Mandate, vision and mission€¦ · (National Ports Authority), Transnet Port Terminals (Port Terminals) and Transnet Pipelines (Pipelines). A standalone Sustainable Development Report

Our mandate

The mandate of Transnet SOC Ltd (Transnet or the Company) is to assist in lowering the

cost of doing business in South Africa, enabling economic growth and ensuring security

of supply through providing appropriate port, rail and pipeline infrastructure in a cost-

effective and efficient manner, within acceptable benchmarks.

Transnet’s mandate and strategic objectives are aligned with Government’s New

Growth Path (NGP) and the Statement of Strategic Intent (SSI) issued by the Minister

of Public Enterprises.

Our vision

Transnet is a focused freight transport company, delivering integrated, efficient, safe,

reliable and cost-effective services to promote economic growth in South Africa.

This is achieved by increasing the Company’s market share, improving productivity and

profitability and by providing appropriate capacity to customers ahead of demand, within

affordability limits.

Our mission

The Company is reliable, trustworthy, responsive and safe; its employees are committed,

safety-conscious, ethical, disciplined and results orientated.

Mandate, vision and mission

1

Transnet SOC Ltd Integrated Annual Report 20112

About this Integrated Annual Report

As a requirement of the King Code of Governance for

South Africa (King III), ‘integration’ has been on the

agenda for many South African companies in the past

year. In putting together this report, the Company was

informed by various guidelines, benchmarks and

engagements, including the draft Discussion Paper

issued by the South African Integrated Annual

Reporting Committee. Based on discussions, the

underlying purpose of integration is to optimise the

positive contribution the Company makes to society in

the short, medium and longer term. Integrated

reporting serves to share this information with

stakeholders.

The value of integrated reporting became apparent to

the Company in that it required a focus on key material

impacts, to engage with stakeholders, to clarify the

linkages between sustainability and the core business

and to ensure performance is communicated clearly to

the relevant target groups.

While the Company explored this to some extent

previously, the sustainability programme has gained

additional impetus based on this revised approach.

This is Transnet’s first Integrated Annual Report, and

while the Company has made some progress, ongoing

improvement in processes and output will continue to

be a priority in future years. Together with Transnet’s

commitment to the NGP, this approach will yield

increasing benefit, both internally and in respect of

Transnet ‘s social contribution.

These requirements reflect a step-change in reporting

for Transnet, South Africa and globally, and as a state-

owned company (SOC) Transnet should play a role in

contributing to that shift.

The report includes comparative information on

Transnet’s performance in prior years, with

information disclosed in past Annual Reports being

restated where appropriate.

The report not only reflects performance information

for the 2011 year, but also contains future targets

based on the Company’s strategy, commercial

prospects, policies and procedures.

It must be noted that there are possible variations

between previously stated objectives and present

targets given that a range of variables could impact

future business activities and may have altered targets.

Where possible, reasons for variations are provided.

The consolidated performance information in the

report covers all Transnet’s Operating divisions and

Specialist Units. In addition, detailed Operational

reviews are presented for Transnet Freight Rail

(Freight Rail), Transnet Rail Engineering (Rail

Engineering), Transnet National Ports Authority

(National Ports Authority), Transnet Port Terminals

(Port Terminals) and Transnet Pipelines (Pipelines).

A standalone Sustainable Development Report (SDR)

is written overtly from the perspective of the

sustainability “lens” and is available on the Transnet

website at www.transnet.net. It is intended to be a

more broadly accessible document, rather than

targeting primarily financial stakeholders. The SDR

includes a detailed index in which Transnet responds

to each of the “G3” criteria of the Global Reporting

Initiative (GRI).

Other than the audited annual financial statements,

the Company has not commissioned additional

external assurance of the non-financial information

provided in this report.

Transnet’s first Integrated Annual Report (the report) covers governance, financial, social,

environmental, broader economic performance and provides a high-level overview, clarifying the

linkages between sustainability and the core business, including the sustainability performance

of the Operating divisions for the year ended 31 March 2011. It provides an account of the

Company’s progress to date and offers a forward-looking perspective in terms of future plans

and value-generating strategies.

Structure

1PRODUCTIVITY

AND EFFICIENCY

4FINANCIAL

SUSTAINABILITY

3CAPITAL

INVESTMENT

2VOLUME GROWTH

5HUMAN CAPITAL

8REGULATORY

6STRATEGIC ENABLERS

7SAFETY, HEALTH,

ENVIRONMENT AND QUALITY (SHEQ)

The following icons are used in the report to depict the Quantum Leap focus areas:

Achievement against the Shareholder’s expectations

The Transnet mandate and strategic objectives of the Company over the medium term are set

out in the Shareholder’s Compact between Transnet and the Department of Public Enterprises

(Shareholder Representative).

To ensure alignment of Shareholder expectations and the strategic intent of the Company, key performance indicators

(KPIs) have been identified for the Company and for each Operating division. These KPIs have helped ensure focus on

the priority value drivers in the key areas of the business is maintained. The Board and Group Executive Committee

monitors the performance against these KPIs to ensure that the strategic objectives of the Company is achieved.

Despite the challenging economic environment, Transnet has exceeded most of its Group targets as set out in the

2011 Shareholder’s Compact, which continues to establish a strong platform for future growth. Details regarding the

Operating division KPIs are contained in the Operational reviews and the Report of the Directors.

Operating expenditure

as a percentage of

revenue (%) ≤60 58,5 ≤60

Return on average

total assets (excluding

CWIP) (%) (a) ≥8,0 6,6 ≥8,0

Cash interest

cover (times) ≥3,2 3,9 ≥3,2

Gearing (%) ≤46 41,1 ≤46

Group key performance indicators (KPIs)

2011 TARGET

2011 ACTUAL

2012TARGET

Financial value creation

Infrastructure and maintenance

Human capital

Safety

Capital

investments (%) (b) ≥90 94 ≥90*

Maintenance

costs (%) ≥90 98 ≥90*

Disabling injury

frequency rate

(rate) 0,85 0,98 ≤0,80

Training spend as

a % of personnel

costs (%) 3 – 4 3 ≤3,5

(a) Total average assets (excluding capital work in progress) comprise a combination of revalued assets and depreciated assets as per Transnet’s accounting policies and have been computed as an average for the two years ending 31 March 2010 and 31 March 2011.

(b) Capital investments exclude borrowing costs, includes capitalised finance leases and capitalised decommissioning liabilities.

Note:i) The industrial strike action during May 2010 had a detrimental impact on Transnet’s operations and consequently on certain agreed

KPIs included in the 2011 Shareholder’s Compact. Accordingly, revised targets for 2011 have been agreed with the Shareholder Representative as presented above.

ii) A number of new Shareholder’s Compact KPIs have been added for 2012 that were not reported on in 2011. These include the number of engineering trainees, technicians, artisans and sector specific trainees. In addition, specific KPIs for employment creation and employee fatalities have been added for 2012.

* Not a Shareholder’s Compact KPI in 2012. Internal targets are reflected.

3

Introduction

The Quantum Leap strategy has been aligned to incorporate the requirements of the

NGP and the SSI .

The Quantum Leap strategy is informed by the policy context of the developmental state

and the NGP, and acknowledges the critical role of state-owned companies (SOCs) as

drivers of the developmental state. Accordingly, SOCs need a culture shift from one based

on compliance and process to one focused on delivery and outcomes as well as a closer

and more collaborative relationship with Government departments and other State

institutions. The underlying urgency on volume growth, increased productivity and

efficiency, capital investment, financial sustainability and safety, are the core elements of

the Quantum Leap strategy and continue to inform efforts to improve customer service.

The generic strategic objectives of SOCs can be summarised as contributing to

economic growth through:

The provision of world-class infrastructure and technologies;

The expansion of economic infrastructure;

Job creation and skills development; and

Industrial capacity building through a more strategic approach to

procurement and operations.

Increase productivity and efficiency

1

Volume growth

2

3

Capital investment

4 Financial sustainability

IMPROVINGCUSTOMER

SERVICE

Regulatory

Humancapital

Strategic enablers6

SHEQ

Quantu

m Leap strategy

New Growth Path

Quantum Leap strategy


The rollout of the capital expenditure programme continues to

create capacity ahead of demand, despite the impact of the

economic recession. However, rail operations in Freight Rail

have underperformed on key elements of the Quantum Leap

strategy. Interventions to address these areas have been

developed and the Company is on track to support the drive

for greater operating efficiencies, service levels and customer

responsiveness.

As a SOC, Transnet has formalised a high level commitment to

the NGP. With a focus covering skills, jobs, the ‘green economy’,

localisation through competitive supplier development,

innovation and rural development, these discussions have

enabled Transnet to reflect on how it creates and sustains value

for a range of stakeholders in the short, medium and longer term.

As such, the NGP commitments effectively frame the

sustainability-related contributions for Transnet and together

with the Quantum Leap strategy, will guide and direct the

sustainability performance going forward. The ability of the

Company to contribute value to society is directly aligned with the

operational goals, as contained in the Quantum Leap focus areas.

Transnet’s fundamental approach to job creation is that greater

efficiency and effectiveness of the freight system will encourage

economic growth and thus lead to the creation of jobs.

To support the growth of the Company and the commitments to

the NGP, Transnet plans to increase direct jobs by 4,5% in 2012

and to maximise opportunities for job creation going forward.

The combined effects of Transnet’s operations and capital

investments will contribute to an average increase of

approximately 200 000 direct and indirect jobs over the next

five years.

Transnet is entirely self-funding and does not receive subsidies

from the Government. Consequently, the Company will focus on

volume growth, capital investment, financial sustainability and

continue to generate strong and stable cash flows and access the

debt capital markets for any shortfall in terms of its funding

requirements. It is, therefore, imperative that the Company earns

an appropriate return on invested capital to maintain a strong

financial position and to maintain its investment grade credit

rating. This, in turn, will provide the capacity for Transnet to

maintain and expand its port, rail and pipeline infrastructure and

support the Company’s efforts to improve customer service.

