post office

The Post Office apparently owes R700 million towards their staff contribution. PHOTO:

Another bailout? SA Post Office is losing MONEY hand over fist

The SA Post Office is losing money hand over fist, to the tune of R7.9 billion, say business rescue practitioners.

post office

The Post Office apparently owes R700 million towards their staff contribution. PHOTO:

There’s no way around it, the SA Post Office is losing money hand over fist and will need to sustain its intensive business rescue program. Daily Investor reports that the South African Post Office (SAPO) has liabilities exceeding its assets by R7.9 billion. This, to all intents and purposes, means SAPO is insolvent.

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This bombshell was dropped in a report last week by SAPO Business Rescue Practitioners (BRPs), Anoosh Rooplal and Juanito Damons, giving an update on SAPO’s business rescue progress for the financial year.


Photo: Alide Dasnois via Groundup.

The long and short of it is SAPO’s liabilities reached R12.5 billion, with only R4.5 billion in assets, meaning it is technically insolvent with R7.9 billion in the red. Rescuing an SA Post Office that is losing money requires a significant increase in revenue and reduction in costs somehow, as well as a more efficient cost structure, said Rooplal and Damons.

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Worse still, SAPO missed its revenue target by R1.8 billion for the year. It generated R3.03 billion against a target of R4.81 billion. In mitigation of this, it blamed customers’ migration to digital alternatives. Also, there was the issue of SAPO being unable to pay its suppliers, who subsequently ceased various services.


Image via Adobe Stock.

Critical infrastructure changes in the business model and new-age technologies are needed to help service clients effectively. A key focus area is the branch network, which is the cornerstone of the SAPO business and needs to work if SAPO has any hope of surviving.

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This work includes branch profitability, geographical reach, universal service obligations (USOs), its motor vehicle licensing, financial and SASSA grant payout services. SAPO BRP also said a focus area will be monitoring staff salaries, which rely on cashflow and government assistance.

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What do you think of the SA Post Office losing money? Do you use any of its critical services and would like to see a better SAPO in the future? Be sure to share your thoughts with our audience in the comments section below. And don’t forget to follow us @TheSANews on Twitter and The South African on Facebook for the latest updates.