1. INVESTOR PRESENTATION
INTERWASTE HOLDINGS LTD. (JSE : IWE)
INVESTOR PRESENTATION
February 2017

2. DOING THE RIGHT THING STARTS WITH
CHANGING THE WAY WE THINK

3. AGENDA Company Introduction Industry Analysis
5 Year Financial Performance
Market Opportunities
Industry Outlook
Conclusion

4. Company Overview

5. COMPANY OVERVIEW Established 1989 27 Years Operational Experience
JSE Altx Listing 2007
Main Board Listing 2014
National and SADC Footprint
Fully Accredited/Licensed Service Provider
Shareholding
40% Management Owned
BEE Level 3

6. COMPANY OVERVIEW Competitive Positioning
Integrated Waste Management Solution
Cradle to Grave
Services
Professional IP based
Operational
Zero Waste to Landfill
1st to Market
National Footprint
Service Availability
Operational Facilities
Waste to Energy
Treatment
Landfill
Reporting Requirements
On line reporting

7. COMPANY OVERVIEW – BUSINESS MODEL

8. COMPANY OVERVIEW – DIVISIONAL
Logistics
Facilities

9. COMPANY OVERVIEW Logistics Facilities Logistics Facilities
Integrated Solution
On Site Staffing
2 500 Staff
550 Vehicles
Containers
Facilities
2 Waste Landfill Facilities
16 Operational centres / Waste Transfer Stations
2 Waste to Energy Facilities
RDF Facilities
Blending Platform
3 Effluent Treatment Plants

10. COMPANY OVERVIEW Segment Overview Performance Drivers
Logistics
Facilities
Segment Overview
Low Barriers to Entry
Low Capital Requirements
Highly Competitive
Performance Drivers
Logistical Efficiencies
Area Density
Fixed vs. Variable 50/50
Facilities Dependant
Segment Overview
High Barriers to Entry
High Capital Requirements
Regulated Environment
Few Market Players
Performance Drivers
Legislation
Volumes/Tonnages
Fixed vs. Variable 70/30
Logistics Dependant

11. FACILITIES – LANDFILL Store of Waste (Commodity)
Class B Designed Facilities
Only two commercially available legally compliant sites
Accepts Type 2, 3, 4 waste materials
Investment
R 250 Million
Current Capacity
3 Million cubic meters of air space
Available Capacity
50 Million cubic meters of air space

12. FACILITIES - BLENDING PLATFORM
Co-processing facility that receives, stores and blends High Value Hazardous Waste
Sludge and liquids with energy (cv) value
power generation,
steam generation,
heat generation,
Cement kilns
other suitable combustion installations.
Investment
R 15 Million
Capacity
tons per year

13. FACILITIES - REFUSE DERIVED FUELS
High quality fuel produced from solid waste
Unique processing methodology
power generation,
steam generation,
heat generation,
cement kilns
other suitable combustion installations.
Current Investment
R 10 Million
Capacity
tons per year

14. Industry Demand: 150 000 tons per annum
The cement process : A true opportunity to co-process waste in an environmentally manner.
Raw mix preparation
Burning
Cement grinding
Additive to cement
High flexibility of our raw mix
Very High temperature (Flame at 2000°C)
High residence time (above 5 seconds)
Gas cleaning inherent to the process
No Ash – No waste
70 types of Waste and 350 kG/T clinker
85% substitution
Alternative raw Material
Alternative Fuels
Industry Demand: tons per annum

15. Industry Analysis

16. INDUSTRY ANALYSIS Waste generation ± 70 million ton per year
Municipal and Private Sectors
Reporting, Compliance, Urbanization
Source: SAWIS

17. INDUSTRY ANALYSIS – HIERARCHY
Traditional Model
Global Trend
Reduce
Reuse
Recycle
Transform
Landfill
Reduce
Reuse
Recycle
Transform
Landfill
Waste Volumes/Tonnages

18. INDUSTRY ANALYSIS
Source: SA Department of Science and Technology, 2014

19. INDUSTRY ANALYSIS – DRIVERS OF INNOVATION
Interwaste Innovations
Conventional Disposal Costs
Carbon Tax
Anaerobic Digestion
2014
NEMWA Amendments
RDF
Packaging Regulations
Blending Platform
Landfill Classification
Effluent Treatment
2010 Air Quality Act
Commodity Trading
2008
NEMWA
1999 National Water Act
On-site Solutions
1998 Minimum Requirements
Available Landfill Airspace
Time

20. INDUSTRY ANALYSIS – MARKET VALUE ESTIMATE
Source: Internal

21. INDUSTRY ANALYSIS – MARKET VALUE ESTIMATE
Source: Internal

22. INDUSTRY ANALYSIS – MARKET SHARE
Domestic sector Excluded from overall market estimate Municipal By Laws

23. Financial Performance
5 Year Financial Review

24. FINANCIAL PERFORMANCE – 5 YEAR PERFORMANCE

25. COMPANY OVERVIEW – MARKETS SERVED
80% Annuity Based Revenues
Three to Five Year Contract Periods
High Levels of Customer Retention 10 – 15 Years
Bi Annual Escalations

