Eskom reported a R16bn net profit for the financial year ending March 31, 2025, marking its first profit in eight years after a previous R55bn loss.
Image: Timothy Bernard/Independent Newspapers
Eskom has redeemed its ES26 bond, marking a milestone in the utility’s journey toward financial independence - the bond had grown to an outstanding amount of R38 billion over its 19-year tenure.
The bond was first issued in March 2007 as a R500 million tranche at a coupon of 7.85%, and its growth has reflected sustained investor support.
"The redemption is a testament to the utility’s turnaround trajectory and our commitment to rigorous financial governance. This is a result of the support provided under the Debt Relief Act, with our significantly improved year-on-year financial performance," said Eskom Group CEO, Dan Marokane.
"By adhering to these debt relief conditions, we are fostering a more predictable and stable investment environment."
Eskom's portfolio of local and international bonds held debt of about R327.7bn as at March 31, 2025, with many of the bonds carrying government guarantees, an online search by BR showed.
The growth of the ES26 bond was achieved through 30 public auctions, which collectively raised about R9bn. The remaining balance was raised through reverse enquiries and liability management issuance, demonstrating flexible execution and continued investor appetite for Eskom debt instruments.
In total, 53 tranches of the ES26 bond were listed, reinforcing its role as a long-duration benchmark instrument in the domestic bond market. In 2007, the bond received the JSE Spire Award for Best Bond Issue.
"The redemption represents a structural win for the South African economy. By honouring this large-scale commitment, Eskom is reducing its risk premium, which lowers the interest rates the utility pays on future borrowing," said Marokane.
He said Eskom remains focused on navigating headwinds arising from ongoing energy sector reforms. Revenue collection and operational efficiency also remain a focus to ensure that the financial milestone translates into a stable and affordable energy future for all South Africans, said Marokane.
Eskom reported a R16bn net profit for the financial year ending March 31, 2025, marking its first profit in eight years after a previous R55bn loss. The turnaround was driven by a 12.74% tariff hike, significantly lower diesel costs due to reduced load shedding, and government debt relief.
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