Eskom posts R30bn profit as turnaround gathers momentum
Eskom has reported a second consecutive annual profit, with profit after tax more than doubling to R30 billion in the financial year ended 31 March 2026.
Eskom Chairperson Mteto Nyati said the improved financial performance reflects stronger generation recovery, tighter cost controls and reduced reliance on expensive emergency generation.
Presenting Eskom’s FY2026 results on Monday, Nyati said operating profits increased, while cash generation and liquidity also improved.
"This is the second year in a row that Eskom has delivered a profit. Profit after tax more than doubled to 30 billion rands from 14 billion in the prior year. Operating profits rose. Cash generation strengthened. Liquidity improved."
Nyati said the turnaround was not accidental, but the result of sustained efforts to improve the utility's operational and financial performance.
"That did not happen by accident. It happened because generation recovery gathered real momentum. It happened because we applied cost discipline and because we reduced our dependency on expensive emergency generation."
He said Eskom's stronger financial position would allow the utility to reinvest in areas critical to its long-term sustainability.
These include Eskom Green, the distribution business, maintenance of the coal fleet and expansion of the transmission grid.
The board chair said the improved financial position should ultimately translate into a better experience for electricity consumers.
"It is this financial performance that allows us to reinvest earnings where they matter into Eskom Green so that we can scale the carbon-free generation without simply loading more risk onto our already stretched balance sheet, into the distribution business."
He said Eskom would also continue investing in the maintenance of its existing coal-fired power stations to ensure that generation reliability continues to improve during the country's energy transition.
The utility also plans to strengthen and expand the electricity grid to accommodate additional generation from independent power producers.
Nyati added that this is critical if South Africa is to increase electricity supply rather than continue relying on power rationing.
"Lastly, into improving or expanding the grid so that independent power producers can connect and South Africa can grow supply instead of rationing it."
BALANCING ESKOM'S COMMERCIAL AND DEVELOPMENTAL ROLE
Nyati said Eskom has a dual responsibility — to operate as a financially sustainable business while also fulfilling its developmental mandate of keeping South Africans connected to the grid.
He used an example shared by President Cyril Ramaphosa of electricity infrastructure being installed near his farm in Limpopo to connect two indigent families.
The board chairperson said the infrastructure cost millions of rand and would not necessarily have been provided if decisions were based purely on commercial considerations.
"That is a developmental mandate in its purest form. We do not leave people behind because they cannot pay the full economic cost of a line that reaches their door."
However, he stressed that the infrastructure required to provide electricity must ultimately be funded.
"There is no such thing as a free lunch. Those lines, those transformers, the coal fleet, the nuclear plant, they have to be paid for."
Nyati said Eskom’s commercial mandate therefore supports rather than contradicts its developmental responsibilities.
"That is why the commercial mandate is not the opposite of the developmental mandate. It is what makes the developmental mandate possible."
AFFORDABILITY REMAINS A CONCERN
Despite Eskom’s improved financial performance, Nyati said the utility continues to face structural pressures.
He said the board recognises the importance of balancing energy security, affordability and sustainability.
Nyati warned that tariff increases alone cannot resolve all of Eskom’s financial and operational challenges, particularly given municipal debt, declining electricity sales, an ageing generation fleet and the capital required for the energy transition.
"Affordability is becoming more critical, not less. This board recognizes that tariff increases alone are not the strategy."
He says Eskom must therefore continue pursuing structural reforms rather than relying solely on higher tariffs to address its financial pressures.
NEW BOARD FOCUSED ON LONG-TERM SUSTAINABILITY
Nyati also highlighted changes to Eskom’s board, which was reconstituted in December 2025.
The new board consists of 15 directors, including eight new directors and four returning non-executive directors who provide institutional memory.
Nyati said the board has strengthened oversight of strategy, finance and risk, allowing it to focus more closely on Eskom’s long-term sustainability rather than simply responding to immediate crises.
"Now looking back eight months in, I can say it plainly, we have a board that is fit for the journey ahead. I am proud to serve with these highly skilled and ethical professionals."
He credited Electricity and Energy Minister Kgosientsho Ramokgopa with prioritising merit in the selection of the new board.
Nyati said Eskom was now moving from a period of recovery towards structural sustainability, while continuing to focus on improving electricity reliability and strengthening the utility's financial position.
"We will do it with clear stage gaze, with fiduciary discipline, with conviction that South Africa is entitled to both lights that stay on, and an institution that can stand on its own two feet."
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