SANRAL ANNUAL DOMESTIC ROADSHOW - October 2011 #441439v1 1

The SANRAL mandate Established in April 1998 by an Act of Parliament as an independent operating company to operate South Africa’s national road network Established in terms of the National Roads Act of 1998 as a public company with a share capital within the requirements of the South African Companies Act Governed by a board of directors (8 members) of whom 7 must be appointed by the Minister of Transport Eighth member of the board is the CEO by virtue of office Responsible for strategic planning with regard to South African national road system Finance, plan, construct, provide, operate and maintain roads in neighbouring countries upon request from the Minister of Transport and in agreement with the respective countries Not profit driven but create public value 2

SANRAL’S ROLE National road network - economic arteries Provide safely engineered, well maintained roads Improve journey experience Transformation Create opportunities for employment, business, tourism 3

WHAT DO WE DO? Responsible for proclaimed national roads: Toll and Non-Toll network Maintain, fund, operate and rehabilitate national roads Levy tolls to service toll roads Manage concessionaires Advise Minister on road related matters Create public value 4

The Bigger Picture Road user is our client – SANRAL objective is to provide a safe well engineered road to the user – movement of people, services and goods Value of time – Time is valuable, both commercial and private To enable the economy to grow – creating wealth and job opportunities, saving on road user costs – sufficient infrastructure is required 5

The Bigger Picture In order to provide above, there are different focus areas: –As minimum, roads must be well maintained: Routine road maintenance (crack sealing, pothole repair, grass cutting, road signs and markings, guardrails, etc) Periodic maintenance – reseals and overlays Rehabilitation Available funding optimized using tools such as pavement management systems, HDM4 –Capacity improvements (combine with rehabs): Additional lanes Paved shoulders Climbing lanes 6

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NATIONAL ROAD NETWORK (km) Description Non TollState TollBOTTotal Dual Carriageway Lane Undivided Lane Single Total % of SANRAL Network 81%11%8%

Please Note: 75% of Network Older than Original 20 Year Design Life 9

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Very Poor ConditionPoor Condition Good Condition COST OF MAINTENANCE DELAY - ROAD USER GoodPoor Based on HDM-4 Modeling 11

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FUNDING  Government Grant for the non-toll network  Cannot budget for a deficit  Toll Revenue – to be used only on toll roads  Borrowings from capital markets and financial institutions  Other income (minimal) – rental income etc  Alternate Funding Sources finalised/under discussion  EIB  ECA  Foreign investors - roadshows 14

Ratings Moody’s Global Scale Issuer Ratings: (Non-guaranteed notes) Long-Term: A3 Short-Term: P-2 National Scale Issuer Ratings: (Non-guaranteed notes) Long-Term: Aa2.za Short-Term: P-1.za 15

BORROWING CAPACITY Initial R6 billion guaranteed funding (SZ bonds) R1 billion N1 loan – separate guarantee R26.91 billion guaranteed funding (HWAY bonds & others) R15 billion – non guaranteed funding (NRA bonds) Total Borrowing capacity = R48.91 billion Increased from R10bn 16

TOTAL DEBT 17

TOTAL DEBT 18

BONDCOU- PON MATURITYCOUPON DATESISSUE AMT (million) TYPE NRA October April 31 October1 473CPI NRA April April 31 October132Fixed NRA November May 30 November2 553Fixed NRA October April 31 October2 887Fixed NRA May May 30 November910CPI NRA November May 30 November3 717Fixed HWAY July January 31 July6 736Fixed HWAY December June 31 December 1 176CPI HWAY December June 31 December 211CPI HWAY July January 31 July2 400Fixed HWAY July January 31 July647Fixed THE SANRAL SUITE (Aug 2011) Spire Awards: BEST BORROWER 2008 & 2009 BEST ISSUER 2009 (HWAY20)

What have we been up to... 20

CONTRACTS AWARDED 1 ST APRIL TO 31 ST MARCH 2011 Business areaR ‘000 Non-toll Network Toll Network Other TOTAL VALUE / / /

Business area R’million 2011/122012/132013/14 Non-toll Network Toll Network TOTAL VALUE BUDGET 22

