Transnet records 11.3 percent revenue increase

Transnet, South Africa, which is one of the consortium concessionaire technical partners of the Lagos-Kano narrow gauge rail project, has reported an 11.3percent revenue increase to Rand 72.9bn ($US 4.9bn) for the year ending March 2018, up from Rand 65.5bn compared with the year ending March 2017, as it moves towards implementing its new Transnet 4.0 strategy.

Under the period, operating costs rose by 6.5 percent to Rand 40.4 bn including an average 13.6 percent increase in energy costs, while Transnet also achieved savings against planned costs totalling Rand 3.1bn.

Ebitda increased 18 percent to Rand 32.5bn while net profit improved by 75 percent from Rand 2.8bn to Rand 4.9bn. Total cash generated from Transnet’s overall operations grew 12.6% from Rand 31bn to Rand 34.9bn.

Transnet Freight Rail increased revenue by 11.7 percent to Rand 43.7bn and transported a record 77 million tonnes of coal, a 4.3 percent increase including a monthly record of 7.2 million tonnes in September 2017. Wagon cycle-time also improved to 62.6 hours, down from 63.7 hours the previous year.

Despite disruptions caused by adverse weather conditions, Transnet achieved a 2.3 percent increase in export iron-ore volumes to 58.5 million tonnes, although accidents, particularly mainline derailments, resulted in volume losses.

Transnet says, it has largely achieved the objectives of its Market Demand Strategy (MDS), which included some of the country’s largest capital projects, and is switching to the new Transnet 4.0 strategy, which involves the investment of a further Rand 163.7bn over five years to take the company to “new heights of digitisation and innovation.

The investments completed during the past year under MDS include:

Transnet’s investments include the purchase of 1,064 locomotives to modernise its fleet in anticipation of a rise in general freight volumes and solidifying its ‘road to rail’ strategy. A total of 402 locomotives have entered service while 16 have been delivered and are currently undergoing testing.

During the year, Transnet Freight Rail and Transnet Engineering built: 2,500 coal containers to service Eskom power stations, 300 CR-13/14 wagons for the iron-ore business, 86 SCL wagons for the automotive business, and 364 CR wagons to be used within the mining sector.