SANRAL ANNUAL DOMESTIC ROADSHOW - October 2011

1. SANRALANNUAL DOMESTIC ROADSHOW- October 2011 #441439v1

2. The SANRAL mandate • Responsible for strategic planning with regard to South African national road system • Finance, plan, construct, provide, operate and maintain roads in neighbouring countries upon request from the Minister of Transport and in agreement with the respective countries • Not profit driven but create public value • Established in April 1998 by an Act of Parliament as an independent operating company to operate South Africa’s national road network • Established in terms of the National Roads Act of 1998 as a public company with a share capital within the requirements of the South African Companies Act • Governed by a board of directors (8 members) of whom 7 must be appointed by the Minister of Transport • Eighth member of the board is the CEO by virtue of office

3. SANRAL’S ROLE • National road network - economic arteries • Provide safely engineered, well maintained roads • Improve journey experience • Transformation • Create opportunities for employment, business, tourism

4. WHAT DO WE DO? • Responsible for proclaimed national roads: Toll and Non-Toll network • Maintain, fund, operate and rehabilitate national roads • Levy tolls to service toll roads • Manage concessionaires • Advise Minister on road related matters • Create public value

5. The Bigger Picture • Road user is our client – SANRAL objective is to provide a safe well engineered road to the user – movement of people, services and goods • Value of time – Time is valuable, both commercial and private • To enable the economy to grow – creating wealth and job opportunities, saving on road user costs – sufficient infrastructure is required

6. The Bigger Picture • In order to provide above, there are different focus areas: • As minimum, roads must be well maintained: • Routine road maintenance (crack sealing, pothole repair, grass cutting, road signs and markings, guardrails, etc) • Periodic maintenance – reseals and overlays • Rehabilitation • Available funding optimized using tools such as pavement management systems, HDM4 • Capacity improvements (combine with rehabs): • Additional lanes • Paved shoulders • Climbing lanes

8. NATIONAL ROAD NETWORK (km)

9. Please Note: 75% of Network Older than Original 20 Year Design Life

11. COST OF MAINTENANCE DELAY - ROAD USER Good Condition Poor Condition Very Poor Condition Good Poor Based on HDM-4 Modeling

14. FUNDING • Government Grant for the non-toll network • Cannot budget for a deficit • Toll Revenue – to be used only on toll roads • Borrowings from capital markets and financial institutions • Other income (minimal) – rental income etc • Alternate Funding Sources finalised/under discussion • EIB • ECA • Foreign investors - roadshows

15. Ratings • Moody’s • Global Scale Issuer Ratings: • (Non-guaranteed notes) • Long-Term: A3 • Short-Term: P-2 • National Scale Issuer Ratings: • (Non-guaranteed notes) • Long-Term: Aa2.za • Short-Term: P-1.za

16. BORROWING CAPACITY • Initial R6 billion guaranteed funding (SZ bonds) • R1 billion N1 loan – separate guarantee • R26.91 billion guaranteed funding (HWAY bonds & others) • R15 billion – non guaranteed funding (NRA bonds) Increased from R10bn Total Borrowing capacity = R48.91 billion

17. TOTAL DEBT

18. TOTAL DEBT

19. THE SANRAL SUITE (Aug 2011)Spire Awards: BEST BORROWER 2008 & 2009BEST ISSUER 2009 (HWAY20)

20. What have we been up to . . .

21. CONTRACTS AWARDED1ST APRIL TO 31ST MARCH 2011

22. BUDGET

23. J-curve

24. J-curve (in numbers) The effect on the SANRAL debt level as a result of GFIP APPROVED GFIP TARIFF SCENARIOS – DEBT LEVEL INFORMATION (ENTIRE TOLL PORTFOLIO)

25. Project Extent: PLANNED LANE ADDITIONS:185 km (2010) FUTURE UPGRADES:(223 KM) PLANNED NEW ROUTES: 158 km FINAL SCHEME:561 KM

26. Open Road Tolling (ORT) • In urban environment (space constraint), high traffic volumes (100 000 to 200 000 AADT), conventional tolling not an option • ORT: • All transactions recorded electronically: • Number plates or tag • Vehicle linked to an account • No physical toll plazas – free flow tolling

27. SANRAL principles for ORT • One tag standard • One account – may include various vehicles • Central clearing Full interoperability

28. Tag • Also known as: • Transponder • or On Board Unit (OBU) Open Road Tolling ORT • All the toll transactions will take place electronically • No physical toll plazas Illustrative Standard: 5,8GHz

29. Discounts Types • E-Toll tag account • Time of day • Frequent user • Public Transport operator (PTO) • No discount if not registered • All discounts cumulative except PTO • Commuter taxis and busses exempt

30. ORT – Violation Processing • Potential violator identified if: • No e-tag or account • Insufficient funds in account • Vehicle not identifiable • Transaction forwarded to VPC: • Send invoice • Not successful – Infringement notice – note, must be peace officers and should be appointed by SANRAL • Not paid – Courtesy letter (RTMC) • Not paid – Enforcement order

31. Violation Enforcement • Enforcement Unit (traffic officers together with ORT contractor) is set up to do violation enforcement • Not only toll – all traffic violations • Also attending to other requirements – management of incidents

32. Key Account Management • Agreements reached with fleetbanks to assist with distribution and management of tags – daily payment guaranteed • SAVRALA – near real time: transactions sent to rental companies > direct link • Large fleets: direct agreement with SANRAL – manage own tags and payments • Bulk registration: Initial registration done through predefined template

33. Capital Investment Programme SANRAL Funded Toll Network Development • N2 Tsitsikamma Toll Road - completed • N17 East Toll Road Extension • Gauteng Freeway Improvement Project (GFIP) • N1 South and R30 Bloemfontein – Kroonstad • N1 Polokwane Bypass - completed • Mariannhill Extension • King Shaka Interchange – completed • Knysna Ring road

34. Current & Proposed Concessions Current Concessions • N4 East, Maputo Development Corridor – 471km • N3 Cedara, Heidelberg – 429km • N4 West, Platinum Highway – 382km Proposed Concessions • N1/N2 Winelands Toll Highway – On tender • N2 Wild Coast Toll Highway – Received RoD • R300 Ring Road

35. Future Investments • Maintain expenditure on asset preservation • Extend intelligent transport systems • Extend electronic toll collection system • Complete feasibility studies • Initial Environmental Scan • Construction Programme • GFIP Phase 2?

36. GEOGRAPHICAL LOCATION OF THE N1-N2 WINELANDS TOLL HIGHWAY PROJECT N1 Section R300 to Hex River Valley: 105,6km R300 N2 Section R300 to Bot River: 70,3km

38. CONCLUSION • Investing in roads • For sustainable economic growth • Leverage procurement to transform industry • Make communities economically independent • Create public value • Effective delivery of road infrastructure for public transport and movement of freight • Expansive investment programme • Core components of South Africa’s growth strategy • Conservative and prudent funding strategy

39. Highways of the future

40. Thank you! SANRAL 48 Tambotie Avenue Val de Grace Pretoria 0184 PO Box 415 Pretoria 0001 Telephone: +27 12 844 8000 Fax: +27 12 844 8200 Nazir Alli, alli@nra.co.za Inge Mulder, mulderi@nra.co.za Philip Gildenhuys, gildenhuysp@nra.co.za Alice Mathew, mathewa@nra.co.za Gill Raine, Gill.Raine@firstrand.co.za Prasanna Nana, prasanna.nana@absacapital.com FRAUD HOTLINE:0800 204 558 Website: www.nra.co.za