Eskom denies it is facing funding crisis

Power utility Eskom has denied that it is broke.

It was responding to weekend reports that the scandal-plagued parastatal had only enough cash to last for the next three months – but that it still wanted bonuses to be paid to axed chief executive Brian Molefe‚ suspended acting chief executive Matshela Koko and others.

Yesterday, Eskom said that due to limitations around disclosing financial information before the official announcement‚ scheduled for Wednesday‚ it was not in a position to respond comprehensively to specific issues raised at this stage.

“Having said this‚ Eskom refutes the notion that it is facing a cash crisis‚ and that it has only enough cash to last for the next three months‚” it stated.

According to its annual financial statements‚ a Sunday Times report said‚ the power utility was sitting on its last R20-billion.

Unless something was done urgently‚ Eskom could find itself unable to pay November salaries.

The financial statements were presented to Public Enterprises Minister Lynn Brown late last month. Her office refused to comment on Saturday‚ saying it was premature.

Eskom postponed the announcement of its results the night before they were scheduled to be made public‚ leaving analysts speculating about the reasons for the delay‚ the newspaper reported.

However‚ Eskom said yesterday that external auditors had confirmed the parastatal as a going concern and that‚ as a result, the company saw these reports as being inaccurate and misleading.

“It is important to reiterate that Eskom is not facing any liquidity challenges‚ and that the company is confident it will maintain sufficient liquidity to support its operations‚” Eskom said.

It said while its financial position had always been supported by significant reliance on debt and borrowings‚ its improved overall financial and operational performance over the last two years had led to an improved balance sheet.

Eskom said it also had sufficient government guarantees to execute its funding plan.

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