1. Private and Confidential
SA Express (SOC) Limited Briefing to The Standing Committee on Appropriations relating to the SAX R1.249 billion allocation 
23 November 2018
Private and Confidential

2. Private and Confidential
Contents 1
SA Express Mandate 2
Problem Statement 1 3
Turnaround Strategy 1 6 4
SA Express Performance 9 5
Funding Allocation & Application 1
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3. Private and Confidential
Company Mandate
Statutory
Provide transportation of Passengers, cargo and mail, air charters and other related services.
Promote frequency of services on lower destiny routes and to expand regional air services capability in the Republic of the African Continent and surrounding islands.
Private and Confidential

4. Private and Confidential
Problem Statement Prior to Suspension
Airline Performance
Finance
Challenges
Weak Balance Sheet
Long outstanding debts
Frozen credit lines
Liquidity challenge
Monthly cash-burn
High cost structure
Corporate Challenges
Low staff morale
High staff turnover
High rate of management vacancies
Onerous agreements/contracts
Zero accountability
Shortage of skills
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5. TURNAROUND STRATEGY

6. Private and Confidential
SAX Adopted the G-POCH strategy based on the principles of Governance, Profitability, Operational Efficiency, Customer Value and Human Capital
Governance
Ensure good corporate governance (board and management and legal compliance)
Review of Policies & Procedures G
Profitability
Grow Revenue
Introduce cost reduction program P
Operational Efficiency
Improve and maintain OTP
Focus on improving ground turnaround
Improve Dispatch Reliability O
Customer Value Proposition
Improve product and services offered
Ensure aircraft On Time Departure
Develop Communication Plan C
Human Capital
Retain and develop competent employees
Inculcate culture of high performance H
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7. Private and Confidential
The G-POCH tenets form the basis of Corporate Turnaround Plan with clear deliverables and milestones G
Initiatives & Outcomes (0 - 6 Months - Phase 1)
Governance
Filled all vacant post-holder positions with experienced aviation specialist
Head of Safety
GM : Technical
Person Responsible for Aircraft
Person Responsible for Flight
Full compliance with SACAA
Finalised the review of all key policies and framework e.g
Supply chain Policy
Delegation of authority framework
Irregular expenditure policy
Fruitless and wasteful
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8. Private and Confidential
The G-POCH tenets form the basis of Corporate Turnaround Plan with clear deliverables and milestones P
Initiatives & Outcomes (0 - 6 Months - Phase 1)
Profitability
Improve Revenue
We have introduced high yield regional routes such as Lubumbashi and Walvis bay as part of Phase 1
Focused on consolidating ORTIA as the main hub
On track to reopen Cape Town as base (from January 2019)
Reduce Costs
Reduced aircraft lease costs
CRJ700-$24K per month (11% reduction)
CRJ 200-$160k per month (termination of monthly rental)
Cancelled all charters
R18m saving per month
Employee Costs
All overtime terminated
Reduction of pool cars
Capital Restructuring
Capital injection to improve debt gearing
Private and Confidential

9. Private and Confidential
The G-POCH tenets form the basis of Corporate Turnaround Plan with clear deliverables and milestones O
Initiatives & Outcomes (0 - 6 Months - Phase 1)
Operations
We have improved OTP from 64% to above 90%
We have improved aircraft reliability from 77% to above 95%
Purchasing directly from OEMs thus reducing cost and improving efficiencies C
Reduced
customer complaints relating to missing bags
Introduction of “Premium Economy” on Lubumbashi effective December 19
Increased frequency has provided the customer flexibility
Customer
Private and Confidential

10. The G-POCH tenets form the basis of Corporate Turnaround Plan with clear deliverables and milestones H
Initiatives & Outcomes (0 - 6 Months - Phase 1)
Revised and promoted new company values to drive a culture of accountability and performance
Human Capital

11. Private and Confidential
During the month of August SAX carried a total of passengers (from the 15th to 31st August 2018
In the month of September 2018 SAX carried a total of passengers
SA EXPRESS PERFORMANCE
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12. SAX Serviceable Fleet & Projection
During the month of August SAX carried a total of passengers (from the 15th to 31st August 2018
In the month of September 2018 SAX carried a total of passengers
SAX Serviceable Fleet & Projection
8 Aircraft
10 Aircraft
12 Aircraft
14 Aircraft
15 Aircraft
22 Nov 18
30 Nov 18
30 Dec 18
31 Jan 19
19 Mar 19
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13. Private and Confidential
OTP vs Competitors
*Source: ACSA
SA Express exceeded 90% target by achieving 94%
Best On time performance compared to other feeder carriers.
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14. Technical Dispatch Reliability
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15. Passenger Performance Year to Date Oct
The Airline will introduce four more routes between December and January 2019
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16. Positive Growth Trend Recorded
Initial launch routes have shown positive growth trend
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17. Flown vs. Booked & Projected Booking Nov-Dec
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18. Revenue Performance Aug to Oct 2018
Passenger revenue achieved for August was R4.7m with a total of 96 flight departures operating for only 8 days.
Passenger revenue for the month of September 2018 was R40.4m
Passenger revenue for the month of October 2018 was R51.8m
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19. Private and Confidential
Income Statement
Phase 1 the company will incur a loss as it returns to optimal operations
Phase 2 - by April 19 ,once additional regional routes are implemented, the company begins to break even
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20. Thank you