Global credit rating agency, Fitch Ratings has given Rand Water an AA+(zaf). This denotes expectations of a very low default risk, with a very strong capacity for payment of financial commitments that is not significantly vulnerable to foreseeable events.
On a standalone basis, Fitch expects larger capex increases than historically, especially starting from 2025. This would in turn gradually shift the company’s financial position to net debt starting from 2026, from net cash.
Fitch could change the outlook to negative if significant water losses (within municipalities water distribution network) contributes to lower profitability and increasing municipality arrears. In addition, further delays of infrastructure investments would constrain water supply and remain a key risk without proactive mitigating measures by management and the Department of Water and Sanitation (DWS).
“We appreciate Fitch Ratings’ recognition of our vital role in the South African water sector and our strong financial position. Our ongoing investment in water infrastructure, including pipelines, purification plants, as well as alternative energy plants is not just a promise but a celebration of our dedication to sustainable water supply. We understand the importance of these projects in meeting the growing demands for water in our region,” says Sipho Mosai, CE, Rand Water.
