RAND WATER ANNUAL REPORT 2023

HOW WE CREATE VALUE

Debt Capital Rand Water raises debt to fund its CAPEX augmentation programme. The entity has managed to raise R4.4 billion of debt through bond issuance at the back of a R10 billion DMTN programme. This debt has been raised at an average

Attracting Funding from Various Sources Rand Water has secured access to funding on the back of the approved gazette borrowing limits by National Treasury. The underlying borrowing plan is developed to ensure that the Group can adequately fund its capital expenditure programme without breaching set financial parameters. As at 30 June 2023, the Group has access to R10 billion DMTN programme with a headroom of R5.6 billion. Sound Governance and Risk Management Processes Rand Water recognises the importance of compliance to all governance, statutory and regulatory requirements. The operational and financial risks of the Group have been reviewed to determine their impact on the business under various conditions. Mitigating initiatives, strategies, and controls are in place as reflected in the business and risk management plans of the Group and the Business Unit.

cost of capital averaging 9.9%. Trading Capital

Trading Capital is achieved through maintaining affordable tariffs, improving cost structures, increasing asset utilisation, and enhancing customer value. Operating Margins • Improving Cost Structures • Cost efficiencies Asset Efficiency • Increasing asset utilisation Business Growth • Expand Revenue Sustainability • Maintaining affordable Tariffs HOW WE MANAGE OUR FINANCIAL CAPITAL The Finance Strategy that drives the Financial Capital is aimed at ensuring financial health and sustainability for the organisation. This is achieved through aiming for returns that are higher than cost of capital, management of adequate working capital, improvement of productivity and striving towards effective and efficient operating practices that will ensure continued supply of water that is affordable.

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