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Remuneration report
Section 2: Implementation report

The implementation report highlights the outcomes of the implementation of the approved remuneration policy. The potential consequences of the remuneration policy on the total remuneration for executive directors and prescribed officers are illustrated below, hurdle rate, on target earnings and maximum cap. Actual remuneration in the year under review is also included.

Section 2: Implementation report

The aggregate remuneration and benefits paid and STI approved in respect of the 2018 financial year.

FY2018 emoluments per executive director

Blue arrow GP*
R  
STI
R
Fringe and
other benefits
R
LTI (vested
shares)
R
  Total
FY2018
R
  Pension TRF    
13%**
R    
Executive directors                
SN Maseko 8 050 000   7 580 163 11 997 11 551 650   27 193 810   901 600    
DJ Fredericks 5 565 000   4 123 055 11 997 3 888 066   13 588 118   593 299    
Total 13 615 000   11 703 218 23 994 15 439 716   40 781 928   1 494 829    
* Guaranteed package includes basic salary, company contribution toward TRF and flexible allowance.
** Company pension contribution.

The aggregate remuneration and benefits paid and STI approved in respect of the 2017 financial year.

FY2017 emoluments per executive director

Blue arrow
GP*
R  
STI
R
Fringe and
other benefits
R
LTI (vested
shares)
R
  Total
FY2018
R
  Pension TRF    
13%**
R    
Executive directors                
SN Maseko 7 441 200   8 813 911 11 997 9 637 818   25 904 926   833 414    
DJ Fredericks 5 250 000   4 365 753 11 997 3 857 167   13 484 917   559 650    
Total 12 691 200   13 179 664 23 994 13 494 985   39 389 843   1 393 064    
* Guaranteed package includes basic salary, company contribution toward TRF and flexible allowance.
** Company pension contribution.

Prescribed officers’ remuneration (excluding executive directors)

The aggregate remuneration, benefits paid and STIs approved for FY2018 are set out in the table below.

FY2018 emoluments per prescribed officer

Blue arrow
Company
GP*
R  
STI
R
Fringe and    
other benefits**
R    
LTI
(vested
shares)
  Total
R
  Pension –      
TRF13%***
R      
BC Armstrong1,3 1 250 336   4 736 586     7 581 727   13 568 649   79 771      
LM de Villiers1,4 3 387 101   2 295 218 1 424 527     7 182 060   14 288 906   460 646      
NM Lekota 3 392 000   2 640 079 –       6 032 079   356 160      
LTS Maloba2 1 354 703   686 560 –       2 041 263   115 513      
TBL Molefe2 4 085 000   3 142 969 –       7 227 969   308 009      
IM Russell 5 000 000   0 11 997     2 461 014   7 473 011   390 000      
AN Samuels 5 000 000   3 816 500 11 997     1 643 012   10 471 509   377 000      
A Vitai1,5 6 004 900   4 634 525 3 209 501     10 454 219   24 303 145   –      
I Mophatlane1,3 2 100 082   8 231 682     8 610 684   18 942 448   105 004      
T Seopa1,3 2 018 441   3 791 836     3 020 953   8 831 230   152 190      
Total 33 592 563   17 215 851 21 418 126     40 953 669   113 180 209   2 344 293      

