STRATEGIC DIRECTION STRATEGIC DIRECTION LM CSM

TRANSNET STRATEGY AND OBJECTIVES VISION Transnet is a transformed holding company that enables its Businesses to be world class, lead their competitors, facilitate competitive trade and positively touch the lives of all South Africans MISSION A holding company with interests in various transport, logistics and other related businesses, that focuses on value chain management of goods, people and information VALUES Respect the individual Manage operations in a manner that ensures the safety of all Support economic development and activity Encapsulate Business probity with a strong focus on ethical conduct Enhance the value of frugality Be customer obsessed Support innovativeness VALUES Respect the individual Manage operations in a manner that ensures the safety of all Support economic development and activity Encapsulate Business probity with a strong focus on ethical conduct Enhance the value of frugality Be customer obsessed Support innovativeness LM CSM

TRANSNET STRATEGY AND OBJECTIVES BUSINESS FOCUS Market leadership in logistics solution provision Leveraging the property portfolio for maximum return Substantial market share in information technology and telecommunications provision BUSINESS FOCUS Market leadership in logistics solution provision Leveraging the property portfolio for maximum return Substantial market share in information technology and telecommunications provision STRATEGIC INTENT Manage and develop profitable, self sustaining businesses in a select range of portfolios STRATEGIC INTENT Manage and develop profitable, self sustaining businesses in a select range of portfolios STRATEGIC OBJECTIVES Increase financial value Ensure a high degree of safety standards Provide the Shareholder with appropriate dividends Develop and maintain an advanced business competence Enhance human capital development STRATEGIC OBJECTIVES Increase financial value Ensure a high degree of safety standards Provide the Shareholder with appropriate dividends Develop and maintain an advanced business competence Enhance human capital development Financial Learning and Growth Customer Internal Financial Learning and Growth Customer Internal BUSINESS ACTIONS AND PERFORMANCE TARGETS (BSC) LM CSM

TRANSNET STRATEGY AND OBJECTIVES STRATEGIC ACTIONS Prioritise funding capacity Gain Shareholder approval on business portfolios Formulate line of communication between Shareholder and company Gain sound capital to structure the business Continues transformation of businesses STRATEGIC ACTIONS Prioritise funding capacity Gain Shareholder approval on business portfolios Formulate line of communication between Shareholder and company Gain sound capital to structure the business Continues transformation of businesses CRITICAL SUCCESS FACTORS Identify: Business portfolios that Transnet want to participate in Capital requirements and prioritisation Funding capacity and gaps Capacity gaps in business processes Potential investment partners Retention of restructuring proceeds CRITICAL SUCCESS FACTORS Identify: Business portfolios that Transnet want to participate in Capital requirements and prioritisation Funding capacity and gaps Capacity gaps in business processes Potential investment partners Retention of restructuring proceeds LM CSM

TRANSNET STRATEGY AND OBJECTIVES Shareholder Expectations Good Corporate Governance Restructuring support Infrastructure development Enhance Shareholder value Continues transformation Black Economic Empowerment Employment Equity Social and Economic development Good Corporate Governance Restructuring support Infrastructure development Enhance Shareholder value Continues transformation Black Economic Empowerment Employment Equity Social and Economic development LM CSM

TRANSNET OBJECTIVES, ACTIONS AND PERFORMANCE MEASUREMENTS ( ) STRATEGIC AND BUSINESS OBJECTIVES BUSINESS ACTIONSPERFORMANCE MEASUREMENT: BALANCED SCORECARD  Increase financial value of Transnet.  Provide the Shareholder with appropriate dividends.  Financial restructuring  Achieve positive Transnet value  Transform property portfolio  Repositioning of Businesses to become financially sound ringfenced entities.  Improve and strengthen Transnet’s balance sheet through debt restructuring initiatives.  Determine the financial requirements of the Business Units and the ability to fund those requirements.  Return on investment in Divisions / Subsidiaries > weighted average cost of capital.  Increased nett operating profit after tax.  Optimisation of the asset base, and protecting the physical, technological and intellectual assets of the group.  Focusing on cash management and to be self-financed.  Unlock value in existing property portfolio.  Identify Taxation planning opportunities.  Improve net operating profit compared to previous year.  Improve cash generated from operations.  Improve cash flow return on investment (CFROI) and to improve Transnet Value added.  Fund activities without deterioration in the budgeted gearing of the company.  Optimise capital investment.  Reduce the cost of pure risk to optimum benchmarked levels.  Property asset verification.  Internal lease income from property portfolio.  External lease income from property portfolio.  Improve cash before investments. FINANCIAL OBJECTIVES LM CSM

TRANSNET OBJECTIVES, ACTIONS AND PERFORMANCE MEASUREMENTS ( ) STRATEGIC AND BUSINESS OBJECTIVES BUSINESS ACTIONSPERFORMANCE MEASUREMENT: BALANCED SCORECARD  Develop and maintain an advanced business competence.  Ensure a dynamic understanding of the business environment and drivers.  Increase customer confidence.  Grow and retain customer base.  Improve service delivery in terms of cost, equity and access.  Build trust relationships with customers, by being customer obsessed.  Restructure and transform Transnet effectively in order to efficiently and competitively meet the demands of domestic and international customers.  Ensure market and public acceptance.  Develop and implement Customer Image Index.  Develop and implement a Customer Satisfaction Index.  See Business Unit actions and performance targets for future details.  Public fatalities.  ESAP rating.  NOSA rating  Safety Index.  Image Index  Customer satisfaction Index  Disabling incidents Frequency rate.  Sustainability  Market share CUSTOMER OBJECTIVES LM CSM

TRANSNET OBJECTIVES, ACTIONS AND PERFORMANCE MEASUREMENTS ( ) STRATEGIC AND BUSINESS OBJECTIVES BUSINESS ACTIONSPERFORMANCE MEASUREMENT: BALANCED SCORECARD  Ensure a high degree of safety standards  Enhance and establish new structures and systems for the Holding Company.  Enhance information technology environment, which is a business enabler.  Develop and implement resilient, sustainable and effective business processes.  Enhance strategic decision-making  Improve the efficiency and effectiveness of the Business Units.  Entrench inter-Divisional market related support to benefit the Business Units and Transnet.  Reconfigure current management structure.  Configure structures of remaining services.  Ensure network availability/access to information.  Develop and implement on-line real-time information systems.  BEE spend  Employee fatalities  Improve Corporate Governance  Improve e-logistics and e-commerce capabilities. INTERNAL OBJECTIVES LM CSM

TRANSNET OBJECTIVES, ACTIONS AND PERFORMANCE MEASUREMENTS ( ) STRATEGIC AND BUSINESS OBJECTIVES BUSINESS ACTIONSPERFORMANCE MEASUREMENT: BALANCED SCORECARD  Enhance human capital development through an effective training programme and business leadership.  Enhance appropriate competencies.  Develop compliance  Enhance a culture of excellence  Ensure leadership capacity for the top two levels of management (training and succession planning).  Review and develop human resources policies.  Develop logistics competency at Business Unit level.  Rationalise or develop new skills within the labour force and ensure their deployment throughout the company.  Continue to use the Balanced Scorecard as an effective performance management system from Board of Director’s level downwards.  Performance management implemented for all levels.  Training spend as % of operating cost. (7 categories)  Employment equity  Containment and management of HIV/AIDS  Staff Turnover LEARNING & GROWTH OBJECTIVES LM CSM

Key Issues Business Portfolio Management of Strategic Investments  Improved control + monitoring  Enable Business Units  Transnet Strategic Direction  Focus from Shareholder  Restructuring (NFA)  Transformation  M.U.P  Turn Strategy  Incorporated under Companies Act  BOD appointed Department of Government Leadership requirements Building portfolio management skills Building independence and capacity Lead business transformation and performance Develop Business thinking Follow prescribed pattern Highly centralised functional structure Group Financial control Group Strategic control Group Managerial control Group Operational control Decentra- lised profit centre divisions Business Focus Establishment of Divisional Boards Corporatisation Commercialisation Development of infrastructure Executive Directors END STATE 2007 Holding company 1996 New Executive Management 1990 Transnet Ltd related businesses 1993 Independent Businesses Units 1997 Shared vision 1910 SAR&H single business TRANSNET MIGRATION PATH 1981 South African Transport Services (SATS) 1989 Legal Succession Act 1991 M.U.P 1988 Deregulation employees employees 1998 Moving South Africa 2001  PFMA  Shareholder compact employees 1996 National Transport Policy employees employees LM CSM

TRANSNET SUBSIDIARIES EMPLOYEE AND SOCIAL ENVIRONMENT Transmed Fund Transnet Foundation Trust Pension Fund Human Resources Transnet Housing DIVISIONS Arivia.kom (Pty) Ltd 32% Protekon (Pty) Ltd 100% S.A Airways (Pty) Ltd 95% Air Chefs (Pty) Ltd 51% V&A Waterfront (Pty) Ltd 100% Viamax (Pty) Ltd 100% Transure Ltd 100% Marine Data Systems (Pty) Ltd 80% Fleetcall (Pty) Ltd 50% B2B Africa Holdings (Pty) Ltd 100% Transwerk Perway (Pty) Ltd 35% Transwerk Foundries (Pty) Ltd 100% Southern African Airline Holdings (Pty) Ltd 100% Autopax (Pty) Ltd 100% Apron Services (Pty) Ltd 100% LM CSM

TRANSNET GROUP BEE SPEND Rm LM CSM

TRANSNET FOUNDATION CSI SPEND Rm LM CSM

TRANSNET FOUNDATION CSI SPEND PER PORTFOLIO (MARCH 2002) LM CSM

Black Managers – Middle Management ( ) % TRANSNET GROUP EMPLOYEMENT EQUITY LM CSM

Female Managers – Middle Management ( ) % TRANSNET GROUP EMPLOYEMENT EQUITY LM CSM

Black Managers - Senior Management ( ) % TRANSNET GROUP EMPLOYEMENT EQUITY LM CSM

Female Managers - Senior Management ( ) % TRANSNET GROUP EMPLOYEMENT EQUITY LM CSM

Black Managers – Executive Management ( ) % TRANSNET GROUP EMPLOYEMENT EQUITY LM CSM

Female Managers – Executive Management ( ) % TRANSNET GROUP EMPLOYEMENT EQUITY LM CSM

Rm TRANSNET GROUP TRAINING SPEND LM CSM

Employees per Business Unit – April 2002 TRANSNET GROUP LM CSM