[miningmx.com] – ESKOM said the secondment of Brian Molefe as acting CEO had been extended three months but gave few clues as to whether the Transnet CEO would be given the job permanently.
“The Eskom board is pleased to announce that, after consultation with the board of Transnet and the Minister of Public Enterprises, Lynne Brown, it has extended the employment contract of its acting CEO Mr Brian Molefe, for a further three months,” Eskom said in an announcement.
“The contract extension is with a view of affording Mr Molefe sufficient time to put into effect the strategies he had already started implementing aimed at turning Eskom’s fortunes around in order to ensure its financial and operational sustainability,” it said.
Eskom also announced that following an investigation started in March, four executives – three of whom have left the organisation – have been cleared of any wrong-doing.
This included former CEO, Tshediso Matona, former CFO, Tsholofelo Molefe and former head of group capital, Dan Marokane.
A fourth executive, Matshela Koko, group executive for technology and commercial, will return to Eskom following ‘gardening leave’. “There is no longer a reason to keep the remaining executive on suspension and he will return to work with immediate effect,” said Eskom in a separate statement.
Since becoming acting CEO, Molefe has presided over the unsuccessful application for a further increase to the annual tariff which means that his second three months will focus on sourcing alternative means of funding.
He has suggested that Eskom will turn to loan finance, international and domestic bond issuances whilst the South African government has also pledged subsidy support.
Molefe has also sought to ease load-shedding while simultaneously undertake crucial maintenance to the utility’s ageging fleet – a strategy that has met with mixed success with some weeks load-shedding free whilst others have been blighted by interruption.
The contract extension has not gone down well with the National Union of Mineworkers (NUM) which criticised Molefe for not meeting with them.
“We are not sure about the term of extension and we are worried about that,” said the NUM in a statement. “Since he came he has never met with the union, he is more concerned about load shedding and forgets about the people behind the generators.”
Molefe has been CEO of Transnet for four years in which he has stabllised the organisation’s management and reporting structures, initiated an aggressive R330bn infrastructure expansion strategy, and improved its funding.
Transnet announced full-year re-tax earnings some 8.1% higher at some R25.6bn earlier this week in which it generated R30.6bn in cash from operations, about 30% higher year-on-year.
Capital investment was 5.7% higher at R33.6bn taking Transnet’s overall spend in terms of its seven-year rolling Market Demand Strategy to R92.8bn.
Owing to the higher cash generation, Transnet was able to lower gearing – net debt to equity – to 40% from 45.9% in the previous financial year.
Roughly 74% of all capital investment went into the company’s rail activities which also includes general freight.
