Eskom Holdings said profit fell 49% after the South African utility sold less power because it struggled to meet demand, a five-month platinum strike cut use by producers, and BHP Billiton closed a smelter.
Net income was R3.62 billion ($286 million) in the 12 months ended March 31 from R7.09 billion a year earlier, the Johannesburg-based company said in a presentation handed to reporters Tuesday. Operating costs rose 13%, while primary energy expenses climbed 19% to R83 billion.
Electricity sales fell 0.7% because of scheduled power cuts, strikes at the local operations of the world’s three biggest platinum producers, a contraction in South African gold mining and BHP’s closing of its Bayside aluminum smelter, acting Chief Executive Officer Brian Molefe said.
Eskom has a 225 billion-rand funding shortfall for the five years through 2018 as it battles to supply adequate power in Africa’s most industrialised economy. The utility has imposed rolling power cuts almost every second day this year.
Eskom to see penalty from Glencore
Eskom is seeking a R2 billion ($157 million) penalty from Glencore’s Optimum Coal Mine because of the poor quality of their coal and its “shoddy performance”, its chief executive said on Tuesday.
“The quality of the coal that we get from the mines we are tied to has not been good,” Molefe said at the company’s annual results briefing.
Glencore was not immediately available to comment.
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