Transnet Group CEO Michelle Phillips highlighted the company’s focus on eradicating corruption following her presentation before Parliament’s Select Committee on Public Infrastructure and Minister in the Presidency on Tuesday.
Phillips shared details of the group’s operational recovery under the Reinvent for Growth strategy.
The 2024/25 audited results and 2025/26 mid-year performance showed rail volumes rebounding from a multi-year decline.
Volumes fell from 226.3 million tonnes (mt) in 2017/18 to 149.5mt in 2022/23, but the recovery plan reversed this, rising to 160.1mt in 2024/25 (approximately 11mt increase, 3.5% CAGR growth post-adoption). Targets for 2025/26 aimed at 180mt, with teams pushing toward 170mt despite weather disruption.
Port performance stabilised: container handling dipped 2% to 4.092 million TEUs, automotive unit handling rose 4.1% to 803 908 units (from 772 040), and pipelines declined 9.8% to 13.37 billion litres due to weak demand and refinery closures.
Phillips said collaboration with customers had improved execution, while new equipment and original equipment manufacturer agreements had stabilised rolling stock.
Financially, revenue grew 7.8% to R82.7 billion, EBITDA (earnings before interest, taxation, depreciation and amortisation) rose 39.4% to R30.6 billion, and the net loss narrowed 74% to R1.9 billion from over R7 billion the prior year.
Operating costs fell 4.9%, capital investment increased 44.2% to R24 billion (focused on infrastructure), and irregular/fruitless expenditure dropped from R3.793 billion to R3.1 billion. Mid-year 2025/26 showed revenue up 9.4% year-on-year, EBITDA growth of 40.9%, and continued improvements.
During the question and answer session, Phillips responded to MPs’ concerns regarding corruption, including an allegation that there had been tender mark-ups of 4 500%.
Phillips said there had also been mention of at least one instance at the Madlanga Commission involving an assassination, followed by an investigation, and that Transnet had identified a number of service providers who appeared to be colluding with some of the parastatal’s employees.
“This is something that we are taking very seriously. To date, we have suspended at least six people. There are a number currently also under investigation, and there will probably be more suspensions that will flow from those investigations. We are pulling in the police. We are pulling in the SIU. We are pulling in the Hawks. We want to be sure that we rid the business of these entities.”
Phillips said the company had identified the errant service providers as well as the processes it would follow to blacklist them.
She said they had always known that, unfortunately, there was one price charged to the private sector and a different price charged to government entities. She added that they had started engaging with their suppliers, firstly to indicate to them that they did not intend to pay these exorbitant prices.
“My job is to ensure that Transnet employees are protected, especially those who are doing the good work,” Phillips said.
She added that Transnet had implemented several interventions to deal with corruption, including the automation of the procurement process.
Phillips said port congestion in Cape Town was linked to extreme weather, including high winds, while rainfall on Monday night had led to a washaway on the iron ore line.
"For the most part, when we experience congestion now, largely it’s because of extreme weather that we may be experiencing... we have purchased new ship to shore cranes… and once we see this equipment in full operation we will see the improvement.”
She said some new crane purchases were equipped with remote functionality, which meant that they could be operated from a control room rather than by an operator sitting in the machine.
She said these were all interventions that would be seen over the next year or two.
Group CFO, Nosipho Maphumulo, highlighted financial gains, noting reduced irregular expenditure through procurement digitisation, oversight committees, and consequence management, aiming to eliminate it.
This comes after Madlanga Commission testimonies in 2025 linking past Transnet fraud to the April 2024 murder of engineer Armand Swart, who was shot 23 times in mistaken identity tied to whistleblowing. Former Transnet executives are facing separate charges stemming from the Zondo Commission of Inquiry into State Capture.
