Transnet released its results late last week and, to the relief of the government and taxpayers alike, this is one state-owned entity that will not need to go cap in hand for a bailout. However, the company is no longer the cash cow it used to be, and the group's performance and financial metrics are looking a tad shaky.
Transnet CEO Portia Derby has been at the helm of the organisation for a little over nine months - long enough to get to grips with the operational and financial challenges facing the giant logistics operator.
Of the six major risks identified as being a threat to future prosperity, two have the real potential to derail Derby and her team's turnaround efforts. These are Transnet's financial sustainability and its market growth risk - in other words, its poor service and poor infrastructure, which are causing customers to seek alternatives.
The latest set of financial results - while superficially solid - reflect cause for concern.
Despite economic growth of just 0.2% in 2019, and many operational challenges, Transnet realised a 1.3% increase in revenue to R75.1-billion, largely thanks to an average tariff increase of 2.9%.
But volumes in the group's largest business...