbe done in a more integrated way to ensurefunctional group reporting. Strengthening ofleadership and focused transformation will becontinued.

I am confident that we have the right team in placeto create a sustainable and profitable business andmeet our objective to significantly increase revenueand turnover by 2015.

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Strengthening Denel’s leadership and growth strategyNew senior appointments in theDenel Group will strengthen thecompany’s business vision andstrategy, says the Group ChiefExecutive Officer, Riaz Saloojee.They are:

Jan Wessels, the current CEO ofDenel Dynamics, has been appointedto the new position of Group ChiefOperating Officer. His primaryresponsibilities will include biddingand contracting for new orders,ensuring progress of cardinalprogrammes and removing bottlenecks, and steering the group’sinvestment portfolio in newtechnologies, new products and newcapacity.

Wessels has as B.Eng. (Hons) degreefrom the University of Pretoria and hasbeen involved in the defenceenvironment since the 1980s as adesign engineer, systems engineer andsenior manager.

Wessels succeeds Major General(Rtd) Otto Schür, who is retiring afterserving on Denel’s ExecutiveCommittee since 2008. General

Schür enjoyed an illustrious career inthe South African Air Force and alsoserved as a diplomat and ChiefDirector: Acquisition in the DefenceSecretariat.

Tsepo Monaheng is the new CEO ofDenel Dynamics, the company in thegroup responsible for the developmentof tactical missiles, precision-guidedweapons and unmanned aerialvehicle systems (UAVS). An electronicengineering graduate from theUniversity of Cape Town, Monahenghas been responsible for thecompany’s UAV business since 2004.

Phaladi Petje is the new CEO ofDenel PMP, the leading manufacturerof small- and medium calibreammunition for military andcommercial use. He has an honoursdegree in Economics from theUniversity of Limpopo and a post-graduate qualification from the WitsBusiness School.

His appointment comes after 11 yearsin the Denel Group - 8 years as anExecutive Manager Marketing at PMP

and recently, as deputy CEO of PMP.

He succeeds Carel Wolhuter who isretiring after 17 years as CEO ofPMP. During Wolhuter’s tenure thecompany become the leadingmanufacturer of small- and mediumcalibre ammunition for military andcommercial use in Africa.

It also produces drill bits for themining industry and up to 80 tons ofbrass strip daily at its foundry inTshwane.

The key to growth in AfricaAfrica presents significant growth opportunities for Denel and thecompany is ready to move decisively into new markets on thecontinent.

Denel’s declared strategy to focus onopportunities in Africa recognises theimportance of the continent as afuture area for revenue growth, saysJohnny Chabalala, Senior Executive:Business Development.

However, he warns, the companyshould not take Africa for granted orunderestimate the challenges withinthe defence business environments.Each country is different with its ownhistory, defence culture, geopoliticalcircumstances, available budgets,needs and requirements. It requires a dedicated process of relationship-building to make breakthroughs in these markets.

Johnny mentions Uganda, Kenya, Ghana and Botswana as key countriesfor future growth in sub-Saharan Africa. “There is a market for a widerange of products within the Denel stable,” he says, from missiletechnology, to mine-protected vehicles, to small-calibre weapons andammunition.”

He is especially optimistic about the growth potential for services providedby Denel such as the mine clearance done by Mechem, Monitoring andSurveillance capabilities using UAVs as provided by Denel Dynamics andthe maintenance, repair and overhaul of helicopters and fixed wingaircraft performed by Denel Aviation. The recent commissioning andlaunch of the Russian helicopter MRO centre at Denel Aviation is anothermilestone for the Denel Group.

“The big opportunity for us will be to sit with potential clients, analyse theirrequirements, and design tailor-made solutions that can meet their needs,”says Johnny.

� Johnny Chabalala

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Launch of MRO Centre for Russian helicopters at Brics

New industry partnershipsat BricsDenel had a strong presence at the Brics Summit in Durban and usedthe opportunity to position itself as South Africa’s obvious partner-of-choice for companies looking to extend their business into Africa.

“Denel is excited about the many opportunities for new business andcooperation flowing from South Africa’s role within the Brics community,”said GCEO Riaz Saloojee. “We already have established joint ventureswith key defence industry players in the Brics countries and the DurbanSummit provided even greater exposure of the products we manufactureand the services we provide.”

Among the most prominent projects already underway are:

• Denel Dynamics is working with Brazil on the development of the A-Darter, a short-range air-to-air missile.

• Denel Aviation has a relationship with Russian Helicopters to providemaintenance, repair and overhaul services to its range of products inAfrica.

• Denel Aerostructures is involved in talks with Embraer SA tomanufacture parts on future aircraft construction.

Denel also participated in presentations and exhibitions on thecapabilities of the South African defence industry which was hosted bythe Aerospace, Maritime and Defence Industries Association (AMD) onthe side lines of the summit.

