“For people going places”
Exel PetroleumExel Petroleum
BEE PRESENTATION TO PPC
MAURICE RADEBE
MANAGING DIRECTOR
10 September 2002
“For people going places”
OVERVIEW OF PRESENTATIONOVERVIEW OF PRESENTATION
History & Track Record
Exel – a True BEE Oil Company
Ownership
Control
Managememt
Transfer of skills
Social Investment
Strategic Partner
Conclusion
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HISTORY & TRACK RECORDHISTORY & TRACK RECORD
Wholly South African owned, black economic empowerment oil
company established in 1997.
The main business of the company consists of marketing a full
range of petroleum products throughout Southern Africa.
Impressive track record since 1997
• strong brand presence in the market. Total market share has
increased to 3.76% by 2001
• Present market share is 3% for petrol and 7% for diesel
• Turnover reached the R1.9 billion mark during the year 2001
• Projected turnover for 2002 will be R 2.8 billion
Successful, Growing CompanySuccessful, Growing Company
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Major customers consisting of Government, Para-statals and large commercial enterprises, include Transnet, South African Police Services, Local Municipalities, Eskom, Imperial Bulk Services, Sasol Mining, Sonop Delwerye, Sun Couriers etc.
Exel currently boasts a countrywide network of 134 retail sites including rosters
Service Station sites have standard offering of C-store, fast food and allied retail offerings to suit the local market
HISTORY & TRACK RECORDHISTORY & TRACK RECORD
Strong Company with Proven Track RecordStrong Company with Proven Track Record
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-22
478
978
1478
1978
2478
2978
Rm
Type Actual Actual Actual Actual Actual YTD Forecast
R Million 71.47 496.78 911.25 1,522.86 1,873.90 1,233.95 2,792.78
1997 1998 1999 2000 2001 '30 Jun 02 '31 Dec 02
TURNOVER (Incl Levies)TURNOVER (Incl Levies)
Outstanding Progressive GrowthOutstanding Progressive Growth
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EXEL – BEE COMPANYEXEL – BEE COMPANY
Exel is a TRUE black empowerment company
CONTROL
Ability to exercise legal rights associated with ownership
Majority shareholding
Control of the Board
MANAGEMENT
Black management cadre running the businesses
Responsible for day to day running of operations
SKILLS TRANSFER
Entrepreneurial/ Innovative thinking
Capacity Transfer Skill Transfer Employee training
OWNERSHIP
77,5% Ownership of Exel
Includes Asset ownership
Made Possible by VISION and Made Possible by VISION and COMMITMENT of our Strategic Partner COMMITMENT of our Strategic Partner
SASOL OILSASOL OIL
SOCIAL INVESTMENT
Affirmative Procurement
Community Involvement/ upliftment
Black Economic Empowerment
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OWNERSHIP - ShareholdingOWNERSHIP - Shareholding
S O U T H A F R IC A N G R O U P
HDSA G RO UP
Exel M anagement & Staff1 0 .0%
S ta ff com m itm en t &In vo lv em ent
Autow orkers Pension Fund8 .0%
R e pre se n tin g P um p A tten da n ts
Autow orkers Provident Fund5 .0%
R e pre se n tin g P um p A tten da n ts
South African Black W om en IH3 ,5%
R e pre sen ting W o m e n s G rou ps
Nozala T rust & Nozala Resouces9 .5 .0%
R e pre sen ting W o m e n s G rou ps
Balance3 ,5
T o be p la ce d w ith H D S A G ro up
SIZANANI TRUST3 9 .0%
B roa d B a se d G rou ps
M pho Jessica Trust7 .2%
Kulisile Investm ent (P ty) Ltd3 .6%
M anyano Investment (P ty) Ltd3 .6%
Buyisa T rust7 .2%
M arquis Trading (Pty) Ltd7 .2%
Bophirim ile Investm ents (Pty) Ltd7 .2%
PO W ER LIB G RO UP3 6 .0%
In d iv idua ls
NABFRA INVEST M ENT HOLDINGS1 .0%
B lack S e rv ice S ta tio n O pe ra to rs
ESTAT E LATE SG NYATI1 .0%
UNALIGNED PART IES2 ,0%
SASO L O IL
NALEDI PET RO LEUM INDUST RIES2 2 .5%
EXEL PET ROLEUM1 0 0% o w n e d by
NALEDI PET RO LEUM HOLDINGS
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OWNERSHIPOWNERSHIP
Established by Established by SasolSasol to facilitate Empowerment to facilitate Empowerment
All share capital is raised by the shareholders who are
personally responsible for the financing
SIZANANI TRUST• At inception in 1997, 77,5% of shares were held by a broad
base of shareholders all being HDSA’s
• In 2000, many elected to sell their shares, earning 14 times their
initial investment.
