Rail, port and pipeline company Transnet has reported strong results for the first half of this financial year.
Revenue was up 9% to R14,4-billion and operating profits up more than 7% to R4,6-billion, the parastatal announced in a statement on Thursday.
Further, for the six months ended September this year, cash from operations after working capital charges surged by 20% to R5,7-billion, operating margins came in at 32% and equity attributable to shareholders rose 30% to R31-billion.
”Transnet today [Thursday] unveiled another set of solid results across all its core business units for the six months ended in September 2006.
”Figures … show a 7,2% rise in operating profits to R4,6-billion for the half year to September 2006, on 2005 numbers, from the five business units that form part of [Transnet’s] future corporate strategy.
”Operating margins have been maintained at 32%, lifting profits to R4,6-billion from continuing operations before impairment of assets, fair value adjustments and net finance costs.
”This was on revenue of R14,4-billion, representing a 9% increase on comparable numbers a year ago,” Transnet said.
The results were further evidence the company was relying more on volume growth, and less on tariff increases, for its revenue.
”Cash flow from operations after working capital changes jumped 20% to R5,7-billion. As a result of the strong cash flow, gearing has dropped to 43%.
”Similarly, net operating costs, excluding impairment of assets and fair-value adjustments, grew in line with revenue growth by 9%, to R9,9-billion, during the period under review.”
The statement quoted Transnet head Maria Ramos as saying the results confirmed the strength of the turnaround in the company’s business.
”We are continuing to reap the benefits of the management team’s focus on the core operating divisions. All our major divisions are showing strong productivity improvement and profit growth in a sustainable way.”
Ramos said the planned structural transformation of Transnet was ”proceeding exceedingly well”.
The company was well into the advanced stages of implementing its business re-engineering programme and targeting efficiency, productivity improvements, safety, cost containment and customer service at its core operating divisions — Spoornet, the National Ports Authority, the South African Port Operations, Transwerk and Petronet.
The results did not include the proceeds of Transnet’s sale of Cape Town’s V&A Waterfront. This was sold to an international consortium two months ago for R7-billion.
Ramos said she was confident the sellers — including Transnet’s pension funds – were just weeks away from ”clearing the regulatory hurdles attendant to the transaction”. — Sapa