{"id":54060,"date":"2026-03-27T06:00:19","date_gmt":"2026-03-27T06:00:19","guid":{"rendered":"https:\/\/eduzim.co.zw\/news\/?p=54060"},"modified":"2026-03-27T06:00:19","modified_gmt":"2026-03-27T06:00:19","slug":"saas-profit-mirage-exposed-as-bailout-disguised-as-share-capital","status":"publish","type":"post","link":"https:\/\/eduzim.co.zw\/news\/2026\/03\/27\/saas-profit-mirage-exposed-as-bailout-disguised-as-share-capital\/","title":{"rendered":"SAA&#8217;s profit mirage exposed as bailout disguised as share capital"},"content":{"rendered":"<p> <script data-jetpack-boost=\"ignore\" async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-1669381584671856\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- Africa tv video display -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-1669381584671856\"\r\n     data-ad-slot=\"3579572842\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script data-jetpack-boost=\"ignore\">\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><br \/>\n<\/p>\n<p><h2>SAA reports profit, but gains rely on asset sales and state support, not sustainable airline operations.<\/h2>\n<\/p>\n<div>\n<p>South African Airways (SAA) received a quiet government bailout of more than R1 billion in the 2024-25 financial year, contributing to its healthy profit announcement. <\/p>\n<p>The injection was in the form of the issuing of new shares to the airline\u2019s sole shareholder, the South African government. <\/p>\n<p>However, the department of transport, under whose aegis SAA falls, denies that the money was a bailout, insisting that the airline has received no state funding since 2023. <\/p>\n<h2 class=\"wp-block-heading\" id=\"h-saa-s-reported-profits-are-bolstered-by-gov-support\">SAA\u2019s reported profits are bolstered by gov support<\/h2>\n<p>Economist Dawie Roodt called out the government\u2019s wordplay. <\/p>\n<p>\u201cIt\u2019s semantics trying to disguise a bailout as share capital. Why do businesses sell shares and dilute shareholding?\u201d he said. \u201cIt\u2019s to raise money. It\u2019s as simple as that.\u201d <\/p>\n<p>Also, after stripping away the sale of assets and spin, the stateowned airline is still precariously close to the same cliff edge it teetered on before business rescue in 2019. <\/p>\n<p>This was the second year that SAA presented its results through its own rose-tinted glasses. In 2023, SAA managed to achieve a gigantic property revaluation gain of R3.784 billion, significantly inflating the value of assets on its balance sheet. <\/p>\n<p>In 2024, during the period under review, the state, as SAA\u2019s only shareholder, injected about a further R1 billion into the airline as share capital. It reads like a bailout but a denial from Transport Minister Barbara Creecy\u2019s office noted that SAA last received funding from the state in April 2023. <\/p>\n<h3 class=\"wp-block-heading\" id=\"h-transport-dept-says-last-bailout-happened-in-april-2023\">Transport dept says last bailout happened in April 2023<\/h3>\n<p>Spokesperson Collen Msibi said that \u201cit must therefore be noted that the National Treasury has not given any money to SAA since Creecy took office\u201d. Aviation analyst Guy Leitch said he had expected more from the airline\u2019s results. <\/p>\n<p>\u201cI was honestly expecting something better and more positive from SAA,\u201d he said. <\/p>\n<p>An aviation analyst told <em>The Citizen<\/em> they question whether the smoke and mirrors applied in the annual report tried to hide the extraordinary lengths that the airline had to go to, during the two financial periods, just to stay afloat. <\/p>\n<p>SAA presented its 2025 annual report as evidence of a recovery. Yet a closer look at the document suggests the national carrier\u2019s well publicised return to profit may have been somewhat romanticised by the carrier. <\/p>\n<p>The airline\u2019s success during the year in review seems to have its foundation in asset sales, state support and accounting interventions, and not particularly reliant on the underlying strength of its airline business. <\/p>\n<h3 class=\"wp-block-heading\" id=\"h-airline-reported-r155m-profit\">Airline reported R155m profit<\/h3>\n<p>The airline reported a profit for the year of R155 million and an operating profit of R336 million, alongside revenue of R9.266 billion. SAA noted rising passenger volumes, route growth and an improved load factor as signs that the business was regaining altitude after years of turbulence. <\/p>\n<p>But the same annual report shows that the result was materially influenced by a R1.169 billion gain on the disposal of property, aircraft, equipment and intangible assets. Strip that out, and the picture becomes far less of an aviation romance with South African taxpayers. <\/p>\n<p><strong>ALSO READ:<\/strong> <strong>Flying could become unaffordable as jet fuel prices jump by 70%<\/strong><\/p>\n<p>Simply put, SAA\u2019s reported profitability in 2025 was not driven by flying passengers but propped up by selling off assets, including one of its prized Heathrow slots. <\/p>\n<p>Without selling off assets, SAA\u2019s position would have moved the needle backwards from a reported