October 07, 2008

Transnet H1 revenue up despite constraints

Reuters reported that South African state owned rail and logistics group Transnet posted a 10% rise in H1 of 2007 revenue to ZAR 15.7 billion (USD 2.32 billion). Transnet said that H1 revenue was boosted by increased volume across its divisions, apart from the pipelines unit, which suffered after the energy regulator ruled against a tariff increase.

Transnet said that its iron ore and coal volumes came in below contracted levels primarily due to insufficient supply from the mines. It further added that the coal line was also hit by cable theft and derailments.

Its capital expenditure rose by 59% to ZAR 6.8 billion which is part of the ZAR 78 billion Transnet plans to invest over the next five years.

Transnet, which has previously said it hopes to sell off all non core assets by the end of the 2007/08 financial year said that it is about to complete the disposals and is now a focused freight transport and logistics provider. Transnet said that the disposal of the remaining non core assets including regional airline SA Express, hotel on wheels Luxrail, passenger bus operator Autopax, IT services subsidiary arivia.kom and non essential properties was underway.

Ms Maria Ramos CEO of.Transnet group said that “The new Transnet we have built in the last three and half years is positioned for further growth which is fuelled by volume based revenue increases instead of reliance on price increases. We are confident of achieving our targets at the end of the financial year."