Latest news with #SouthAfricanPostOffice
eNCA
16-07-2025
- Business
- eNCA
How many still use the post office?
CAPE TOWN - Pumping money into the South African Post Office (SAPO) won't help unless it's backed by drastic reforms to make the institution viable again. This was the key message from a meeting between the Post Office and Parliament's Standing Committee on Public Accounts (Scopa). The Department of Communications and Digital Technologies has allocated R1.8 billion to SAPO over the next three years. However, concerns remain about the Post Office's ongoing cash flow problems.
IOL News
14-07-2025
- Business
- IOL News
R2. 5 billion bailout bonanza: SABC and Post Office get a lifeline
Communications and Digital Technologies Minister Solly Malatsi has announced that the SABC will receive over R700 million and the South African Post Office (SAPO) R1.8 billion Image: Solly Malatsi/X Communications and Digital Technologies Minister Solly Malatsi has announced that the SABC will receive over R700 million and the South African Post Office (SAPO) R1.8 billion over the Medium-Term Expenditure Framework (MTEF). Tabling the Department's 2025/26 Budget Vote in Parliament last week, Malatsi said the allocations were aimed at supporting the SABC's public broadcasting mandate and stabilising SAPO's declining services. "The SABC will receive R704 million over the MTEF. This includes R43 million for programme production, R464 million to support the core public broadcasting, R197 million for Channel Africa, which amplifies South Africa's voice across the continent," Malatsi said. Last month, IOL reported that SABC CEO Nomsa Chabeli raised concerns about the broadcaster's financial sustainability, highlighting that the cost of its public mandate remains unfunded and that the SABC depends heavily on commercial revenue to support these obligations. "It's important to note that when we have discussions about the SABC's financial sustainability, we remember the cost of the public mandate that is currently unfunded. The SABC, from a commercial perspective, takes commercial revenue to fund the public mandate that's our current model." Chabeli said. She also pointed out that less than 20% of households in South Africa are paying for TV licenses, a situation that has led to a steady decline in funding for the public broadcaster. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad Loading The funding announcements come amid growing concerns about the long-term sustainability of both the SABC and SAPO. Many South Africans have criticised repeated government bailouts, questioning whether money alone can fix deep-rooted issues such as outdated business models and competition from digital alternatives. "The South African Post Office is allocated R8 billion over the MTEF to fulfil its universal service obligations, improve service delivery. This funding will support SAPO's efforts to diversify revenue, rebuild trust, and stabilise operations through strategic partnerships and good governance". Malatsi said. Last month, SAPO also received a R381 million wage subsidy from the government, aimed at covering employee salaries for the next six months as part of the ongoing business rescue process. IOL News Get your news on the go, click here to join the IOL News WhatsApp channel
The South African
21-06-2025
- Business
- The South African
SA Post Office confirms you may get your mail by COURIER in 2029
The South African Post Office (SAPO) has unveiled an ambitious five-year plan to reinvent itself as a major player in the courier and delivery market, aiming to pull itself out of financial crisis and into profitability by 2029. The struggling state-owned entity presented its strategy to Parliament this week, revealing plans to dramatically increase revenue from R1.9 billion in 2024 to R5.2 billion by 2029, with a major push into the courier and parcels sector. SAPO is betting big on parcel delivery, hoping to grow revenue from a modest R38 million in 2024 to R1.4 billion within five years. The public postal service has set its sights on capturing: 5% of the B2B and B2C market 25% of the Consumer-to-Consumer (C2C) market These targets align with a 50% forecasted increase in international mail and parcel volumes, indicating a shifting market in which traditional postal services are rapidly declining. As digital communication continues to replace letters and bulk mail, SAPO predicts a 5% to 7% annual decline in traditional services like registered and franking mail, unless aggressive modernisation and digitisation are undertaken. The plan highlights a pivot toward a dual revenue model focused on digital transformation and parcel logistics – a move SAPO says is key to remaining relevant. Following a devastating R1.03 billion projected loss in 2024, the SAPO is targeting a net profit of R1.5 billion by 2029. But reaching that goal comes with steep costs. The Post Office estimates it will need an additional R3.8 billion in funding to execute its turnaround strategy. This follows a turbulent recent history that includes: Provisional liquidation in February 2023 A business rescue plan to avoid collapse to avoid collapse The retrenchment of over 4 300 workers Closure of 360+ branches nationwide Despite these cuts, the entity was bolstered by a R2.4 billion state bailout, enabling critical upgrades to IT infrastructure, logistics equipment, and its vehicle fleet. SAPO's transformation plan sees it becoming a self-sustaining, digitally-driven postal and logistics service – no longer reliant on government bailouts and increasingly integrated into South Africa's e-commerce ecosystem. 'This strategy is not just about survival – it's about creating a modern, profitable national service that meets the demands of a digital economy,' said an official familiar with the presentation. Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1 Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
IOL News
18-06-2025
- Business
- IOL News
Funding crisis looms for SA Post Office and Post Bank as rescue practitioners prepare to exit