FY2017 emoluments per prescribed officer

* GP includes basic salary, company contribution towards TRF and flexible allowance.
** Fringe and other benefits includes motor car insurance, relocation benefit, separation package, notional completion bonus and leave payments.
*** Company pension contribution.
1 Exited as prescribed officer: BC Armstrong - 30 June 2017; LM de Villiers - 31 March 2018; A Vitai - 31 March 2018; I Mophatlane - 31 July 2017; STM Seopa - 31 October 2017.
2 Appointed as prescribed officer: LTS Maloba - 13 November 2017; TBL Molefe - 1 April 2017.
3 Separation and leave pay included in fringe and other benefits for BC Armstrong; I Mophatlane; and T Seopa.
4 Notional completion bonus and leave pay included in fringe and other benefits for LM de Villiers.
5 Notional completion bonus, relocation benefits and leave pay included in fringe and other benefits for A Vitai.
Blue arrow
Company
GP*
R  
STI
R
Fringe and    
other benefits**
R    
LTI (vested
shares)
  Total
FY2018
R
  Pension –      
TRF13%***
R      
BC Armstrong 5 001 345   4 249 353 11 997     1 037 264   10 299 959   319 086      
LM de Villiers 3 288 448   2 681 058 11 997     3 635 999   9 617 502   447 229      
NM Lekota 266 667   179 207 –       445 874   28 000      
IM Russell 4 153 353   4 103 244 11 997     1 236 249   9 504 843   323 961      
AN Samuels 4 153 353   4 433 738 11 997       8 945 735   339 300      
A Vitai 5 830 000   5 777 314 11 997       11 619 311   –      
I Mophatlane 5 804 827   5 341 562 519 909       11 666 298   246 371      
T Seopa 3 460 184   –       3 460 184   260 898      
J Henning1 1 900 000   594 660 96 371     921 224   3 512 255   172 841      
Total 34 204 824   27 360 136 676 265     6 803 736   69 071 961   2 137 686      
* Guaranteed package includes basic salary, company contribution towards TRF and flexible allowance.
** Fringe and other benefits includes motor car insurance and company car benefit.
*** Company pension contribution.
1 Stepped down following merger of enterprise with BCX.

Executives and prescribed officers’ emoluments are set out in the annual financial statements in note 38, which is availible online at www.telkom.co.za/ir.

Executive management

Blue arrow
GP*
R  
STI
R
LTI
R
Fringe and    
other    
benefits**
R    
  Total
FY2018
R
  Total
FY2017
R
Executive management team 94 479 605   50 852 470 15 961 070 3 530 462       164 823 607   200 794 593
Total           44   47
* Guaranteed package includes basic salary, company contribution towards TRF and flexible allowance.
** Fringe and other benefits includes motor car insurance, separation package, and leave payments.

Non-executive directors’ fees

The group benefits from active non-executive directors who not only attend meetings, but actively contribute to the success of our business. Therefore, non-executive directors receive an annual retainer plus meeting attendance fees. They do not receive short or long-term incentives. Telkom’s MOI states that shareholders must approve these fees at the AGM. The current fee level was approved at the AGM on 24 August 2017.

Blue arrow
2018
R
  2017
R
 
Chairman of the board 1 325 000   1 250 000  
Non-executive director of the board 387 960   366 000  
International board member 535 732   505 408  
Audit committee chairman 281 037   220 600  
Audit committee member 147 321   134 900  
Risk, remuneration and social and ethics committee chairman 212 000   200 000  
Risk, remuneration and social and ethics committee member 127 200   120 000  
Nominations committee chairman 141 033   133 050  
Nominations committee member 95 400   90 000  
Investment and transactions committee chairman 146 426   138 138  
Investment and transactions committee member 95 400   90 000  
Committee Scheduled
meetings
  Fee per
meeting
Special
meetings
  Fee per
committee meeting
Board 5   Annual retainer 1   Chairman:
R24 804
Audit 5   Chairman: R70 259 1   Member:
R18 550
      Member: R36 830      
Risk 4   Chairman: R53 000 0    
      Member: R31 800      
Remuneration 4   Chairman: R53 000 1    
      Member: R31 800      
Nominations 3   Chairman: R47 011 0    
      Member: R31 800      
Investment and transactions 3   Chairman: R48 808 2    
      Member: R31 800      
Social, ethics and sustainability 4   Chairman: R53 000 0    
      Member: R31 800      

Board members do not receive fees for voluntarily attending a committee meeting of which they are not members. All fees are paid proportionally to the period in which office is held. Non-executives’ emoluments are set out in the annual financial statements in note 38, which is available online at www.telkom.co.za/ir.

Beneficial shareholding

Directors’ shareholding as at 31 March 2018

  Beneficial   Non-beneficial  
Director’s interest and prescribed officers Direct   Indirect   Direct   Indirect  
Executive                
SN Maseko 52 520        
DJ Fredericks 48 711   534      
Total 101 231   534      
Non-executive                
JA Mabuza 26 000              
I Kgaboesele 12 000              
KW Mzondeki 748              
Total 38 748        

The beneficial interest of one of our executive directors, DJ Fredericks has increased from 48 978 to 49 245 due to indirect shareholding acquired.