By enhancing efficiency, expanding rail market share, developing

the New Multi-Product Pipeline (NMPP) and increasing port

connectivity and productivity, Transnet contributes significantly

to reduced fuel use per ton of freight, enhanced energy security

and socio-economic development. These are the primary

material impacts and they are positive.

At the same time, in line with the environmental, social and

governance commitments, the Company is striving to achieve

these contributions with zero fatalities, significantly reduced

environmental impacts, exemplary levels of governance and

accountability and with due consideration to the risks and

opportunities emerging in a resource-constrained world.

To achieve the growth and efficiency objectives, the Company

has developed a demanding five-year capital investment plan of

R110,6 billion (excluding capitalised borrowing costs), focusing

on areas where existing infrastructure is inefficient and

contributing to bottlenecks in the freight logistics

transportation system. Transnet’s capital investment plan is

designed to provide maximum support for the NGP objectives to

achieve a responsive economic infrastructure. Transnet will also

work with the Department of Public Enterprises (DPE) to develop

a joint investment planning process to ensure that the Company’s

investment plan is aligned with those of other stakeholders.

Transnet is unable to fund a globally competitive freight

transport system single handed. It is therefore critical for the

Company to leverage private sector participation (PSP) in both

operations and investments. Significant opportunities for PSPs

exist in the container and intermodal space and in the iron ore

and coal segments. Transnet has started engagements with

customers and other logistics operators regarding private sector

investment in rolling stock and terminals and interest from the

private sector has been positive.

Transnet will continue to leverage procurement for the benefit of

the South African economy. Procurement will be effectively

utilised as a tool for industrial capability building and economic

transformation. Local sourcing will comprise approximately 88%

of the total planned capital spend over the next five years. The

focus on local suppliers will benefit Transnet’s supply chain cost

through efficiency improvements, such as reduced turnaround

time and support services. Key focus areas for industrialisation

and supplier development include rolling stock, port equipment

and other infrastructure.

Strategy overview

Since 2009, Transnet has been implementing its Quantum Leap strategy. The Quantum Leap strategy is aimed at

rapidly improving the pace of volume and revenue as well as, significant safety, productivity and efficiency

improvements. By adopting the Quantum Leap strategy, Transnet has sought to refocus the business on what

matters the most; the provision of improved services to its customers.

During the year, the Quantum Leap initiatives delivered meaningful improvements in the port and pipeline

operations, including volume growth and productivity improvements that, together with cost-reduction

initiatives, contributed to improved profitability.


49

Integrating sustainability into the Quantum Leap strategy

This process was initiated during the year through internal dialogues involving various functions including

risk, compliance, finance, environment, safety, human resources, the Transnet Foundation, and the Operating

divisions. This process identified the impacts the Company has on social and natural systems, as well as the

risks and opportunities arising from sustainability-related trends. It is clear that the sustainability drivers

indicated below will combine to create an increasingly volatile marketplace and consequently uncertainty will

impact the Company and will provide the context within which the Quantum Leap strategy and NGP

commitments are implemented.

A materiality process led to the development of a framework of key sustainability concerns. The linkages between these,

the Quantum Leap strategy and NGP commitments are indicated below. These five key areas also form the structure of the

standalone Sustainable Development Report.

KEY AREAS OF INTEGRATION

CREATING SHARED VALUE

LINK TO QUANTUM LEAP AND STRATEGIC INITIATIVES LINK TO NGP

Governance systems that drive accountability.

Builds social capital by promoting trust and accountability.

Safety, skills and a culture of delivery.

Builds human and social capital through personal and career development.

Efficiency, security and reliability.

Builds financial, manufactured and social capital by lowering costs of doing business, enabling economic growth and ensuring security of supply.

efficiency.

Environmental compliance and climate change.

Reduces environmental degradation; supports the protection and restoration of natural capital.

Aligning with priorities of the developmental state.

Builds social capital by addressing disparities and developmental challenges.

challenges.

SUSTAINABILITY DRIVERS RISKS OPPORTUNITIES

Resource constraints.

Climate change and associated response. pressures (including food distribution).

Green economy and increasing awareness of sustainability issues.

requirements.

and compliance.

contribution.

energy.

Continued social disparities.

properties.

skills development, social projects.

localisation and enterprise development.

Geo-political shifts. developmental challenges.


1PRODUCTIVITY AND EFFICIENCY

2VOLUME GROWTH

5HUMAN CAPITAL

6STRATEGIC ENABLERS

7SAFETY, HEALTH, ENVIRONMENT AND QUALITY (SHEQ)

8REGULATORY

4FINANCIAL SUSTAINABILITY

3CAPITAL INVESTMENT

Quantum Leap focus areas*

* Refer to pages 10 to 25 for key highlights and targets for each Quantum Leap focus area.

7

51

Managing sustainability at Transnet

KEY SUSTAINABILITY ACTIONS FOR 2012

Sustainability issues are cross-cutting and pervasive in the business. For this reason, the Company has not

established a separate sustainability division. The approach adopted has been one of co-ordination, seeking

constantly to highlight aspects of stakeholder value creation within the Quantum Leap strategy and NGP

commitments. The Company is currently assessing whether the Quantum Leap strategy, together with NGP

commitments, provide an adequate sustainability framework to work within or whether a separate framework

for sustainability would be preferable.

Either way, Transnet is committed to consolidating its plan of action around sustainability. Accordingly, the

Company will undertake further sustainability processes in the year ahead, both internally and with a range

of external stakeholders. Finalisation of the sustainability strategy is the responsibility of Transnet’s newly

established Board Social and Ethics Committee, which has executive oversight of the Company’s sustainability

performance.

Water quality testing, Durban.


99

Stakeholder engagement activities

At Transnet, relations with a broad range of stakeholders are a key aspect of understanding and managing

the social and environmental business risks. Transnet’s reputation is a vital intangible asset upon which

social trust is built, and the Company’s long-term ability to operate is ensured. While internal sustainability

dialogues are continuing, these have not yet been taken overtly to external stakeholders. Ongoing

engagements with customers, Government, suppliers and others relate to numerous sustainability-related

issues. Accordingly Transnet will continue to engage and respond to concerns and issues raised as illustrated

below. At present, the stakeholder engagement is managed as part of the Reputation Management strategy,

in which structured and systematic plans are outlined to manage Transnet’s reputation, guide stakeholder

engagement processes, and mitigate reputational risks should they arise. The 2011 Integrated Annual Report

and the Sustainability Development Report, are initial steps in exploring an overtly sustainability-based

dialogue with a broader range of stakeholders.

STAKEHOLDER GROUP ENGAGEMENT APPROACH

MAIN AREA OF STAKEHOLDER CONCERN TRANSNET’S RESPONSE

Shareholder and other SOCs

Shareholder’s Compact engagements.Quarterly report, Annual reports and Corporate Plans.SOCs CEO’s, Chairman and Chief Financial Officer forums.

nnual General Meetings.Board engagement with the Shareholder Minister, Deputy Minister and the Director General of DPE.

Shareholder’s Compact.

delivery.

commitments.

Compliance with sound principles of corporate governance.Implementing vigilant risk management and controls. Compliance with the following regulations: Public Finance Management Act, Treasury Regulations, Companies Act. Execution of the Quantum Leap strategy and fulfiling the Company’s mandate. NGP commitments.

Regulators and other Government agencies

Meetings with policy departments and Ministers.Periodic reports and returns to regulatory authorities. Periodic submissions to the relevant Parliamentary Portfolio Committees.

Compliance with all applicable laws, rules and standards.

Customers GCE roadshows.Customer satisfaction feedback and reports.Fact sheets, pamphlets and newsletters.

Improved customer service.

ahead of demand. SHEQ.

Suppliers Transnet Acquisition Council.BEE forums.Publications and site visits.Stakeholder engagement meetings.

Long-term growth opportunities created by:

Supplier development programmes.Governance and ethical conduct, reputation and contract management.Appointment of a procurement ombudsman.

Employees and labour unions

Strategic leadership forum.Internet/Intranet.Memoranda from the GCE.Culture Charter champions.

Assurance of: Sound governance, reputation, ethical transformation and management.Culture Charter scoring process and related initiatives.Transnet wellness programmes.Safety programmes.

The public, financiers and media

Press conferences.One-on-one interviews.Roadshows, media breakfasts.Corporate identity manual.

deliver on its commitments as set out in its Quantum Leap strategy.

investment plans.

investment plans on Transnet’s financial position and credit rating.

Launch of public advertising campaign.Private sector engagement.Investor updates and presentations.Market feedback.

Communities Partnerships, awareness campaigns.Corporate Social Investment Initiatives.

Demonstrating principles of accountability and care.Caring for pensioners through ex gratia (voluntary) payments and potential enhanced benefits.Aim to be an exemplar Company in terms of environmental compliance.


1PRODUCTIVITY AND EFFICIENCY

Highlights

Transnet has relentlessly focused on improving

service levels and customer responsiveness over the

past five years. Significant investments were made

in infrastructure and equipment to improve the

condition of assets in order to support the drive for

greater operating efficiencies, service levels and

customer responsiveness. Transnet has not met

certain targets, particularly in respect of rail

operations and safety which was exacerbated by the

three week industrial strike action in May 2010 as

well as derailments.

Transnet’s Quantum Leap strategy is designed

specifically to address these challenges and places

emphasis on achieving quantum leap improvements

in operating efficiency, productivity, reliability,

safety and environmental compliance, including

the restructuring of Freight Rail into business

segments. The successful implementation of the

strategy will result in increased volumes

transported, improved service delivery and better

utilisation of existing assets.

The capital investment programme will continue as

planned, thereby creating the required capacity

ahead of demand and to achieve the anticipated

volume growth.

Key productivity improvements during the year are

outlined alongside.

Refer to Operational reviews for challenges experienced during the year and plans to achieve all the targeted quantum leap improvements.

RAIL

Export coal tons per train increased from

7 400 to 7 900. Reliability remains a concern due to

an ageing fleet.

Record number of containers on rail handled on

Durban/Gauteng Corridor (Natcor) through City Deep.

