JOHANNESBURG, Nov 28 (Reuters) – South African state power utility Eskom said on Friday that it expected this year’s profit to be similar to last year’s, after a strong first six months helped by higher tariffs and lower finance costs.
Eskom made 16 billion rand of profit after tax last year, its first full-year profit in eight years, after a steep reduction in the recurring electricity blackouts that have held back Africa’s biggest economy for more than a decade.
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The rebound in its financial results has been underpinned by a multi-year government bailout and a sharp turnaround in the performance of its coal-fired power stations.
It made profit after tax of 24.3 billion rand ($1.4 billion) in the first half of its current financial year, which coincided with the southern hemisphere winter months when Eskom sells more power and does less plant maintenance.
Eskom said the result showed last year’s profit was not a one-off achievement.
In the six months to the end of September, revenue was up 4% to 191.3 billion rand, helped by a 12.7% average tariff increase.
Net finance costs fell 14% to 15.3 billion rand due to lower interest rates and levels of debt. But the money it is owed by struggling municipalities rose to 105 billion rand from 90.1 billion rand a year before.
Eskom said power cuts were only implemented on four days of the six-month period covered by its latest results. In 2023, when power cuts reached record levels, there were outages on more than 300 days of the year.
The former state monopoly is still the country’s dominant electricity supplier, mostly generating power from coal-fired plants though it also operates a nuclear plant and some smaller facilities that burn diesel or harness water.
($1 = 17.1260 rand)
Reporting by Anathi Madubela;
Editing by Alexander Winning and Emelia Sithole-Matarise
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