Is a profit really one when you receive taxpayer money?

Government funding helped Eskom post a 22% increase in net profit for the six months ended 30 September 2015.

Eskom CEO Brian Molefe said the entity’s profit increase R11.3bn, while achieving a 9% increase in Ebitda (Earnings before interest, taxes, depreciation and amortization) to R24.9bn

Revenue increased by 8%, while primary energy costs went up by 7.7%, he explained.

Molefe said Eskom received the first tranche of R10bn of government equity injection, while R13bn is expected in March 2016.

R60bn in government loans was converted to equity, while R46bn of the R55bn funding for the year was secured, which improved the liquidity position, said Molefe.

“Operating expenses are under control,” he said. “Maintenance costs increased by 11.2% due to strategy to perform more planned maintenance.”

Molefe said payment agreements have been signed with 50 defaulting municipalities, including 15 of the top 20. Approximately 52% of the outstanding amount is within due date.

He also said plant availability has improved to 74.4% as at November 16 2015 due to the positive impact of planned maintenance, says Brian Molefe.

In the period under review Eskom has transformed the classic game Tetris into a planning tool to improve maintenance planning on its ageing power fleet, thus avoiding load shedding.

Matthew le Cordeur, Fin24