Eskom’s interim financials revealed a decline in all financial metrics compared to those of the same period for the previous financial year, with sales revenue declining by 2% to R95.5-billion, operating costs remaining flat at R66,7-billion, net cash generated from operations declining by 30% to R22-billion, net finance costs increasing by 53% to R10-billion, and net profit after tax declining by 34% to R6.3-billion.
Eskom’s financial position for the second half of the financial year ending 31 March 2018 traditionally worsens significantly, with lower sales revenue and higher maintenance costs than in the first half. Eskom’s year-end financials are therefore expected to reflect a significant net loss position.
The release of Eskom’s interim financial results follows the recent liquidity crisis at the utility, the downgrade of Eskom’s credit rating by ratings agency, Moody’s, from B1 to Ba3, and concerns by banks, financial institutions and lenders in respect of the “going concern” status of Eskom as reflected by its apparent inability to meet loan capital and interest repayments from operating income for the months ahead.
The liquidity crisis was attributed to poor leadership and governance by the previous Eskom chairman, board and executive management, with perceptions of maladministration and corruption by the financial community leading to difficulties in Eskom rolling over existing debt, obtaining bridging finance and raising new debt.
Energy analyst Chris Yelland breaks down the Eskom results
Ten key takeaways from the Eskom 2017/18 interim financial results are as follows:
Chris Yelland is investigative editor, EE Publishers
Photo: Eskom chairman, Jabu Mabuza
Want to watch Richard Poplak’s audition for SA’s Got Talent?
Who doesn’t? Alas, it was removed by the host site for prolific swearing*... Now that we’ve got your attention, we thought we’d take the opportunity to talk to you about the small matter of book burning and freedom of speech.
Since its release, Pieter-Louis Myburgh’s book Gangster State, has sparked numerous fascist-like behavior from certain members of the public (and the State). There have been planned book burnings, disrupted launches and Ace Magashule has openly called him a liar. And just to say thanks, a R10m defamation suit has been lodged against the author.
Pieter-Louis Myburgh is our latest Scorpio Investigative journalist recruit and we’re not going to let him and his crucial book be silenced. When the Cape Town launch was postponed, Maverick Insider stepped in and relocated it to a secure location so that Pieter-Louis’ revelations could be heard by the public. If we’ve learnt one thing over the past ten years it is this: when anyone tries to infringe on our constitutional rights, we have to fight back. Every day, our journalists are uncovering more details and evidence of State Capture and its various reincarnations. The rot is deep and the threats, like this recent one to freedom of speech, are real. You can support the cause by becoming an Insider and help free the speech that can make a difference.
*No video of Richard Poplak auditioning for SA’s Got Talent actually exists. Unless it does and we don’t know about it please send it through.
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