Nored sinks into the red

25 March 2021 | Energy

OGONE TLHAGE



WINDHOEK

Northern regional energy distributor Nored – which has not produced audited financial reports for over six years – is struggling financially. The company had difficulties paying about N$67 million due to NamPower yesterday, documents seen by Namibian Sun show.

According to a concerned board member, Nored pinned its hopes on a N$90 million cash inflow to help fend off its creditors, but outflow projections for the period amounted to N$112 million.

Of this, N$87 million is due to the national power utility, including interest.

Other payments due include N$12 million in salaries. Cash flow is so bad that the struggling parastatal contemplated defaulting on creditor payments to fulfil its remunerative obligations to staff.

Nored’s financial woes were impacted by sitting and travel allowances to the tune of N$1.6 million, slow collection of funds from customers, credit worthy checks and meters that were not recorded, information at hand shows.

“As board members, we are gravely concerned at the direction the company has taken. The shareholder is closely monitoring underperforming state-owned enterprises and Nored needs to get its act together to avoid the fate of Air Namibia and others,” a director told Namibian Sun.

Misplaced priorities

The board is further concerned about N$34.8 million budgeted for the construction of Nored offices in Nkurenkuru and Katima Mullilo, saying this is a misplaced priority given the company’s current liquidity position.

Questions sent to Nored spokesperson Simon Lukas earlier this week went unanswered.

Despite its precarious situation, the company is expecting a cash flow of N$90 million from its pre- and post-paid customers. The report also noted that Nored expects N$101 million from the Receiver of Revenue in back-dated tax refunds for the period 2014 to 2017.

Meanwhile, the company’s last financial report was released in 2014 – other situation which irks the board. At the time, Nored held a cash position of N$106 million and reported a profit of N$49 million.

First of its kind

Nored was established in 2001 as the country's first regional electricity distributor (RED).

It distributes electricity to thousands of consumers in the Oshana, Ohangwena, Omusati, Oshikoto, Zambezi and two Kavango regions.

This is after Cabinet in 2000 approved the initiative to create REDs to distribute and supply electricity - through economies of scale - by pooling human and operational capital resources.

The ultimate goal is to stabilise electricity prices and ensure reasonable, affordable and cost-effective tariffs for electricity consumers.

Namibia was divided into five energy regions, to be serviced by five REDs. However, only three are currently operational - Nored, Cenored and Erongo RED.

Similar News

 

Vivo Energy revitalised by new headquarters

3 weeks ago - 19 March 2021 | Energy

Yochanaan CoetzeeVivo Energy Namibia, the local licensee for Shell, yesterday celebrated the completion of their move into their towering new headquarters, aptly named “Vivo House”,...

Protests in Germany over Namibian biomass

1 month - 04 March 2021 | Energy

ELLANIE SMIT WINDHOEKProtests flared up last week in Hamburg, Germany, against a project investigating the feasibility of using Namibian bush biomass to...

Govt backs Recon’s Kavango oil hunt

2 months ago - 25 January 2021 | Energy

KENYA KAMBOWEKAWEDespite a number of objections against the planned oil and gas exploration at Kawe village in the Kavango East Region, the government has given...

Fuel prices remain unchanged for January

3 months ago - 06 January 2021 | Energy

NAMPA WINDHOEKThe ministry of mines and energy has announced that fuel pump prices will remain unchanged countrywide for January due to the...

Kahimise resumes CEO duties

4 months ago - 17 November 2020 | Energy

ESTER KAMATIOTJIWARONGOThe chief executive position at Cenored has been filled by Robert Kahimise, who assumed duty on 1 November and signed his contract last Friday.This...

Probe ordered into Namcor fuel deal

8 months ago - 15 July 2020 | Energy

OGONE TLHAGE WINDHOEKPublic enterprises minister Leon Jooste has confirmed an instruction to the National Petroleum Corporation of Namibia (Namcor) board to investigate allegations that the...

Fuel prices expected to remain meek

10 months ago - 04 June 2020 | Energy

Phillepus Uusiku- The association between the Organisation of Petroleum Exporting Countries (OPEC) and independent oil producers such as Russia reached an agreement last month to...

Zambia denies expropriation

10 months ago - 04 June 2020 | Energy

Zambia's government said on Wednesday it had no intention of taking over Copperbelt Energy Corp (CEC), after the company accused the government of expropriating its...

Angola's oil output to drop

10 months ago - 02 June 2020 | Energy

Oil production in Angola will fall to 1.3 million barrels per day due to the cancellation or postponement of investments planned for this year, Banco...

NamPower to electrify 1 000 households

10 months ago - 29 May 2020 | Energy

ELLANIE SMIT WINDHOEK NamPower is set to electrify 1 000 households in Windhoek's peri-urban areas at a cost of N$15.5 million. This was announced yesterday...

Latest News

Economy in critical need of...

12 hours ago | Economics

PHILLEPUS UUSIKU – To ensure that Namibia’s economy gets back on track, it is of critical importance to aggressively spend on the health sector to...

Geingob tells Shanghala off

12 hours ago | Politics

JEMIMA BEUKES WINDHOEK President Hage Geingob on Saturday suggested that former justice minister...

Business struggles to recover from...

12 hours ago | Business

Ndalimpinga Iita - Despite economic revival efforts in Namibia, businesses operating in the country continue to struggle following disruptions due to the Covid-19 pandemic.For years,...

EDITORIAL

12 hours ago | Opinion

Affirmative Repositioning leader Job Amupanda and his cohorts in the social justice movement last week promised to up the tempo in their fight against corruption.Amupanda...

Angola woos Spanish investment

12 hours ago | Economics

Luanda - Angola's president João Lourenço has vowed to resolve the country's staggering debt in a bid to encourage business investment from Spain, as the...

Sacu coordination critical for AfCFTA

12 hours ago | Economics

The coordination of the Southern Africa Customs Union (Sacu) member countries in the implementation of the African Continental Free Trade Area (AfCFTA) agreement is critical...

Outjo’s water arrears run into...

12 hours ago | Economics

More than 3 000 residents and businesses owe the Outjo municipality in excess of N$33 million and the local authority will today cut the water...

Three die in car crash...

12 hours ago | Accidents

NAMPA OKAKARARAThree men died instantly on Saturday after the sedan they were travelling in overturned and crashed into a concrete wall...

Excessive risk-taking making stocks overvalued

12 hours ago | Economics

Washington - Massive government aid has provided liquidity to support economies during the Covid-19 pandemic, but also caused stock prices to surge beyond their value,...

Load More