A happy first half for Transnet

Although SA has also slipped into the global economic sludge, Transnet has at least managed to increase its revenues in the first half of the financial year – up by 12.9% over the same period last year to hit R16.8- billion. In the same period, the capital expenditure was up 22.3% to R8.3-bn, but the cash generated from operations dwindled by 15.6% to R5.2- bn. According to the halfyear report, revenues increased across all five operating divisions. Volumes also increased in all of the operating divisions with the exception of Transnet Freight Rail (TFR) – although its container volumes railed to and from the ports did increase. The railways increased revenue by 11.1% to R9.2-bn. But it was an up and down story for the main cargoes. Iron ore export tons increased by 5% to 15.9-million tons, but volumes on the coal line dropped by 6% to 29.9-mt – primarily due, said TFR, “to operational issues and derailments”. This problem, the report added, “is receiving significant management attention to stabilise operations. And, consequently, steady improvement is expected for the rest of the year.” Meanwhile, general freight tons – which make up a major portion of TFR’s revenue – remained constant at 43.5-mt, although container volumes increased by 9% to 287 000 teus. Transnet National Ports Authority (TNPA) also saw a 9.9% increase in revenue to R3.8-bn. The main drivers in this, said management, were a continued growth in container imports and exports, liquid bulk imports and automotive export volumes. However, vehicle import volumes decreased due to a decline in local demand. Transnet Port Terminals (TPT) also bumped up its revenue by 14.7% to R2.7-bn. This increase was driven mainly by increased volumes in the container sector (6.7%), bulk sector (10.5%) and automotive sector (4.8%). The breakbulk sector, however, experienced an 11.9% decline in volume mainly due to reduced steel exports. A 20.9% increase in operating costs mainly came from increased personnel numbers after the commissioning of the new Pier 1 container terminal in Durban, and significant increases in fuel costs.