South Africa’s Transnet reports $87 million half-year loss

(Reuters) -South Africa’s state-owned logistics firm Transnet on Friday reported a 1.6 billion rand ($87 million) loss in the six months to Sept. 30 on the back of declining rail, port and pipeline volumes amid higher costs.

Transnet made a 159 million rand profit during the same period last year.

Although its revenue rose 8.6% to 39.2 billion rand in the six months thanks to tariff increases for its services, costs rose 9.5% to 25.3 billion rand due to higher payroll, electricity and security expenses.

Transnet has struggled to provide adequate freight rail and port services in South Africa due to equipment shortages and maintenance backlogs after years of under-investment.

On Dec.1 the South African government, Transnet’s sole shareholder, said it would inject 47 billion rand to help the firm meet its immediate debt obligations.

Transnet has debts of 130 billion rand and has seen freight volumes decline to 150 million metric tons in financial year 2022/23 from 226 million tons in 2017/18, while reporting port backlogs of as much as three months.

($1 = 18.4244 rand)

(Reporting by Nelson Banya; Editing by Jan Harvey and Emelia Sithole-Matarise)