South African state-owned rail and port operator Transnet reported a loss of 7.3bn rand ($0.41bn) in the year to 31 March, out from a R5.1bn loss the previous year, according to results announced today. The company cites a lost legal battle and theft and vandalism on its rail line.
Transnet's rail business contended with collisions, community unrest, equipment failures, derailments, power outages and customer challenges, the company said.
Transnet Freight Rail (TFR) delivered 151.7mn t of cargo, with coal deliveries generating R10.23bn, up by R277mn on 2023.
A recovery plan that gave Transnet R47bn of support kicked in from October 2023, and holds out the prospect of improved deliverables. But persistent wagon and locomotive shortages, maintenance backlogs, increased energy costs, and reduced demand as a result of these prevailing challenges capped expected results for 2024.
Transnet revenues increased by 11.6pc to R76.6bn, in line with weighted average tariff increases, but net operating expenses increased by 19pc to make provisions for litigation by energy companies Sasol and Total in Transnet's pipeline business.
Debt totalled R226.5bn for the year. Recently, the New Development Bank — lender for countries of the Brics group — also granted Transnet a R5bn loan for rail modernisation. This is on top of a R18.85bn loan from the Asian Development Bank for recovery and growth.
Against the backdrop of mounting debt, auditors have cast doubt over Transnet's operational viability after weighing its performance and capital expenditure required. A report by the auditor general to parliament said there is reason to "doubt the entity's ability to continue as a going concern".
Transnet says its recovery plan and collaboration with industry stakeholders will bear fruit and the firm has set a profit target of R1bn for 2025.
