Rand Water | Integrated Annual Report 2025

INTEGRATED ANNUAL REPO

GROUP CHIEF EXECUTIVE’S REVIEW

The organisation has delivered exceptional performance, a testament to the dedication of our employees and their ability to navigate an increasingly complex operating environment.

Mr. Sipho Mosai Group Chief Executive

The financial year 2024/25 has once again underscored the resilience, agility, and unwavering commitment of Rand Water in fulfilling its mandate. The organisation has delivered exceptional performance, a testament to the dedication of our employees and their ability to navigate an increasingly complex operating environment. Rand Water’s financial performance continues to reinforce its strategic foundation. The gross profit margin on primary activities reached 31.70%, surpassing the target of 29.0%, while the net profit margin stood at 22.70%, exceeding the target of 19.0%. Return on assets closed at 10.2%, outperforming the target of 8.8%. Secondary activities also exceeded expectations. These results affirm Rand Water’s financial sustainability and its capacity to fund critical infrastructure investments while meeting the water needs of millions of South Africans within its area of supply. Operational excellence remains central to Rand Water’s mandate. The quality of bulk potable water consistently exceeded all SANS 241 standards, reaffirming our reputation for world-class water quality. Despite increasing demand and pressure on licensed abstraction volumes, Rand Water maintained zero water supply disruptions across all possible supply days, a remarkable achievement given the sector’s growing challenge. Capital expenditure reached 130% of the budget percentage exceeding the target of 95%, while repairs and maintenance as a percentage of budget stood at 124.8%, reflecting our commitment to infrastructure reliability.

During the reporting period, Rand Water undertook extensive preventative and rehabilitative maintenance across its infrastructure, including pipelines, pump stations, and reservoirs. Maintenance activities were strategically expanded, informed by comprehensive condition assessments and asset lifecycle analyses. This operational discipline has enhanced the reliability of Rand Water’s infrastructure, reduced unplanned outages, and mitigated water losses. Key interventions including high-capacity pump refurbishments and targeted valve replacements have extended the lifespan of essential assets and minimised operational risks. All maintenance works were executed in strict compliance with national water sector standards and aligned with the Department of Water and Sanitation’s broader infrastructure recovery objectives. The maintenance programme for 2024/25 has also adopted a forward-looking approach, embracing innovative and cost-effective solutions to extend water supply to underserved areas while alleviating pressure on existing infrastructure. Notably: • Groundwater initiatives in informal settlements have reduced dependence on long-distance reticulation systems, facilitating quicker access to potable water. • Operation Vulindlela Phase II, endorsed at the national level, has emerged as a catalyst for structural reform. Its emphasis on a utility-based delivery model aligns with Association of Water and Sanitation Institute of South Africa (AWSISA)’s vision for professionalised,

69

Rand Water | Integrated Annual Report 2025