According to SABC’s Chief Financial Officer (CFO), the company is said to be in extreme financial distress and could be forced to apply for business rescue.
Reports have also revealed that the company is set to announce a loss of more than R1 billion for the financial year ended March 2023. The company has mentioned that its financial challenges are due to load shedding, the current economic downturn, and the analogue switch-off.
Yolande van Biljon who is the group CFO, said that if the group cannot sort out its financial situation, it could go into liquidation. If it went through the liquidation process, it would become the second institution under the Department of Communications to do so after the South African Post Office (SAPO).
In June, van Biljoen wrote in a memorandum: “The business rescue application that [the Post Office] is currently contemplating is going to become a very real consideration unless other sources of funding or support [are] identified and confirmed as a matter of urgency in the medium to longer term, while in the short term, immediate significant interventions that are in the corporation’s control are required”.
Even though the memorandum came out last month, the SABC board is yet to intervene on the matter. Moreover, the memorandum also mentioned that the available cash to settle the obligations at the end of May was short R60 million, despite the company not paying its monthly instalment to Sentech for roughly a year.
