Only half of South Africa's state-owned enterprises (SOEs) managed to post profits in the 2009-2010 financial year, according to a survey by the South African Institute of Race Relations (SAIRR).
Of the nine SOEs reporting to the Department of Public Enterprises (DPE), only five produced a profit in 2009-2010, the institute said in a statement.
The DPE is the shareholder representative of the government with oversight responsibility for all nine of the SOEs.
While there are numerous other state-owned organisations, they are not accountable to the DPE.
The most lucrative parastatal was Transnet, which showed a profit of R3 billion.
The four other SOEs that managed to make a profit that year were the Pebble Bed Modular Reactor (PBMR), South African Airways (SAA), South African Express (SAX), and the South African Forestry Company (SAFCOL). The combined profit of these parastatals was R4 billion.
The Institute's analysis was based on the annual reports of all nine SOEs.
The least profitable SOE for the 2009-2010 financial year was Eskom, which posted a loss of over R9.7 billion, although it has since turned around its fortunes to post a profit of R13 billion for the 2010-11 period.
In addition to Eskom, Alexcor, Broadband Infraco and Denel also posted losses for 2009-2010 totalling a combined loss of R310 million, which brings the total loss of all four entities to R10 billion.
This equates to a net loss of R6 billion for all SOEs.
“The biggest concern with these results is that the government will have to support loss-making entities at taxpayers' expense,” said Jonathan Snyman, a researcher at the South African Institute of Race Relations.
The total assets of all SOEs in 2009-2010 amounted to over R450 billion.
“South Africa's infrastructure is already under strain, and without money derived from profits to develop new projects, the prospect of alleviating pressure on infrastructure is dependent on finding alternative forms of capital for investment,” Snyman added.
The full survey will be released by the SAIRR in Johannesburg next week. - I-Net Bridge