The beneficial interest of one of our non-executive directors, KW Mzondeki has increased from 267 to 748 due to purchase of shares.

Subsequent to 31 March 2018, the indirect beneficial shareholding of DJ Fredericks has reduced by 267 shares. Other than this change there has been no change to directors’ shareholding between 31 March 2018 and the date of the approval of the integrated report.

Directors’ shareholding as at 31 March 2017

  Beneficial   Non-beneficial  
Director’s interest and prescribed officers Direct   Indirect   Direct   Indirect  
Executive                
SN Maseko 52 520        
DJ Fredericks 48 711   267      
Total 101 231   267      
Non-executive                
JA Mabuza 26 000              
I Kgaboesele 12 000              
KW Mzondeki 267              
Total 38 267        
                                       
  Year of
the
award
  Shares
awarded
  Share
award price
R
  Face value
of award
R
  Vested
shares
  Vesting
date
  Vesting
price
R
  Value of
vested
shares
R
  Shares
forfeited
  Closing
number
 
SN Maseko                                        
FSP 2013   163 866   23.80   3 900 011   81 933   06/06/2016   59.63   4 885 665     32 773  
36 870   05/06/2017   78.76   2 903 881   12 290  
ASA 2013   54 622   23.80   1 300 004   54 622   06/06/2016   59.63   3 257 110      
FSP 2014   138 352   76.11   10 529 971   51 882   05/06/2017   78.76   4 086 226   17 294   69 176  
FSP 2015   150 428   74.20   11 161 758             150 428  
Performance
shares
2015   50 143   74.20   3 720 611   25 072   06/06/2016   59.63   1 495 043      
25 071   05/06/2017   78.76   1 974 592    
FSP 2016   197 066   56.64   11 161 818             197 066  
Performance
shares
2016   65 689   56.64   3 720 625   32 845   05/06/2017   78.76   2 586 872     32 844  
FSP 2017   161 366   74.83   12 075 018             161 366  
ASA 2017   53 789   74.83   4 025 031             53 789  
Total     1 035 321       61 594 845   308 295           21 189 390   29 584   697 442  
DJ Fredericks                                    
FSP 2013   74 898   23.80   1 782 572   37 449   06/06/2016   59.63   2 233 084     14 980  
16 852   05/06/2017   78.76   1 327 264   5 617  
ASA 2013   27 236   23.80   648 217   27 236   06/06/2016   59.63   1 624 083        
FSP 2014   86 705   76.11   6 599 118   32 514   05/06/2017   78.76   2 560 803   10 839   43 352  
FSP 2015   53 066   74.20   3 937 497             53 066  
FSP 2016   69 043   57.03   3 937 522             69 043  
FSP 2017   55 776   74.83   4 173 718               55 776  
ASA 2017   92 961   74.83   6 956 272               92 961  
Total     459 685       28 034 916   114 051           7 745 233   16 456   329 178  
IM Russell                                    
FSP 2013   24 005   30.35   728 552   12 003   06/06/2016   59.63   715 739     4 800  
5 401   05/06/2017   78.76   425 383   1 801  
ASA 2013   8 729   30.35   264 925   8 729   06/06/2016   59.63   520 510      
FSP 2014   68 922   76.11   5 245 653   25 846   05/06/2017   78.76   2 035 631   8 615   34 461  
FSP 2015   41 981   74.20   3 114 990               41 981  
FSP 2016   54 621   57.03   3 115 036               54 621  
FSP 2017   46 105   74.83   3 450 037               46 105  
ASA 2017   76 841   74.83   5 750 012               76 841  
Total     321 204       21 669 205   51 979           3 697 263   10 416   258 809  
AN Samuels                                    
FSP 2014   55 629   76.11   4 233 923   20 861   05/06/2017   78.76   1 643 012   6 954   27 814  
FSP 2015   40 431   74.20   2 999 980               40 431  
FSP 2016   59 179   57.03   3 374 978               59 179  
FSP 2017   50 114   74.83   3 750 031               50 114  
