How Eskom doubled its profit to R30.3bn despite selling less power
Eskom’s profit after tax more than doubled to R30.3 billion in the year ended March 2026, despite a 6.2% fall in electricity sales.
Eskom, South Africa's power utility, has experienced a remarkable turn in its finances, doubling its profit to R30.3 billion in the financial year ending March 2026. This significant increase marks the second consecutive year of profitability for the company. Chairman Mteto Nyati attributed the success to improved performance of power stations, reduced diesel usage, and stringent cost controls.
He emphasized that the profit is crucial to sustaining Eskom's dual mandate of commercial viability and societal development. Despite a 6.2% decline in electricity sales to 178 TWh, revenue rose by 4.1% due to a 12.74% tariff increase. This revenue growth largely compensated for the reduced sales volumes. Moreover, Eskom benefited from a 7% decrease in primary energy costs and a substantial reduction in the use of open-cycle gas turbines, which cut costs by R10.6 billion.
However, the utility is grappling with mounting municipal arrears, which rose by 17.9% to R111.6 billion at the end of March 2026 and could reach R358 billion by 2031 if urgent action is not taken. Eskom's CEO warned that such non-compliance poses a significant risk to the company's liquidity and overall operational sustainability.
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