Delivery of coal to Eskom and jet fuel to OR Tambo

International Airport – critical 2010 Fifa Soccer

World Cup flows.

>94% – Overall wagon availability.

0,38 faults/per million km-Wagon reliability.

PORTS

44% reduction in marine services delays.

Implementation of dual loading at the Port of

Saldanha – 6 959 tons/hour for export iron ore

loading rates.

Achieved a 23,8% improvement in moves per gross

crane hour (GCH) at DCT Pier 1 and has sustained an

average GCH of 29,5 since December 2010.

Despite DCT Pier 2 average GCH for the year being

only 23, the premium berths have improved

significantly due to productivity improvement

initiatives.

PIPELINES

Continued fulfilment of strategic role in the economy

by ensuring security of fuel supply to the inland

market.

Pipelines continued to perform at significantly

improved performance levels (regarding production

interruptions).

11

Looking ahead

6 133

2016

5 975

2015

5 809

2014

5 595

2013

5 400

2012

GTK/loco/month (’000)

ProjectionsTarget

8,58,59,010,0

11,0

Wagon turnaround (days)

20162015201420132012

ProjectionsTarget

General Freight

Four-year CAGR 3,2% Four-year

CAGR 6,2%

The 2012 target for shipping delays for tugs and pilots at all ports is less than 1,8 hours.

National Ports Authority

48

2016

46

2015

44

2014

42

2013

40

2012

TEUs per ship turnaround time (Ngqura) (average hours)

ProjectionsTarget

4443414040

TEUs per ship turnaround time (Durban) (average hours)

20162015201420132012

ProjectionsTarget


CAGR 2,4%

30

2016

30

2015

30

2014

28

2013

26

2012

Moves/GCH – DCT Pier 2(b)

ProjectionsTarget

30

2013

30

2012

30

2016

30

2015

30

2014

Moves/GCH – DCT Pier 1

ProjectionsTarget

Four-year CAGR 3,6%Performance level maintained

45 600

2012

63 394

2013

64 458

2014

64 458

2015

64 458

2016


ProjectionsTarget

68

2016

68

2015

68

2014

68

2013

76

2012

Wagon cycle time (hours)

ProjectionsTarget

Export iron ore

The 2012 target for on time departures is 89(a).The 2012 target for on time arrivals is 152(a).


CAGR 2,7%

1 050

2016

1 040

2015

1 030

2014

1 020

2013

1 010

2012

Meantime between failures (days)

ProjectionsTarget

210

2016

255

2015

290

2014

300

2013

250

2012

Production interruptions – internal (cumulative hours per annum)

ProjectionsTarget

Pipelines

due to the commissioning of the NMPP.


CAGR 4,3%

Port Terminals

The 2012 target for tons loaded per hour at Saldanha Iron Ore

Terminal is 6 896.

(a) Minutes deviation from scheduled time.(b) Premium berths only.

25 023

2016

26 875

2015

24 266

2014

25 942

2013

24 700

2012


ProjectionsTarget

Export coal

The 2012 target for on-time departures is 142(a).The 2012 target for on-time arrivals is 282(a).

5858585858

Wagon cycle time (hours)

20162015201420132012

ProjectionsTarget

Four-year CAGR 0,3% Performance level maintained

rget for on-time departures is 175(a).The 2012 target for on-time arrivals is 227(a).


Petroleum volumes grew by 1,5% compared to 2010 and was marginally above target.This was achieved despite the use of a constrained pipeline system.

increased by 2,2% compared to 2010, but were 3% below target.

strike action during May 2010 as well as operational issues such as cable theft and rolling stock related faults.

improvement in manganese volumes, a 12,0% improvement in domestic coal volumes and a 13,2% increase in containers on rail compared to 2010.

2011 @

VS2010

@ 2,2%2011 VS

2011 target 3,0%

General Freight (mt)

72,178,4 76,0 73,7

2009 2010 2011 2011

by 0,6% to 62,2mt, although 4,3% below target.

the impact of derailments, tippler constraints at Richards Bay Coal Terminal and adverse weather conditions during the third quarter of the year.

line was shut down for an extended period due to delayed maintenance, as a result of the industrial strike action, resulting in a loss of 3,1mt.2011 @

VS2010

@ 0,6%2011 VS

2011 target 4,3%

Export coal (mt)

62,2

2011

65,0

20112010

61,9 61,8

2009

2011 @

VS2010

@ 1,5%2011 VS

2011 target 0,5%

2009

17 216

2010

17 751

2011

17 928

2011

18 025

Petroleum (ml)

Highlights

increased by 3,4% to 46,2mt compared to the prior year.

derailments during the year, as well as capacity constraints at the mines negatively impacted volume growth, resulting in a 3,8% below target performance.

2011 @

VS2010

@ 3,4%2011 VS

2011 target 3,8%

Export iron ore (mt)

48,0

2011

46,2

20112010

36,8

44,7

2009

and the 2010 FIFA Soccer World Cup positively impacted container volumes, which increased by 12,5% compared to the prior year and by 5,8% when compared to target.

volumes were positively impacted by an increase in transshipments.

2011 @

VS2010

@ 12,5%2011 VS

2011 target 5,8%

3 8593 6293 800

Containers (’000 TEUs)

4 081

2011201120102009

2VOLUME GROWTH

13

With the NMPP being commissioned during the 2012 year, certain operational efficiencies are expected to be negatively impacted during the commissioning phase (as with any large project of this nature).

However security of supply is not a risk as Freight Rail will assist in ensuring security of supply with a planned allocation of 10ml/week for petroleum by rail.

General comments:Improving operational efficiency, productivity and service delivery, remains a key focus area, including the immediate restructuring of Freight Rail into business segments to achieve the required service delivery improvements.

thereby creating the required capacity ahead of demand and to achieve the anticipated volume growth. Refer to Operational reviews for plans to achieve the targeted volume growth.

increase by 14,5% to 84,4mt in 2012. Growth in Eskom coal from 7,1mt in 2011 to 14,5mt in 2016 have been planned for, but is dependent on the timing of the Eskom ramp-up.

2012

84,4

2013

91,1

2015

104,4

2016

110,7

2014

99,7

General Freight (mt)

ProjectionsTarget

Four-year CAGR 7,0%

increase by 12,5% to 70mt in 2012. Allocation of capacity to emerging miners.Capacity beyond 81mt will be created through alternative funding models (eg PSPs).

73,0

2013

Export coal (mt)

81,0

2016

81,0

2015

77,0

2014

70,0

2012ProjectionsTarget

Four-year CAGR 3,7%

20 006

2015

19 663

2014

19 147

2013

20 653

2016

Petroleum (ml)

18 002

2012

ProjectionsTarget

Four-year CAGR 3,5%

Looking ahead

increase by 11,7% to 51,6mt in 2012. Allocation of capacity to emerging miners.Capacity beyond 61mt will be created through alternative funding models (eg PSPs).

2012

51,6

2013

59,9

2015

60,7

2014

60,7

2016

60,7

Export iron ore (mt)

ProjectionsTarget

Four-year CAGR 4,1%

increase by 5,8% to 4,3 million TEUs in 2012. Current capacity expansion programmes are in progress at Durban, Ngqura and Cape Town container terminals which will create capacity of 6,1 million TEUs by 2016.

Containers (’000 TEUs)

2012

4 319

2013

4 527

2015

5 069

2014

4 790

2016

5 364

ProjectionsTarget

Four-year CAGR 5,6%


R21,5 billion2011 capital investment (excluding capitalised borrowing costs)

Spend on major projects for the year# R billion

(NMPP) 5,6

maintenance 2,4

maintenance 2,3

Rail and Ports 3,01,4

the coal line 0,9

the iron ore line 0,3

expansion 0,7

Total investment of

R86,8 billion over the past five

years, funded on the strength

of Transnet’s financial

position.

2011 Capital investment byOperating division# (R21,5 billion)

# Excludes capitalised borrowing costs.* Includes inter-company eliminations and other adjustments.

Freight Rail andRail Engineering R12 ,5 billion*

National Ports Authority R2,0 billion

Port Terminals R0,9 billion

Pipelines R6,1 billion

Historical capital investment# (R billion)

21,5

2011

18,4

2010

19,4

2009

15,8

2008

11,7

2007

Highlights

As a SOC, Transnet will continue to play its role to provide responsive

infrastructure that creates appropriate capacity ahead of demand in

the context of affordability, a fair return on invested capital and

supporting economic growth by partnering with the private sector.

The investment plans are aligned to the strategic objectives of the

Company and support the NGP. The capital spending in 2011 was

R21,5 billion. The rolling five-year investment plan of R110,6 billion

for the period 2012 to 2016 is considered to be appropriate to support

the planned volume growth. Other major projects have been

identified to increase capacity in excess of the existing capacity

plans, and the funding thereof will be done in conjunction with the

private sector.

3CAPITAL INVESTMENT

For further details refer to the Capital investment report.


Five-year Capital Investment Plan: 2012 – 2016#

Sishen

East L

Port Elizabeth Mossel Bay

Ngqura

Saldanha

Cape Town

2

1

3

3 3

WESTERN CAPE

NORTHERN CAPE

EASTERN CAPE

FREE STATE

NORTH WEST

GAUTENG

Capital investment in the strategic corridors

CorridorPrimary commodities transported

Five-year capital investment

R billion

Sishen to Saldanha

Capecor

Southcor

Natcor

R Baycor

Maputo Corridor

National*

* National – Unallocated corridor-wide investments.# Excludes capitalised borrowing costs.

