However, factory production rose 1.1% month on month in January.
Analysts polled by Reuters had predicted a 5.1% drop in annual terms and a 0.3% month-on-month decline.
South Africa's manufacturing sector has been hammered by a number of factors: the constant power cuts by Eskom, the state-0wned electric utility, along with trade disruptions caused by supply chain problems and shipping.
The power situation has caused South Africa's GDP to be lower than analysts say it would have been under normal power supply situations.