Denel Aviation used the occasion of the Brics summit to officially launchits new MRO Centre for Russian Mil Mi-8 and Mi-17-family helicopters atits Kempton Park campus on Tuesday 26 March.

The launch was officially endorsed by President Jacob Zuma who, afterbilateral talks with Russian President Vladimir Putin in Durban, described it asone of the “highlights” of the visit. “This is an important development in ourrelations,” he said.

The new service centre is a joint initiative with Russian Helicopters, the state-owned Russian company that incorporates the world-renowned Mil andKamov brands.

There are some 650 civil and military versions of the Mi-8 and Mi-17-familyhelicopters flying in Africa today. Denel Aviation has already done roadshows across the continent about the new MRO centre and receivedfavourable responses. The first helicopter scheduled to undergo maintenanceat the centre, a South African-registered civilian Mi-8T, is already at thefacility.

The two companies signed a Memorandum of Understanding at the AfricaAerospace and Defence exhibition (AAD) in September last year which setout the broad parameters for cooperation. The necessary ground supportequipment from Russian Helicopters arrived at Denel Aviation in early Marchand has already been installed and commissioned.

� Mike Kgobe, CEO of Denel Aviation at the official launch of the MRO facility for RussianHelicopters at the Kempton Park campus.

Denel’s strong presence at LAADbuilding on success of Brics summitDenel’s participation in the LAAD defence and security exhibition in Rio deJaneiro from 9 to 12 April followed quickly on the very successful Brics summitof emerging nations and the official visit of Brazilian president Dilma Rousseff toSouth Africa.

A seminar on opportunities for growth in the defence industries of the five Bricscountries – Brazil, Russia, India, the People’s Republic of China and South Africa –coincided with the summit. “Denel had a strong presence at LAAD to showcase thequality and range of our products, systems and technology to a wider-range ofdefence decision-makers in Latin America," said Riaz Saloojee, Group CEO.

“We have strong relationships with the defence industries and defence forces ofmany countries in South and Latin America and we used these to grow theknowledge about the products and services we can offer the region,” said Riaz.

LAAD Defence and Security 2013 is the largest exhibition of its kind in LatinAmerica and attracted official delegations from more than 60 countries. Denel wasone of the more than 720 exhibitors to maintain a presence at the Riocentro in Riode Janeiro.

� Mr Mthobisi Zondi, Deputy Director General, Department of Defence; Minister NosiviweMapisa-Nqakula, Minister of Defence, Mr Sipho Mkhanazi, Acting CEO, Armscor andRiaz Saloojee, Group CEO, Denel.

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Denel strengthened its marketing campaign in theMiddle East and Africa through a strong presenceat the International Defence Exhibition (IDEX) inAbu Dhabi in February.

Riaz Saloojee, the Group Chief Executive Officer ofDenel SOC said IDEX is the most opportune vehiclefor the company to present and demonstrate itsproducts and services to defence decision-makers inthe region. The 2011 IDEX was attended by officialdelegations from 52 countries. “We have identifiedthe Middle East as one of the primary regions for ournew marketing drive to grow Denel’s business,” said

Saloojee “At IDEX we had an opportunity to put

some of our flagship products on prominent display

and speak directly to potential clients.”

Denel has maintained strong relations with clients in

the Gulf region for many years. The G6 self-

propelled artillery system, manufactured by Denel

Land Systems, is currently in use by the defence

forces of the United Arab Emirates and Oman. The

first product jointly developed by Tawazun

Dynamics, the Al-Tariq precision-guided bomb kit,

made its debut at IDEX.

Denel Land Systems displayed scale models of its

recently upgraded G6-52. The highly-mobile self-

propelled gun-howitzer has been upgraded with an

increased firing range and ability to fire up to eight

rounds per minute.

The company’s range of turret systems that can be

fitted to armoured fighting vehicles was

demonstrated to visitors. Last year, Denel signed a

R3.5 billion contract with Malaysia to supply turrets

and integrated weapon systems to be fitted to 8X8

armoured vehicles.

Denel hosts a high-level delegation from ChadDenel hosted a high-level delegation from Chad which included the Minister of Defence and Minister of Foreign Affairs.Malusi Gigaba, Minster of Department of Public Enterprises, hosted the event on 29 March. The visitors were given anoverview of the Denel business followed by a tour of the UAV Systems production facility.

Denel’s strong presence at IDEX

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Denel at the forefront in the fight against corruption

Gifts of maths and science dictionaries to learners

Fighting corruption in state-ownedcompanies is an on-going priorityand it is a source of great pride thatDenel receives a clean audit yearafter year.

