EQUITY INJECTION
Post Office gets stronger but still needs cash boost
The balance sheet of the South African Post Office (Sapo) has strengthened considerably over the past year, but the organisation still requires a "substantial" equity injection by the state, group CEO Mark Barnes says in the annual report. Sapo received a R650m capital injection by the state in April 2016, which it used to pay long outstanding creditors. It also depends on government guarantees valued at R4.14bn, which it utilises to secure loan funding. The need for a further equity injection was highlighted by the finding of the auditor-general that a "material uncertainty exists on the Sapo group and company’s ability to continue as a going concern". This was because Sapo did not generate sufficient revenue to finance its high cost base. In the year to end-March, revenue fell to R4.5bn (R4.7bn in the previous year) and the operating loss to R807m (R973m). The loss for the year amounted to R959m, down from the previous R1.1bn. Employee costs amounted to R3.7bn. Sapo directors, how...
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