JOHANNESBURG, March 24 (Reuters) – South African state-owned power utility Eskom on Tuesday projected a sustained improvement in its finances over the coming years, after reporting its first full-year profit in eight years in the last financial year.
In a presentation to a parliamentary committee, Eskom forecast a pre-tax profit of 25.8 billion rand ($1.5 billion) this financial year, about 8% higher than last year. Eskom’s financial year runs to the end of March.
The following financial year’s pre-tax profit is seen at 30.1 billion rand, rising to 35.4 billion rand the year after.
Eskom said its performance would be underpinned by operational improvements at its power station fleet and ongoing government debt relief.
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. It used to implement regular power cuts, holding back growth in Africa’s biggest economy.
But the frequency of its outages has reduced dramatically: this month Eskom reported 300 consecutive days without power cuts. Last financial year there were 13 days of power cuts and the year before a record 329 days of cuts.
Eskom said on Tuesday that municipal arrear debt remains a major financial risk, with the amount it is owed climbing to 110.5 billion rand and projected to rise further.
Over the next five years Eskom plans up to 343 billion rand of internally funded capital expenditure. It said it could also embark on public-private partnerships outside of that expenditure envelope.
