New electricity crisis for South Africa, and major 76-year-old company’s profit tanks
The rand appreciated on Monday as investors shifted their focus to the upcoming 2026 national budget set to be presented later this week, in what analysts characterised as a “relatively favourable macroeconomic backdrop.”
The rand traded at 15.9825 against the dollar, up 0.5% from its prior close.
Local investors are looking forward to Finance Minister Enoch Godongwana’s budget address on Wednesday for insights into the ruling coalition’s fiscal priorities, strategies for addressing national debt, and proposed economic reforms.
“This year’s Budget Statement will show further progress in fiscal consolidation, with a faster pace of deficit reduction, a widening primary surplus and stabilising public debt,” said economists.
“The improved macroeconomic environment has led to a broad-based increase in tax collections, and the tax windfall will help narrow the overall budget shortfall to below 3% of GDP by 2029, provided expenditure restraint is maintained.”
In a budget review released in November, South Africa’s Treasury estimated a consolidated budget deficit of 3.8% for the current fiscal year and 3.3% by 2027.
On the Johannesburg Stock Exchange, the Top-40 index was last reported to be up 1.3%.
As of Tuesday, 24 February, the rand is trading at R16.03 to the dollar, R21.62 to the pound, and R18.88 to the euro.
Gold is currently valued at $5,169.6 per ounce, while oil prices have risen to $71.89 per barrel.
5 important things happening in South Africa today
Goodbye load shedding, hello load reduction: While South Africa is approaching 300 days since its last load shedding, many people still experience hours without electricity due to a different, more complex issue: load reduction. Eskom has repeatedly clarified that load reduction is not the same as load shedding. The key difference lies in the cause of the outages, but the outcome remains the same: widespread power disruptions. [Newsday]
Sasol profit drops by 34%: South African petrochemical company Sasol announced a 34% decline in half-year profit, primarily due to falling oil and chemical prices. Its headline earnings per share for the six months ending December 2025 were R9.27 ($0.5789), down from R14.13 previously. The firm, founded in 1950 , again chose not to pay a dividend, as its net debt of $3.8 billion remained above the $3 billion threshold set by its dividend policy. [BusinessTech]
Spar requests payment plan: Wholesaler Spar has asked suppliers if it can stagger payments due to cash flow issues amid declining sales and shrinking margins. In an email to KwaZulu-Natal suppliers, Spar proposed a payment plan for February, with 50% due on February 20 and the remaining balance on March 10. This strategy comes as the group faces profit and margin pressures, especially in its Southern African operations, as well as the ongoing, though diminishing, impact of its European businesses in Poland and Switzerland. [BusinessDay]
WeBuyCars sticks to the old: WeBuyCars, a JSE-listed company that buys and sells used vehicles, has opted not to enter the new-car market. Instead, they are pleased to see a strong increase in new vehicle sales, largely driven by more affordable Chinese brands. Rikus Blomerus, the chief marketing officer of WeBuyCars, said that selling new cars is not a direction the company plans to pursue at this time. [Moneyweb]
New app launches in South Africa: South African grocery retailer price comparison app Grocify is now available on the Google Play Store. After weeks of internal testing to improve the app’s interface, fix bugs, and explore new features requested by early users, the app has been officially launched. Grocify retrieves product prices in real time from five major retailers’ online catalogues, enabling users to quickly identify the lowest prices and compare them across different stores. [MyBroadband]
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