Themba Zwelibanzi, Group Risk andCompliance Manager, is the man inthe hot seat who says Denel’s rigorouscontrols over tender and procurementprocesses keep corruption at bay.

“We are very proud of our record andthe good systems we have in place tofight corruption,” he said. “The biggestfocus area is procurement fraud andconflict of interest between employeesand suppliers and we have in place agovernance process to prevent this.”

Procurement is the group’s secondbiggest cost driver. Denel spends someR2-billion a year on suppliers makinggood governance and transparency atop priority.

Fraudulent activity anywhere along thesupply chain will push up costs andhave an impact on pricing, ultimatelyaffecting not only Denel, but itscustomers and suppliers.

“Procurement spend is not only aconcern for Denel but to a number ofstakeholders including suppliers,customers and government. Some ofthe suppliers’ existence depends onbidding for Denel’s work,” he says.Denel encourages both the employees

and suppliers to work with manage-ment to prevent procurement fraud.

In order to remain one step ahead,Denel is continually creating checksand balances. Themba recentlyintroduced the data analytics systemwhich analyses trends and identifiesexceptions in the supply chain and isalready showing results. A hot line foremployees and suppliers has also paidoff.

The supply chain at Denel is carefullyscrutinised and tenders will appearbefore various forums before receivingthe go-ahead.

Denel’s procurement frameworkpromotes competitive pricing of quality

services and goods and requireshonesty and fair dealing by employeesinvolved in the supply chain, fromdesign and specification ofrequirements to placement andadjudication of tenders.

Risk management is continuouslyreviewed by management andreported to the group executives on amonthly basis. Internal audits also helpcurb fraud.

Themba, who has a BComm in RiskManagement from UNISA, says the artof risk management involves keepingup with current affairs and havingsome understanding of the regulatoryenvironment.

Denel’s endorsement and funding of a project to give learners a free mathsand science dictionary at shows and the AAD expo has been so successfulthat the DPE are now looking at a countrywide distribution of the books withplans to involve other SOCs.

“I think this is the best handout we have ever been given. If we buy in bulk it turnsout to be cheaper than say, a water bottle - which is usually the type of gift wegive out - and it is of such benefit to learners,” said Zizikazi Mlokoti, ProjectManager at Denel Technical Academy.

The dictionaries give learners from Grade 8 to matric all the formulas anddetailed information they need for maths and science studies. It is a pocketdictionary so it is easy to carry around. Denel distributed 3 000 of these booksat the Africa Aerospace and Defence expo (AAD) last year to learners fromaround the country.

Nontsha Mazengwe, principal of Vaal Reefs Technical High School said theywere thrilled with their gifts: “You can take me up on this but you will see thechange in our children’s maths and science results at the end of this term. We areexpecting distinctions!

“Learners are very happy with it as it clarifies so much for them. It is somethingthey can refer to whenever they want to. Sometimes if they don’t listen in classand miss something then they can refer to the dictionary which comes up witheverything. It is a great step and we really appreciate it. Denel is so respectedhere, we raise your name everywhere.”

“Denel is so respected here…“Nontsha Mazengwe, Principal of Vaal Reefs

Technical High School.

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Knowledge sharing – the way forwardDeniprop employees participated in the firststructured mentoring programme at Denel. Itwas a twelve month programme focussing onknowledge sharing and personal development.

This was an authentic exercise in diversityawareness using conversations to bridge thegender, ethnic and generational divide.

The programme concluded with a broadercommunity project which saw the menteesleadership skills coming to the fore.

This culminated in an awards ceremony on19 March. Awards went to: Lifalethu Ndhlovu,Mentee of the year, Roelf Mare, Mentor of theyear and the Mentoring Partnership of the YearAward went to Roelf Mare and NomakhosiSigasa.

“We are very excited about the outcome of thisproject, but acknowledge that this is only thebeginning of a powerful journey that forms part ofour transformation plans at Denel. Knowledge

sharing and leadership development at all levelsof the organisation must become the culture of ourorganisation. “The mentees of Denel Propertieshave created a legacy with the community basedMake a Difference (MAD) project, and willcontinue to sustain the project through a number ofdevelopment initiatives,”said Rani Padayachey-Moodley, Project Manager.

“There have been many efforts at mentoring in thepast which have failed due to a lack of support orsimple know- how. The difference with thisprogramme lies in the methodology and synergiesbetween mentors, mentees, subject matter expertsand line management. Deniprop, like many otherentities, has an aging workforce in which keyindividuals have critical knowledge and skills thatneed to be transferred.

“A mentoring programme not only benefits theorganisation by reducing the risk of loss of keyskills and knowledge, but also helps reduce theload on the key employees,” she added.

(by Khosi Sigasa-Thoabala)

The last phase of the mentoring programme is the (MAD) Make A Difference Project. This is toencourage team and leadership development as well as to embed the knowledge and skillsgained throughout the programme. Sustainability is key to the project.

