COMPANY NEWS IN BRIEF
Eskom announces interim resultsEskom, which announced its interim financial results on Friday, says it has made progress with unbundling and expects that a license for its new subsidiary transmission company will be issued by the end of April.
It also hopes that it will have secured lenders' consent for the split by this date in instances where this is necessary.
The Cabinet also announced progress on Eskom's unbundling this week with the approval of the Electricity Regulation Amendment Bill, which will establish the independent market and system operator and further open up the electricity market to competition.
The interim financial results for the six months ended 30 September 2022 showed a profit of R3.8 billion but the company warned that its performance was "seasonal" as revenue is higher, tariffs rise, and costs from renewable energy are lower, during the winter months. A large loss is expected by the end of March 2023, due to load shedding and diesel costs.
Eskom also noted that when the new financial year begins on 1 April, Eskom would only be permitted to borrow with the written permission of the finance minister, which is one of the conditions of the Treasury's R254 billion debt relief plan. The R350 billion of government guarantees will expire as the debt is paid off.
This means it must fund its capital costs from the revenue it earns from operations. Large capital projects – such as investment in the transmission grid – will need permission.-Fin24
Huawei reports huge drop in profits
Huawei posted a massive drop in 2022 profits on Friday, as the company battered by US sanctions appointed its CEO's daughter to be its rotating chair.
A leading supplier of telecom gear, smartphones and other advanced equipment, a US-led pressure campaign in recent years has taken a major chunk out of Huawei's businesses.
And after posting record profits for 2021, the firm Friday reported 35.6 billion yuan ($5.2 billion) in net profits in 2022 -- a fall of 68.7 percent year-on-year.
"In 2022, a challenging external environment and non-market factors continued to take a toll on Huawei's operations", the company's outgoing rotating chairman Eric Xu said at its annual report press conference.
"In the midst of this storm, we kept racing ahead, doing everything in our power to maintain business continuity and serve our customers," he said.
"We also went to great lengths to grow the harvest - generating a steady stream of revenue to sustain our survival and lay the groundwork for future development," he added.
Taking over as chair - a role that lasts six months - is Meng Wanzhou, daughter of billionaire CEO and founder Ren Zhengfei.-Fin24
Absa eyes black ownership
Absa has announced a new broad-based black economic empowerment (B-BBEE) scheme worth R11.2 billion that will increase its black ownership by about 7 percentage points.
Its last empowerment report showed black share ownership stood at 17.56% in 2021, with the bank saying that after the transaction, its black ownership will exceed the 25% threshold set out in the Financial Sector Charter.
The bank hopes to implement the deal before the end of this year, with shareholders set to vote on the matter on 2 June.
A Corporate Social Investment (CSI) trust, for the benefit of black communities, will indirectly own a 4% shareholding, while a staff trust will indirectly hold 3% of Absa.
Black staff members in South Africa will receive just over 82% of the value of the staff trust, it said, while the equivalent of approximately 1% of Absa will be made available to staff employed by subsidiaries in other markets. –Fin24
PSG Wealth ordered to pay client
The South Gauteng High Court in Johannesburg has ordered a financial services company to pay a client more than R800 000 stolen by fraudsters through email cybercrime.
Judge Denise Fisher ruled in favour of Jan Jacobus Gerber who sued a PSG Wealth Financial Planning for the loss he sustained due to the unlawful electronic transfer of money intended for his retirement that he had invested with the company.
Judge Fisher said it had become routine for business to be conducted via email and it had now become common for these emails to be accessed remotely by fraudsters. She said business email compromise (BEC) had become rife and that both parties had been victims of the fraud.
"The question is, who should bear the losses," she said.
Judge Fisher said Gerber had a share portfolio which had been managed by PSG, through its representative Jonathan Fisher, for more than a decade.
Gerber had a share and cash portfolio with investments totalling R855 413 as at September 2019. This could be liquidated and paid out at Gerber’s request.
The judge said that the contact between Fisher and Gerber was rare. The dealings entailed no more than a monthly statement, detailing his account activity, sent via email to Gerber.
Then, in October 2019 there was a "somewhat unusual request" when Fisher received an email, purportedly from Gerber, requesting to liquidate R250 000. The email also provided details of a new bank account with FNB.-Fin24
Momentum caps power surge payouts
Momentum Insure reduced the amount it pays out for power surge claims.
The Centurion-based insurer sent a letter to its customers informing them that power surge cover under their buildings and contents policies will be capped to a maximum of R10 000 per claim. Customers will still pay a standard excess of R3 000 per incident for all power surge claims.
It wrote that the changes were necessitated by "the significant increase in power outages across the country, the inconsistency of the current provided to homes and businesses, and the increase in power surge-related claims."
Previously, the insurer only committed to covering loss or damage caused by power surges or dips without putting a limit on the payable claims.
If people want to be covered for more than R10 000 per event, they'd have to cough up more in terms of their monthly premiums. Momentum Insure said customers can increase their default cover with extended power surge cover up to a maximum of 30% of the total sum insured.
Momentum is not the first insurer to try to hedge its risks against power surge claims. OUTsurance and Bryte Insurance are among those who have implemented larger excesses for these claims.-Fin24