J-curve 23

J-curve (in numbers) The effect on the SANRAL debt level as a result of GFIP 24 APPROVED GFIP TARIFF SCENARIOS – DEBT LEVEL INFORMATION (ENTIRE TOLL PORTFOLIO) Scenario Maximum Debt (in Milions of ZAR) Year of Maximum Debt (in Million of ZAR) Year of Debt Repayment (in Millions of ZAR) Original Gazetted tariff R - 47, / /2028 Steerco recommended tariff – start date 1 Nov 2011 R - 53, / /2030 Public transport exemption effect R - 54, / /2030 Start date 1 Feb 2012 R - 57, / /2031

PLANNED LANE ADDITIONS: 185 km (2010) FUTURE UPGRADES: (223 KM) PLANNED NEW ROUTES: 158 km FINAL SCHEME: 561 KM Project Extent: 25

Open Road Tolling (ORT)  In urban environment (space constraint), high traffic volumes ( to AADT), conventional tolling not an option  ORT:  All transactions recorded electronically:  Number plates or tag  Vehicle linked to an account  No physical toll plazas – free flow tolling 26

SANRAL principles for ORT  One tag standard  One account – may include various vehicles  Central clearing Full interoperability 27

Open Road Tolling ORT  All the toll transactions will take place electronically  No physical toll plazasTag Also known as: Transponder or On Board Unit (OBU) Illustrative Standard: 5,8GHz 28

Discounts Types E-Toll tag account Time of day Frequent user Public Transport operator (PTO) No discount if not registered All discounts cumulative except PTO Commuter taxis and busses exempt 29

ORT – Violation Processing Potential violator identified if: –No e-tag or account –Insufficient funds in account –Vehicle not identifiable Transaction forwarded to VPC: –Send invoice –Not successful – Infringement notice – note, must be peace officers and should be appointed by SANRAL –Not paid – Courtesy letter (RTMC) –Not paid – Enforcement order 30

Violation Enforcement Enforcement Unit (traffic officers together with ORT contractor) is set up to do violation enforcement Not only toll – all traffic violations Also attending to other requirements – management of incidents 31

Key Account Management Agreements reached with fleetbanks to assist with distribution and management of tags – daily payment guaranteed SAVRALA – near real time: transactions sent to rental companies > direct link Large fleets: direct agreement with SANRAL – manage own tags and payments Bulk registration: Initial registration done through predefined template 32

Capital Investment Programme  N2 Tsitsikamma Toll Road - completed  N17 East Toll Road Extension  Gauteng Freeway Improvement Project (GFIP)  N1 South and R30 Bloemfontein – Kroonstad  N1 Polokwane Bypass - completed  Mariannhill Extension  King Shaka Interchange – completed  Knysna Ring road SANRAL Funded Toll Network Development 33

Current & Proposed Concessions Current Concessions N4 East, Maputo Development Corridor – 471km N3 Cedara, Heidelberg – 429km N4 West, Platinum Highway – 382km Proposed Concessions N1/N2 Winelands Toll Highway – On tender N2 Wild Coast Toll Highway – Received RoD R300 Ring Road 34

Future Investments Maintain expenditure on asset preservation Extend intelligent transport systems Extend electronic toll collection system Complete feasibility studies Initial Environmental Scan Construction Programme GFIP Phase 2? 35

36 N1 Section R300 to Hex River Valley: 105,6km N2 Section R300 to Bot River: 70,3km R300

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CONCLUSION Investing in roads  For sustainable economic growth  Leverage procurement to transform industry  Make communities economically independent  Create public value Effective delivery of road infrastructure for public transport and movement of freight Expansive investment programme Core components of South Africa’s growth strategy Conservative and prudent funding strategy 38

Highways of the future 39

Thank you! SANRAL 48 Tambotie Avenue Val de Grace Pretoria 0184 PO Box 415 Pretoria 0001 Telephone: Fax: Nazir Alli, Inge Mulder, Philip Gildenhuys, Alice Mathew, Gill Raine, Prasanna Nana, FRAUD HOTLINE: Website: