1. QUARTER 2 BUSINESS PERFORMANCE REPORT

2. INTRODUCTION Overview of performance against corporate KPIs
Financial Performance
Product and Network Performance
Governance
Internal Audit
Management Letter Points
Risk Management
Enterprise Development
Human Capital Development

3. Performance against corporate KPIs

4. Performance against corporate KPIs Achieved/Not Achieved
* In Quarter 2, eight KPIs are applicable and 6 out of 8 (75%) targets have been achieved
Strategic Goal
Strategic Objectives
KPI
Annual Target
Q2 Target
Actual Performance
Achieved/Not Achieved
Variance Explanation
SG 2: Ensure high levels of customer and stakeholder satisfaction by meeting their needs at all times.
Ensure network availability meets SLA requirements across all platforms
Weighted average availability based on product revenues
Weighted average availability based on product revenues of 99,80%
Weighted average availability based on product revenues of 99,80%
Weighted average availability based on product revenues of 99,89
Achieved
This target has been over- achieved due to better management of SENTECH’s national network.
Improve customer and stakeholder satisfaction
Customer service index
Baseline +5%
Complete survey recommendatio n monitoring tool.
Survey monitoring tool completed and issued
Not applicable

5. Performance against corporate KPIs Achieved/Not Achieved
Strategic Goal
Strategic Objectives
KPI
Annual Target
Q2 Target
Actual Performance
Achieved/Not Achieved
Variance Explanation
SG 3: Drive organisati onal performa nce in to improve organisati onal effectiven ess
Effective talent management
Performanc e ratings achieved
Average employee performance score of 3,2 for the 2016/17 financial year
Performance Reviews completed for all employees for Q2
0% performance reviews completed
Not Achieved
Disputes with the Union had ripple effects on signing of performance contracts. The performance reviews for bargaining employees were thus not done on time.
% Training Plan implemente d
80% of the 2016/17 approved training plan interventions implemented
40% of the 2016/17 approved training plan interventions implemented
41.4% of approved training plan implemented.
Achieved
This target has been over-achieved by a marginal amount. This was due to the completion of additional training interventions than what was required during the quarter.

6. Performance against corporate KPIs Performance against corporate KPIs
Strategic Goal
Strategic Objectives
KPI
Annual Target
Q2 Target
Actual Performance
Achieved/Not Achieved
Variance Explanation
SG 4: Ensure that the Company is financially sustainabl e.
Revenue diversificatio n into international markets
No of Pan- African customers contracted (customers outside the Republic of South Africa)
Develop and implement Pan-African Strategy
Complete market research
Concept document developed and market research process initiated
Not Achieved
There have been delays in procuring a service provider to conduct the research. To be done by Q3.
Implement ESD and SED initiatives
% actual NPAT spent for the 2016/17 financial year
6% of actual NPAT spent for the 2016/17 financial year
Achieve 50% of budgeted ESD and SED spend
Actual spend is 183% for ESD & 72% SED
Achieved
This target has been over- achieved due to an additional number of ESD and SED Activities during Q2

7. Performance against corporate KPIs
Strategic Goal
Strategic Objectives
KPI
Annual Target
Q2 Target
Actual Performance
Achieved/Not Achieved
Variance Explanation
SG 4: Ensure that the Company is financially sustainabl e.
Implement effective internal control system and compliance with applicable legislation
Clean audit achieved
Clean audit achieved
Audit action monitoring tool completed
Audit action monitoring tool completed and issued
Achieved
Not Applicable
Maintain a healthy earnings before Interest and tax (EBIT)
Earnings before interest and tax
R5.22 million
R2,08 million
R17 million
This target has been over-achieved due mainly to dual illumination funds received as well as savings against budget for the following categories of expenditure: Operating, Selling and Administrative Expenditure.

