Eskom shoots the lights out
Eskom made a significant half-year profit of R17.83 billion as the utility’s turnaround extends to its financial health.
Eskom released its interim results for the six months through September 2024 on Thursday, which showed a remarkable improvement in the utility’s financial performance.
The utility reported revenue of R183.71 billion, an almost 16% increase from the comparative half-year period. Eskom’s EBITDA rose by 64% to R61.66 billion.
The company’s profit for the six-month period was R17.83 billion – up over 1,000% from the R1.61 billion it recorded in 2023.
The utility explained that its revenue improved due to higher tariffs, the suspension of load-shedding, and the impact of seasonality.
Eskom’s improved financial performance coincides with a positive turnaround in its operations.
Following years of mismanagement and operational struggles that saw the country experience frequent power outages, Eskom’s performance has improved significantly.
The utility has not had to implement load-shedding since March last year, and its energy availability factor is around 60%, the highest it has been in years.
This improvement in its operations has now also translated into an improved financial performance, as Eskom was able to sell more electricity and reduce its diesel spending.
The utility’s balance sheet has also benefitted from a bailout from the National Treasury.
The government announced a R254 billion debt relief package for the struggling utility in 2023 that is being paid out in yearly tranches.
The utility is set to receive R66 billion in 2025 and R40 billion in 2026.
Eskom noted that this debt relief package helped to increase its cash and cash equivalents balance to R33.01 billion from R23.59 billion at 31 March 2024.
It said this increase was mainly due to the debt relief support received as well as an improvement in the cash generated from operations during the period.
Despite this, the utility warned that its liquidity in the longer term after the debt relief period remains at risk.
This is because of the financial sustainability challenges arising from an inadequate tariff path, high debt service costs, escalating municipal arrear debt, operational inefficiencies, the impact of fraud and corruption and a continued focus on addressing plant performance.

The Auditor-General (AG) also recently released her Eskom audit outcomes to Parliament’s Portfolio Committee on Electricity and Energy.
The AG found that Eskom made very little progress in implementing recommendations made by auditors over the years.
“The significant internal control deficiencies that resulted in negative audit outcomes for at least the previous five years were not addressed,” the AG said.
The report revealed there is a material breakdown in controls over compliance with applicable laws and regulations at Eskom.
This has hindered the utility’s ability to prevent material non-compliance findings, resulting in qualified audit opinions.
“Adequate action is not taken against officials who contravene the supply chain management prescripts, resulting in continued noncompliance and irregular expenditure,” it said.
“Failure to implement consequence management encourages a culture where the disregard for legislation, policies, and procedures thrives.”
Eskom also failed to meet numerous targets, which hurt both the utility and South Africa’s economy.
It failed to meet its 80% energy availability factor target, did not increase the reserve margin, and did not reach its planned R22 billion savings from turnaround initiatives.
Eskom further failed to comply with environmental laws and regulations, there is a backlog of forensic cases, and it did not meet minimum financial standards.
The AG said that while Eskom is a going concern, various dependencies and internal and external uncertainties could impact this position.
One of Eskom’s biggest threats is municipal debt, which has topped R95 billion.
The utility previously noted that this debt pile could jeopardise its plans to spin off its distribution unit, a move that is key to boosting Eskom’s efficiency and securing investment.
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