The state logistics company Transnet has reported a return to profitability, recording a net income of 4.6 billion rand for the financial year ending in March 2026. This figure significantly exceeds the loss of 1.9 billion rand registered the previous year.
The company disclosed its annual financial results on Thursday, specifying that the improvement in performance was driven by increased volumes of rail and pipeline transport, as well as tariff increases and efforts to optimize operational activities.
These results come against the backdrop of Transnet working to recover after several years of reduced cargo flow, infrastructure limitations, and operational disruptions that negatively affected the economy and exporters of South Africa.
Growth in rail transport
The company is also implementing reforms aimed at opening the railway network to private operators and attracting private investment into the country's ports. According to the company, the volume of rail transport increased by 4.9%, reaching 167.9 million tonnes. This reflects the positive impact of targeted measures aimed at improving network reliability, maintenance quality, and asset availability.
Furthermore, there was an increase in the volume of pipeline transportation during the reporting period. Although challenges remain, the improvements achieved over the year indicate that Transnet's efforts to restore operations are beginning to yield measurable results.
Transnet's revenue for the year grew by 7.1%, amounting to 88.6 billion rand. However, operating expenses increased by 10.8%, reaching 57.7 billion rand, while the EBITDA margin only rose slightly—by 0.7%—to 30.9 billion rand.
During the year, the company invested 23.3 billion rand in infrastructure, equipment, and operational improvements. Transnet faced several difficulties, including derailments, issues with the railway network and rolling stock, safety incidents, power supply interruptions, and adverse weather conditions.
The logistics operator noted that a key event of the year was the sale of a 49.999% stake in the Durban Gateway Terminal (DGT) to International Container Terminal Services Inc. (ICTSI) for 10.5 billion rand. This transaction generated a gain on disposal of 12.5 billion rand, including fair value adjustments, strengthening the Group's overall financial performance for the year. Transnet retained a 50.001% ownership stake in DGT, and management transferred to ICTS.
Transnet also added that 23.3 billion rand was invested in critical infrastructure, equipment upgrades, and operational improvements during the year to support current recovery and future growth. Additionally, approval from the National Treasury for grant funding of 14.8 billion rand through the Budget Infrastructure Facility (BIF) for strategic railway and port projects is expected to further support infrastructure development, improve network performance, and reduce future financing needs.