Sanral e-toll revenue slumps 63% in year to March 2019

Raises R10.04bn impairment on its total e-toll trade.
The roads agency says its board is ‘fully aware’ of the liquidity risk it faces and is ‘actively engaging with government’ to resolve the matter. Image: Moneyweb

If you are paying e-tolls, you one of the few. Low payment rates by motorists resulted in revenue received by the SA National Roads Agency (Sanral) from e-tolls on the Gauteng Freeway Improvement Project (GFIP) slumping 63% to R687.7 million in the year to March from R1.87 billion in the previous year.

Read: Sanral board suspends e-toll debt collection process

Sanral raised an impairment of R10.04 billion on its total e-toll trade and other receivables of R10.96 billion at end-March.

Auditor-General Kimi Makwetu confirmed this was the value of expected credit losses by Sanral’s e-toll trade and other receivables at the end of its financial year.

Read: Government corruption to blame for non-payment of e-tolls

The impairment resulted in the remaining balance of Sanral’s trade and receivables dropping to R1.14 billion.

Trade receivables are amounts billed by a business to its customers when it delivers goods or services to them in the ordinary course of business.

Sanral says in its latest integrated report that although the debtor was not written off, the impairment was a reflection of the probability of collection based on historic trends and a new International Financial Reporting Standard (IFRS).

The agency reported a profit after finance costs of R2.42 billion for the year compared to the R418 million loss in the previous year.

Revenue for the year from non-toll operations declined by 23% to R6.97 billion, which Sanral attributes largely to the transfer of R5.75 billion to the toll portfolio.

Toll revenue from operations declined by 18% to R4.24 billion from R5.19 billion in the previous year.

Read: Sanral lashes out at Outa for undermining road-funding efforts

To address the shortfall because of the low e-toll payment rate, Sanral received R439 million from government as a grant plus a R5.75 billion portion of the non-toll grant.

The non-toll portfolio reported a R96 million operating loss for the year compared to R1.1 billion profit in the previous year, with income (comprising largely the grant received from government) declining by 23.9% because of the R5.75 billion transfer to the toll portfolio.

The toll portfolio reported an operating profit after finance charges of R2.51 billion, with a 56.1% increase in income for toll operations largely because of the grant transferred from the non-toll portfolio.

Sanral’s cash and cash equivalents increased to R8.74 billion at end-March from R7.64 billion in the previous year.

Sanral says it has continued to meet its repayment obligations and is considering resuming borrowing using its non-guaranteed domestic medium-term note programme and is “at an advanced stage” in negotiations with several international financial institutions to secure loans.

“Any positive developments towards resolving the e-tolling issues and improving the collection rate are expected to increase the appetite for Sanral debt,” it says.

Development loan of R7bn

Sanral earlier this month reported that the New Development Bank had decided to extend a R7 billion loan to it for road infrastructure development projects.

President Cyril Ramaphosa earlier this year appointed Minister of Transport Fikile Mbalula to head a task team that had to report to him by the end of last month on the options on the table with regard to e-tolls.

Sanral says government has also issued guarantees totalling R37.91 billion, of which R29.5 billion had been used at end-March.

“The board of Sanral is fully aware of the liquidity risk it faces in the short term and is actively engaging with government to resolve the matter,” it says.

Makwetu says a material uncertainty exists that may cast significant doubt on Sanral’s ability to continue as a going concern.

He adds that Sanral’s funding strategy for the next 12 months relating to toll operations is dependent on positive developments to resolve the e-toll impasse and Sanral raising funding either from government grants or further borrowings.

Irregular expenditure by Sanral in the year to March increased by 25% to R419 million from R334 million.

However, Sanral says R117 million was for irregular contracts identified in prior years but the expenditure on the contracts remained irregular until it was condoned by the relevant authority.

The agency says two issues in the year under review were declared as irregular expenditure that amounted to R282 million of the total irregular expenditure.

It says one of these issues was the result of additional expenditure that could not be avoided on an existing road construction contract and was submitted to National Treasury for approval on time, but the approval was delayed.

Sanral says the other issue related to the acquisition of a building for administration purposes where the approval for the acquisition was given to a board subcommittee.

Sanral chair Themba Mhambi says the agency has received a record 15th consecutive unqualified audit report and is on track to achieve a clean audit opinion by 2020/21.

Wayne Duvenage, chief executive of the Organisation Undoing Tax Abuse (Outa), declined to comment on Sanral’s financial results until the organisation has analysed them.

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Have you ever dealt with anyone from SANRAL? I have. So they are broke and failing and “QUALIFY” for a loan?? Is V.B.S. or Saambou back in business??????????
How do you take a failing company with no real forecast of making money and then GIVE THEM A LOAN.
HEY NATIONAL CREDIT REGULATOR, IS THIS RECKLESS LENDING???????????
I personally love watching those guys in the SANRAL trucks sitting on the side of the road, DOING NOTHING @ full salary. Sounds like a money maker to me.

hi Zokey…..this is e-Africa…what a self-begotten degrading name ? e-tolls

I guess the ANC already spent the bribe money it received so its doing all it can to keep etolls going.

This is the crux of the whole matter.

Besides the bribes, there are the unwarranted “commissions” “finders fees” etc etc. Then there are the bloated operating costs )which include recovery of related kick-backs) charged by the company in Austria (they are laughing all the way to prosperity skimming SA taxpayer money via bail outs to Sanral) not forgetting the bloated salaries paid to Sanral executives and the “ghosts” manning the e-Toll Service Centres. I wonder if the new commission investigating fraud, corruption and misappropriations by our dear politicians, civil servants and all their related patronage networks will eventually get to investigate the Sanral thefts.

Imagine being one of the losers (still) paying.

We’re looking at you Zokey.

I suspect that most of the payments are coming from companies (specially listed ones) who are too large (& audited) to protest like the bulk of individuals. That might explain Zokey’s involvement.

Or, Zokey might just be a loser. Occam’s razor.

Time to catch a wake-up, ANC and Sanral. ANC, you started the whole culture of non-payment in the past. Now, the principle has come back to bite you instead. Stop trying to think you can fool the motoring public any longer. We know that the whole deal with that overseas company (PROVEN to have previously paid bribes) was crooked. So stop expecting us to pay. And you clots still with e-tags – chuck them in the nearest lake and rather subscribe to OUTA. Time to realise the truth, SANRAL. Your whole crooked e-tolls scheme is totally dead in the water. Just accept the truth.

The etoll debacle caused SANRAL to accrue a total debt of R 47 B acc to [MyBroadband]
So, when the GFIP program was conceived it was supposed to cost R 9.5 Billion, it ended up costing around R 20 Billion, and now SANRAL has a debt of R 47 Billion.

Wow, sounds like typical SOE management.

So it has costed far more to run those gantries and the whole system, than they were able to collect.

SCRAP IT ASAP !

A system that gives lawless taxi-thugs a free-ride while expecting law-abiding, tax-paying citizens to contribute is something out of a Zumaesque mind-set.

Oh please, the fortuner, polo and ranger crowd as just as lawless, thuggish but usually less alert.

Disappointing slumping result! Should have been closer to 90%.Lets hold thumbs they slump into the slums even more!

End of comments.

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