Johannesburg — South African state logistics firm Transnet on Monday reported a six-fold jump in unauthorised spending for the year to March 31 mainly due to train replacement contracts, as it posted a 1.6% rise in annual revenue.
Transnet, which operates gas pipelines, railway lines and ports, said “irregular expenditure” rose to around 49 billion rand ($3.23 billion) from 8 billion rand in the prior year. Some 41.5 billion rand of the spending related to the train contracts dating from before 2015.
Transnet acting CEO Mohammed Mahomedy said the two figures were, however, not directly comparable as the contracts involved between the two years were not necessarily the same.
The company also said its external auditors had given its audit report a “qualified opinion” relating to the completeness and accuracy of the reported irregular expenditure.
A qualified opinion on a company’s finances means the auditor has found minor problems with the books but is still broadly vouching for them.
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The operator of nearly three-quarters of Africa’s rail network – the bulk of which is in South Africa – said it did not agree with the auditors opinion and the matter was still under investigation.
Transnet has been investigating allegations of corruption in the procurement of diesel and electric locomotives.
A number of its top executives, including its chief executive and chief financial officer, have been suspended or fired in the wake of an official corruption inquiry into a 54 billion rand contract to buy 1,064 locomotives.
It said annual revenue rose to 74.1 billion rand, boosted by a 9.1% increase in piped petroleum volumes. Export coal volumes, however, fell 6.5% to 72 million tonnes due to low first-quarter demand, operational challenges, derailments, community unrest and train cancellations.
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– Reuters