The National Treasury firmly ruled itself out as an option to recapitalise SAPO. Image: Supplied Uncertainty surrounds the funding of about R7 billion needed to recapitalise both the South African Post Office (SAPO) and the Post Bank after National Treasury firmly ruled itself out as an option. This comes as the SAPO Business Rescue Practitioners prepare to exit the process, leaving the entity with a R1.7bn paper profit. During a briefing to Parliament's Portfolio Committee on Digital Technologies and Communications on Tuesday, SAPO's group acting CEO, Fathima Gany, expressed the urgency of the situation. Gany said SAPO required R3.8bn to efficiently run its extensive network of 657 branches while integrating necessary digitisation capabilities. "The magic number is R3.8bn. It could be anything else, unfortunately the fiscus doesn't have the ability to give us that and we have to appreciate that. How do we get SAPO fit for business to operate in this futuristic space that's digitalised?" Gany said. "We don't know what the funding model will be as we go out to the market. It has to be a hybrid because if it's not a hybrid and we turn only to the fiscus and the answer is no, then its a futile discussion on how to get SAPO ready for business." Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ Gany said the Post Office had settled all historical and outstanding debt through the business rescue process in a compromise that saw 12 cents to the rand paid out to the creditors, with the remainder flushed into the profit and loss account. She said SAPO looked like it made profits but those were none cash profits, and they were on the back of expenses while there were some creditors in dispute and immaterial amount. Gany said SAPO was close to finalising a service-level agreement with the Post Bank in the services it delivers to it, and some of the commercial revenue streams envisaged from postal branches. Meanwhile, Post Bank acting CEO Nikki Mbengashe said it was unclear how the bank could structure the at least R3bn required for it to serve the identified niche. Mbengashe said one of the options was to obtain guarantees from the National Treasury to enable the bank to raise funding without necessarily diluting the shareholding. "How much funding do we need? A lot if we really want to build branches, if we want to build digital presence. We don't have ATMs, branches and the infrastructure we need to have to provide digital capabilities," Mbengashe said. "The minimum is R3bn. We have done that exercise, we are engaging with the board in our next meeting. We have no intention of privatising the Post Bank, but we do need funding therefore we need to find options. We have gone to the National Treasury three times and three times the National Treasury has said no." Cape Argus
The Citizen
17-06-2025
- Business
- The Citizen
Increased risks of cyberattacks, limited skills among Sapo's challenges
The Sapo aims to move from a loss of R1.03 billion in 2025 to a net profit of R1.48 billion in 2029. The South African Post Office (Sapo) has a plan in place to turn its business around by 2029. However, several hurdles remain that it must overcome to reach its goals. In 2023, the state-owned enterprise entered business rescue with R8.7 billion in outstanding debt to creditors. It requested a R3 billion bailout at the end of 2024 to avoid liquidation, but National Treasury decided against the move. ALSO READ: Post Office rescue plan is working, but more money is needed For the financial year 2024-25, Business Rescue Practitioners (BRP) managed to pay creditors R1 billion. On Tuesday, Sapo presented its corporate plan to the Portfolio Committee on Communications and Digital Technologies, outlining its strategy for turning things around over the next five years. Sapo's corporate plan Acting CEO Fatima Gani stated that the entity is exploring the formation of partnerships with e-commerce platforms and small to medium-sized enterprises (SMEs) to unlock new revenue streams. Public-private partnerships would also help modernise Sapo infrastructure without requiring full privatisation, she said. The Sapo hopes to reach the R5 billion mark in revenue; however, this can only be achieved with the help of investments. ALSO READ: Union fights liquidation of Sapo while govt says it cannot bail it out 'If we had to achieve this revenue stream, there needs to be an investment, whether it's through a partnership, capital injection, equity injection, or raising funds on our own. We need those investments to make Sapo fit for business, to achieve a diversified revenue stream,' said Gani. 'We are forecasting to be breaking even around 2027–2028, which means working capital stress that we feel, and we keep on coming back to the government to say please help us fund this organisation, will fall away as we are on our investments from our diversified revenue stream.' Market threats Among other threats, Sapo will have to outplay increasing competition from more agile and technologically advanced private sector operators amid a decline in demand for traditional postal services. It will have to find growth amid weak economic conditions and increasing business costs, which will negatively impact Sapo's operational costs. There is also a threat of an increase in cyberattacks, which have recently targeted the public sector. Security costs are expected to increase by 6% per annum due to network expansion over the next five years. ALSO READ: Ramaphosa signs Post Office Bill into law 'This one keeps me awake at night, as it is relevant, and we have seen it happening in the public and private sectors. Unfortunately, if the very clever people put their minds into something positive, we would be ahead of this, but these very clever people join the dark side of the world,' said Gani. 'They are always a step ahead. How do you stay on top of cyberattacks? As a national asset, we hold critical information regarding citizens, including their personal information, residences, and addresses. This is something that keeps me awake at night.' Escalating operational costs, including employee wages, transport, and security services, exacerbate Sapo's financial distress. Employee salaries Last month, Sapo and the Unemployment Insurance Fund (UIF) reached an agreement to fund employee salaries for the last half of the year. The Ters scheme will inject R381 million to assist 5 956 employees. Gani lamented that the Sapo's slow pace to embrace digital transformation has limited its ability to compete effectively with the private sector. This is in addition to the limited skills to transform and modernise the entity 'We have multiple vacancies from a leadership perspective. We have limited skills internally.' The Sapo aims to move from a loss of R1.03 billion in 2025 to a net profit of R1.48 billion in 2029. READ NEXT: More millions to save jobs at SA Post Office