2

6

8

5

3

4

7

1

Rail

Ports and Terminals Pipelines

Richards Bay

London

Durban

Maputo

Beitbridge

6

47

5

MPUMALANGA

LIMPOPO

KWAZULU-NATAL

Capital investment by Province

Province

Five-year capital investment

R billion

KwaZulu-Natal

Western Cape

Eastern Cape

Gauteng

Mpumalanga

Northern Cape

North West

Free State

Country wide-executed

centrally

17

13,8

12,1

7,8

14,6 14,9

9,7

12,8

5,9

13,1

5,9

20162015201420132012Target

Replacement (63%)

Expansion (37%)

Projections

Capital investment by Operating division* (R110,6 billion)

Freight Rail R63,7 billion

Rail Engineering R1,6 billion

National Ports Authority R23,2 billion

Port Terminals R5,0 billion

Pipelines R15,1 billion

Specialist Units R2,0 billion

Capital investment plan by commodity* (R110,6 billion)

General Freight R39,0 billion

Export coal R14,6 billion

Export iron ore R10,5 billion

Containers R14,7 billion

Piped products R14,3 billion

Other** R13,3 billion

Bulk R2,5 billion

Break-bulk R1,7 billion

R110,6 billionFive-year capital investment plan (excluding capitalised borrowing costs)

Key projects

PSPs – Potential future opportunities

Looking ahead

Five-year capital investment plan* (R billion)

* Excludes capitalised borrowing costs.** Other includes investments that support commodities

that may span across sectors including the above eg tugs and dredgers support all commodities transported


EBITDA (R billion)

14,4

2010

13,2

2009

12,8

2008

10,7

2007

15,8

2011Actual

15,1

2011Target

Revenue (R billion)

2007

26,9

2008

30,1

2009

33,6

2010

35,6

39,5

2011Target

2011

38,0

Actual

EBITDA margin (%)

2007

39,7

2008

42,6

2009

39,3

2010

40,538,3

2011Target

2011

41,5

Actual

2010

4,1

2007

5,5

2008

6,5

2009

3,7

2011

3,9

3,0Minimum

Cash interest cover* (times)

Actual

Highlights

2011 @

VS2010

@ 4,9%

41,1

2011

39,8

2010

37,7

2009

30,9

20082007

40,850,0

MaximumGearing* (%)

Actual

2011 @

VS2010

@ 1,3%

* Restated.

2011 @

VS2010

@ 6,6%2011 VS

2011 target 3,8%

2011 @

VS2010

@ 1,0%2011 VS

2011 target 3,2%

2011 @

VS2010

@ 9,4%2011 VS

2011 target 4,3%

2011 @

VS2010

@ 1,1%2011 VS

2011 target 1,4%

Return on average total assets (ROTA) (%)

2007

11,1

2008

11,6

2009

9,0

2010

7,7 8,0

2011Target

2011

6,6

Actual

4FINANCIAL SUSTAINABILITY

19

36,3

2016

32,1

2015

27,3

2014

23,6

2013

18,1

2012

EBITDA (R billion)

Projections

4,8

2016

3,9

2015

3,4

2014

3,3

2013

3,2

2012

3,0Minimum

Cash interest cover (times)

Projections

Revenue (R billion)

73,7

2016

67,0

2015

60,0

2014

53,3

2013

45,9

2012Projections

Looking ahead

increase in revenue is mainly due to growth in GFB volumes as well as growth in export commodities and maritime container volumes.

The 19,0% four-year CAGR is due to continued cost saving initiatives resulting in future operating expenses being kept lower than revenue increases as well as increased volumes.

the increased volumes will be achieved by executing the capital investment programme as well as operational efficiencies.

coal sectors will continue to generate significant value.

General Freight business are expected to yield positive results.


CAGR 19,0%

37,7

2016

42,8

2015

46,4

2014

46,8

2013

46,8

2012

MaximumGearing (%)

50,0

Projections

The gearing ratio is not expected to exceed the target ratio of 50% over the medium term.

49,3

2016

47,9

2015

45,6

2014

44,2

2013

39,6

2012

EBITDA margin (%)

Projections

Four-year CAGR 5,6%

EBITDA margin is expected to remain >40% over the medium-term.

The cash interest cover ratio remains above the target of 3,0 times and is not likely to fall below the target in the medium term.

11,3

2016

10,6

2015

9,4

2014

8,6

2013

6,5

2012

Return on average total assets(ROTA) (%)

Projections

Four-year CAGR 14,8%

Although depreciation, amortisation and derecognition is expected to increase, in line with the capital investment programme, the return on average total assets, four-year CAGR is positive due to improved asset utilisation.


Funding

The objective of the funding plan is to ensure that Transnet has adequate liquidity to meet all its operational

and capital investment funding requirements. The choice of the funding instrument to fund any capital

investment project will be subject to a thorough cost and risk assessment, including smoothing the maturity

profile to avoid undue market risk, refinancing risk and other risks.

Funding strategy

Highlights

Managing and protecting Transnet’s financial position.

Smoothing Transnet’s maturity profile to mitigate refinancing risk.

Exploring innovative and alternative forms of funding (including PSP, PPP, leasing and

project finance).

Using the Domestic Medium-Term Note (DMTN) programme for local funding.

Utilising the various diverse funding sources already established and exploring new

sources. These include Development finance institutions (DFI), export credit agency

(ECA), domestic bank loans and foreign loans.

Issuing bonds internationally under the Global Medium-Term Note (GMTN) Programme.

Inaugural drawdown of US$750 million (R5,1 billion) from the GMTN programme.

Continued tapping of the DMTN programme of R7,7 billion.

Commercial paper issue of R2,0 billion.

Bank loans and asset-backed funding of R1,9 billion.

DFIs and ECA funding of R1,7 billion.

Cost-effective funding resulting in a reduction in the weighted average cost of debt

of <10%.

4FINANCIAL SUSTAINABILITY(continued)

21

Looking ahead

Funding requirements

27,1

2016

22,5

2015

19,8

2014

17,0

2013

16,0

2012

Cash flow from operating activities including security of supply fuel levy (R billion)

Projections

6,5

2016

(3,7)

2015

(8,3)

2014

(7,2)

2013

(20,8)^

2012

Funding requirements (R billion)

Projections

(0,8)

2016

(6,8)

2015

(2,0)

2014

(1,0)

2013

(8,7)

2012

Loan redemptions (R billion)

Projections

(19,8)

2016

(19,4)

2015

(26,1)

2014

(23,2)

2013

(28,1)

2012

Cash flows from investing activities* (R billion)

Projections

*Includes capitalised borrowing costs.

To fund capital investments and loan redemptions.

Next three years R36,3 billion.

Five years R33,5 billion.

R million

Commercial paper 2 600

Domestic bonds 2 650

DFIs, ECAs, domestic and foreign loans 7 650

Total^ 12 900

PROBABLE SOURCES OF FUNDING 2012

^ The funding requirements for 2012 have decreased due to cash on hand at 31 March 2011 of R10,9 billion and increased by the pre-funding buffer of R3 billion, resulting in a net funding requirement of R12,9 billion.


Highlights

HUMAN CAPITAL

1 412 apprentices and 427 engineers in the Company.

Granting of 52 engineering bursaries for 2011.

356 engineering technicians in the internship

programme.

Representation of black (African, Coloured and

Indian) employees improved to 76% of the total

workforce.

Female and people with disabilities still remains a

significant challenge representing 20% and 0,8 %

of Transnet’s workforce, respectively.

Since 2001, Transnet more than doubled its female

employee base from 8,4% to the current 20%.

The availability of appropriate skills across the

Company remains a significant challenge.

STRATEGIC ENABLERS

The Company has embedded the internal CSDP

policies and procedures into the standard business

practices.

Transnet is recognised as the leader in CSDP

execution in South Africa.

Achieved significant CSDP contractual commitments

of up to 50% in localisation as well as significant

skills development and technology transfer.

Created and preserved over 900 jobs and aims to

increase this number significantly in the year ahead.

Some of the key CSDP benefits realised were on the

100 GE locomotives, the GE and EMD locomotive

parts agreements as well as the 32 Class 15E

locomotives.

Transnet has ramped up its BBBEE spend over the past

three years from R6,9 billion to R19,4 billion, which is

75% of total measured procurement spend compared

to a 50% target set by the Department of Trade and

Industry (DTI).

The spend for the year, which is in excess of the

targets set by the DTI, for exempted micro-

enterprises amounted to R1,9 billion, R2,8 billion for

qualifying small enterprises, R3,1 billion for black-

owned businesses and R1,4 billion for black women-

owned businesses.

Key ICT initiatives include the implementation of the

NAVIS system at Port Terminals; implementing the

Asset Stabilisation Programme across the Company,

enabling the optimisation and standardisation of

Human Capital and Payroll via the SAP HCM system.

HUMAN CAPITAL AND STRATEGIC ENABLERS

5 -6

23

Looking ahead

HUMAN CAPITAL

The growth and efficiency required over the next

five years is supported by an intensive and

accelerated skills development plan.

The key focus will be on the development of

managerial, supervisory and technical skills.

Plan to increase the number of trained artisans by

an additional 500 in 2012.

Sector-specific skills development is focused on

marine, rail and cargo with an annual internship

target of 1 500 learners.

To support the growth of the Company and the NGP

commitments, Transnet plans to increase direct jobs

by 2 562 and to create 333 331 indirect jobs in the

supplier industries in the year ahead.

Aim to improve the female employee base to 25% and

align representivity of people with disabilities to the

national averages for the economically active

population (EAP).

Continue with the implementation of appropriate

HR strategies.

Continue integrating EE strategies and interventions

with the Culture Charter.

STRATEGIC ENABLERS

Improve industrial capability building and economic

transformation in South Africa to achieve the NGP

targets.

Transnet’s Supplier Development strategy strives to

leverage off the planned infrastructure spend of

R110,6 billion over the next five years to develop new

manufacturing and service capabilities and capacity

through local content and skills development.

Transnet aims to localise its supply of imported

manufactured goods and/or services to a reasonable

level via CSDP in three key focus areas: rolling stock,

port equipment and infrastructure.

Reduce import leakage by 1% per annum.

BBBEE target to remain greater than 70%.

Implementation of a common ICT Enterprise

Architecture model that facilitates the integration

of operational processes and systems across

the Company.

Integrate planning, scheduling and forecasting

processes across the Operating divisions thereby

increasing visibility across the value chain (ports,

rail, pipeline, customers and suppliers).


Highlights

SHEQ

The total number of employee fatalities was 12 for

the year, compared to eight in the prior year.

Employee fatalities have decreased by more than

50% over the past five years.

