This report reflects Umgeni Water’s performance against its strategy for a year that will go down in history as one of the most difficult. One where we all had to forcefully play catch-up to past water services imbalances in the shortest time possible, amidst competing priorities, in order to save lives.

While Umgeni Water’s performance as an entity of state is guided by the policies and plans of the Department of Water and Sanitation, the goal posts had to be changed for all in response to the global COVID-19 pandemic. Development of bulk water infrastructure was one of the pandemic’s biggest casualties, which hindered the programmes of Government in the urgent socio-economic transformation through Universal Access to Safe Drinking Water.

Umgeni Water is to be commended on the quality of water delivered to municipalities and progress made with bulk water infrastructure developments, for both economic growth and increasing access to rural areas despite the prevailing challenges.

Another year has come to an end, and it is time again to report on performance against
pre-determined targets contained in Umgeni Water’s strategic plans. The outcomes of performance, for the period 1^st July 2019 – 30^th June 2020, are aligned to the strategic theme of Umgeni Water, Enabled and Innovative Growth.

Umgeni Water like everyone else in the world was not spared from the grip of COVID-19. However, the organisation rose above the limitation of the prevailing conditions. Interruption of services was not an option.

The crisis is not over yet, but the Board of Umgeni Water can confidently say that there is a battle plan to secure the health of staff, protect lives, keep potable water flowing and safeguard the environment and downstream communities through continued proper operation, maintenance and management of wastewater treatment plants.

In the medium-term, Umgeni Water will continue efforts to expand coverage in KwaZulu-Natal through the provision of services and products to municipalities that are facing service delivery challenges, or when requested by the
KwaZulu-Natal Provincial Government and/or the Ministry of Human Settlements, Water and Sanitation to act as implementing agent.

Internally at Umgeni Water there have also been some significant changes that have had the effect of strengthening governance. The Umgeni Water Board term ended in July 2020 and the Minister appointed an interim Board, effective from
1 August 2020.

The Board will continue to provide leadership in the development of strategy, while at the same time, drive business growth and initiatives to improve the lives of the people through increased access to water.

Umgeni Water again illustrated its strong financial resiliency. In the reporting year Group revenue totalled R4.2 billion and a net surplus of R1.3 billion
was achieved, partly as a result of cost containment measures through optimisation of water production process and recovery from the drought in the prior year.

The earned surplus for the year will be invested in support of the future five-year R16.7 billion
(not escalated) capital investment programme, as well as used for debt reduction. As at 30 June 2020, a significant portion of capital investments were already committed.

The strength of the balance sheet and access to other strategic financial resources remain vital to Umgeni Water for expanding services to new areas and implementing the strategy of enabled and innovative growth.

A combination of solid enterprise-wide systems, backed by highly competent employees and robust leadership provided by the Executive Team and Board ensured that Umgeni Water’s performance was maintained at a high level during this reporting period.

The outlook is positive. The position of strength that has been carefully maintained within the entity provides a stable base that can be leveraged by Umgeni Water to implement its strategy of
Enabled and Innovative Growth. In so doing, Umgeni Water will serve its customers and the people of KwaZulu-Natal in a more effective manner, while braving the challenges and taking the opportunities presented by a changing future and almost certain changing world of work.