Rand Water | Integrated Annual Report 2025

INTEGRATED ANNUAL REPO

Consolidated Annual Financial Statements for the year ended 30 June 2025

NOTES TO THE CONSOLIDATED ANNUAL FINANCIAL STATEMENTS

39. Contingencies

Contingent assets

Group

Rand Water

Figures in Rand thousands

2025

2024

2025

2024

Legal proceedings to recover amounts due to Rand Water

299 946

266 228

299 946

266 228

299 946

266 228

299 946

266 228

Contingent liabilities Legal claims for damages against Rand Water

291 013 291 013

-

291 013 291 013

-

-

-

Guarantees Performance guarantees given to customers and other guarantees and claims

10 664

5 751

10 664

5 751

Supply agreement

702 936 713 600

673 401 679 152

702 936 713 600

673 401 679 152

Contingent assets

Included in the balance of contingent assets are amounts owed to Rand Water by various customers. In these circumstances services to the entities involved are discontinued, in line with the Credit Management Policy, to recover the sums owed, amounting to R266.2 million. In March 2023 following heavy rainfall which occurred from January 2023, a road situated close to Rand Water’s pipeline collapsed. Rand Water is accountable for protecting its infrastructure to sustain water supply and avoid the risk of a high- pressure pipe bursting and causing catastrophic events. In March 2023 Rand Water appointed a contractor to investigate the cause of the collapse, design, and reinstate the road. The contractor completed the work in July 2024 and the road was designed and constructed in accordance with the owner’s standards and the final handover was completed. Rand Water submitted the claim to Johannesburg Roads Agency (JRA) amounting to R33.7 million and awaiting a response. On 21 July 2015, Rand Water issued a tender, for the Supply and Delivery of Fine Filter Sand to Rand Water’s Vereeniging and Zuikerbosch Water Treatment Plant for a period of three (3) years. The evaluation of the bids ensued and, Plaintiff was shortlisted alongside other bidders as a potential supplier. No award was made by Rand Water in respect of the tender instead the tender was cancelled in compliance with the applicable legislation. Rand Water cancelled the tender due to the expiry of the validity period. The Plaintiff’s claim is that Rand Water ought to have awarded the tender to it, however, Rand Water could not have awarded this tender as the tender had been cancelled due to it having expired. The applicant is requesting that Rand Water reviews its decision not to award the tender and has further filed a damages claim of R54 million againt Rand Water. Contingent liabilities

301

Rand Water | Integrated Annual Report 2025