profit before tax of R173 million to an underlying pretax loss of roughly R996 million, not dissimilar to the edge-of-cliff position that the airline had previously found itself in. <\/p>\n<p>According to the annual report, the sale of assets had to happen after the collapse of the Takatso deal, led by the PIC Harith investment group that\u2019s now courting FlySafair. <\/p>\n<h3 class=\"wp-block-heading\" id=\"h-ag-questions-credibility-of-report\">AG questions credibility of report<\/h3>\n<p>The credibility of the report was also questioned by the auditor-general. Instead of signing off the numbers cleanly, or even with a qualified audit, it issued a disclaimer opinion on SAA\u2019s 2025 financial statements. <\/p>\n<p>\u201cThat is among the worst audit outcomes a public entity can receive,\u201d the analyst said. \u201cIt means the auditor could not obtain sufficient appropriate audit evidence to form an opinion on the figures presented.\u201d <\/p>\n<p>Auditor-general Tsakani Maluleke was unable to verify key balances, disclosures and the consolidation of some subsidiaries. In other words, even as SAA celebrated a return to profit, the public has been told by the country\u2019s top audit authority that the books themselves could not be relied on in the normal way. <\/p>\n<p>Outa chief executive Wayne Duvenage said the report raised serious concerns about governance, accountability and whether the airline\u2019s leadership had learned from SAA\u2019s long history of failure and repeated lifelines. <\/p>\n<p>\u201cIn this day and age of SAA\u2019s history of failure and lifelines, it amazes me that we still have question marks around their financial reporting and matters of governance,\u201d he said. <\/p>\n<h3 class=\"wp-block-heading\" id=\"h-outa-raises-serious-concerns\">Outa raises serious concerns <\/h3>\n<p>\u201cFor SAA to still receive a disclaimed audit outcome is a serious concern. One would think the executive and non-executive directors would by now have covered all the governance bases and ensured that reporting is accurate.\u201d <\/p>\n<p>Duvenage said SAA\u2019s disclosure of more than R500 million in irregular expenditure, coupled with the absence of the necessary investigation reports, was \u201cnothing short of irresponsible\u201d. <\/p>\n<p>He also said it was troubling the airline itself acknowledged that sustainable positive operating cash flow would require higher load factors and yields. <\/p>\n<p>\u201cThis is a fundamental operational factor in the airline industry and I\u2019m afraid that one isn\u2019t confident that current management really understand or drive this discipline into the airline\u2019s management culture,\u201d he said. <\/p>\n<p>\u201cAs we have said in the past, the government must get out of these complex and highly competitive businesses and sell off a majority shareholding to private industry players.\u201d <\/p>\n<h3 class=\"wp-block-heading\" id=\"h-operational-data\">Operational data<\/h3>\n<p>SAA\u2019s operational data shows that while the airline carried more passengers and improved its load factor to 65%, it also showed a negative airline ebitda of R443 million against a target of positive R241 million. <\/p>\n<p>Meanwhile, chief executive John Lamola was rewarded with a 23% pay boost to R4.7 million. Other executives were also thanked with increases that ranged from 23-36%.<\/p>\n<p><strong>NOW READ:<\/strong> <strong>SOEs strike out as SAA leads the pack<\/strong><\/p>\n<\/p><\/div>\n<p><script data-jetpack-boost=\"ignore\" async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-1669381584671856\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- Africa tv video display -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-1669381584671856\"\r\n     data-ad-slot=\"3579572842\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script data-jetpack-boost=\"ignore\">\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><br \/>\n#SAAs #profit #mirage #exposed #bailout #disguised #share #capital<\/p>\n","protected":false},"excerpt":{"rendered":"<p>SAA reports profit, but gains rely on asset sales and state support, not sustainable airline operations. South African Airways (SAA)&hellip;<\/p>\n","protected":false},"author":1,"featured_media":54061,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[32],"tags":[],"class_list":["post-54060","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mzansi"],"_links":{"self":[{"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/posts\/54060","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/comments?post=54060"}],"version-history":[{"count":1,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/posts\/54060\/revisions"}],"predecessor-version":[{"id":54062,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/posts\/54060\/revisions\/54062"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/media\/54061"}],"wp:attachment":[{"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/media?parent=54060"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/categories?post=54060"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/tags?post=54060"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}