1. Annual Financial Results 2005/2006
July 2006

2. Contents of presentation
Strategy confirmation and structure
Strategy implementation
Salient features 2006
Financial results 2006
Post-balance sheet events
Summary
Conclusion and questions

3. Strategy confirmation and structure

4. Strategy confirmation and structure
Focused freight transport company
Delivering effective and competitive services
Enabling economic growth
TRANSNET COMPANY
Structure
Operational divisions (continued businesses)
Non-core portfolio
SAA
Viamax
V & A Waterfront
Autopax
Metrorail
freightdynamics
Equity Aviation
VAE Perway
Discontinued
businesses
Other to be sold
Propnet – non-core portfolio
Housing assets
SA Express
“C” class preference shares
Spoornet
RAIL
Transwerk
Petronet
PIPELINE
PORTS
National
Ports
Authority
SA Port
Operations

5. Strategy: Four-point turnaround plan
Lower cost of doing business
Targeted sectors
Redirect &
re-engineer
the business
Re-engineer core business
Corporate HO restructure
Operational synergies
Customer focus
Infrastructure development
Corporate governance
and risk management
Shareholders compact
Memo and Articles of Association
IFRS
Legal review
EWRMF
4-Point turnaround plan
Human capital
development
Skills audit and matching
Recruitment and retention
Skills and training
Performance management
Career management
Succession
planning
Balance sheet restructuring
Pension fund deficit
Transfer SAA to Government
Disposal of non-core businesses
Economic development

6. Strategy implementation: Progress made
Human capital development
Corporate governance
and risk management
Balance sheet restructuring
Progress summary
Major re-engineering program –
“Vulindlela” underway
Commenced with roll out of R64.5 billion investment plan
Disposal of non-core assets
Established governance structures and risk programmes implemented
Comprehensive HR strategy
Redirect and re-engineer the business

7. Strategy implementation (continued)
Restructuring the balance sheet
Exit of non-core assets
PFMA approval obtained for the disposal of non-core assets
Businesses sold
Business
Buyer
Effective date
Sale price
SAA
Government (DPE)
31 March 2006 subject to fulfillment of suspensive conditions
R2 billion (no cash flow)
Metrorail
SARCC
(Dept of Transport)
1 May 2006: Effective date
26 December 2005: Risk and rewards
R1.00
Transtel: Full service network (Metro fibre and electronic assets)
SNO
3 May 2006
R256 million
Sale process started
Viamax, freightdynamics, V & A Waterfront (26%), Equity Aviation (49%),
VAE Perway (35%), non-core property, Transtel
Future plan
Sale of Housing Assets, SA Express, Autopax, “C” class preference shares

8. Strategy Implementation: Progress
Redirecting the business
Investment plan of R64.5 bn approved and roll-out commenced
Rail
R34.1 bn
Ports
R24.9 bn
Pipeline
R4.9 bn
Other
R0.6 bn
Total
R64.5 bn
Vulindlela (re-engineering) programme implemented with focus:
Addressing safety
Efficiency improvements
Costs reductions
Service delivery
Market-share increase
Main focus is on Spoornet
Port and Rail Master Plan for future growth completed
Restructuring of corporate office completed

9. Strategy implementation (continued)
Human capital strategy
Completed redesign and staffing of corporate centre
Introduced a talent management programme
Began capacity-building exercise for operational requirements and skills demand study for medium term
Introduced a new reward and performance management system and the roll-out has begun
Introduced a leadership development programme
Redefined partnership with labour for the transformation of Transnet

10. Strategy implementation
Corporate Governance and risk management
Shareholder compact completed and approved by Board awaiting approval from Shareholder
Revised articles of association approved by Board awaiting Shareholder approval
Litigation and material contracts due diligence completed
Enterprise Wide Risk Management Framework completed
Key risks identified and monitored for each operating division
Internal audit (outsourced) now fully functional focusing on
Control environment /compliance reviews
Transaction audit (a comprehensive payroll audit completed)
Assessment of major projects and special investigations
Developed and completed a fraud prevention plan, core values,
ethics statements and contracts for all employees

11. Capex spending five-year plan
Planned spending over next five years (core businesses): R64.5 billion
Petronet R4.9 billion
Multi-product pipeline DJP (R4.2 billion)
Gas line upgrading (R0.4 billion)
Transwerk R2.6 billion
Equipment
SAPO R6.3 billion
Mainly capacity increases
Durban (R1.5 billion)
Richards Bay (R1.0 billion)
Ngqura (R1.2 billion)
Cape Town (R0.9 billion)
Saldanha (R0.6 billion)
Spoornet R31.5 billion
Coal line (R8 billion)
Ore line (R2.7 billion)
General freight (R10.8 billion)
Maintenance capitalisation (R8.1 billion)
NPA R18.6 billion
Upgrade and expansion
Durban (R8.7 billion)
Cape Town (R3.9 billion)
Ngqura (R2.5 billion)
Richards Bay (R1.4 billion)