Transnet’s DIFR deteriorated to 0,98 in the current

year compared to 0,88 in the prior year.

There has been an increase in reported noise-

induced hearing loss (NIHL) cases during the year,

which had an adverse impact on the DIFR, and is

receiving continued attention.

Continued to improve and implement measures to

prevent, minimise, rectify and manage

environmental impacts associated with Operations.

Positive response of the Department of

Environmental Affairs to the progress achieved at

the Port Elizabeth Manganese Terminal.

Following extensive analysis, the asbestos clean-up

programme began in 2010.

Developed short and medium-term plans to address

waste, air quality and water quality management.

Development of a Company-wide climate change

strategy was initiated during the year.

REGULATORY

Closer alignment with NERSA resulting in certainty

in terms of the applicable regulatory framework.

Difference with the Ports Regulator on tariff

determination for National Ports Authority due to the

lack of an approved tariff methodology.

Establishment of an interim Rail Regulator.

Statutory compliance including King III compliance

and PFMA compliance.

SHEQ AND REGULATORY7 -8

25

Looking ahead

REGULATORY

Continue to engage relevant stakeholders and the

Ports Regulator on an appropriate tariff methodology.

Continue to interact with NERSA to maintain the

professional association and to address any

regulatory challenges.

Continue role as an active participant in processes

affecting regulatory frameworks, and implement a

regulatory reporting system to establish policy

certainty and to facilitate future reforms and tariff

application processes.

SHEQ

Continued focus on safety and strive for zero

fatalities.

Target Group DIFR of <0,80 for 2012.

Minimal environmental incidents for 2012 through

audits and implementing environmental management

systems.

Implementation of safety plans and standards to

improve overall strategy.

Reduced cost of losses and reduction in number of

safety incidents.

Compliance and safety audits.

Noise surveys will continue to take place, equipment

will be reengineered where possible, and medical

check-ups and best hearing protective equipment will

be issued to those exposed.

The Board will continue its support and commitment

to the ERM framework and process by maintaining a

strong and visible oversight.

Re-certification of all ports in terms of ISO 14001.

Develop green energy suppliers through leveraging

Transnet’s procurement programme.

Reduce Transnet’s carbon footprint and electricity

consumption by 5% in 2012.

Finalise outstanding environmental assessments and

implement environmental rehabilitation plans.

Following the completion of the Transnet carbon

footprint assessment the following will be completed

in 2012:

innovation.


Number of employees 2011

49 078

Group external revenue (R billion)

30,1

2008

26,9

2007

35,6

2010

33,6

2009 2011

39,5

Target

38,0

2011Actual

Transnet is a public Company, wholly owned by the Government of the Republic of South

Africa. As the owner and operator of South Africa’s major transport infrastructure,

Transnet is responsible for ensuring that the country’s freight transportation system

operates according to benchmark standards and supports economic growth in the country.

Return on average total assets (ROTA) (%)

7,7

2010

9,0

2009

10,2

2008

11,1

2007

8,0

2011Target

2011

6,6

Actual

Group EBITDA (R billion)

13,2

2009

12,8

2008

10,7

2007

14,4

2010 2011

15,1

Target

15,8

2011Actual

Depreciation and amortisation (R billion)

4,8

2009

3,8

2008

3,0

2007

6,1

2010 2011

7,4

Target

7,2

2011Actual

Group capital investment* (R billion)

18,4

2010

19,4

2009

15,8

2008

11,7

2007

22,8

2011Target

2011

21,5

Actual

Group Disabling injury frequency rate (DIFR) (weighted)

0,88

2010

1,09

2009

1,25

2008

1,30

2007

0,85

2011Target

2011

0,98

Actual

2011 @

VS2010

@ 6,6%2011 VS

2011 target 3,8%

2011 @

VS2010

@ 18,0%2011 VS

2011 target 3,4%

2011 @

VS2010

@ 6,6%2011 VS

2011 target 1,4%

2011 @

VS2010

@ 9,4%2011 VS

2011 target 4,3%

2011 @

VS2010

@ 16,6%2011 VS

2011 target 5,8%

GROUP STRUCTURE AND PERFORMANCE HIGHLIGHTS

* Excludes capitalised borrowing costs.

27

Transnet Freight Rail (Freight Rail) is focused on

transporting bulk and containerised freight along its

approximately 20 500 kilometre rail network, of which

1 500 kilometres comprises heavy haul export lines.

During 2011, Freight Rail transported 182,1 mt of freight

for export and domestic customers. Its main business lines

are the export coal line, the export iron ore line and the

General Freight business. Refer to Operational reviews for

further details.

Transnet Rail Engineering (Rail Engineering) consists

of eight product focused business units which provide

services ranging from refurbishment, conversion and

upgrades, to the manufacturing of rail-related rolling

stock. Whilst this Operating division is largely focused

on supporting Freight Rail, it is also focusing on growing

its external customer base. Refer to Operational reviews

for further details.

Transnet National Ports Authority (National Ports

Authority) is responsible for the safe, efficient and

effective functioning of the national ports system,

which it manages in a landlord capacity.

The National Ports Authority is also a provider of port

infrastructure and marine services at all commercial

ports in South Africa. Refer to Operational reviews for

further details.

Transnet Port Terminals (Port Terminals) owns and

operates 16 cargo terminal operations situated across

seven South African ports. It provides cargo handling

services for the container, bulk, automotive and break-

bulk sectors. Refer to Operational reviews for further

details.

Transnet Pipelines (Pipelines) transports a range

of petroleum products and gas through 3 000 kilometres

of underground pipelines traversing five provinces,

thereby ensuring the security of supply of petroleum

products to the inland market, especially Gauteng.

Pipelines is gearing itself for the full commissioning

of the New Multi-Product Pipeline (24-inch trunk line)

by December 2013. Refer to Operational reviews for

further details.

Overview 2011 Operating division highlights^*

RAIL ENGINEERING

NATIONAL PORTS AUTHORITY

PORT TERMINALS

PIPELINES

FREIGHT RAIL

58,8% external

revenue

51,7% EBITDA

58,3% capital

investment

1,7% external

revenue

7,3% EBITDA

2,5% capital

investment

19,3% external

revenue

37,2% EBITDA

9,4% capital

investment

16,7% external

revenue

13,9% EBITDA

4,0% capital

investment

3,0% external

revenue

4,4% EBITDA

28,2% capital

investment

In order to achieve Transnet’s mission and vision, the Company is structured as follows#:

^ Operating division highlights as a % of Transnet.* Excludes intercompany.# Supported by Specialist Units.


PRODUCTIVITY AND EFFICIENCY

lengths to harness haulage capability. By year-end, Freight Rail was operating several larger trains on a weekly basis, including anaconda container trains, manganese trains and heavier coal trains.

increased from 7 400 to 7 900.

locomotives and the implementation of the Concept 39 train plan continue to contribute to improvements in locomotive efficiencies and wagon turnaround time on the export iron ore line.

VOLUME GROWTH

its highest ever annual volumes of 627 825 TEUs during the year.

increased by 13,2% compared to 2010.

iron ore of: 1,024mt for the week ending 5 September 2010; 1,060mt for the week ending 26 September 2010; 1,070mt for the week ending 24 October 2010 and 1,094mt for the week ending

volumes compared to 2010.

CAPITAL INVESTMENT

R12,5 billion.

Model C30ACi locomotives from General Electric.

locomotives of the 100 new Class 43 diesel locomotives at its plants in the USA. The remaining 90 locomotives will be assembled by Rail Engineering at its manufacturing facility in Koedoespoort.

FINANCIAL SUSTAINABILITY

to R22,3 billion, while operating expenses were up 7,7% to R14,5 billion, driven mainly by 16,0% increase in maintenance and materials costs and a 25% increase in electricity tariffs.

of 1,6mt as well as a change in the commodity mix to higher revenue per unit commodities resulted in a 12,3% increase in General Freight revenue.

HUMAN CAPITAL

in Training’ programme contracted for an 18 – 24 month period, 36 were successfully placed in permanent positions.

programme was successfully launched and implemented.

personnel costs was 2,2% in 2011.

STRATEGIC ENABLERS AND SHEQ

12% due to various initiatives being implemented.

have reduced by 25% due to the

upgrades.

damage to key railway assets and injuries.

29,8% compared to the prior year.

REGULATORY

a transport economics analysis of South Africa’s freight rail challenges and will propose an optimal configuration of the freight rail system to facilitate rail reforms.

0,94

2010

1,3

2009

1,3

2008

0,94

2011Target

Disabling injury frequency rate (DIFR)

1,22

2011Actual

7,4

2010

5,7

2009

5,1

2008

8,1

2011Target

EBITDA (R billion)

8 ,1

2011Actual

23,6

Target20112010

20,620,8

2009

16,0

2008

External revenue (R billion)

22,3

2011Actual

9,7

2010

8,6

2009

9,2

2008

11,6

2011Target

Capital investment* (R billion)

12,5

2011Actual

Highlights


23 665

2011 @

VS2010

@ 8,3%

2011 @

VS2010

@ 10,1%

2011 @

VS2010

@ 29,0%

FREIGHT RAIL


29

0,73

2016

0,74

2015

0,77

2014

0,82

2013

0,88



20,4

2016

18,0

2015

15,6

2014

13,0

2013

10,8


EBITDA (R billion)

44,9

2016

40,6

2015

36,4

2014

31 ,8

2013

27,5



10,6

2016

11,6

2015

13,3

2014

13,5

2013

14,7



Looking ahead


capital and maintenance programme implementation, operational processes and improved operational discipline in execution will all contribute to better asset utilisation and operational efficiencies.

implementation of customer-based resources, infrastructure and execution models to improve service reliability and efficiencies in asset utilisation.

on the export coal line is not yielding the expected benefits. A 10% improvement is required to achieve the expected 58-hour turnaround time.

departures and arrivals.

increased infrastructure reliability.

VOLUME GROWTH

approximately 206mt of export and domestic commodities in 2012, with anticipated volumes of 252mt by 2016.

increase, with a focus on exports through Maputo and other cross-border rail traffic.