The MAD Project commenced in November 2012, and the team of mentees decided to callthemselves Re ya Pele Mentee Team (Re ya Pele means – we going forward). Re ya Pele teamed upwith a community youth organisation, Young People Making a Difference (YPMAD) from Soshanguve,who operate from a shack in the middle of a squatter camp in Soshanguve, with no running water,electricity and basic furnishings.

The organisation was formed in 2008 by three young, unemployed men armed with only a matriccertificate who decided to empower the local community to acquire additional skills. They trainunemployed youth in a variety of skills, assist with homework,(since many pupils in this community

� Back row left to right: Abram Mphiwe, Paul Malekane, Lucas Mabilu and Moses Mokansi. Front row left toright: Anna Malope, Mpolokeng Daimane, Zimmy Geswind, Khosi Sigasa-Thoabala and Lifa Ndhlovu

come from child-headed households or live withgrandparents who are uneducated) and also host HIV/Aidsworkshops.

Deniprop mentees decided to assist with education bydonating two pre-fabricated containers, converted intomobile classrooms, which were refurbished by the menteeswho also provided furnishings and stationery.

Re ya Pele established a partnership between the localschool, Lesedi Primary School and YPMAD since many ofthe children being assisted with homework came from thatschool. The principal agreed to house the pre-fabricatedcontainers on its grounds. On Friday 15 March thecontainers were delivered to the school.

The handover was a tear jerker when YPMAD received theirnew classrooms from Re Ya Pele. All this was done in underthree months and with no funding. The Re ya Pele Teamcomprises Khosi Sigasa-Thoabala , Lifa Ndhlovu, ZimmyGeswind, Mpolokeng Daimane, Abram Mphiwe, MosesMokansi, Lucas Mabilu, Paul Malekane and Anna Malope.

Sustainability is key to the ‘Make a Difference’ project

A number of initiatives are beingplanned to upskill the YPMAD and it ishoped that other Denel entities willcontribute towards this project.

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Tawazun Dynamics facility gets the Crown Prince’s Approval

Denel Dynamics Youth Forum gets together

The precision-guided weapon system, Al Tariq,demonstrated superior accuracy against a laserdesignated target during a recent flight testevaluation.Despite the level of difficulty intentionally selected to give Al Tariq athorough test, the weapon completed its mid-course guidance successfullyand during terminal phase had a direct hit on the designated target (missdistance < 0.5m). Al Tariq has a number of range options, from 40 kmfor the standard version to 100 km for the long-range version. Thedemonstrated accuracy is independent of the range variant. Theweapon can furthermore be pre-programmed to engage targets fromspecific directions and at different dive angles.

Since May 2012, work has been underway on the new Tawazun Dynamicsproduction facility in Abu Dhabi.

The new Tawazun Dynamics facility hosted Sheikh Mohamed bin Zayed Al-Nahyan, Crown Prince of Abu Dhabi and the Deputy Supreme Commander ofthe UAE Armed Forces on 10 February 2013 when the facility received thecountry’s highest approval. The final touches are being added on andproduction is expected to commence during April 2013.

Denel Dynamics used last year’s Aerospace and Defence expo (AAD) as aplatform to announce to the industry an international partnership with Abu-Dhabi-based Tawazun Holdings. The joint venture will see Denel Dynamics makingguided weapon systems in the Middle Eastern country. Denel Dynamics, tradingas Tawazun Dynamics, is 51% owned by Tawazun and 49% by Denel.

Abu Dhabi is the capital and the second largest city of the United Arab Emiratesin terms of population and the largest of the seven member emirates of theUnited Arab Emirates. Abu Dhabi lies on a T-shaped island jutting into thePersian Gulf from the central western coast.

Tawazun Holdings is a strategic investment company focused on defence andspecialised manufacturing and is owned by the government of Abu Dhabi. � Entrance to the Tawazun Dynamics facility – February 2013.

Laser sharp Al Tariq provessuperior

Denel Dynamics Youth Forum (DDYF) hosted a2013 Kick-off Function on Friday 25 January.

Thendo Managa, the outgoing DDYFChairperson, highlighted some of the DDYFachievements such as the Knowledge Hubsymposiums, the 2011 and 2012 Youth Day, theBack to the Future Warfare Work session eventsas well as the many successful foosballcompetitions hosted to encourage socialisingbetween all staff members.

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Young Achievers’ Awards 2013Sixty engineering bursary students fromuniversities across South Africa, who achieved150 distinctions between them in 2012, werehonored on 25 January for top academicperformance.

The Young Achiever Awards 2013 event, held atthe Centurion Country Club, was hosted bybursary sponsors; Denel Dynamics.

