State-owned rail and ports operator Transnet mentioned its full-year loss widened as theft and vandalism resulted in muted development in shipments and because it offered for lawsuits.
Transnet posted a lack of R7.3-billion for the yr to March 2024, in contrast with a restated R5.1-billion loss in 2023. Its freight-rail enterprise — the most important working unit accounting for 44% of income — delivered 151.7 million tons of cargo throughout the interval, up 1.5% from the prior yr. Pipeline volumes fell 2%, whereas port-container actions improved 2.9%, it mentioned.
“Collisions, derailments, neighborhood unrest on the coal line and tools availability on the ore line” affected volumes, the corporate mentioned in an announcement on Monday. “Excessive ranges of cable theft in addition to infrastructure vandalism” additionally affected the rail enterprise, it mentioned.
A court docket in June ordered that Transnet pay Sasol and TotalEnergies R6.2-billion in damages, alleging that the state-owned firm overcharged the companies in an alleged breach of a 1991 oil pipeline contract. Transnet mentioned it has offered R9.3-billion in its accounts for the declare, curiosity and authorized charges, and appealed the choice on 8 July.
Transnet is nearly a yr right into a turnaround technique that it introduced in October 2023 to overtake its rail and port companies and deal with the impacts of years of mismanagement, theft and vandalism. The challenges, together with underinvestment in infrastructure and tools, and exterior shocks together with floods and excessive climate occasions, have added to operational issues.
The corporate’s administration mentioned the plan is beginning to bear fruit, with additional enhancements in rail volumes anticipated within the present monetary yr.
Assist package deal
Transnet, with whole debt of R226.5-billion, has repeatedly mentioned its turnaround and development plan wants vital capital to implement. That led to nationwide treasury offering the entity with a R47-billion assist package deal.
The auditor-general, which verified Transnet’s accounts, mentioned “materials uncertainty exists which will forged vital doubt on the entity’s capacity to proceed as a going concern”.
Learn: Tech sector feeling influence of Transnet ports chaos
Final week, the New Growth Financial institution — a lender fashioned by the Brics group of economies — granted Transnet a R5-billion mortgage. It would use the funds to modernise and enhance South Africa’s freight-rail community.
The African Growth Financial institution in July accepted a mortgage of R1-billion for the primary section of the corporate’s five-year capital funding plan that requires R152.8-billion. — Ntando Thukwana, with Paul Burkhardt, (c) 2024 Bloomberg LP
