State-owned Transnet has reported a 1.5% year-on-year improvement in the total rail volumes reaching 151.7-million tonnes at the end of March 2024, showcasing improvement in operational performance. However, this figure still fell 1.8% short of Transnet’s recovery plan target of 154.4-million tonnes for the 2023/24 financial year.

Speaking at a media briefing at the Transnet Freight Rail headquarters in Johannesburg on Friday, Transnet group CEO Michelle Phillips acknowledged that while several metrics indicate positive momentum, challenges persist.

“We lost close to a million tonnes in one of the derailments that we experienced towards the end of the year. If that derailment did not occur, we probably would have achieved or gotten very close to achieving the target,” she said.

Phillips reported that revenue had also increased by 12.8% year-on-year, just 1% below the recovery plan goal, while operating expenditure increased by 8.3% year-on-year, which was 4.2% less than budgeted. She noted that these were preliminary estimates pending the official release of the audited year-end financial results.

“We committed to our customers that we would ensure that we would not end the year worse off than the previous year. The preliminary data certainly indicates that Transnet, firstly, has been able to increase its revenue - it's been able to reduce operating costs. And very importantly, we have also been able to drive up the volumes. A lot of the work and a lot of improvement came during the second half of the year as part of our recovery plan. We halted the downward trend that we saw in the earlier part of the year,” she said.

Phillips also noted that container handling had a 2.2% improvement to 4.15-million twenty foot equivalent units (TEUs) at the end of March 2024. This also fell 1.8% short of the recovery plan goal of 4.23-million TEUs.

She said these improvements had been achieved on the back of focused attention given to operational processes, greater accountability, and improved oversight.

“We've had to improve on our equipment and rolling stock availability. We've been able to achieve a return to service of an increased number of locomotives. And we've also seen, in the ports, delivery of some critical port equipment,” Phillips said.

In terms of automotives, Transnet handled 773 510 units for the year, an 11.7% decline from the 876 040 units handled the year before and 5.1% lower than the 815 000-unit target set in the recovery plan.

She said the lower volumes in automotive units was largely a result of the market and not a consequence of poor terminal performance.

“It all depends also on the volumes that are coming into the country and that are leaving. So, you see them ending up slightly below last year, as well as slightly below the recovery plan target,” Phillips said.

Pipeline performance also declined by 1.9% year-on-year to 15.19-billion litres in 2023/24. This was 3.8% below the target of 15.78-billion litres. Phillips said that this performance was owing to market issues and shutdowns that took place in the early part of the year.

At the ports, she said that new equipment had either been delivered or was scheduled for delivery soon. These included 10 new haulers and a reach stacker already delivered to Pier 1, as well as 35 new haulers for Pier 2, 25 of which have already been delivered and 10 of which will arrive by May 18.

A further six reach stackers are scheduled for delivery to the Durban port by mid-May, along with three empty handlers to be delivered by the end of April. The Cape Town Container Terminal is also scheduled to receive four new reach stackers by the end of this month, while seven rubber tire gantry cranes have already been delivered.

“These are only the ones that are about to be delivered or have already been delivered. Over the next few months, we will see more equipment coming into the system as we proceed towards the end of this year. It's important because we've got a citrus season that cannot fail. We've made a lot of commitments and promises,” Phillips said.

She said, however, that security breaches were an ongoing point of concern. However, she implied that others needed to step up in this regard.

“As a country, we need to come together to try and find ways to better protect the infrastructure. A breach of the network means everybody loses. It really is in all of our interest to ensure that we get the security where it needs to be,” Phillips said.

Transnet chairperson Andile Sangqu recalled that the recovery plan was implemented in October last year to address the numerous constraints on Transnet's operational performance and to stabilise and improve volumes.

The first goal of the recovery plan was to stabilise the operational performance, with the second phase of the plan being to realise significant improvements in operational and financial performance for the financial year ending March 2025.

“Transnet’s journey to recovery is on course. We are executing our plans to enhance operational and financial performance for long-term sustainable growth. Of course, we are not out of the woods yet but the progress is real. The business is being stabilised and we are increasingly optimistic about the future,” Sangqu said.