AERIAL PICTURE OF NHLS HEAD OFFICE

2. AERIAL PICTURE OF NHLS HEAD OFFICE

3. National Health Laboratory ServicePresenter: Ms Joyce Mogale Parliament Presentation 14 October 2015

4. Table of content • Organogram • Introduction • Our people • Our people our pride • Our stakeholders • Technological innovation • Our business • Key performance Indicators. • Finances • Challenges • New Plans Going Forward

5. Organogram

6. The Organogram

7. Introduction In this past year, the NHLS celebrated 13 years of delivering world class, qualitative, affordable and sustainable laboratory services to the South African public, and participated in ground-breaking research with our international and continental counterparts.

8. Our People • The year under review was characterized by a number of transitional events – from the appointment of an interim CEO in December 2014, to the appointment of a new Board and Board Chairperson. • It was also pleasing to welcome three new staff members: the Chief Financial Officer, Head of the Learning Academy and Company Secretary. • Dr Sophia Kisting was welcomed as the new Executive Director of the National Institute for Occupational Health (NIOH).

9. Our People • To attract prospective employees from rural areas into a sector that faces scarce and critical skills shortages, and to promote the NHLS as an employer of choice, 91 biomedical technology students from universities of technology were awarded study bursaries.

10. Our People Our Pride • The National Institute for Communicable Diseases (NICD) received a special message of congratulation and appreciation from the Speaker of Parliament for its role in sending eight teams of specialists to Sierra Leone during the Ebola outbreak in West Africa from the 16th of August 2014 to the 26 March 2015.

11. Mobile Laboratory in Sierra Leone

13. Our People Our Pride • We celebrated the following people during the financial year 2014/2015: • Prof Mary Gulumian who was nominated as a Director of the International Union of Toxicology’s (IUTOX) Executive Committee and was elected Vice-President of this committee. • Ms Jeaneth Manganyi won an award from the South African Institute for Occupational Hygiene (SAIOH), for Hygienist of the Year. • Prof Lucille Blumberg who was awarded the 2014 World Small Animal Veterinary Association One Health Award

14. Our People Our Pride • Dr Boitumelo Kgarebe was elected as a member of the Governing Council of the African Academy of Sciences (AAS) representing the South African sub-region. • Prof Lesley Erica Scott, was awarded the Special Prize for Social Impact at the 2015 Innovation Prize for Africa ceremony in Morocco.

15. Our Stakeholders • The interim CEO increased focus on stakeholder engagement. • The mandate of teaching and training continued in collaboration with medical universities and universities of technology.

16. Our Stakeholders • Focused support towards strengthening the diagnostic laboratory platform was received from the Centre for Diseases Control (CDC) and global funding in conjunction with the National Department of Health (NDoH). • A healthy relationship has also been forged with the Southern African Development Community (SADC) in which the NHLS spearheads the development of training materials and provide laboratory training courses.

17. Technological Innovation • Collaboration between NHLS and the CSIR resulted in the initiation of National Pathology Database in 2014, aimed at teaching, training and outreach within the NHLS, in order to improve the accuracy and throughput of diagnoses related to diagnostic morphology.

18. Technological Innovation • The database and associated technology infrastructure was permanently implemented throughout the NHLS’s national centers as of February 2015 and was used for the 2014 and 2015 annual morphology training courses.

19. Our Business • It is pleasing to note that despite major challenges involving increasing debtors, we have remained resilient in delivering on our mandates and have continued to make strides in our day-to-day business activities . This is evident in the below mentioned activities. • It is satisfying to note that during the 2014\15 period, the demand from provinces for NHLS’ services showed an increase of 4.52% from 79 507 377 to 83 278 870 in test volumes, mainly driven by Viral Load and GeneXpert volumes.

20. Highlight • GeneXpert Infinity Analyser

21. National Test Volumes Year on Year

22. Provincial Test Volumes Year on Year

23. Provincial Contribution to National Test Volumes

24. Our Business • The number of HIV viral load tests performed across the country increased from 2.4 million in 2013/14 to 2.9 million in 2014/15. • The NHLS entered into collaboration with Roche Diagnostics and Abbott Molecular in a landmark programme to decrease the price of HIV viral load testing. The new pricing structure will benefit the 2.5 million South Africans on anti-retroviral treatment.

25. National CD4 Volumes Year on Year

26. Provincial CD4 Volumes Year on Year

27. Provincial Contribution to National CD4 Volumes

28. National Viral Load Volumes Year on Year

29. Provincial Viral Load Volumes Year on Year

30. ProvincialContribution to National VL Volumes

31. National HIV PCR Volumes Year on Year

32. Provincial HIV PCR Volumes Year on Year

33. Provincial Contribution to National PCR Volumes

34. National GeneXpert Volumes Year on Year

35. Provincial GeneXpert Volumes Year on Year

36. Provincial Contribution to National GXP Volumes

37. National Cervical Smears Volume Year on Year

38. Provincial Cervical Smears Volume Year on Year

39. Provincial Contribution to National Cervical Smears

40. Key performance indicators : Customer / Business Process Perspective

41. Key performance indicators : Financial Perspective

42. Key performance indicators : Employee Perspective

43. Key performance indicators : Internal Perspective

44. Our Finances • Our finances took a dramatic turn during the last four months of the reporting period for better. I am pleased to report that the NHLS through increased collection of debtors has improved its financial status to meet its operational needs, although prior debt remains an area of concern. • This could not have happened without the continuous support from the Minister of Health Dr Aaron Motsoaledi and the Director General of Health Ms Precious Malebona Matsoso in encouraging provinces to pay their bills.

45. Our Finances • The aging profile of creditors drastically reduced from December 2014, with a sound payment plan in place. • As of the end of March 2015, credit balances for all SMMEs were current, and those of all major suppliers were being proactively managed.

46. 2014 – 2015 Financial Highlights Positives • Unqualified Audit Opinion – 9th year in a row • Maintained 2013/14 prices Negatives • Debtors recoveries was at 84% • Capital Expenditure% of Turnover of 1% - in line with the target

47. 5 Year Financial Summary

48. Accounts Receivable Collection Trend Analysis • Collections from accounts receivables averaged R366m for the first two thirds of the year under review • For the latter part of the year, the collections increased by 13% to R414m. • Substantial payments were noted from Gauteng and KZN Department of Health. • The highest receipts which happened in the later part of the financial year was 1.9 times more than monthly collections. • The bank balance grew considerably year-on-year by 87% to R651m by the end of the financial year

49. Accounts Receivable as at 31 MAR 2015

50. Trade Payable payment Analysis • For the year under review, trade payable days outstanding closed at 70 days as compared to 74 days at the beginning of the financial year. • Considerable improvements were noted by the end of the financial year and this was largely due to cash inflows in the latter part of the year. • SMME’s and courier service providers are current on their outstanding balances due to maintaining a two month rolling cash flow strategy to cover the debt for when it becomes due