Africa in focus as Transnet sets R100bn revenue target for 2020

State-owned freight logistics group Transnet has set a target of becoming a R100-billion company by March 2020, with its business interests in the rest of Africa expected to contribute materially to the increase in revenues. In 2016/17, Transnet reported a 5.3% rise in revenue to R65.5-billion.

Addressing stakeholders at the ‘Transnet Indaba’, which is taking place in Gauteng this week, CEO Siyabonga Gama said Africa’s infrastructure bottlenecks, which were undermining intra-regional trade, represented a significant business opportunity for the South African group.

Twenty-four African projects had already been identified, some of which could be realised in the not-too-distant future. The most advanced projects included rail ventures in Zimbabwe, Zambia and Nigeria and a port operations contract in Kenya.

Gama reported that the group was also aiming to increase rail and port equipment sales to third parties to R20-billion by 2020, while liberating R15-billion-worth of revenue from its extensive property holdings.

Chief customer officer Mike Fanucchi said that the group also had specific projects in place to raise freight-related revenue to R70-billion by 2020, from R46-billion currently.

Fanucchi also expected that pipeline-related revenues could grow to sales to R10-billion in the coming three years through the integration of gas into a network that has hitherto handled only liquid fuels.

Acting COO Raisibi Lepule reported that the group’s international expansion would take place under the Transnet International Holdings banner.

The entity would focus initially on doubling cross-border volumes to 10-million tons by 2023 and growing trans-shipment volumes to R498-million a year in 2023 from R267-million currently.

“We are talking about an entity that will grow to a R100-billion business by March 2020 if we do all of the things that we have put in place to create this new Transnet – this Transnet that is responsive to customer needs, this Transnet that is agile, this Transnet that is digital,” Gama concluded.