JOHANNESBURG, Eskom, South Africa’s State-owned power utility, says it is not facing financial distress and aims to release 105 billion Rand (about 8.12 billion US dollars) in government guarantees.
“Our ambition is to release about 105 billion Rand in government guarantees and that will ensure we focus on the sustainability of this organization, its interim Group Chief Executive Johnny Dladla told a media briefing here Wednesday.
This was reiterated by the utility’s Chief Financial Officer (CFO), Anoj Singh, and interim board chairman Zethembe Khoza, who said the utility is financially sound and stable. Singh said Eskom was looking at alternative sources of funding not requiring government guarantees.
Briefing the media on the company’s 2017 consolidated annual financial results released Wednesday, Dladla, who was appointed to the position last month, said that looking at the numbers will also give comfort in terms of where the utility is and that with the results Eskom is positioning itself to emerge from its challenges.
The results showed that Eskom’s revenue increased by 7.9 per cent to 177 billion Rand, while EBITDA (earnings before interest, tax, depreciation and amortization) totalled 38 billion Rand, an increase of 14.4 per cent over the previous year.
Eskom’s own generating costs fell by 8.5 per cent to 60 billion Rand with total primary energy costs down by 2.3 per cent.
Cost savings at the utility of 20 billion Rand were achieved compared with a target of 17 billion Rand.
Eskom’s arrears in debt owed to it by municipalities, including interest, increased from 6.0 billion Rand to 9.4 billion Rand.
“Payment arrangements were signed with 60 municipalities with 20 fully honouring the payment arrangement and 11 partially [doing so],” said Dladla.
Dladia said that since his appointment by Public Enterprises Minister Lynne Brown, his focus and that of the board had been on the Minister’s concerns around leadership cohesion within the utility, as well as on contract management, among others.
“I will strive to meet those expectations of the shareholder representative (the Minister),” said Dladla.
Eskom also announced that it had received a report regarding allegations of impropriety against the former group chief executive officer, Matshela Koko.
At a briefing in May, Brown said the former executive had decided to go on leave until the investigation was concluded.
On Wednesday, Zethembe said Eskom received the report on June 23. We then sought legal advice ….. and the charges were drafted, he said.
Source: NAM NEWS NETWORK