Business

Eskom’s great results, Gupta-linked admissions and action against CEO

2017-07-19 17:20

The announcement of Eskom’s annual results included some impressive improvements, startling admissions over R500 million in payments to a Gupta-linked company and the disciplining of its suspended chief executive.

During the power utility’s integrated annual results presentation for the 2016-2017 financial year on Wednesday, Eskom’s interim chairperson, Zethembe Khoza, announced that suspended chief executive Matshela Koko would face disciplinary action.

The disciplinary action came after an investigation into tenders awarded to a company associated with Koko’s step-daughter, Koketso Choma, under his jurisdiction.

Koko was suspended when Brian Molefe returned briefly in May and promptly investigated as concerns were raised by their auditors about an apparent conflict of interest.

Eskom also admitted to paying Gupta-linked company Trillian almost R500 million in consultancy fees, after denying the claims made in a report by amaBhungane.

Khoza said while the power utility never entered into a direct contract with Trillian, it was a sub-contractor of McKinsey. McKinsey was paid R900 million.

Eskom announced that the utility had significantly improved its generation plant performance from 71.1% to 77.3% and announced a revenue increase of 7.9%, from R167 billion to R177 billion.


Acting chief executive Johnny Dladla said R20 billion was achieved in cost savings against a R17 billion target and that more than half of the funding for 2018 had already been secured.

Unplanned breakdowns were reduced from 14.9% in 2016 to 9.9% in 2017 and primary energy costs were reduced by R5.6 billion.

Municipalities were still in heavy arrears with debts mounting to nearly R10 billion, an increase of R4 billion from last year’s R6 billion. Soweto alone accounted for half of this debt.

Chief financial officer Anoj Singh also came under fire after being asked of trips to Dubai in 2015, possible Gupta links, and why Eskom reduced the R2.1-billion fine to Gupta-owned Tegeta.

Singh said the fine was reduced because of a problem with the coal crusher.

Tegeta Exploration & Resources bought the struggling optimum mine and incurred the fine when it bought the mine from Glencore, before it was concluded in arbitration.

Read: How Eskom bailed out the Guptas

On the trips to Dubai enquiry, Singh said he was preparing a document which will be shared with the board and asked for space and time to do this.

Eskom said none of this warranted a suspension.


Ndileka Lujabe
Journalist
City Press
p:+27 11 713 9001
w:www.citypress.co.za  e: ndileka.lujabe@citypress.co.za
      

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March 29 2020