CEO believes struggling Transnet can turn R1 billion profit in 2024

CAPE TOWN - Transnet’s Group CEO Michelle Phillips believes the ailing state freight company can recover from its R7 billion loss in the past year to turn a billion rand profit in this financial year.

But to make that happen, she said that more borrowing would be required. 

The company was Tuesday grilled by Parliament’s finance watchdog – the Standing Committee on Public Accounts (SCOPA) - as to why its finances had regressed so badly from being one of the state’s better-performing SOEs.

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Into her sixth month as Transnet’s permanent CEO, Phillips said that a number of interventions had already been made to increase Transnet’s profitability. 

This included plans to sell non-core properties and spending more prudently.

If the company reaches its 250 million tonne freight target, Phillips said that there was no reason why it could not turn a billion rand profit in 2024.

"It is an ambitious target, but some people have said maybe we are not ambitious enough, so we continue to push to see where we will end up." 

But former Transnet CEO, now MK MP, Brian Molefe, was not buying Phillips' explanations that asset purchases and loans made during the state capture years had led to the company’s decline. 

"What happened after 2017/18 that Transnet is now making such extraordinary losses from a very profitable situation during the so-called state capture years?"

Amid the myriad challenges, Phillips said that theft and vandalism continued to render the rail network dysfunctional.