1. Overview and Achievements
TRANSFORMATION
Overview and Achievements
2006 – 2010

2. TRANSFORMATION ACHIEVEMENTS TO DATE
Transformation Committees in place and functional.
Climate Survey Index: 2006 (43%) and 2008 (50%): Benchmark 60%.
B-BBEE target Level 5: Achieved Level 4 in 2009/10.
BBBEE spend from total Procurement spend:
2005/6
2009/10
R 334m
R 584m
18%
28%
B-BBEE independently assessed by EmpowerLogic

3. PROGRAMMME MANAGEMENT

4. THE CHALLENGE OF DEFENCE PROGRAMMES
Leading-edge technology integration a prerequisite to deliver competitive products
High investment in human capital development and equipment essential
With declining defence budgets volume sales not available
Most contracts on Denel for technology and product development, resulting in lower margins and mostly requiring own investment before serial production status is attained
International economic downturn has resulted in overcapacity and growing competition in our traditional markets
Clients now demand service providers to carry programme risk

5. STRIVING FOR OPERATIONAL EXCELLENCE : ACHIEVEMENTS
91,5% cash flow on DOD contracts
majority of orders of a developmental nature (85% international benchmark)
A-Darter development and Gripen integration milestones
On-time delivery of Badger new-generation infantry combat vehicle Section Variant milestone
Rooivalk certification completed
DoD requiring delivery of an initial operational capability by April 2011
DSA Special Processes accredited to international standards
Seeker 2 export contract completed ahead of schedule
Virtual flawless munitions and pyrotechnic deliveries to local and international client base

6. A-DARTER PROGRAMME

7. OVERVIEW OF THE INTERNATIONAL PARTNERSHIP
A-Darter is a Bi-National project which supports the government’s objectives of closer ties with Brazil
The Brazilian Air Force invested 50% of the funding at the start of the programme – without this funding it would not have been possible to develop the missile
Technology transfer has been part of the package and has been highly successful, paving the way for future similar contracts
Brazil and South Africa both benefit from the world class technology embedded in the fifth generation missile capability
Both countries will have a first class capability to effectively protect their air-space

8. A-DARTER PROGRAMME CONTRIBUTION FOR SOUTH AFRICA
Provides international credibility in a highly competitive environment
Ensures valuable engineering skills development and retention in South Africa
Provides challenging career opportunities for young people to grow in programme management and systems engineering disciplines
Raises the level of the electronics and mechanical engineering sector in South Africa
Creates sustainability (future production contracts) for Denel and local industry
Creates jobs in the South African economy

9. A-Darter Program: First Successful Launch Firing
from SAAF Gripen at Overberg Test Range

10. 10
SEPARATION 1 17 JUNE 2010

11. A-DARTER PROGRESS INDICATORS
Program Objective:
Status: 1
Develop a reliable, fit-for-purpose 5th generation infrared air-air missile with performance characteristics comparable to the best from the USA or Europe, without export controls imposed by USA 2
Keeping to the tight Planned Program Schedule in order to complete development by 2012 and start production:
Technically on specification
Financially within budget 3
Ensuring a highly successful partnership with Brazil, to pave the wave for future collaboration (example - extended range Umkhonto missile development) 4
Enable skills development to attract a next generation of missile engineers and rocket scientists to Denel Dynamics and related RSA industry 5
Develop export opportunities for A-Darter to third-markets to benefit both RSA and Brazil industry

12. BUSINESS DEVELOPMENT