ASA 2017   83 523   74.83   6 250 026               83 523  
Total     288 876       20 608 938   20 861           1 643 012   6 954   261 061  
NM Lekota                                    
FSP 2016   21 042   57.03   1 200 025               21 042  
FSP 2017   33 997   74.83   2 543 996               33 997  
ASA 2017   33 997   74.83   2 543 996               33 997  
Total     89 036       6 288 016                 89 036  
TBL Molefe                                    
FSP 2017   40 943   74.83   3 063 765               40 943  
ASA 2017   68 238   74.83   5 106 250               68 238  
Total     109 181       8 170 014                       109 181  
BC Armstrong                                    
FSP 2013   15 126   23.80   359 999   7 563   06/06/2016   59.63   450 982      
3 403   05/06/2017   78.76   268 020   1 135  
2 411   30/06/2017   61.48   148 228   614  
ASA 2013   9 832   23.80   234 002   9 832   06/06/2016   59.63   586 282      
FSP 2014   82 717   76.11   6 295 591   31 019   05/06/2017   78.76   2 443 056   10 340    
26 374   30/06/2017   61.48   1 621 474   14 984  
FSP 2015   50 553   74.20   3 751 033   29 499   30/06/2017   61.48   1 813 599   21 053    
FSP 2016   65 773   57.03   3 751 034   19 818   30/06/2017   61.48   1 218 411   45 955    
ASA 2017   50 127   74.83   3 751 003   1 121   30/06/2017   61.48   68 919   49 006    
Total     274 128       18 142 661   131 040           8 618 971   143 087    
LM de Villiers                                    
FSP 2013   70 603   23.80   1 680 351   35 302   06/06/2016   59.63   2 105 058      
15 886   31/03/2018   52.58   835 286   5 295  
13 597   31/03/2018   52.58   714 930   523  
ASA 2013   25 674   23.80   611 041   25 674   06/06/2016   59.63   1 530 941      
FSP 2014   54 569   76.11   4 153 247   20 463   31/03/2018   52.58   1 075 945   6 822    
23 283   31/03/2018   52.58   1 224 220   4 001  
FSP 2015   33 239   74.20   2 466 334   26 389   31/03/2018   52.58   1 387 534   6 850    
FSP 2016   43 246   57.03   2 466 319   21 316   31/03/2018   52.58   1 120 795   21 930    
FSP 2017   33 948   74.83   2 540 329   7 172   31/03/2018   52.58   377 104   26 776    
ASA 2017   33 948   74.83   2 540 329   8 487   31/03/2018   52.58   446 246   25 461    
Total     295 227       16 457 950   197 569           10 818 059   97 658    
A Vitai                                    
FSP 2014   95 374   76.11   7 258 915   35 765   31/03/2018   52.58   1 880 524   11 922    
40 691   31/03/2018   52.58   2 139 533   6 996  
FSP 2015   58 929   74.20   4 372 532   46 786   31/03/2018   52.58   2 460 008   12 143    
FSP 2016   76 670   57.03   4 372 490   37 792   31/03/2018   52.58   1 987 103   38 878    
FSP 2017   60 185   74.83   4 503 644   12 714   31/03/2018   52.58   668 502   47 471    
ASA 2017   100 309   74.83   7 506 122   25 077   31/03/2018   52.58   1 318 549   75 232    
Total     391 467       28 013 703   198 825           10 454 219   192 642    
LTS Maloba                                    
LTIP 2017                      
Total                              
I Mophatlane                                    
LTIP 2016   255 384   65.34   16 686 791   63 846   05/06/2017   78.76   5 028 511      
55 068   31/07/2017   65.05   3 582 173   136 470  
Total     255 384       16 686 791   118 914           8 610 684   136 470    
T Seopa                                    
LTIP 2016   147 805   70.23   10 380 345   59 491   31/10/2017   50.78   3 020 953   88 314    
Total     147 805       10 380 345   59 491           3 020 953   88 314    

Details of full share award history since date of appointment within Telkom.