An Analysis Of The Financial Performance Of State Owned Enterprises: A Case Study Of Transnamib

ABSTRACT

The study sought to analyse the financial performance of state owned enterprises in Namibia, using TransNamib as a case study. A sample of twenty-five respondents was selected using the convenience sampling technique. This technique was used to ensure that data was collected from the right respondents at TransNamib and the Ministry of Works and Transport as the main shareholder. A mixed research method, involving the administration of questionnaires containing both open and closed-ended questions and an analysis of financial statements for the period 2009 to 2013 was used to collect the data. The study found out that the poor financial performance of TransNamib was caused by numerous factors, including lack of stakeholder foresight. While TransNamib has not been performing well enough financially, sixty-four percent of the respondents were still of the opinion that the organisation can contribute to the nation’s development. Results from the rating of the financial performance of the company shows that seventy percent of the respondents rated the performance as poor. This was confirmed by the analysis of financial statements showing a downward trend since 2011. Furthermore, the study found that there is a positive relationship between financing provision and the financial performance of SOEs. Finally, the study recommends the setting up of a financing mechanism by government through the newly established Ministry of Public Enterprises to ease access to funds by the SOEs for better performance. The study also recommends that Government should facilitate regular auditing of SOEs and managers should be held accountable for poor performance. This will lead to good financial management and improved financial performance by SOEs.