The South African Post Office (SAPO) says that it is working on a turnaround plan, after the country’s auditor-general declared that the organisation was 'commercially insolvent'.
"We continue to engage SAPO’s creditors to acknowledge our indebtedness and willingness to honour the commitments. Equally, debt collection is a focus area.
"The minister is in the process of appointing a team of turnaround experts to work with the board and the executive team in the development of a bankable turnaround plan, in line with the requirements of the post-Covid-19 economy.
"welcome this process, as it will allow the various teams to ensure the basics are in place – and improve on the matters flagged by the latest audit report."
The group added that it plans to expand into the ‘highly lucrative’ e-commerce space, focus on the digitisation of its processes, the courier space, as well as those activities which fall within SAPO’s legal mandate.
"We are confident that with the sense of urgency that now prevails in the organization, we are in the process of building a South African Postal service organization we can all be proud of."
SAPO on Tuesday said that it was operating in a difficult environment, and has seen revenues perform below targets by 8%.
"The entity received recapitalisation funding of R2.9 billion on 25 January 2019 which was utilised to settle term loans of R1.035 billion and pay outstanding creditors."
It said has taken steps to address its cost base by embarking on initiatives of staff reduction, which was achieved through natural attrition and voluntary severance packages.
Staff numbers at the group have dropped by 1,871 during the year under review, it said.