CAPITAL INVESTMENT

Investment Programme to address operational constraints, improve allocation to specific growth market segments, and to create capacity for emerging miners.

for 2012 amounts to R14,7 billion and R63,7 billion over the next five years (excluding capitalised borrowing costs).


is R27,5 billion.

due to the expected volume growth and tariff increases in line with contractual agreements.

HUMAN CAPITAL

grow to approximately 25 900 in 2012 and 28 920 by 2016. This growth in employees is for train drivers, operational, technical and engineering positions, in line with NGP commitments.

spent per annum on training, development of employees and building leadership competence.


country-wide asbestos and hydrocarbon pollution elimination programmes will reduce pollution and liability exposures.

REGULATORY

(DoT) on numerous initiatives to establish policy certainty and to facilitate rail reform.



Four-year CAGR 7,8%


25 900



0,7

2010

0,8

2009

1,2

2008

1,1

2011Target

EBITDA (R billion)

1,2

2011Actual

1,3

2010

1,4

2009

1,1

2008

1,3

2011Target


0,7

2011Actual

Highlights


successfully upgraded by Rail Engineering.

award for the transformation of logistics, yielding an inventory reduction of R800 million in 18 months.

availability by 0,5%.

whilst locomotive reliability deteriorated by 15,4% as a result of an ageing fleet.

VOLUME GROWTH

delivering all in record time.

the 100 new Class 43 General Electric diesel locomotives for Freight Rail, resulting in the largest CSDP agreement being signed in South Africa to date.

coach customers slowed volume growth.

CAPITAL INVESTMENT

R532 million.

in the planned completion of key projects due to unforeseen circumstances such as theft and adverse weather conditions.

successfully launched during the year, with an investment of R27 million in equipment to facilitate prompt reaction for the clearing of derailments.


R9,3 billion.

mainly due to programmes in support of Freight Rail’s fleet expansion plans and volume growth.

R661 million mainly due to a lower number of PRASA coach upgrades performed.

HUMAN CAPITAL

personnel costs was 3,5% in 2011.

labour interventions during the year as part of the ‘Relationship By Objectives’ (RBO) joint initiative between management and labour.

being implemented throughout all the regions within Rail Engineering.

STRATEGIC ENABLERS, SHEQ AND REGULATORY

year, enabling the industry as a whole to improve skills levels and to develop new enterprises to manufacture components.

shortages of critical components challenged the sustained availability of rolling stock.

rolled out to eliminate waste and variation in all aspects of operations.

year without injuries.

14,8% compared to the prior year.


2008

1,31

2009

1,15

2010

0,81

Target2011

0,76

2011

0,93

Actual

0,4

2010

0,6

2009

0,8

2008

0,6

2011Target


0,5

2011Actual


13 001

2011 @

VS2010

@ 48,4%

2011 @

VS2010

@ 71,8%

2011 @

VS2010

@ 41,5%

RAIL ENGINEERING


31

0,67

2016

0,68

2015

0,71

2014

0,75

2013

0,80

2012Target


Projections

1,2

2016

1,3

2015

1,2

2014

1,1

2013

1,3


EBITDA (R billion)

1,5

2016

1,5

2015

1,5

2014

1,5

2013

1,0



0,4

2012

0,2

2016

0,3

2015

0,3

2014

0,4



Looking ahead


improve fleet availability and reliability.

continue to reduce turnaround times and improve quality.

reliability to benchmark levels to support Freight Rail’s planned volume growth.

VOLUME GROWTH

growth.

CAPITAL INVESTMENT

R445 million and total capital expenditure over the five-year period amounts to R1,6 billion.

investment in machinery, equipment and furniture at R279 million and investment in buildings and structures at R166 million.


strengthen partnerships with OEMs with the aim of enhancing existing skills and knowledge and creating new market opportunities.

continent with the view to increase external revenue.

to increase by 12,3% from R9,3 billion in 2011 to R10,5 billion in 2012.

volume growth.

HUMAN CAPITAL

skills.

Six Sigma competencies.

creation to meet the NGP commitments.

STRATEGIC ENABLERS, SHEQ AND REGULATORY

supported by providing locomotive upgrade and maintenance services for the branch lines.

fatalities as well as no major environmental incidents.

lease activities.


Four-year CAGR 2,0%



13 190



2011

1,24

2010

1,22

2009

2,17

2008

1,0

2011Target


0,80

Actual

5,6

2010

5,3

2009

5,2

2008

5,6

2011Target

EBITDA (R billion)

5,9

2011Actual

6,8

2010

6,6

2009

6 ,4

2008

7,2

2011Target


7,3

2011Actual

3,2

2010

4,2

2009

2,7

2008

3,4

2011Target


2,0

2011Actual

Highlights


and berthing services) were significantly reduced.

towage was implemented in Cape Town, Richards Bay and Durban.

initiatives were implemented, including a dual loading process at the Port of Cape Town.

VOLUME GROWTH

to 2010.

CAPITAL INVESTMENT 3 Trailing Suction Hopper

Dredger was brought into operations, enhancing depth management capabilities within the ports.

entrance channel at the Port of Durban was completed during the year.

Terminal ahead of demand has allowed the Port to attract new business.


R3,6 billion compared to 2010 mainly due to improved container volume growth.

42,6% annually to R472 million due to increased automotive imports and export volumes.

compared to the prior year due to increased global demand for iron ore.

HUMAN CAPITAL

appointed, addressing the skills shortage.

in 2010 to 5,4% in 2011.


improvement from 1,24 in the prior year.

incidents at the ports during the year.

REGULATORY

from the Ports Regulator, and was awarded a 4,49% increase.

determination can be explained by the lack of an agreed tariff methodology.


3 535

2011 @

VS2010

@ 7,4%

2011 @

VS2010

@ 5,3%

2011 @

VS2010

@ 37,1%

NATIONAL PORTS AUTHORITY


33

0,74

2016

0,75

2015

0,76

2014

0,77

2013

0,80



10,1

2016

9,2

2015

8,3

2014

7,8

2013

7,0


EBITDA (R billion)

12,3

2016

11,3

2015

10,2

2014

9 ,3

2013

8 ,4



5,3

2016

5,2

2015

7,0

2014

3,3

2013

2,4



Looking ahead


include achieving 2 000 coal tons per ship turnaround time (STAT hour) at Richards Bay; and 3 078 iron ore tons per STAT hour at Saldanha.

following TEUs per STAT hour: Durban (40), Port Elizabeth (36), Ngqura (40) and Cape Town (27).

ports and the current towage (tug) capacity continues to challenge the ability to meet demand.

on improving the overall operational efficiency of marine resources ie towage, pilotage, berthing and vessel traffic services.

VOLUME GROWTH

investment programme supports and drives volume growth.

expected to increase by 5,8%; dry bulk sector is expected to achieve growth of 4,7% and break-bulk is expected to increase by 18,4%.

CAPITAL INVESTMENT

R2,4 billion (excluding borrowing costs) and cumulatively R23,2 billion over the next five years.

management programme to ensure the timeous replacement of marine craft.


opportunities for volume growth.

an increase of 14,2% compared to 2011.

the tariff determination methodology results in significant cash flow risk for National Ports Authority.

HUMAN CAPITAL

Ports’, will continue to review its capacity and programmes to ensure quality delivery of skills.

infrastructure skills in the job market, as well as the legislative prescribed time requirements to qualify as trained marine related resources, continues to be a challenge.


domestic market to attract volumes from BEE/SMME customers and new market entrants in key sectors through incentives and trade facilitation for terminal accessibility.

reduce safety incidents to less than 27.

by March 2012 and working towards all ports achieving compliance in terms of acceptable environmental standards.

REGULATORY

embark on the deemed licence conversion process and active engagement with the Ports Regulator and Port Consultative Committees.

and the Ports Regulator on an appropriate tariff methodology.


Four-year CAGR 9,8%



3 748



0,71

2010

0,85

2009

0,93

2008

0,69

2011Target


0,51

2011Actual

1,6

2010

1,7

2009

1,8

2008

1,8

2011Target

EBITDA (R billion)

2,2

2011Actual

5,2

2010

5,0

2009

4,8

2008

5,7

2011Target


6,4

2011Actual

2011

2,4

2010

3,1

2009

2,0

2008

1,3

2011Target


0,9

Actual

Highlights


per gross crane hour (GCH) performance at the Durban Container Terminal (DCT) – Pier 1. The terminal has sustained a rolling average GCH of 29,5 since December 2010.

achieved an annual average GCH of 25 for 2011 against a target of 24, despite the terminal being under construction and operating a dual operation of both straddles and rubber tyred gantry cranes (RTGs) for most of the year.

year being only 23, the premium berths have improved significantly during the latter half of 2011 due to productivity improvement initiatives.

VOLUME GROWTH

from the prior year to 4 016 564 TEUs.

Richards Bay were lower than expected due to a lack of rail capacity and tippler constraints.

CAPITAL INVESTMENT

R866 million.

year included R131 million for the Durban Container Terminal reengineering project, R253 million for the Cape Town Container Terminal, and R79 million for the Port and Rail Phase 1 C expansion in Saldanha.


23,2% to R6,4 billion.

of 35,0% compared to the prior year of R1,6 billion.

HUMAN CAPITAL

11,3% due to efficiency improvements and the filling of only critical positions.

skills training (mainly mentorship programmes) in 2011, which translates to 3,7% of personnel costs.

personnel costs have increased from 15,1% to 15,9%.


developed and implemented with planned maintenance reflecting 95% compliance.

meantime to repair (MTTR) have demonstrated corresponding improvements.

0,71 in 2010.

compared to 2010 and was higher than target.

employee fatality at the Durban RoRo and Agri Terminal.

REGULATORY

plan and minimum control framework for the National Ports Act.


