• Eskom forecasts $937M profit for FY2026 after strong first-half results
  
• Fewer blackouts, lower finance costs, and tariff hike boost performance
  
• Utility plans $17B investment to upgrade grid and expand capacity to 107 GW
  

South African state power utility Eskom said it expects to post a second consecutive annual profit. The company forecasts an after-tax profit of about 16 billion rand (937 million dollars) by the end of its financial year in March 2026.

In a statement on Friday, Eskom said the expected result would be similar to last year’s profit. The outlook follows strong first-half results: the utility reported a net profit of 24.3 billion rand (1.4 billion dollars) in the six months to September.

Lower interest rates and a reduced debt burden helped cut finance costs by 14 percent to 15.3 billion rand. A 12.7 percent increase in electricity tariffs from April lifted revenue by 4 percent to 191.3 billion rand.

Eskom said rolling blackouts occurred on only four days between March and September, a sharp improvement from 2023, when more than 300 days of power cuts hit the continent’s most industrialized economy.

The company’s improved performance was among the factors cited in S&P Global Ratings’ recent decision to upgrade South Africa’s long-term foreign currency credit rating to BB from BB-, the first upgrade in 20 years.

“These unaudited interim results demonstrate that our annual results for FY2025 were not a once-off achievement and that our progress in turning around operational and financial performance, supported by government and stakeholder collaboration, is positioning Eskom for a sustainable future, ” said Eskom Chairman Mteto Nyati. 

The utility still faces structural challenges, including unpaid municipal debts that reached 105 billion rand as of September 30. Eskom said the finance ministry has introduced measures to address the issue.

The company said it is working to strengthen cash flow while borrowing at acceptable rates to fund investment needs estimated at 320 billion rand over the next five years. The investments will maintain critical generation and network infrastructure and expand the transmission grid to integrate renewables and handle expected growth in electricity capacity from 66 gigawatts in 2024 to 107 gigawatts by 2034.

Espoir Olodo