Fin24

Transnet balance sheet to fund projects

2012-02-10 08:01

Cape Town – Transnet’s new expanded capex programme will be funded entirely from the company's balance sheet.

Brian Molefe, CEO of Transnet, was pleased that President Jacob Zuma put the parastatal at the centre of a massive new infrastruce development plan in his State of the Nation address on Thursday night.

Zuma announced that Transnet's capital expenditure will increase from R110bn over the next five years, to R300bn over the next seven.

“The money’s there,” Molefe told Fin24.

“Transnet’s performance is improving, we think we can do it and remain within the necessary gearing ratios.”

Molefe wasin the public gallery while the announcements were being made.

“I’m very happy tonight,” Molefe told Fin24, laughing loudly as the national gallery emptied out into the quad in front of parliament.

Molefe said Transnet had been working on the plans to expand its capex programme since last year, working closely together with minister of public enterprises, Malusi Gigaba.

Molefe said the money will be used, amongst other things, to build new locomotives locally.

“A lot of the money will go to the improvement of rail in South Africa. This will increase expansion of rail lines to the Waterberg area. There will also be money for the ports.”

Gigaba told Fin24 that government had taken the decision to increase Transnet’s capex to R300bn  in mid-2011 already.

“Government doesn’t have to spend a cent on this (Transnet) capex expansion.  It will be funded completely out of the balance sheet of Transnet. It shows the strength of the organisation at the moment. There is quite an exciting phase ahead of us,” Gigaba said, dressed in his 49m campaign shirt, a project that calls on South Africans to use electricity sparingly.

President Zuma’s announcements on Transnet were broadly welcomed. Opposition parties said it’s good to see government planning infrastructure projects that will lead to positive returns for the country down the line.

 - Fin24 

Comments
  • Mphotent - 2012-02-10 08:41

    Good news, wish all business could cut down costs on operations, increase efficiency and ensure sustainability...Transnet has good history on financial management and efficiency. Cde Brian, I think you need to give attention to your human resource and increase your skills pool for 2018...I will be here incase you need me.

  • Cecelia - 2012-02-10 09:15

    Yes Mr Gigaba and Molefe it is a pity that the Transnet pensioners must hear that Transnet do not have money for the pension fund !!You must be ashamed and not happy !!!!!!!!!!!!!!1

  • Bertus - 2012-02-10 15:19

    I wonder if this is for the Swazi railway line?? And I wonder if it is for the ANC owned coal mine (Maloma) in Swaziland... I wonder if this is a hidden agenda...

  • sandy.langenstrass - 2012-02-11 14:11

    Iv'e decided not to put this new incentive down, that hopefully this is the start of good things to come. Let's hope it will get of the ground and the railways can be put to good use, which has badly been lacking in the past 15 years. This would not only be a more cost effective form of moving goods...but for me, an ardent wish of mine to get those huge trucks off our roads..that terrify me, on trips between JHB/DURBAN. Not only do they cause many accidents, they also do damage to our roads.

  • Vince.York - 2012-02-12 10:34

    This will be no different to the splendid projects like the e-Tolling SANRAL debacle and now linked Gautrain which cannot survive economically unless massively punitive tolls are exercised against ordinary motorists and road haulage enterprises. It will also be tantamount to the Taxi Recap rollouts, ever increasing in amount and frequency and culminating in "flying a non-flying chaotic airline" with money allocations that stripped tax payers bare FOR TAXI'S - but which some bright sparks now see can more easily be pumped into a normal "FEW POCKETS" rather than be relaxed in burden on the tax payers. SHEER NONSENSICAL DESPERATION and last second clawing at the straws breaking the proverbial camels back. Not wishing to be depressive, BUT this is the result of following failed communistic policies brainlessly.

  • pages:
  • 1