Jan Wessels, CEO of Denel Dynamics, saidyoungsters working from advanced technologyenvironments have the potential to create from10 to 1 000 jobs wherever they go in theirproductive lives.

“Young engineers can vastly influence jobcreation and people with bright young mindshave the drive to build things that work throughexperiment and product realisation - exactly thetype of skills South Africa needs to nurture.”

The group of 60 BSc and BEng (Aeronautical,Mechanical, Electronic and ComputerEngineering) undergraduate students came fromuniversities around the country includingUniversities of Pretoria, Cape Town,Witwatersrand, Kwa-Zulu Natal, Stellenboschand Johannesburg. Once bursars become interns,they go through an intense engineering andproject management programme as part of DenelDynamics’ Engineering Academy of Learning.

The Academy steers interns into technologyterritory that pushes limits. The 2012 Interns fromthe Denel Dynamics Engineering Academy ofLearning (EAL) were tasked with designing,manufacturing and commissioning a 1 U CubeSatellite (CubeSat) and its associated groundsupport systems.

The ceremony also marked thefourth year that learners andteachers from Denel DynamicsSaturday Maths and ScienceSchool were included in thehonours list. Learners fromOlievenhoutbosch SecondarySchool and Steve TshweteSecondary School wererewarded for distinctionsachieved in maths and science– a proud moment for everyoneinvolved. These learners arerecruited into the bursaryscheme and eventuallyappointed as engineers-in-training.

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New generation CASSPIR raises the standards

The CASSPIR mine-protected vehicle, one of theiconic products of the South African defenceindustry, has been significantly improved.

The New Generation CASSPIR 2000 sets newstandards in protection, power, manoeuvrability andcomfort for crew and passengers. It even includesair-conditioning as a standard feature.

“The basic, reliable features of the CASSPIR remainthe same,” said Ashley Williams, the GeneralManager of Denel Mechem. “It has always been theworld leader in its class – providing unequalledprotection against landmines, roadside bombs andautomatic rifle fire.

“Now we have upgraded the hull protection byusing a higher quality of steel, increased its power,improved the accessibility for passengers andmounted it on a more versatile and reliable vehicleplatform,” says Mr Williams.

There are two versions of the CASSPIR NG 2000one mounted on a Mercedes Benz drive train andthe 2000B using a Powerstar engine as platform.Both versions will feature an upgraded steel hullmeeting the highest industry standards of protection.

Jack Geldenhuys, Mechem’s Manager for VehicleSystems, says the new vehicle will also feature sidedoors for the driver and crew and an improvedback-door design for troops or passengers to enter

and exit during operations. The CASSPIR can featurein its conventional role as mine-resistant troop carrierbut can also be adapted to become a fieldambulance, a command-and-control vehicle, arecovery vehicle or a light transport vehicle. Allvariants are fitted with run-flat tyres and are availablein 6X6 or 4X4 format and with a choice of manualor automatic transmission.

Jack said the decision to standardise the engine anddrive train makes the CASSPIR a more cost-effectivesolution for the international agencies and defenceforces that depend on its outstanding reputation forreliability. This means substantial savings onmaintenance costs, spare parts and logistics.

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Mechem’s role in preventing rhino poaching

Mechem’s sniffer dogs are playing astar role in helping fight the scourgeof rhino poaching.So far Mechem’s Dog Unit has trained anddeployed 11 dogs and 11 handlers in variousgame parks around the country. Ten of the dogsare tracker and apprehension trained, whichmeans that the dog can track humans andapprehend fleeing poachers.

Mechem has also trained a dog in the detection ofprotected species such as rhino horn, ivory, crayfishand perlemoen and it has been despatched to theCape to help fight poaching.

The Dog Unit presented yet another Stop RhinoPoaching Tracker/Apprehension Dog Handlers

course in the North West Province. This coursestarted on the 28 January and ended on the13 April.

A total of 15 dogs will then have been deployed --a small number, yet these dogs make a hugedifference.

New Mechem cabs provide improved protection

Suppliers’ day for largest and most strategic SA suppliers

Crew members driving trucks thatcarry humanitarian support inconflict areas can now enjoy betterprotection from landmines androadside bombs because of newcabs manufactured by Mechem.

Ashley Williams, the GeneralManager of Denel Mechem, says thenew cab systems are primarily aimedat clients in Africa who renderhumanitarian assistance in post-conflict

zones. Such trucks, carrying life-saving

loads of medicines, food, tents and

fuel, are vulnerable to the scourge of

landmines and roadside bombs.

Ashley says Mechem identified a clear

need for a strengthened cab that can

be fitted on all makes and models of

4X4 or 6X6 supply trucks.

The new cab was designed and

developed at Denel Mechem and the

conversions are done at its facilities inLyttelton. Mechem offers potentialclients a complete multi-purpose truckbased on a Powerstar drive train andfitted with the strengthened mine-protected cab.

