ZETDC Records ZWG10 Billion Loss

• The Zimbabwe Electricity Transmission and Distribution Company (ZETDC) recorded a ZWG10 billion operating loss during the financial year ended December 31, 2025, according to the Auditor-General’s Report on State-Owned Enterprises and Parastatals. The report says the utility is under increasing financial pressure, with liabilities significantly exceeding assets, foreign loan repayments in default and growing concerns about its ability to continue operating as a going concern.

  Although ZETDC received an unmodified audit opinion on its financial statements, the Auditor-General identified several financial conditions that raise uncertainty about the utility’s future operations. The report noted that the company’s financial position requires close attention because of its worsening liquidity challenges.

  According to the audit, ZETDC’s current liabilities exceeded its current assets by ZWG29.9 billion during the reporting period. The report also found that foreign loans which had not been restructured were reclassified as current liabilities after the company failed to meet its repayment obligations.

The Auditor-General said the financial position presents a significant risk to the utility’s future operations. “These conditions indicate the existence of a material uncertainty that may cast significant doubt about the Company’s ability to continue as a going concern,” the Auditor-General stated in the report.

The audit also highlighted the impact of the company’s financial challenges on electricity service delivery. It found that some customers who paid in full for electricity connections have remained unconnected for nearly a decade, with some applications submitted as far back as 2016 still awaiting completion.

According to the report, the delays were mainly caused by shortages of connection materials. The Auditor-General warned that the continued backlog could affect the company’s ability to provide services to customers who have already fulfilled their payment obligations.

ZETDC acknowledged the delays and linked them to long-standing financial constraints. “Delays in connecting customers were mainly due to shortages of connection materials as a result of cash-flow constraints the Company has been facing for a long time,” the utility said.

The report further revealed that ZETDC incurred ZWG230.8 million in penalties and interest after failing to make timely payments of Value Added Tax (VAT), Pay-As-You-Earn (PAYE) and income tax. Management attributed the penalties to the company’s ongoing cash-flow difficulties. “The ZWG230.8 million under 2024 fines and penalties relates to interest on late payments for VAT, PAYE and income tax due to serious cash-flow challenges the Company is facing,” the utility said.

The Auditor-General also identified weaknesses in procurement and contract management. The report noted that advance payments amounting to ZWG6.9 million were made in 2023 for electrical switchgears that had still not been delivered by December 31, 2024. The equipment remained classified as goods in transit, while some supplier prepayments dating back to 2019 had not yet been cleared. ZETDC attributed the delays to pricing discrepancies between purchase vouchers and supplier invoices.

The report further noted that several issues raised in previous audits remain unresolved, including weaknesses in asset management, outstanding statutory obligations and unreconciled account balances. ZETDC continued to attribute the delays in addressing these findings to persistent cash-flow constraints. The Auditor-General’s report adds to growing concerns about the financial sustainability of Zimbabwe’s electricity distribution utility as it faces mounting debt, liquidity pressures and ongoing challenges in maintaining operations, investing in infrastructure and improving electricity service delivery.