26. FINANCIAL PERFORMANCE – 5 YEAR PERFORMANCE

27. FINANCIAL PERFORMANCE – Revenue Operating Profit 2015

28. FINANCIAL PERFORMANCE - CAPEX

29. FINANCIAL PERFORMANCE – CASH FLOWS

30. FINANCIAL PERFORMANCE – CASH FLOWS
2013
FG Landfill
Fleet Capitalisation
Previously off balance sheet
Share Capital R 80 Million
Loans R 115 Million
2014
Fleet Capitalisation
Previously off balance sheet
2016 Half Year
Klinkerstene Landfill

31. FINANCIAL PERFORMANCE - ROA

32. FINANCIAL PERFORMANCE – LOGISTICS

33. FINANCIAL PERFORMANCE – LOGISTICS + 2 YEARS

34. FINANCIAL PERFORMANCE – FACILITIES

35. FINANCIAL PERFORMANCE – FINANCIAL INDICATORS
2011
2012
2013
2014
2015
ROA
0.57
7,7
9,12
9,99
9,17
ROE
-2,55
6,04
8,45
9,85
8,17
Assets/ Turnover
1,16
1,33
1,24
0,99
1,03
ROCE
-1,96
4,48
5,67
6,28
5,22
Source: INET

36. FINANCIAL PERFORMANCE – 6 MONTH COMPARATIVE (ZAR ‘mil)
2015 – 6 Months
2016 – 6 Months
%Change
Revenue
420
445 6%
Gross Profit
222
243
10%
Gross Profit Margin
52%
54% 2%
Operating Profit 32 41
28%
Operating Profit Margin
7.6%
9.2%
13%
EPS*
3,0
4,4
46%
* Basic EPS less exceptional items

37. Market Opportunities

38. MARKET OPPORTUNITIES - FACILITIES
Waste treatment and disposal will offer the opportunities required for the group to grow organically and leverage its facilities
Source: Case study JHB and Tswane Metros Airspace Study

39. MARKET OPPORTUNITIES LANDFILLS IN PTA & JHB 2016
FG Landfill
Klinkerstene
FG Landfill
Klinkerstene
Multisands
Gauteng Municipal Landfill Sites Near Capacity
No Municipal Development in Future Capacity
Source: Case study JHB and Tswane Metros Airspace Study

40. COMPETITOR ANALYSIS WASTE TREATMENT and DISPOSAL ASSETS
MARKET OPPORTUNITIES
COMPETITOR ANALYSIS WASTE TREATMENT and DISPOSAL ASSETS
Competitor 1
3.5 1 2
Competitor 2
1.5
Interwaste 5
Competitor 3
Competitor 4
Competitor 5
Competitor 6
Hazardous Waste Landfills
Glass B Landfill Sites
Unlined & Non-Compliant Landfill sites
Waste Transfer Stations
Anaerobic Digester
Liquid Waste Treatment Plant
Refuse Derived Fuel Plant
Waste Evaporation Plant
Hazardous Waste Stabilization Plant
Licensed Composting Facility
Liquid Blending Platform WTE
Medical Waste Incinerator
Recycling Processing Plant
Source: Internal

41. Correct Status of Development
MARKET OPPORTUNITIES
Project Description
Investment Phase
Correct Status of Development
F.G. Landfill “B” site
Completed
Site Operational
Klinkerstene Landfill “B” site
Hub Transfer Station
Complete
Power Street H:H Treatment Plant
EIA – Complete
Site Operational Future Development*
Multi Sands Landfill “B” site
EIA Only
Site to be developed around 2018 /19 *
Amadwala Landfill H:H site
Moatize Landfill H:H site
Future Development *
Gauteng Waste to Energy Plant DC AD
Drakenstein Waste to Energy Plant
S.A.’s first municipal Waste to Energy Plant
* Investment subject to hurdle rate calculations

42. MARKET OPPORTUNITIES - MOZAMBIQUE

43. INDUSTRY OUTLOOK

44. INDUSTRY OUTLOOK Long term GDP growth estimated at 2% (IMF 2016)
Waste Management Industry closely aligned
Stagnating growth in commercial, manufacturing, industrial, and mining sectors
Pending Legislation
Demand Driver
Increasing Levels of Compliance
Low Levels of Municipal Infrastructure Development (Landfill)

45. STRATEGIC POSITIONING
Interwaste Strategically Aligned
Solution based - Hierarchy of Waste Management
Facilities Operational
Industry and Service Diversification
National Footprint
Annuity Based Income
Capacity within Existing Assets
SADC
Mozambique
Oil and Gas Sector

46. Conclusion

47. CONCLUSION Targeted ROE 15% (2018) Commited to Dividend Policy
Strategy Based on Organic Growth
End of Investments Cycle
Leverage of Existing Infrastructure
Major Investments in Facilities Completed
Klinkerstene Landfill (30Million)
Refuse Derived Fuels
Maintenance Capex
10% of Revenues
Sustainable Growth Rates
Positive Cash Flows
Future growth funded by operational cash flows

48. CONCLUSION
Q & A