The financial woes dogging South Africa’s behemoth state power utility show little sign of letting up even as the government grants it massive bailouts.

Eskom, which supplies 95% of the nation’s electricity, posted a R1.3-billion profit in the six months to September, about double a year earlier. However, it still anticipates a R20-billion loss for the full year due to lower demand and prices in the summer months. Eskom’s debt burden rose to R454-billion, from R440-billion at the end of March.

“The Eskom turnaround remains a long and difficult journey,” Jabu Mabuza, Eskom’s chairman and acting CEO, said at the results presentation in Johannesburg on Thursday. “The ultimate goal is to make Eskom profitable.”

Eskom’s precarious state stems from years of mismanagement, a bloated wage bill, massive cost overruns at two new coal-fired power stations and maintenance backlogs at other plants that left it struggling to meet demand. The government has said the utility is too big to fail and allocated it R138-billion over the next three years to enable it to keep operating. Yet that isn’t likely to be enough to ensure its viability.

Freeman Nomvalo, who was named Eskom’s chief restructuring officer on 30 July, is considering options to reorganise its debt.

The government plans to split the utility into generation, distribution and transmission units under a state holding company — a reorganisation it says will make it easier to raise financing and improve efficiency. This month it announced that André de Ruyter, currently the CEO of packaging company Nampak, will take the helm at Eskom on 15 January.

More highlights from the first-half results presentation:

Sales volumes fell 1.3% in the six months to September compared to the previous year; Primary energy costs increased 13%; and
The utility has raised 61% of its funding for 2019/2020. — Reported by Mike Cohen and Loni Prinsloo, (c) 2019 Bloomberg LP