SA Post Office Group Annual Financial Results For The Year Ended 31 March 2011

1. SA Post Office Group Annual Financial Results For The Year Ended 31 March 2011 Presentation to the Parliamentary Portfolio Committee on Communications

2. Annual Results Group Performance Overview

3. Focus 2010 - 2011 • Corporate Governance and Compliance • King III and Companies Act • Financial Services Regulatory Bodies • PostbankCorporatisation • Long Term Sustainability Platform for the Last Mile • Financial Oversight within Economic Crisis • Human Resource Capacity • Service Improvement Drive • Environmental Programmes

4. Vision To be recognized among the leading providers of postal and related services in the world

5. Mission To enable the nation to efficiently connect with the world by distributing information, goods, financial and government services; leveraging our broad reach and embracing change, technology and innovation

6. Postal Environment - Global Trends Maximising the efficiency and effectiveness of existing processes, systems and networks performance The introduction of new products and services designed to respond to the needs of a demanding market Entering new lines of business through investment in new capabilities, partnerships and acquisitions Expanding and capturing business opportunities beyond local borders

7. Local Trends • Third consecutive decline in mail volumes, this year by 3.6% • Increased Focus in governance and corporate citizenship • Sustainable development and Environmental impact • Commercialisation and regulation of financial services • Social transformation and embracing Universal Service Obligations • Robust Financial Management in a economically challenged environment.

8. Strategic Themes • Grow top line revenue at an acceptable cost • Deliver on our shareholder mandate and establish excellent stakeholder relationships • Improve efficiency and effectiveness in the way we conduct our business • Satisfy our customers by being consistent and innovative • Entrench a high performance culture in the organisation • Contribute positively to our communities and environment by embracing responsible business and social practice.

9. Financial Highlights

10. Government Mandate • To provide physical addresses to every household • 1.7 million against a target of 1.6 million • To make the postal and financial service available to all South Africans at an affordable price • 77.7 million customers, a 5.7% increase • Depositors’ book up 9.1% • Quality Service 94.1% vs. 95% target • Tariff Increase below CPI • Provide a countrywide service • 54 New and Renovated outlets vs. 134 last year • Enabling economic opportunity

11. Key progress per Business Model • Mail Business • E-fulfilment positioning completed and positive revenue growth opportunities • Logistics • Phase 1: Integration of SSC and CFG still in progress • Financial Services • Corporatisation of Postbank on track • Properties • Unlocking Value in the Property Portfolio • Property valuation remains unchanged at R1bn • ICT • Leveraging investment in IT Infrastructure • Trust Centre Lock down and Accreditation

12. Customers and Performance • Satisfy our Customers by being consistent and innovative • E-fulfillment services • Extension of services in SADC – Logistics Business • ISO Accreditation Programme • Entrench a High Performance Culture • Skills Development and Training • Recognition of Prior Learning Programme • Review of the Staffing and Remuneration Models • Achievement of Equity targets • 79% participation in Wellness program vs 55% last year

13. Environmental Plans • Carbon Emissions - Criteria and targets set • 30.34Kt CO2e against last year’s 31.42Kt CO2 e carbon emissions achieved i.e. a 3.4% reduction in fleet emissions • Carbon off-set at 3.4% emissions, exceeding target by 0.9% • 1 107 trees planted against a target of 857. • Paper recycling Programme • 649 tons of waste paper recycled against 137 tons recycled last year. • 385.47 tones of paper used vs. 614.3 used last year, a 37% reduction in paper usage • Piloting energy saving programs to measure reduction of energy usage at Tshwane Mail, Sunnyside, NPC and SCM • Participating in the Carbon Disclosure Project

14. Performance Highlights • Group Profit Before Tax down by 37,8% to R235,3 million • Group Operating Revenue stable at R6.0 billion • Capital Expenditure down by 30% to R379 million • SA Heritage Resources Agency Award • SETA award for Best Internal Provision of Training • African Access National Business Award for diversity in the workplace

15. Group Financial Overview Level 3 BBBEE Contributor

16. Performance Summary • Seventh consecutive year of profitability • Total assets increased by 5.68% • Revenue increased by 1.71% • Expenses increased by 3.87% • Net profit decreased by 47.63% • Profit margin declined to 4.35% • Postbank depositor’s funds increased by 9.1% • Strong cost controls minimised impact of trading conditions • The Group remains debt free Level 3 BBBEE Contributor

17. Post Office Group financial overview Level 3 BBBEE Contributor

18. Post Office excluding subsidiaries Level 3 BBBEE Contributor

19. Courier & Freight Group Level 3 BBBEE Contributor

20. Docex Level 3 BBBEE Contributor

21. Balance Sheet Summary Level 3 BBBEE Contributor

22. Economic indicators Level 3 BBBEE Contributor

23. Fuel price history Level 3 BBBEE Contributor

24. Group revenue Level 3 BBBEE Contributor

25. Interest income Level 3 BBBEE Contributor

26. Group revenue Level 3 BBBEE Contributor

27. Group staff costs Level 3 BBBEE Contributor

28. Group transport costs Level 3 BBBEE Contributor

29. Group property costs Level 3 BBBEE Contributor

30. Group balance sheet Level 3 BBBEE Contributor

31. Group cash flow Level 3 BBBEE Contributor

32. Group financial ratios Level 3 BBBEE Contributor

33. Group net asset value trend (R’000) Level 3 BBBEE Contributor

34. Group profit before tax trend (R’000) Level 3 BBBEE Contributor

35. Group trading profit trend (R’000) Level 3 BBBEE Contributor

36. Group total assets trend (R’000) Level 3 BBBEE Contributor

37. Group depositor’s fund trend (R’000) Level 3 BBBEE Contributor

38. Group capex – R204 million Level 3 BBBEE Contributor

39. Group capex (R’000) Level 3 BBBEE Contributor

40. Subsidy utilisation – 2010/11 26 New post offices 1,715,935 New addresses Level 3 BBBEE Contributor

41. Declining Subsidy (R’000) Level 3 BBBEE Contributor

42. Summary • Profit of R153 million achieved through tough trading conditions • Tight working capital management ensures continued balance sheet strength • Lower profitability due to decreased mail volumes and lower interest rates • Strong cost control minimises depressed revenue impact. • Reduction in capital investment due to current economic climate Level 3 BBBEE Contributor

43. Thank You! Level 3 BBBEE Contributor