1. KwaZulu-Natal Regional Airport Growth and KZN Air Series Dr Clive Coetzee General Manager: Infrastructure Management and Economic Services KZN Provincial Treasury

2. THE BIG PICTURE

3. Passenger Flights pre-2011

4. Passenger Flights 2011 to 2014

5. Passenger Movements

6. Increased Scheduled Flights, Destinations and Passenger Movements Avis Opened an Office in Ulundi Number of Property Sales in Margate because of direct flights Increased number of direct jobs at the 9 regional airports = 36 Total Investment in 9 regional airports = +-R115m post 2010 Total savings of +-R6m pa for PMB Businesses using PMB Airport re KSIA Revenue to the Msunduzi Municipality increased from R3.5m in 2010 to R7.4m in 2013 Savings for KZN Gov from using flights to and from Ulundi = +- R3.5m April 12 to Jun 14

7. Passenger Flights planned post 2014

8. Concept is to showcase KZN aviation and the various municipal airports, to support tourism in the province and to position the province as an attractive and competitive aviation industry location.

9. Why Investing in KZN Regional Airports – PMB Airport Achievements and In the Pipe line – Increase in Cargo Activity – Investor to establish a bio fuel developed aircraft engine manufacturing establishment and to create an aviation industry – Land Developments (Hotel, etc) need to take place 9

10. PIETERMARITZBURG AIRPORT Massive Progress – Great Success Story An airport to be proud off Significant Opportunities Dedicated Partnership Imperative

11. PMB Airport experienced significant growth and improvement in performance Its becoming an “Airport of Choice” No doubt its a success story But some challenges still exists

12. PIETERMARITZBURG AIRPORT

14. R’0002008/09.2010/11.% Change pa 2011/12.2012/13.2013/14.2014/15. Receipts Passenger Levy1004149324.371967254539324325 Landing Fees703110728.741444186122882516 Other Receipts993906-4.391003109311341247 Total inflows2700350648.724414549973548089 Payments Total outflows-5689-4313-12.09-5104-4633-5004-5505 Net Cash Flow-2989-807-36.50-69086523492584

15. PIETERMARITZBURG AIRPORT

16. Summary Stats of Passenger Survey Where do you Reside? PMB59.61PTA7.84JHB17.25DBN3.53 The location of your business/departme nt? PMB50.59PTA9.41JHB16.47DBN3.53 Do you primarily travel for business, government, non- governmental or personal (private) purposes Business56.47Government7.06Personal19.61 Business&p ersonal 4.31 PIETERMARITZBURG AIRPORT

17. Average number of flights per year over the past 3 years?Average26.46Sum6723 Number of officials from your business/department who fly regularly (more than four times/year)? Average36.15Sum9219 Number of flights paid for by the company/department in an average year? Average104.31Sum26496 Please indicate your preference and/or willingness to fly to the following destination(number of flights per year) CPT direct ? Yes185No70 CPT via PE ? Yes56No199 CPT via EL ? Yes60No195 Lanseria ? Yes92No160 BLOEM Yes64No190 Other ? (please specify)OR Tambo8JHB11 Would you support a new airline and/or a new destination (please specify)? No46Yes207

18. Regional Airport Precincts Economic Activities-Land Areas (Ha) MkusePZBDundeeMargateNewcastle Ladysmit hUlundiR/ BayTotal Primary industry 1.00 12.000.0073.0041.50 127.50 Logistics 173.00 Technology 1.80 2.0011.003.004.001.4023.20 Business 1.80 40.00 41.80 Residential 6.003.50 1.30 17.004.205.1037.10 Tourism/Culture 5.0012.00 23.00 40.00 Urban Agric 4.00 46.00 3.10 53.10 Terminal/Parking 1.803.00 1.203.00 1.302.3018.60 Generall Aviation 11.005.502.506.306.004.001.304.5041.10 Runway/Apron/Ta xi 41.0037.0017.0027.0033.0040.0043.5037.00275.50 Roads 2.004.000.502.0011.004.003.002.0028.50 75.4065.0081.0039.80350.00135.5060.4052.30859.40

19. Airport Net Present Values and Internal Rate of Return (R million and Per cent) Initial CapitalCapexNPV IRR (KZN Grant)IIPSA Model8%4% PietermaritzburgR 39.00R 126.63R 65.65R 129.2323.1% Richards BayR 12.00R 145.65R -61.48R -83.85N/A MargateR 10.00R 118.20R 4.59R 35.629.0% UlundiR 30.00R 69.83-R 10.27R 0.684.2% Newcastle R 272.92-R 93.78-R 104.68-7.6% Mkuze R 130.20R -15.21R 6.494.9% Dundee R 47.88-R 16.51-R 18.21-9.4% Ladysmith R 194.50R -15.58 R 11.345.3% TotalR 91.00R 1 105.81R -142.59R -23.39

21. PMB Case Study

22. The project is for the establishment, financing, designing, constructing and operating of a number of regional innovation and technology hubs in the province.

23. Site Location PMB

24. LOCAL MUNICIPALITY Size (HECTARES) Cost to developZoning / Ownership Newcastle LM5.46 haR 613 211 517 EDUCATIONAL / Majuba FET Umhlathuze LM9.05 haR 1 676 780 058 IN PDA PROCESS / Umhlathuze LM Msunduzi LM25 haR 1 959 596 160 COMMERCIAL, INDUSTRIAL / Msunduzi LM Hibiscus Coast LM28.5 haR 1 138 472 194 TO BE SUBDIVIDED / Hibiscus Coast LM

26. The concept initiatively seems sustainable from a capital budgeting point of view. The concept has a positive net present value, an estimated yield of between 13% and 19% and a discounted payback period of about 11 years. Total capex of R5.5bn plus total opex of R6.5bn vs. Total income of R34bn = NPV of R6.6bn over a 23 year period or R289m per annum.

27. Total CapexTotal OpexTotal CostsTotal IncomeNPVNPV pa Province (Concept) 5 450 963 267 6 497 021 281 11 947 984 548 34 342 893 294 6 637 390 777 288 582 208 PMB 1 959 596 160 3 021 846 002 4 981 442 162 15 691 007 809 3 389 038 778 147 349 512 Newcastle613 211 517749 392 1961 362 603 7134 465 492 298973 901 87542 343 560 Hibiscus coast 1 201 375 532 1 509 895 344 2 711 270 8765 846 313 854788 941 22034 301 792 Umhlathuze 1 676 780 058 1 215 887 739 2 892 667 7978 260 907 907 1 487 210 370 64 661 320

28. AVIATION ACADEMY Durban University of Technology

29. The World Cycling Centre

30. Aircraft Manufacturing

31. Msunduzi Technology and Innovation Hub: Advanced Manufacturing and related cluster for the Transport Industry AirTerrestrialMaritime Space + n Skills – Low end to Post-Doc, determine current and future skills needed Underlying Science and Technology Material Science, Process Technologies, Energy, n Shared facilities – testing, labs, 3D printers, conference and meeting space, high end computing Business Support – legal (IP), entrepreneurship, access to capital, Community of practice, Networking Opportunities (act on what the Market wants) Recreational activities – cycle tracks, possible gym/sport institute, use as draw card towards the Innovation Park (Create Sense of place) Cross Cutting Platforms