Denel Mechem has the capacity toupgrade the level of protection of thecab according to the requirements ofthe client. The standard versions canbe modified into fuel and water trucks

or for medical support. This provides aclient with a versatile range of trucksbased on the same drive train resultingin substantial savings on logistics,maintenance and spare parts.

Ashley said the new truck and cabdesign can also be an ideal futurereplacement for the South AfricanDefence Force’s range of SAMIL trucksthat are now reaching the end of theirworking lives.

Denel Land Systems, incorporating Mechem,hosted a suppliers’ day event for its largest andmost strategic South African suppliers in theprivate sector on 28 February. The main themefor the event was Supplier Transformation andBusiness Sustainability Beyond 2013.

Guest speakers included: Dr Tebogo Makube,Chief Director: DTI-Industrial Procurement, BridgetMohlala, Director: EDD- Economic Developmentand Social Dialogue, Abdul Isma, SA SupplierDiversity Council and Dennis Mlambo, DenelGroup Supply Chain Executive.

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Final operation-ready Rooivalk handover to the SAAFThe final operation-ready Rooivalkhelicopter has been handed over to theSouth African Air Force (SAAF) by DenelAviation.

Mike Kgobe, the CEO of Denel Aviation,says the acceptance of the locally developedcombat support helicopter marks theculmination of a 26 year partnershipbetween the SAAF and Denel.

“We took this proudly South African aircraftthrough all its stages – from design tomanufacturing, upgrading and retrofitting – tothe point where it will soon be deployed.“

Denel will continue to be involved with theRooivalk through on-going maintenance andrepair services and providing the continuedairworthiness engineering support to ensurethe fleet of 11 helicopters remains missionready.

Kgobe says the Rooivalk project is indicativeof the symbiotic relationship between DenelAviation and the SAAF. “We are alwaysready to provide technical and groundsupport to ensure the operational readinessof the Air Force’s fleet.”

This relationship was strengthened last weekwith an agreement in which Denel Aviation

will continue to deliver vital maintenanceservices to the SAAF, leading to continuedairworthiness and the upkeep of air assets.

“This is a win-win situation for both Deneland the SAAF which results in the retention ofhigh-level critical skills, a focused servicedelivery and cost effectiveness for the SAAF,”says Kgobe.

The company recently received a “zerodefect report” from the SAAF to confirm thatall 11 Rooivalk helicopters have beenupgraded to block 1F baseline standards.

Excellent feedback

Denel Aviation is receiving excellentfeedback from the SAAF – and especiallyfrom 16 Squadron at Air Force BaseBloemspruit – where the first batch ofhelicopters has now been flying continuouslysince April 2011.

Dewald Steyn, the project manager:Rooivalk, at Denel Aviation says theperformance of the aircraft is being closelymonitored and evaluated from a design anddevelopment perspective.

The helicopter has exceeded theexpectations and no major maintenance orrepair work has thus far been required.

Denel Aviation (DAv) has met all the internationally recognisedrequirements for occupational health and safety as well as environmentalmanagement required in terms of OHSAS 18001:2007 and ISO14001:2004.

The company successfully achieved certification in both OHSAS 18001:2007and ISO 14001:2004. This is a huge achievement for the company as itdemonstrates its commitment to maintain an effective Safety, Health andEnvironment (SHE) Policy.

“It means that we are able to meet our present needs without compromising theability of future generations to meet their needs and we provide a saferenvironment to work in,” said Patricia Ramalibana, Manager Safety, Healthand Environment. “It also improves our reputation and increases ouropportunities to gain new business with other environmentally cautiouscompanies and it minimizes risks of downtime through accidents.”

Patricia said these certificates demonstrated DAv’s commitment to meet legalobligations and the maintenance of compliance to them, while it is a possiblecost savings from public liability insurance premiums.

“It provides a robust internationally recognized system to maintain andcontinually improve health, safety and environmental management,“ sheadded.

High standards in health, safety and environmental management

� Keeping high standards.. From left Samela Nomxanya - SHE Advisor, PatriciaRamalibana - SHE Manager, Arno de Beer - SHE Advisor

� Lt Col R Buys (left) and Maj J Stirling received the last fully operationalRooivalk on behalf of 16 Squadron.

14

Denel test pilots spread their wings into AfricaExperimental test pilots and flight test engineers from DenelAviation are now taking their unique skills and experience toclients in countries across Africa.

The company now has a mobile telemetry support vehicle which iscapable of supporting flight tests at remote locations, says MikeKgobe, the Chief Executive Officer of Denel Aviation. In the past thishighly-specialised test flying could only be conducted within SouthAfrica.

