Financial News in South Africa 8th November:
1. More Loadshedding:
Eskom suddenly announced on Thursday evening that it will implement stage 2 loadshedding from 22:00 this evening until 05:00 on Friday morning.
This was because on Thursday it lost three additional generation units and had to use its emergency reserves in order to meet demand throughout the day.
The emergency demands, therefore, became critically low.
2. Eskom is owed money by neighboring countries:
Minister of Public Enterprises Pravin Gordhan has said that debt-laden power utility Eskom is owed a combined R632m by three neighbouring countries for providing electricity.
Gordhan, in written reply to a question from Democratic Alliance MP Denis Joseph, said the debtors were
- Zimbabwe Electricity Supply Authority (Zesa) of Zimbabwe – which owes R322m;
- Zesco of Zambia – which owes R221m; and
- Electricidade de Mocambique (EDM) – which owes R89m.
Gordhan said none of the funds owed to Eskom by the power utilities of neighbouring countries were in dispute. “Eskom’s clients acknowledge their debt and attribute economic challenges as well as financial constraints as the cause of their delays in settling the outstanding debt,” Gordhan said.
3. Manufacturing Production falls further:
South Africa’s manufacturing production fell for a fourth consecutive month in September.
Manufacturing production fell by 2.4% in September 2019 when compared with September 2018, a decrease well above the estimates of analysts.
On a monthly basis, production decreased by 2.4% between August and September.
Of the 10 manufacturing divisions that the index tracks, only food and beverages showed positive annual growth of 2.8%. The largest annual decline was in the glass and non-metallic mineral products sector, which decreased by 6.7%.
4. Foschini reports growth:
The Foschini Group – which consists of Foschini, @home, Markham, Totalsports, Sterns and other brands – reported a 6.3% increase in revenue to R18.6bn, with headline earnings per share up 3% for the six months to end-September.
Turnover at its TFG London unit, which owns premium clothing brands in the UK, was flat “in a particularly tough environment” amid Brexit-related uncertainty. Its Australian business saw turnover growth of 11% .
“The general retail outlook in the UK and Australia remains relatively subdued. However, the retail outlook for South Africa is particularly challenging given the close to zero growth environment, chronically high structural unemployment and the continuing speculation of a possible credit downgrade and what that may imply for the consumer.”
5. Truworths retail sales see increase:
Truworths says its retail sales for the past 18 trading weeks (up to 3 November) increased by 2% to R6.3 billion, compared to the same period last year.
In a trading update the clothing retailer said that while cash sales fell by 1% over the same time period, sales on accounts – which now represent 52% of total sales – rose by 5%. Excluding its UK stores, account sales at Truworths Africa (which mainly consist of the Truworths businesses in South Africa) now represent 71% of sales. Apart from Truworths, the group includes YDE, Uzzi, Earthaddict, Earthchild and Naartjie.
Information acquired from: