Onderstepoort Biological Products Ltd. Presentation to the Portfolio Committee (November 2004)

1. ONDERSTEPOORT BIOLOGICAL PRODUCTS LTD PRESENTATION TO THE PORTFOLIO COMMITTEE: 2 NOVEMBER 2004

2. PRESENTATION OUTLINE: • Introduction (Mr S C Makama – Board Chairperson) • Governance Report (Mr S C Makama – Board Chairperson) • Company Performance for 2003/04 (Dr L Makuleni – Managing Director) • Human Resource Report (Ms S A Bokwe) • Financial Performance 2003/04 (Mr M P van Jaarsveld – General Manager: Finance) • Conclusion (Dr L Makuleni)

3. INTRODUCTION

4. VISION: “To be a centre of excellence in developing, producing and marketing biological products – Serving Africa…Serving the world.”

5. MISSION : “To translate science into biological products, knowledge and technology - resulting in improved animal health, food security and safety for all our stakeholders”

6. VALUES: • OBP will conduct business in such a way to ensure: • A high level of integrity; • High ethical standards; • The highest standards of quality; and • Excellence in everything that we do. • We accept that: • People are our major assets; • As a State owned entity we have the responsibility to provide for Public Good; • We have a responsibility to our society and the environment

7. VALUES: • As a Company we will strive to promote: • Respect for all people; • Animal welfare; • Development of our employees; and • Customer care and satisfaction.

8. CORPORATE GOVERNANCE:

9. CORPORATE GOVERNANCE – FUNCTIONING OF BOARD • The Board retains full and effective control of the Company • To this end, the Board met quarterly, and also scheduled 6 additional meetings • The Board is committed towards Good Corporate Governance: • Induction • Director Development Programme • Agreed to assessment of Board and Board Committees

10. CORPORATE GOVERNANCE – FUNCTIONING OF BOARD COMMITTEES

11. CORPORATE GOVERNANCE – FUNCTIONING OF BOARD COMMITTEES

12. CORPORATE GOVERNANCE – FUNCTIONING OF BOARD COMMITTEES

13. CORPORATE GOVERNANCE – FUNCTIONING OF BOARD COMMITTEES

14. CORPORATE GOVERNANCE – FUNCTIONING OF BOARD COMMITTEES

15. COMPANY PERFORMANCE FOR 2003/04

16. HIGHLIGHTS: Onderstepoort Biological Products Ltd has become a respected leader in its niche market: the production and sale of animal vaccines and related biological products. World export sales are steady and firm; trade with the continent is being stimulated and is increasing while domestic market sales continue to be encouraging.

17. HIGHLIGHTS: • FINANCIAL • Sales Growth • Domestic • Export • Operational Profits

18. HIGHLIGHTS: • Sales History

19. HIGHLIGHTS

20. HIGHLIGHTS: • Cumulative Sales Income 2003/04

21. HIGHLIGHTS: • Cumulative Operating Profit 2003/04

22. HIGHLIGHTS: Our strengthened Research and Development capacity has resulted in OBP having identified and initiated research projects that have led to a number of products in the pipeline.

23. HIGHLIGHTS: • RESEARCH AND DEVELOPMENT • Broaden Research and Development Partners: • International • Local – Academic Institutions • 3 Research and Development Projects on Trans-Boundary Diseases

24. HIGHLIGHTS: • RESEARCH AND DEVELOPMENT • Establish and Strengthen Research and Development Capacity • 3 Functional Departments • Increase Number of Scientists • Increase R & D Expenditure (5% of sales)

25. HIGHLIGHTSSCIENTISTS EQUITY STATUS REPORT 2000 2004

26. HIGHLIGHTS: The streamlining of production processes has had the effect of improving our production success rate to 90%, as well as improving our production quality, our product availability and thereby ensuring increased customer satisfaction

27. HIGLIGHTS: • OPERATIONS • Production Success Rate: 75% to 90% • Facility Upgrade • Physical Infrastructure Audit • Facility Upgrade Plan • Streamlining Production Processes • Production Planning Processes

29. HIGHLIGHTS: The new state-of-the-art small animal holding facility that has been erected is important for facilitating experimental work requiring controlled environment and bio-containment. It will also provide much needed opportunities for international researchers to form partnerships with OBP (Ltd).

30. EXPERIMENTAL ANIMAL FACILITY:

31. HIGHLIGHTS: • TOTAL QUALITY MANAGEMENT • Regulatory Affairs • Dossiers submitted • Local • International

32. HIGHLIGHTS: • TOTAL QUALITY MANAGEMENT • Two new products submitted, and registered • Quality System • Experimental Animal Facility

33. HUMAN RESOURCE REPORT: 2003/04

34. HIGHLIGHTS: Our Human Resource Management and Development Policies have enabled OBP to effect a successful restructuring and transformation in terms of representivity and gender especially within the management and decision making cadres.

35. HIGHLIGHTS: • HUMAN RESOURCE • Staff Compliment – 187 • Human Resource Development • Skills Development • ABET • Bursaries • Multi-skilling • In-House Training • Management Development programme • System and Process in place

36. COMPANY PERFORMANCE: • EQUITY REPORT: • Executive: 50% Designated group, 40% female) • Management: 69% Designated group, 32 % female) • Scientist: 75%Designated group, 50% female)

37. EQUITY STATUS REPORTMANAGEMENT LEVEL (2000 vs. 2004) 2000 2004

38. SKILLS PROFILE:2002/03 PG = Post Graduate

39. SKILLS PROFILE:2003/04 PG = Post Graduate

40. Financial results of Onderstepoort Biological Products Ltd 2003/04

41. Index • Sales • Production • Cost Analysis • Profit • Capital expenditure • Cash position • Balance Sheet

42. Sales in doses • Budget 95m • Actual 100m • Variance 5m • Percentage +5%

43. Sales in Rand • Budget R61m • Actual R70m • Variance R9m • Percentage +14%

45. Local Sales in Rand • Budget R40m • Actual R36m • Variance R4m • Percentage -4%

46. Export Sales in Rand • Budget R21m • Actual R34m • Variance R13m • Percentage +59%

49. Expenses • Budget R44m • Actual R36m • Variance R8m • Percentage +19%