South Africa's Transnet revenue increases 21pc, but profit slips 1.5pc

SOUTH Africa's state-owned ports rail freight, logistics and pipelines firm Transnet SC recently posted revenues for the fiscal year 2011/12 ending March 31, which increased 21 per cent to ZAR45.9 billion (US$5.6 billion).

But higher operating costs, mostly labour, eroded net profit, resulting in a 1.5 per cent year-on-year decrease to ZAR4.1 billion.

From April 1, 2011 to March 31, 2012, operating income (EBITDA) increased to ZAR18.9 billion from ZAR15.8 billion in the year before, reported London's Containerisation International, adding that it is due to a record high in rail volumes with a 10.4 per cent growth year on year at 201 million tonnes, as well as enhanced productivity and efficiency.

Container volume grew 21.5 per cent to 762,760 TEU from 627,825 TEU in 2010/11. Also, the Transnet Freight Rail's general cargo traffic rose 10 per cent to 81 million tonnes.

Said Transnet CEO Brian Molefe: "These figures show that Transnet is regaining market share for rail-friendly freight and removing these volumes from the roads."

Another subsidiary Transnet Port Terminals, which runs the nation's main container ports, also experienced good performance with an 8.1 per cent rise in average box moves per crane hour (up to 26.6 moves) and strong growth in cargo volumes at its newest port, Ngqura.

In light of good results, the company was eager to spend ZAR22.3 billion on capital programmes in the past fiscal year. Mr Molefe said Transnet will continue to invest at high levels, with ZAR300 billion being budgeted for the next seven years.