Eskom Losses Show Urgent Need of Turnaround Plan, Says Moody’s

Eskom Holdings SOC Ltd. urgently needs a plan to turn profitable or South Africa’s state-owned utility will collapse under mounting debt, according to credit agency Moody’s Investors Service, Bloomberg News reported. The generator of more than 90% of the nation’s electricity reported a record annual loss of 20.7 billion rand ($1.4 billion) last week and is regarded as the biggest threat to South Africa’s economy. The government is giving Eskom a 128 billion-rand bailout over the next three years to keep it afloat. “The company’s operational and financial performance has deteriorated, indicating the extent of the challenges facing Eskom in meeting its debt obligations absent government support,” Moody’s said in an emailed report. The rand declined as much as 0.6% against the dollar after it was released. Read more