8. Financial Performance

9. Financial Performance
Q2 September 2016

10. Financial Performance
Revenue Per Service
 R’000
Quarter 1 FY2017
Quarter 2 FY2017
YTD FY2017
Service
Actual
Budget
Variance
R '000 % TV
146,528
156,434
(9,906)
(6%)
146,278
154,291
(8,014)
(5%)
292,805
310,725
(17,919) FM
69,231
71,085
(1,854)
(3%)
74,378
73,757
620 1%
143,608
144,842
(1,234)
(1%) MW
2,365
2,339 26
2,338
(1)
(0%)
4,703
4,678 25 SW
6,582
8,186
(1,604)
(20%)
6,105
(2,081)
(25%)
12,687
16,372
(3,685)
(23%)
DTH
44,090
34,981
9,110
26%
45,891
38,666
7,226
19%
89,982
73,647
16,335
22%
Facility Rentals
16,020
14,368
1,652
11%
14,816
14,397
419 3%
30,836
28,766
2,071 7%
Continuing business
284,816
287,393
(2,577)
289,806
291,637
(1,831)
574,622
579,030
(4,407)
Connectivity services
1,642
1,588 54
1,630
1,475
155
3,272
3,062
209
DTT: Dual Illumination
22,500 -
100%
45,000
Sundries
697 2
700
Total services
309,655
288,980
20,675
313,938
293,111
20,827
623,594
582,092
41,502
TV revenue is below budget mainly due to DTT revenue not materializing as a result of optimization of the network.
SW revenue is below budget due to Radio Lead Africa suspension, contract termination of TWR and no new revenue realised per our projected 8hrs/day additional sales.

11. Product and Network Performance

12. Product and Network Performance Sentech Performance (%)
Network Services
SLA Target (%)
Sentech Performance (%)
Weighted Ave
Terrestrial Television
99.7
99.88
53.13
FM Radio
27.01
Medium Wave Radio
99.5
99.96
0.85
Short Wave Radio
99.97
2.22
Satellite
99.8
99.94
16.68
Overall Network availability
99.80
99.89

13. Governance
The priority activities for the Board during this quarter were:
Annual General Meeting
Recruitment of the CFO
Board evaluation
Consideration of the 2015/16 Annual Financial Statements and Annual Report
Board and Board Committee meetings
Compliance with statutory requirements
SENTECH has achieved a clean audit for the fourth successive year.

14. Internal Audit
Internal Audit is on track with the execution of its Annual Internal Audit Plan.

15. Management Letter Points (MLPs)
SENTECH has enjoyed four years of unqualified audit opinion since 2012/2013.
The following is a summary of progress against the 26 findings issued by the external auditors on 31 July 2016:
Forty two percent (42%) of findings have been addressed,
31% are ongoing
27% are in progress.

16. Risk Management
Developments and emerging risks associated with our big customers are being monitored and mitigation strategies on managing these emerging risks are in place.
The revenue assurance risks are being managed to ensure that all revenue due to SENTECH is collected.
Management will continue to double efforts in implementation of all activities related to KPIs to reduce the risk levels.

17. Enterprise Development
SENTECH supported 13 SMMEs which in turn created 68 jobs and 5 internship programmes for young people. Four were offered grants to the value of R2.7 million that was used for equipment, IT systems, office infrastructure and training. Other SMMEs were in the Incubation programme amounting to R3.5 million. No
Company name
Jobs created
Job opportunities
Grant Funding 1
Batsha IT Solutions 2
Centrax
5 Internships 3
Fibretronics 40 4
Moagi Technologies
Incubation Programme 5
Axol(Prt) Ltd 6
GeneAnthony IT & Projects Management Solutions 7
Bumba Technos 8
Pacesetter Network 9
2VP Electrical Services 10
MPowerIT 11
Simplified Intelligent Solutions 12
Imvana IT Solutions 13
Epiq IT Solutions
TOTAL 68

18. Human Capital Development
Attracting African talent remained a key driver of our recruitment process.
At top management levels 100% are black, 87% at senior management and 72% at specialists and middle management levels are black; and 82% for skilled and technical levels
Most of the human capital activities are on track, namely, overtime management, employee wellness, policy reviews, staff retention, employee relations, health and safety, and training.
Performance management and succession planning are being addressed.

19. Human Capital Development…
Building high performance teams through:
Training : 40% of the 2016/17 approved training plan interventions implemented
Bursaries : 35 of the 106 bursary applications for 2016/2017 were approved
Changing the environment
Office space : 30% of construction to be done in this financial year
STP Canteen re-establishment : Estimated operational date before end of Q4
Appointment of new CFO
This appointment completes the filling of vacancies at Executive Director level.

20. Thank You!