5 867

2011 @

VS2010

@ 23,2%

2011 @

VS2010

@ 35,0%

2011 @

VS2010

@ 63,4%

PORT TERMINALS


35

0,51

2016

0,52

2015

0,54

2014

0,57

2013

0,62



4,6

2016

4,0

2015

3,3

2014

2,7

2013

2,2


EBITDA (R billion)

10,5

2016

9,5

2015

8,6

2014

7,6

2013

6,7



0,9

2016

0,7

2015

0,7

2014

1,0

2013

1,7



Looking ahead


Maintenance Engineers will help to address challenges on equipment reliability.

forward due to interventions and will unlock both capacity and volumes, which will drive increased revenues.

currently contribute to a loss of between four and seven GCH per month and are now being managed on a daily basis to ensure that this loss is minimised.

VOLUME GROWTH

Ngqura Container Terminal (NCT) will increase capacity to 800 000 TEUs based on design assumptions.

continue to be affected by a lack of rail capacity and the poor reliability of current operational equipment at the port.

CAPITAL INVESTMENT

will be invested to sustain existing operations and the remaining R1 billion (19%) will be invested to increase capacity to achieve growth initiatives over the next five years.

Saldanha Iron Ore Terminal to increase the capacity of the plant to 60,7mt.


opportunities, strategic partnerships and pursuing corridor optimisation strategies.

capacity on the Richards Bay corridor.

by negotiating contractual agreements with potential new shipping lines.

HUMAN CAPITAL

and ‘operator’ mentorship programmes in 2012.

Operations in line with operational needs.


Wharf MPT.

management partner to assist in the management and operation of the Cape Town Cold Storage Facility.

Improvement Plan’ and utilise the ‘Golden Safety League’ to improve overall safety controls.

continual improvement to minimise systemic non-conformances.

remain a challenge, especially in Richards Bay and Port Elizabeth, with specific reference to dust emissions, soil and groundwater contamination.

REGULATORY

current legislation of the National Commercial Ports Policy and the National Ports Act is that it does not adequately address the role of a SOC in a developmental state.

relevant stakeholders on the National Commercial Ports Policy to achieve alignment with Port Terminals’ strategy.





6 292



Highlights


economy by ensuring security of fuel supply to the inland market.

volumes through optimally managing the capacity usage of the pipeline system.

interruptions.

extended to ensure that the inland market is supplied.

VOLUME GROWTH

and collaboration with Freight Rail ensured that all 2010 FIFA Soccer World Cup targets were met and that the OR Tambo International Airport always had jet fuel available.

transported in a capacity constrained pipeline network.

CAPITAL INVESTMENT

telemechanical upgrade projects.

of the NMPP into the network was successful. Park-Alrode and Alrode-Langlaagte sections of the pipeline were commissioned by 31 May 2011.


award for the best internal financial control environment in Transnet for the year.

increased by 5,5% from R1,3 billion to R1,4 billion.

mitigate the lower than expected tariff increase in 2011.

HUMAN CAPITAL

1,2% against a target of 1,5%.

4,0% compared to a target of 6,0%.

a challenge.

STRATEGIC ENABLERS

enhanced to ensure that Pipelines continues to meet its obligation in terms of security of supply.

SHEQ

the year, three of which resulted from unauthorised activities by third parties in the servitudes causing damage to the pipelines.

to the prior year.

REGULATORY

R4,5 billion over three years, commencing in 2011, for the ‘security of supply’ requirement of the NMPP.

tariff setting, which comprises an integrated (bundled) system application.

0,54

2010

1,44

2009

0,88

2008

0,95

2011Target


0,33

2011Actual

0,7

2010

1 ,0

2009

1,0

2008

0,9

2011Target

EBITDA (R billion)

0,7

2011Actual

1,2

2010

1,5

2009

1,3

2008

1,5

2011Target


1,1

2011Actual

3,1

2010

2,8

2009

0,9

2008

5,4

2011Target


6 ,1

2011Actual


567

2011 @

VS2010

@ 3,6%

2011 @

VS2010

@ 0,9%

2011 @

VS2010

@ 98,1%

PIPELINES


37

Looking ahead


the reduction of “lost time”, thereby ensuring that the pipeline is operated with minimum lost time and improved volume throughput.

VOLUME GROWTH l/w

share from road in the 4th quarter of 2012.

NMPP into operation as and when planned.

CAPITAL INVESTMENT

line of the NMPP and ensure successful commissioning.

– The estimated cost of the NMPP has increased from R15,5 billion to R23,4 billion due to increases in the cost of the terminals, pumpstations and project management. The increase is related to additional scope, schedule changes and higher than initially budgeted for costs.

– The NMPP construction is progressing according to the revised plan with operationalisation of the

Completion of the entire project is still expected to be by December 2013.

maintenance plan to mitigate risks and address findings of the “special intelligent pigging” survey.

requirements.


application and the final regulatory decision for future tariffs.

cost-reduction initiatives.

HUMAN CAPITAL

personnel costs is expected at 7,0% in 2012.

and improved retention of key skills by March 2012.

STRATEGIC ENABLERS

requirements of the NMPP.

and guide operational skills requirements.

SHEQ

management system (EMS) for all sites.

associated with the handling of hazardous products and will ensure that operational practices are enhanced to reduce environmental impacts.

reduction in the number of safety incidents to less than 23 in 2012.

REGULATORY

maintain the professional association and to address any regulatory challenges.

processes affecting regulatory frameworks, and implement a regulatory reporting system to facilitate future tariff application processes.

0,78

2016

0,83

2015

0,95

2014

0,95

2013

0,80



3,2

2016

2,9

2015

2,1

2014

1,9

2013

1,1


EBITDA (R billion)

4,1

2016

3,8

2015

3,0

2014

2,7

2013

1,8


External revenue# (R billion)

1,6

2016

0,7

2015

2,9

2014

3,8

2013

6,1







650

# Includes clawback and levy.


Board of Directors

3

4

1Mr ME Mkwanazi Chairman

(Non-executive)

Date of appointment 2010

QualificationsBSc (Mathematics and Applied Mathematics) and BSc (Electrical Engineering).

Area of expertiseCorporate governance, engineering and strategy.

Other directorships and trusteeshipsBefore the Wind Investments 53; Marble Gold 237 (Pty) Ltd;

Mkwanazi Investment Holdings (Pty) Ltd; Saatchi and Saatchi (Pty) Ltd; Ukhamba Bricks and Quarry (Pty) Ltd; Born Free Investments 402; Hulamin Ltd; Stefanutti & Stocks Holdings; and Shamsko Projects.

2Mr B Molefe Group Chief Executive


QualificationsMaster of Business Leadership; Postgraduate Diploma in Economics; and BCom (Accounting and Economics).

Area of expertiseFinance, management and leadership.

Other directorships and trusteeships

Karibu Holdings (Pty) Ltd; Karibu Capital (Pty) Ltd; Karibu Real Estate Investments (Pty) Ltd; and Lion of Africa Fund Managers.

3Mr A SinghActing Chief Financial

Officer


QualificationsBAcc and CA(SA).

Area of expertiseFinancial and business.

Other directorships and trusteeshipsComazar (Pty) Ltd; Crosskeys Security Services (Pty) Ltd; Owner-Driver Management (Pty) Ltd; Protekon (Pty) Ltd; Freight Logistics International; Transhold Properties (Pty) Ltd; and Transnet Retirement Fund.

4Mr MA FanucchiNon-executive


QualificationsMSc Engineering Management; GDE; and BSc Engineering (Mech) Industrial.

Area of expertiseLogistics, supply chain management and business management.

5Mr HD GazendamNon-executive


QualificationsBA; BProc; Dip Labour Relations; AEDP; EDP; and UCLA.

Area of expertiseLabour relations, HR management, remuneration and corporate governance.

Other directorships and trusteeshipsToyota SA (retired from Board in 2009 after 15 years); and currently serving as Trustee on several pension/provident funds, trusts and foundations. Transnet Second Defined Benefit Fund.

6Ms NBP GcabaNon-executive


Qualifications

Area of expertiseLegal and corporate governance.

Other directorships and trusteeshipsTransnet Retirement Fund Property Trust; Transnet Second Defined Benefit Fund; and Partnership – Spoor & Fisher Attorneys.


1 2

5

6 78

9

7Mr MP MalunganiNon-executive


QualificationsBCom; Advanced Management Programme and Leadership Development Programme.

Area of expertiseEntrepreneurship, business strategy, corporate governance and investment banking.

Other directorships and trusteeshipsPeu Group (Pty) Ltd;Phumelela Gaming and Leisure Ltd;Asili Investments (Pty) Ltd;Coral Lagoon Investments 225 (Pty) Ltd;Ematini Game Lodges (Pty) Ltd;Dipcivils (Pty) Ltd;Dipcivils Properties (Pty) Ltd;Dip Plant (Pty) Ltd;Dip Developments (Pty) Ltd;Great North Building Supplies;Intsika Enablement Trust;Intsika Investment Trust;Investec Ltd;Investec Bank Ltd;Investec Asset Management Holdings (Pty) Ltd;Investec Plc;Investec Security Purchase Share Scheme 2003;

Investments (Pty) Ltd;

Investments Trust;Klaprops 80 (Pty) Ltd;Klaprops 81 (Pty) Ltd;Klaprops 82 (Pty) Ltd;

Klaprops 83 (Pty) Ltd;Klatrade 452 (Pty) Ltd;Klatrade 200022 (Pty) Ltd;Lazarus Car Hire (Pty) Ltd;Lazarus Motor Company (Pty) Ltd;Malazvis Property Holdings (Pty) Ltd;Malungani Building Supplies CC;Malungani Family TrustMalungani Sanitary & Hardware Supplies CCMangeke Estate (Pty) Ltd;Masana Networking (Pty) Ltd;Masana Technologies (Pty) Ltd;Masana Telecommunications (Pty) Ltd;Matini Game Lodge (Pty) Ltd;Mpindo (Pty) Ltd;Ndzhakeni Investments (Pty) Ltd;New Adventure Shelf 165 (Pty) Ltd;Nkanyi Game Lodge (Pty) Ltd;Nkanyi Private Game Reserve (Pty) Ltd;Northern Diamond News Group (Pty) Ltd;Nungu Game Lodge (Pty) Ltd;

Nungu Private Game Reserve (Pty) Ltd;Phumelela Gaming and Leisure Ltd;Plot 93 Roodekrans (Pty) Ltd;Portfolio Business Television Productions (Pty) Ltd;PPC SBP Consortium

Pretoria Portland Cement Company Ltd;Pytprops 180 (Pty) Ltd;Stabilid Holdings (Pty) Ltd;Southern Lights Investments 2709 (Pty) Ltd;Suddaby Investments (Pty) Ltd;Tiyani Property Consortium (Pty) Ltd;Umlimi Holdings (Pty) Ltd;

(Pty) Ltd;

Energy (Pty) Ltd;

Ltd; andW P Malungani and Sons Management Services (Pty) Ltd.

