http://www.fin24.com/Companies/Eskom-posts-R36bn-profit-20100602
Johannesburg – Power utility Eskom on Wednesday reported a significant financial turnaround, posting a R3.6bn profit for the year to end-March.
Revenue increased to R71bn, from R54bn a year earlier. Eskom finance director Paul O' Flaherty said the turnaround was the result of a combination of higher electricity tariffs after Eskom was granted a 34% increase in 2008, and more power sold during the year.
Revenue per kilowatt hour of electricity increased to 31.9c from 24.7c.
Eskom came from a R9.7bn loss in 2009 on the back of soaring coal prices and embedded derivative contracts linked to three aluminium smelters owned by BHP Billiton. Eskom had been contracted to supply power to the stations, with its electricity prices linked to commodity market prices.
Some of the derivative contracts have been renegotiated and taken off the balance sheet, freeing up about R4.6bn in liabilities, said Eskom on Wednesday.
"But the big item in the profit was the removal of the Mozal aluminium smelter," said O'Flaherty. "The new contract has achieved what we sought to achieve. We sell electricity to the smelter at a rand price and there is no derivative now."
Acting chairperson and CEO Mpho Makwana said Eskom was now on a strong path to recovery.
"Last year we made a commitment to break even this year. We have bettered that," said Makwana. "South Africa can now take solace in the knowledge that Eskom is less of a burden and returning to the jewel in the SA crown it was once was."
Cash at hand was lower at R15.9bn, compared to R18bn previously. But Eskom said it had enough to carry out its activities and was still committed to a R20bn saving "from within" in the next seven years.
Makwana also announced the appointment of three senior managers to positions that have been vacant for more than a year. The appointment of a chief executive to replace Jacob Maroga is also imminent.
"The board has written to the minister of public enterprises with its recommendation and we expect the government to confirm the appointment before the end of June," said Makwana.
All its infrastructure programmes were progressing as planned, said Eskom. The Medupi and Kusile power stations were still on track to come online by 2012 and 2014 as originally intended.
On the eve of winter and the 2010 FIFA World Cup, Eskom said it had enough coal stockpiles at 37 days' worth.
Johannesburg – Power utility Eskom on Wednesday reported a significant financial turnaround, posting a R3.6bn profit for the year to end-March.
Revenue increased to R71bn, from R54bn a year earlier. Eskom finance director Paul O' Flaherty said the turnaround was the result of a combination of higher electricity tariffs after Eskom was granted a 34% increase in 2008, and more power sold during the year.
Revenue per kilowatt hour of electricity increased to 31.9c from 24.7c.
Eskom came from a R9.7bn loss in 2009 on the back of soaring coal prices and embedded derivative contracts linked to three aluminium smelters owned by BHP Billiton. Eskom had been contracted to supply power to the stations, with its electricity prices linked to commodity market prices.
Some of the derivative contracts have been renegotiated and taken off the balance sheet, freeing up about R4.6bn in liabilities, said Eskom on Wednesday.
"But the big item in the profit was the removal of the Mozal aluminium smelter," said O'Flaherty. "The new contract has achieved what we sought to achieve. We sell electricity to the smelter at a rand price and there is no derivative now."
Acting chairperson and CEO Mpho Makwana said Eskom was now on a strong path to recovery.
"Last year we made a commitment to break even this year. We have bettered that," said Makwana. "South Africa can now take solace in the knowledge that Eskom is less of a burden and returning to the jewel in the SA crown it was once was."
Cash at hand was lower at R15.9bn, compared to R18bn previously. But Eskom said it had enough to carry out its activities and was still committed to a R20bn saving "from within" in the next seven years.
Makwana also announced the appointment of three senior managers to positions that have been vacant for more than a year. The appointment of a chief executive to replace Jacob Maroga is also imminent.
"The board has written to the minister of public enterprises with its recommendation and we expect the government to confirm the appointment before the end of June," said Makwana.
All its infrastructure programmes were progressing as planned, said Eskom. The Medupi and Kusile power stations were still on track to come online by 2012 and 2014 as originally intended.
On the eve of winter and the 2010 FIFA World Cup, Eskom said it had enough coal stockpiles at 37 days' worth.