12. Transnet core businesses five-year gross capital investment budget
Financial years
Financial years

13. ACHIEVING PERFORMANCE OBJECTIVES
Salient features: 2006
Results 2006: Continuing operations
2006
R million
% change
Turnover *
26 346 +7
Operating profit
8 478
+57
Operating margin
32%
+47
Capital and reserves
27 706
+31
Cash generated from operations
11 233
+28
Gearing
47%
-24 **
ACHIEVING PERFORMANCE OBJECTIVES
* Excludes notional revenue on embedded derivatives
** Excludes R1.7bn decrease in SAA’s operational cash flow

14. Financial Results 2006

15. Financial results 2006 Consolidated income statement
for the year ended 31 March 2006
% change
2006
R million
2005
Revenue 7
26 346
24 706
Notional revenue on embedded derivatives 14
554
Net operating expenses
(10)
(17 882)
(19 846)
Profit from operations 57
8 478
5 414
Impairment of assets and fair value adjustments
318
4 023
Profit from operations before net finance costs
8 796
9 437
Net finance costs
(2 395)
(2 107)
Taxation 25
(1 978)
(1 582)
Income from associates 33 62
Profit for the year from continuing operations
4 456
5 810
Profit from discontinued operations
115
754
Net profit for the year
4 571
6 564
Operating margin (before impairment and fair value adjustments)
32.2%
21.4%

16. Transnet operating profit margin (after impairment before fair value adjustment)
HIGHEST MARGIN IN LAST SEVEN YEARS
Transnet Group (Including discontinued operations)
Average previous 6 years = 5,8%

17. Spoornet performance 2006 versus 2005
Financial
Operating profit
Turnover increased by 4% to R14.4 billion
Capex spending R3 809 million in 2005/2006 and R31.5 billion over the next five years
Total volumes transported increased by 0.5% to 182mt
Iron-ore line volumes achieved: 29.6mt (increase of 5% over 2004/2005)
Coal line volumes transported was 68.7mt (increase of 2.7% over 2004/2005)
General freight volumes decreased by 2.7% to 83.8mt over the year
1014
681*
32%
Operational
*Includes a net amount of R681m for capitalisation of maintenance under IFRS

18. NPA performance 2006 versus 2005
Financial
Turnover increased by 11% to R5.5 billion
Capex spending R783 million in 2005/2006 and R18.6 billion over the next five years
Bulk volumes grew by 6% due to increased demand for coal, iron ore (China) and other commodities
Full container imports grew 9% while exports did not reflect growth due to currency strength, competition and quality issues
All ports were accredited as being ISPS code compliant
Operating profit
19%
Operational

19. SAPO performance 2006 versus 2005
Financial
Turnover increased by 9% to R3.6 billion
Capex spending R776 million in 2005/2006 and R6.3 billion over the next five years
Container volumes increased by 7% and is expected to further increase by 8% in 2005/2006
Breakbulk volumes dropped 5% due to competition and the trend towards containerisation
Volumes in automotive sector reflected exceptional growth of 43% compared to 2004/2005
A record 28.8mt was exported through the Saldanha iron-ore terminal
Operating profit 4%
Operational

20. Petronet performance 2006 versus 2005
Financial
Turnover increased by 4% to R1.1 billion
Capex spending R224 million in 2005/2006 and R4.9 billion over the next five years
Petronet successfully complied with the “clean fuels” requirements in January 2006
‘De-bottlenecking’ project became operational in October 2005 resulting in an 18% improvement on existing constraints
Existing refined products pipeline (DJP) is running at close to capacity while the crude line feeding Natref is operating at 75%
Operating profit
31%
Operational

21. Transwerk performance 2006 versus 2005
Financial
Turnover increased by 28% to R3.8 billion
Capex spending R189 million in 2005/2006 and R2.6 billion over the next five years
Output achieved during the year which entails refurbishing, upgrading, building and modifying:
7 213 wagons
316 locomotives
550 coaches
2 113 traction motors
wheel pairs
Operating profit
46%
Operational

22. SAA: Financial performance 2006 versus previous two years: three-year view
Turnover
Operating profit
Includes extra release from
Air Traffic Liability of R600m
12,5%

