Eskom to announce interim results

Tuesday, January 30, 2018

Power utility Eskom will today present its interim results for 2017 at a media briefing at its Megawatt Park offices in Johannesburg.

Interim Group Chief Executive Phakamani Hadebe, who was appointed by government earlier this month, will present the utility's financials.

Earlier this month, the Presidency announced the appointment of a new board for the utility as an immediate measure to strengthen governance and management at the parastatal.

“The company has been facing several challenges, including a weak financial position, declining revenues and governance failures, which are threatening the sustainability of the company going forward,” said the Presidency at the time.

The appointment of the 13 member board, headed by seasoned businessman Jabu Mabuza, form part of the measures to strengthen governance and management.

Government also recommended Hadebe as the Acting Group Chief Executive with immediate effect. 

At the tabling of the Medium Term Budget Policy Statement (MTBPS) in Parliament in October, Finance Minister Malusi Gigaba announced that a new board would be appointed.

Last week, the power utility noted rating agency Moody’s credit rating downgrade, saying it remains resolute to turn its fortunes around.

“We note the decision by Moody’s to downgrade the company’s rating. However, we remain resolute in our endeavours to progressively turn this company around,” said the power utility on Friday.

Moody’s Investor Services downgraded the utility to ‘B1’ from ‘Ba3’. The State-owned entity’s zero coupon eurobonds rating was similarly revised to ‘B1’ from ‘Ba3’, in line with the corporate family rating (CFR) and the global medium-term note (GMTN) programme. The senior unsecured GMTNs of Eskom have been downgraded to ‘(P)B2/B2’ from ‘(P)B1/B1’.

All of Moody’s ratings remain under review for further downgrades.

While the agency said it views recent interventions at the utility -- including the appointment of a new board by Deputy President Cyril Ramaphosa -- as favourable actions in bolstering the credit quality of Eskom, Moody’s cited Eskom’s deteriorating liquidity and the ability of government to provide direct equity support to Eskom.

Acting Chief Financial Officer at the utility, Calib Cassim, said the company remains hopeful of turning its liquidity position around.

At its 2017 integrated annual results announcement in July, the utility said it aimed to release R105 billion in government guarantees.

"Our ambition is to release about R105 billion in government guarantees and that will ensure we focus on the sustainability of this organisation,” said former acting Interim Group Chief Executive Johnny Dladla at the time.

The media briefing is scheduled to get underway at 11am. -