Mike says this service is part of Denel Aviation’s initiative to grow itsbusiness in Africa. “We are taking our highly-skilled pilots andengineers as well as our state-of-the-art technology to the client,cutting the costs and efforts to fly the planes out to South Africa fortesting.”

Growing markets

The company is also expanding its maintenance and repair servicesto the rapidly growing number of military and civilian aircraft criss-crossing the continent.

Experimental flight testing is one of the specialised services providedby Denel Aviation. The test pilots and flight test engineers have theresponsibility to ensure that every aircraft that leaves the company’sfacilities following maintenance or repair work is in top shape andready for full flying duties.

“Our primary responsibility is aviation safety,” says Derick Matthee,the Manager of the Flight Test Centre. “Once the aircraft has passedour flight testing the client can be absolutely assured that it is 100%safe and ready for regular flying duties.”

International clients

The list of work successfully done for international clients is growingby the day. On the fixed wing side DAv recently completed enginedevelopment testing for the Hawk-120 Lead-in Fighter Traineracquired by the SAAF, did air-to-air refuelling testing between aMirage III and an IL78 Tanker and supported the establishment of theGripen Flight Test Centre at Air Force Base Overberg.

The recent delivery of 12 Cheetah fighter jets to the Ecuadorian AirForce (FAE) was preceded by extensive flight testing and the trainingof the FAE pilots by Denel Aviation.

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Local aerospace industry’s readiness in participating in global boom

As South Africa’s aerospace industryresponds to the rapidly changingglobal environment, its future will beshaped by a number of vitaldecisions on fleet acquisition thatgovernment must take in the next 24months.

The industrial participation benefitsassociated with such acquisitions canserve to strengthen the local advancedmanufacturing industry and accelerateSouth Africa’s aims to become aglobal player in the aviation andaerospace sectors.

At least three major aircraft acquisitionpackages are on the state’s agenda.SAA is engaged in a major exerciseof fleet renewal to replace its long-haulfleet with more fuel-efficient aircraft. SAExpress has announced its intention tointroduce new generation planes on itsregional routes and the SA Air Force isconsidering strategic options tostrengthen its tactical transportcapabilities, protect the country’sextensive coastline and combat thescourge of piracy in southern waters.

Global interest

The interest among global originalequipment manufacturers to deliveraircraft for each of these acquisitionpackages are high and a largenumber of offers have already landedon the tables of the decision-makers.

It is standard practice across the worldthat such bids will not only beevaluated on the basis of cost but alsoon the offset value (i.e. industrialparticipation) and local contentbenefits that manufacturers can bringto the table to support the country’sdevelopmental objectives.

The international experience hasshown that offset offers can cover arange of economic activities -- frominvestments in manufacturing to supportfor training initiatives to firm contractsfor the on-going maintenance, repairand overhaul work to be performed onthe new fleet.

The South African government hasalready indicated its strong support forthe aerospace industry in a number ofdefining policy documents. TheIndustrial Policy Action Plan (IPAP)identifies aerospace as a cluster with“the potential for long-term advancedcapabilities.”

Similarly, an Aerospace SectorDevelopment Plan has been draftedjointly by the departments of Tradeand Industry and Science andTechnology to “manage aerospace asa priority sector” and create anenabling environment for the growth ofthe industry.

Future growth

These policy formulations havealready led to tangible results. InSeptember a Joint AerospaceSteering Committee wasannounced to bring together allstakeholders – governmentdepartments, the private sector,industry bodies, finance institutionsand research and development bodies– in a single representative forum toadvise on the future growth of thesector.

There is optimism in the industry thatthese developments, collectively, willlead to a surge in the advancedmanufacturing sector of the countryand a deepened understanding of thevalue it can add to the South Africaneconomy.

In its recent country report on SouthAfrica the respected research house,Oxford Economics, notes that SouthAfrica’s aviation manufacturing sectorgenerates R1.8 billion direct and R4.6billion indirect benefits to GDP. Itdirectly employs some 7 000 peopleand supports an additional 25 000jobs through the supply chains.

Most successful industrialisingeconomies – including our BRICSpartners, Brazil, Russia, India andChina – are turning to aerospace as akey industry to be developed, nurtured

and, if need be, supported throughstate-sponsored initiatives. In SouthAfrica, companies such as DenelAerostructures, Aerosud, Cliff’s Wayand Dailiff are developing into globalplayers as manufacturers of complexstructures and specialised parts formajor manufacturers such as Airbus,Boeing, Embraer and Bombardier.

Boom for aerospace industry

Despite the global economicrecession, the international aerospaceindustry is experiencing a boom time.Globalisation has led to anunprecedented demand for air travel,spurred on further by the growth in

developing economies such as China,India, Brazil and Turkey.

