Credit rating agency Moody’s Investor Services has upgraded the South African National Roads Agency Limited (SANRAL) rating from negative to stable, a move welcomed by the parastatal.
HumanIPO reported last September Moody’s downgraded SANRAL’s long-term issuer ratings over a fall in cash flow related to the controversial e-tolling project, but it has now upgraded it again.
“This upgrade highlights the significant progress that has been made in restoring investor confidence,” SANRAL chief executive officer (CEO) Nazir Alli said.
“It is particularly welcome that Moody’s have singled out the success of good e-toll collections related to the Gauteng Freeway Improvement Project as a key factor in their decision.”
According to SANRAL the outlook change is a direct result of increased revenue from e-toll collection, with its total revenue increasing to ZAR3.4 billion (US$320 million) for the financial year ended March 31, 2014 from ZAR2.1 billion (US$198 million) in 2013, which it said enables it to continue the work it is mandated to do by government.
“This rating affirmation, but more especially the outlook change, would not have been possible without the public’s support – support from the companies, large and small, and the road users who have been doing the right thing by paying for the world-class roads. We would like to express our sincere thanks to all of them,” said Alli.
SANRAL has been subjected to criticism in the past few months for how they have handles e-tolling in Gauteng.
Most recently the organisation has been accused ofworking with law enforcement to stop road users to check up on their e-tag status.
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