8Mr BD MkhwanaziNon-executive


QualificationsBachelor of Administration; Post-graduate Diploma in Marketing; Programme for Management Development; Graduate Diploma in Company Direction; Certificate in Managing Finance and Strategic Management and MBA.

Area of expertiseBusiness, finance, strategy, human resource development and corporate governance.

Other directorships and trusteeshipsSouthern African Shipyards (Pty) Ltd;Hlahlindlela Investments (Pty) Ltd;Directorship/TrusteeshipUnigas (Pty) Ltd; andOceanmasters (Pty) Ltd.

9Ms T MnyakaNon-executive


QualificationsBachelor of Social Science; Masters in Town and Regional Planning; Diploma in Project Management; Certificate in Project Management; and Project Leadership Certificate.

Area of expertiseEconomic planning and development, international trade and business consulting.

Other directorships and trusteeshipsBlack Management Forum National; Deputy President; Business Unity South Africa (BUSA) – Manco member (Board); Durban Chamber of Commerce

President and Board member; South African Chamber of Commerce and Industries – Council member; BMF – Investment – Board

Advisory Commission – member.

39

1011

1213

10Mr MP Moyo Non-executive


QualificationsBAcc (Hons); CA(SA); CA

Diploma in Tax Law; and Advanced Management Programme.

Area of expertiseFinancial/business.


Limited (Chairman); Transnet Second Defined Benefit Fund (Chairman); Amabubesi Financial Services Group (Pty) Ltd;

Amabubesi Financial Services Holdings (Pty) Ltd; Amabubesi Capital (Pty) Ltd; Amabubesi Capital Technologies (Pty) Ltd; Amabubesi Consulting Services (Pty) Ltd; Amabubesi Health Care (Pty) Ltd; Amabubesi Health Services (Pty) Ltd; Amabubesi Investments (Pty) Ltd; Amabubesi Property Holdings (Pty) Ltd; Bulawayo Electrical Supplies (Pty) Ltd; Clorpique 149 (Pty) Ltd; Corridor Infrastructure Development Holdings; Dartingo Trading 161 (Pty) Ltd; Lexshell 713 Investments (Pty) Ltd;

Liberty Group Limited, Liberty Holdings Limited; Mtha-We-Mpumelelo Investments; Pinnacle Technology Holdings; Plexus Fundamental

STS Trust; Utafutaji Trading 36 (Pty) Ltd; and Worldwide Capital Limited.

11Ms NR Ntshingila Non-executive


QualificationsBA; MBA; andDiploma in Advertising.

Area of expertiseMarketing.

Other directorships and trusteeshipsGolden Dividend 456 (Pty) Ltd; Kantar South Africa (Pty) Ltd; Ntinta Investment; Ogilvy South Africa (Chief Executive Officer); Old Mutual Life Assurance Company South Africa) Ltd; Old Mutual Life Holdings (South Africa) Ltd; and PWC CSI Board.

12Ms N Moola Non-executive


QualificationsBachelor of Business Science; CFA Charterholder.

Area of expertiseEconomics and strategy.

Other directorships and trusteeshipsMercedes-Benz South Africa.

40 Transnet SOC Ltd Integrated Annual Report 2011

Board of Directors (continued)

14

1516

17

13Mr IM Sharma Non-executive


QualificationsBSc (Hons).

Area of expertiseStrategy, business, international trade, management and global economy.

Other directorships and trusteeshipsGMT Concepts; Blackstone Resources and Nulance Investments.

14Mr IB Skosana Non-executive


QualificationsBCom, BCompt (Hons); CA(SA); Certificate in the Theory of Accountancy (CTA); and Advanced Management Programme.

Area of expertiseLeadership, strategy and finance.

Other directorships and trusteeshipsAbscido Investments (Pty) Ltd;Bond Choice (Pty) Ltd;Cloudberry Investments 8 (Pty) Ltd;CQS Performance Solutions (Pty) Ltd;CQS Technology Holdings (Pty) Ltd;FDB Eiendoms-beleggings cc; Kapela Bond Investments (Pty) Limited;Pradella Investments (Pty) Ltd;Tascali Investments 5 (Pty) Ltd;TNS Research South Africa (Pty) Ltd; andTNS Research Surveys (Pty) Ltd.

15Ms E TshabalalaNon-executive


QualificationsBCom; International Licentiate Diploma of Banking; and Postgraduate Diploma in Labour Relations.

Area of expertiseBusiness and strategy

Other directorships and trusteeshipsPresidential Advisory Council on BEE (Council Member); Port Shepstone Harbour Development Company (Chairperson of the Board); African Academy for CADD training (Trustee); and Moral Regeneration Movement (Trustee).

16Ms DLJ Tshepe Non-executive


QualificationsBProc; LLB; and LLM.

Area of expertiseLegal and corporate governance.

Other directorships and trusteeshipsCheadle Thompson & Haysom Inc; Cheadle Thompson & Haysom Legal Administration Trust; Boardroom Alliance (Pty) Ltd; Boardroom Alliance Black Equity Trust; and National Children’s Rights Committee.

17Ms ANC CebaGroup Company

Secretary


QualificationsBProc; and LLB

Other directorships and trusteeshipsPremier Soccer League (PSL) – Alternate Chairman of the Disciplinary Committee and member of the PSL Audit and Risk Committee.

41

12 3

4 5 67

1 Mr M Gregg-Macdonald

Group Executive:

Planning and Monitoring

Year joined Transnet 2001

QualificationsBCompt (Hons) and CA(SA).

Area of expertiseFinancial and general management.

2Ms V Dunjwa Chief Risk Officer


QualificationsMSc (Engineering); Graduate Diploma Civil Engineering; BA (Chemistry), and Certificate:Executive Women Development Programme.

Area of expertiseEnterprise risk management.

3Mr SI Gama Chief Executive:

Transnet Freight Rail


QualificationsBCom; Banking Diploma; Advanced Executive Programme; and Postgraduate Diploma in Company Direction.

Area of expertiseBusiness leadership, finance, ports, railways, transformational/turnaround strategy.


listed; Mafumbuka Investment Holdings (Pty) Ltd; and Centre for Logistics and Transport, University

(non-profit).

4Mr B Molefe Group Chief Executive


Qualifications Master of Business Leadership; Postgraduate Diploma in Economics; and BCom (Accounting and Economics).

Area of expertiseFinance, management and leadership.


(Trustee); Karibu Holdings (Pty) Ltd;Karibu Capital (Pty) Ltd; Karibu Real Estate Investments (Pty) Ltd; and Lion of Africa Fund Managers.

5Mr T Morwe Chief Executive:

Transnet National Ports

Authority


Qualifications BA Economics; Advanced Programme for Chief Executive Officers; and Executive Programme in Logistics: Transportation Management.

Area of expertise Transport and logistics.


and Investment; Commercial Cold Storage (Pty) Ltd; and Bulk Connections (previously Durban Coal Terminal).

6Mr CA Möller Chief Executive:

Transnet Pipelines


QualificationsCivil Engineering (BSc, BEng) and BCom (Hons).

Area of expertise Engineering and pipeline operations.

42 Transnet SOC Ltd Integrated Annual Report 2011

Group Executive Committee

8

9

10

11

12

13

7Ms M Moses Group Executive:

Transnet Capital

Projects


QualificationsBA and Management Advancement Programme.

Area of expertiseBusiness.

Other directorships and trusteeshipsPublic Investment Corporation; Government Employees’ Pension Fund; and Thusanang Trust.

8Mr KC PhihlelaGroup Executive:

Commercial


QualificationsEngineering, MBA and Executive development.

Area of expertiseEngineering and operations.

Other directorships and trusteeshipsMarine Data Systems (Pty) Ltd; B2B Africa (Pty) Ltd and Tru-South Group.

9Mr A Singh Acting Chief Financial

Officer


Qualifications BAcc and CA(SA).

Area of expertiseFinancial and business.

Other directorships and trusteeshipsComazar (Pty) Ltd; Crosskeys Security Services (Pty) Ltd; Owner-Driver Management (Pty) Ltd; Protekon (Pty) Ltd; Freight Logistics International; Transhold Properties (Pty) Ltd; andTransnet Retirement Fund.

10Mr KXT Socikwa Chief Executive:

Transnet Port Terminals


QualificationsBCom and LLB.

Area of expertiseLegal and commercial.

Other directorships and trusteeshipsInvestec Bank Ltd; RAM Hand-to-Hand Couriers; The Brand Union SA (Pty) Ltd; and Southern Palace Investments.

11Ms Z Stephen Group Executive:

Corporate Services


QualificationsBProc; LLB and Higher Diploma in Company Law.

Area of expertiseLegal, Corporate Governance and Risk Management.

Other directorships and trusteeshipsTransnet Retirement Fund.

12Mr R Vallihu Chief Executive:

Transnet Rail

Engineering


Qualifications BSc (Hons) and MBA.

Area of expertiseStrategy and engineering.

13Mr R Wolfenden Chief Audit Executive:

Transnet Internal Audit


QualificationsBCompt; MBA and CIMA.

Area of expertiseFinance, Corporate Governance, Internal Control and Strategy.

Other directorships and trusteeshipsErnst & Young Advisory Services.

43

Documents

Mandate, vision and mission€¦ · (National Ports Authority), Transnet Port Terminals (Port Terminals) and Transnet Pipelines (Pipelines). A standalone Sustainable Development Report