• The Sizanani Trust was established by Sasol as a vehicle to
temporarily house the shares, with the express intent to place all
of these shares with HDSA’s
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CONTROL - DirectorsCONTROL - Directors
66,6% of Directors are HDSA
Non-Executive board – sits every two months
Sub-committees of the board meet to
recommend and advise on key issues for
submission to the board:
• Strategy Committee
• Audit Committee
• Remuneration CommitteeControl and Corporate GovernanceControl and Corporate Governance
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77% of Management are HDSA Well qualified top management with more
than 70 years industry experience Experienced executive committee Flat structure enables quick
communication to all staff and quick decision making to support customers
Innovative culture that emphasises learning and leadership development
MANAGEMENTMANAGEMENT
Live Values - Total TransparencyLive Values - Total Transparency
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White Male27%
White Female18% Black
55%
EMPLOYMENT EQUITY – All StaffEMPLOYMENT EQUITY – All Staff
73% HDSA’s73% HDSA’s
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Male53% Female
47%
GENDERGENDER EQUALITY – All StaffEQUALITY – All Staff
Striving to Improve with New AppointmentsStriving to Improve with New Appointments
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Black33%
White Female34%
White Male33%
SENIOR MANAGEMENTSENIOR MANAGEMENT
77% HDSA’s77% HDSA’s
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SKILLS TRANSFERSKILLS TRANSFER
20% of staff are studying through company assistance
Secondment of staff with strategic partner Flat structure and small staff complement
makes for easy identification of talent Mentorship and acceleration programme
for high potential staff Quarterly staff assessment and
performance appraisals address learning requirements
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SOCIAL INVESTMENTSOCIAL INVESTMENT
Affirmative Procurement:• Tender committee to monitor and facilitate process• Procurement Policy structured to ensure BEE
companies have preference• Evaluation process provides ability to pay up to
10% higher for BEE suppliers• Technical buyer position created to promote &
assess new suppliers• 2001 spend (excluding product) – 54%, • 2004 target – 75%
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SOCIAL INVESTMENTSOCIAL INVESTMENT
Community Involvement• Appointed General Manager to drive programmes• Policy adopted to direct key areas of expenditure
– Development & training– Skills enhancement – Youth– Environment
• Budget 2% of Net Profits before tax for CSI expenditure • Hero concept – Retail franchisees involvement with
community encouraged• Exel Impact – Identify projects in conjunction with retail
franchisees• ExelYes! – News sheet for pump attendants• Staff encouraged to be personally involved with
community programmes
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ADDITIONAL INFORMATIONADDITIONAL INFORMATION
RETAIL SITES
• Programme to fund HDSA franchisees• Strict code of conduct for franchisees relationship with
pump attendants• Dedicated trainers visiting sites to ensure continued
training for pump attendants• Programme in place to ensure at least two attendants
become franchisees by 2005
No. % HDSA % Black No. PA’s
Prime Sites 89 48 37 1700
Roster Sites 50 13 10 500
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ADDITIONAL INFORMATIONADDITIONAL INFORMATION
No Depots – rely on partnerships and accomodation agreements
Transport – No Bulk Vehicles – most deliveries handled by Sasol• Sasol & rail 66 %• Customer Collection 24 %• BEE 6%• Other 4%
Commercial – piloting BEE reseller programme with view to roll out to remainer of country
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STRATEGIC PARTNERSTRATEGIC PARTNER
Key strategic partner is Sasol Oil 22,5% Shareholding in Exel Board Representation Strategic Partnership offering
• Financial Support• Technical Support• Transfer of Skills
SuccessSuccess DEPENDSDEPENDS on QUALITYQUALITY of Relationship Between Partner & BEE Operator
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STRATEGIC PARTNERSTRATEGIC PARTNER
Financial • Warehousing of share sale through
Sizanani Trust • Surplus product offer at discounted rates• Cession of certain Fuel Oil business• Loan for property development (Exel
company owned sites)• Property Development - Sites leased to
Exel for 10 year period
All at Market RatesAll at Market Rates
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STRATEGIC PARTNERSTRATEGIC PARTNER
Technical• Supply of product in In-land areas• Distribution, including scheduling, logistics
and delivery • Lubricants – supply and technical support• Technical services
– Pump maintenance,– Environmental compliance– Capital Installations (Pump & Tanks)
Arms Length, Market RelatedArms Length, Market Related Commercial AgreementsCommercial Agreements
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STRATEGIC PARTNERSTRATEGIC PARTNER
Skills transfer• Exel staff invited to Sasol training programmes (eg
Executive Development Programme, Accelerated Leadership Development Programme)
• Consultancy agreement (allows Exel management to draw on Sasol expertise at agreed preferential rates)
• Sasol employees seconded to Exel (currently 6)
• Exel employees seconded to Sasol (currently 2)
Capacity Capacity BuildingBuilding is Key to Success is Key to Success
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CONCLUSIONCONCLUSION
Proven track record in the industry Financially strong High emphasis on corporate governance Strong management team, flat structures and quick decision
making in place Vision 2005 firmly in place and actively pursued Exel enjoys a high profile in the industry and the market Exel is the strongest black oil company in SA The above is due to the BEE dream and passion of our
strategic partner, Sasol Oil
Exel IS the leading example of Exel IS the leading example of successful Black Empowermentsuccessful Black Empowerment