The major original aircraftmanufacturers such as Boeing andAirbus are pushing the boundaries ofdesign and development of newaircraft in the long-haul segment –most notably in the use of advancedmaterials such as composites in themanufacturing processes.

Local companies such as DenelAerostructures are well-positioned totake advantage of this new wave ofaircraft-manufacturing thanks totimely investments made incomposite technology and experiencegained on projects such as theRooivalk helicopter and the AirbusA400M.

The track record of the localaerospace industry clearly shows thatwe have the collective knowledge,technology, facilities and experienceto participate in multinationalprogrammes – from the design stagethrough engineering, industrialisationand manufacturing.

The new acquisitions and the prudentmanagement of the offsets canstrengthen the industry and ensure thelong-term sustainability of the SouthAfrican aerospace sector.

Opinion piece by Ismail Dockrat. CEO, Denel Aerostructures

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Denel PMP contributes to the safety of fighter pilotsPMP has started with the local production ofpower cartridges for the ejection seats of Gripenfighter aircraft.

The company is proud of the fact that it currentlymanufacturers most of the ejection seat cartridges inaircraft flown by the South African Air Force, saysthe CEO of Denel PMP, Carel Wolhuter. “This is avital contribution PMP is making in ensuring thesafety of our SAAF personnel,” he said.

The explosive cartridges are fitted below the pilot’sseat. In an emergency situation an ejection handle ispulled which jettisons the aircraft’s canopy andpropels the pilot away from the stricken plane beforea parachute is deployed to carry the pilot to safetyon the ground.

Wolhuter says PMP produces the ejection seatcartridges under licence from British company,Martin-Baker, the world’s largest manufacturer ofejection seats.

The acquisition of new aircraft for the SANDF,including the JAS-39 Gripen fighter and the Hawk

lead-in fighter trainer, opened the scope for PMP towiden its product base and move towards theproduction of power cartridges.

“We have successfully qualified the ejection seatcartridges for the Hawk and Gripen aircraft and theHawk is currently flying with proudly South Africanmanufactured components,” said Wolhuter.

The industrialization of the Gripen cartridges wasdone at PMP and monitored by Martin Baker. Fivecomplete sets of locally built cartridges were testedat Martin-Baker’s test chambers, while five sets ofMartin Baker cartridges were tested at PMP to verifythe build quality and test results between the twofacilities. This was a prerequisite before localproduction could start.

PMP’s Power Cartridges department started off as apart of the company’s small calibre division but wasmoved to a separate facility in 1990. The team waslater strengthened with personnel from AdvenaLaboratories.

Since then PMP has gained experience inpyrotechnical systems, the design and managementof high-technology system support, qualitymanagement and an excellent track record ofcustomer support.

The product range includes cable cutting cartridges,parachute deployment cartridges, crew escapesystems and canopy fragmentation systems.

Image: Hoo Leng Siong

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Denel Overberg Test Range provides telemetry launch supportTwo telemetry specialists from Denel Overberg Test Range and a high-technology mobile telemetry station are leaving for French Guiana in SouthAmerica to track the launch of the Vega space mission.

Abrie van der Walt, CEO of Denel Overberg Test Range, says its participation inthe launch, scheduled for May, confirms international confidence in Denel’sexpertise, resourcefulness and experience in space science that has beendeveloped over the past decade.

French Guiana is an overseas region of France and is on the north Atlantic sideof South America.

Two telemetry experts, Leon Korkie and Deon van der Hoven, will assemble themobile telemetry station on site, integrate it with the French Space Agencytelemetry kit and participate in the qualification of the telemetry network beforesupporting the actual mission.

Denel’s mobile telemetry station will be used to improve coverage of the poweredphase of the ascent of the launch vehicle shortly after launch from the GuianaSpace Centre near Kourou until it is about to disappear over the horizon.

The Vega mission will carry two satellites, including a demonstration satellite, intoa polar orbit. The launch vehicle was developed by the European Space Agencyand the May launch of Vega VV02 follows on the successful launch of VVO1 inFebruary 2012.

Japie Venter, the Project Manager at the Denel Overberg Test Range, says thetelemetry group completed preparations of the mobile telemetry station in recordtime that. It is now ready to leave for French Guiana. “We are very proud of ourteam that provides a reliable and responsive service to international clients,” hesays.

The Test Range has already successfully supported three missions in a five yearcontract with the French Space Agency and will provide telemetry launchtracking support to future European space launches.

� Herman Steenkamp and Nico du Plessis, telemetry specialists from Denel OverbergTest Range, putting a segment of the antenna dish into a container which will beshipped to Kourou in French Guiana for launch support.

� Herman Steenkamp busy with calibrations on the mobile telemetry station,before it was packed to be shipped to French Guiana, for launch supportby telemetry specialists from Denel Overberg Test Range.