JOHANNESBURG - The SA Post Office (Sapo) continues to bleed with the entity posting another financial loss of R978 million in the last financial year, however, showing a 13% improvement from a loss of R1.1 billion the corresponding previous period.
In its financials tabled in Parliament yesterday by the Minister of Telecommunications and Postal Services, Siyabonga Cwele, Sapo said it was not out of the woods yet. Acting Sapo chairman Comfort Ngidi said in the director’s report they had cash constraints and did not have sufficient working capital.
Ngidi said the Department of Telecommunications and Postal Services gave them funding for the current financial year to stay afloat. The post office was arranging a working capital of R400m.
“The Department of Telecommunications and Postal Services allocated R650m in the 2017 financial year for the capitalisation of Sapo. The government has issued Sapo with a government guarantee of R4.17 billion and R3.7bn utilised to acquire external funding,” said Ngidi.
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“The cause of the deterioration of the group’s liquidity position is both due to internal and external factors, such as the migration of customers towards digital communication, general decline in the mail business volumes and revenue as well as an inappropriate and inefficient business model,” said Ngidi.
He said Sapo had been tasked with managing the distribution of Set-Top Boxes and antennae for the broadcasting digital migration project, and was allocated R240m in the 2017 financial year, with a further allocation of R240m in the 2018 financial year.
Ngidi said in his report that the board has agreed to the implementation of revenue upliftment initiatives that would see a R768m improvement in cash flows in the 2018 financial year.
In its consolidated financial statements Sapo said it would continue to operate as a going concern, based on its strong financial position with its assets exceeding its liabilities by R1bn.