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])ragon_\/oid;11315957 said:
So I've crunched the numbers even further with a very quick and dirty calculation that proves that they are lying.
Check this out:
Using Sanral's numbers, it would be impossible for them to repay their debt.
Their bonds are ten year issuances. They mature in 2020 (which is when final payment including all interest must be paid)
As you can see, using their numbers, they would have an annual shortfall of R9bn in this respect. They would default in their first 3 months of operation.
In fact using their numbers, it would take about 37 years for them to repay their bond investors. But they issued ten year bonds - they cannot extend this term whatsoever.
Ignore the theoretical margin in this one. We'll get to it next.
All of this assumes a 30% EBITDA margin, which is fair for any company. The likelihood of them operating at a higher margin than that is very slim.
Bottom line: Sanral are lying through their teeth.
Next lady for a shave:
Let's see what kind of margins and income they would actually have to generate in order to repay their debt (remember that this involves them repaying their entire margin towards their debt - no reinvestment in their roads, no maintenance of the roads, no profits effectively, and this is all before interest, tax, depreciation and amortisation which will erode a massive chunk of that margin as well).
So, using their figures, they would need to operating under the following conditions:
No costs whatsoever to their business. Nothing.
Even with no costs whatsoever, they're still short 10% income to repay their loan.
They'd need to operate on a 100% margin. So every cent they spend, they make double, effectively. In other words, they simply receive money and never spend it. Ever. And, they're still short 10% here.
So even in a world where they have no costs at all, do not pay tax, do not depreciate their assets, do not amortise anything at all - they still cannot repay their debt based on the numbers they submitted. Can you believe it? Not even in a world where every single road user goes and pays Sanral's creditors on Sanral's behalf to eliminate the cost element, do so on time, Sanral have no costs, nor maintenance at all. They still cannot repay their debt.
So let's see how much they would need to charge the average road user in order to repay their debt on time, working on a 30% margin which is reasonable, if not high for them:
So... every single Gauteng road user would have to pay R598 per month just for Sanral to repay their debt. And on time as well. That's an impossible 100% 30 day debtors book. And that doesn't take into account other elements like tax, depreciation, other interest, amortisation etc, and also means no road maintenance whastoever. This is a perfect world scenario.
So what can we conclude?
Sanral are a lying bunch of thieving bastards.
But wait, there's more. Let's actually factor in the other costs. Let's let Sanral work on a 10% net profit margin after absolutely everything:
Every single Gauteng road user realistically needs to pay about R1794 per month in order for Sanral to operate as a somewhat liquid business. Otherwise they will require cash injections in a massive way in order to stay afloat. So basically, e-tolls should be scrapped now. Nobody is going to pay R1794 per month just to drive on our own roads. This is simply not possible. It's absurd. It's ridiculous. It is quite clear that Sanral are stuffed as an organisation. If only half of road users pay their e-tolls, they'd have to be paying R3600 per month in order for Sanral to break even as a business.
So they're either going to cross-subsidise e-tolling with other projects (which I don't think is entirely legal or ethical) or paying e-tolls means paying money into a dead duck. You might as well burn your money in a big fire.
Spread this around to your friends and family. I'm tired of seeing them bandy about numbers as blatant lies. These numbers work back with what we actually know.
And what we know now, is that paying e-tolls is the WRONG thing to do, not only on moral grounds, but on financial grounds as well. Paying e-tolls will not cover their debt. It's time the government cut its losses and found other ways to monetise the gantries. Like average speed traps, perhaps? Or melting them down and using it for cabling infrastructure to connect SA properly?