23. Financial results 2006 Consolidated balance sheet at 31 March 2006
R million
2005
ASSETS
Non-current assets
49 131
59 442
PPE and other
47 112
56 725
Long-term loans and advances
2 019
2 717
Current assets
28 202
17 609
Inventories, receivable assets and cash
7 588
13 700
Derivative financial assets
3 874
3 909
Assets classified as held-for-sale
16 740 –
TOTAL ASSETS
77 333
77 051

24. Financial results 2006 (continued)
Consolidated balance sheet (continued)
at 31 March
2006
R million
2005
EQUITY AND LIABILITIES
Capital and reserves
27 706
21 106
Non-current liabilities
22 996
30 717
Borrowings and provisions
17 724
23 421
Post-retirement benefit obligations
4 348
7 238
Deferred taxation
924 58
26 631
25 228
Payables and other
13 699
Liabilities classified as held-for-sale
12 932 –
TOTAL EQUITY AND LIABILITIES
77 333
77 051
RATIOS
Gearing
47%
62%
Return on total assets
11% 7%

25. IFRS: Impact on 2004/2005
Financial statement prepared under IFRS with effect from 1 April 2004
for the year ended 31 March 2005
R million
BALANCE SHEET
PPE deemed cost (land and buildings, other)
4 183
Other
(65)
INCOME STATEMENT
Operating costs (mainly depreciation)
(98)

26. IFRS 5: (Non-current assets held-for-sale and discontinued operations)
The following businesses met criteria at 31 March 2006
SAA – V & A Waterfront
Autopax – Equity Aviation
Viamax – VAE Perway
freightdynamics
Metrorail treated as discontinued – 26 December 2005
Net income for the above shown as “discontinued”
Gross assets and liabilities shown separately as “held-for-sale”

27. Post-retirement benefit obligations
Consolidated balance sheet
Post-retirement benefit obligations
2006 R billion
2005
R billion
Transnet Pension Fund (fully funded) –
Transnet Second Defined Benefit Fund (a)
1.6
4.3
Post-retirement Medical Benefits (b)
SATS pensioners
Transnet employees
0.8
Other
0.3
0.5
Total
7.2
Unfunded liabilities
Restructuring and funding plan in progress
Funding monthly including Transnet subsidy

28. Financial results 2006 (continued)
Abridged consolidated cash flow statement
for the year ended 31 March 2006
Deviation %
2006
R million
2005
Cash flow from operating activities
5 865
546
Cash generated from operations
*28
11 233
10 089
Other
(5 368)
(9 543)
Cash flows from investing activities
(2 479)
(5 001)
Capex – expand
(1 745)
(3 678)
Capex – maintain
(4 856)
(1 963)
Other investment activities
4 122
640
Cash flow from financing activities
(4 001)
2 437
Decrease in bank and cash
(615)
(2 018)
* Effective 28% increase after adjustment for the decrease in SAA operational cash flow of R1,7 billion

29. Funding requirements: Next three years
Cash flow
Budget 2006/07 R billion
Total R billion
2007/08 R billion
2008/09 R billion
Total capex
(12.9)
(16.3)
(19.7)
(48.9)
Cash available from operations
10.0
*8.9
11.9
30.8
Cash shortfall
(2.9)
(7.4)
(7.8)
(18.1)
Loan redemptions
(0.9)
(1.1)
(8.6)
(10.6)
Gross funding requirement
(3.8)
(8.5)
(16.4)
(28.7)
Projections: Excluding non-core
Note: Excludes proceeds from sale of non-core portfolio
* Reduction because of discontinued businesses

30. Post-balance sheet events
SAA – sale agreement signed
Metrorail sale agreement signed
Sale process launched for V & A, Viamax and freightdynamics
Second Network Operator (SNO) – Telecommunications assets sold

31. Summary Sound financial performance for the year
R64.5 billion investment program underway
Vulindlela project implemented that will deliver significant improvement in efficiencies, cost reductions, safety and customer service
Disposal of non-core entities has begun and will be complete by December 2006

32. WE THEREFORE MOVE INTO THE FUTURE WITH CONFIDENCE
Conclusion
Progress to date is pleasing but still significant challenges ahead
The sustainability of the turnaround achieved to date and future improvements can only be achieved through relentlessly driving the implementation of the strategies
Our optimism for the future is based on the commitment of management and staff to focus on priorities and work as a team to deliver
WE THEREFORE MOVE INTO THE FUTURE WITH CONFIDENCE

33. Thank you