Annual Results Presentation 27 August 2009 Jacob Maroga – Chief Executive Empowering the South African dream

Eskom Holdings Limited Reg. No. 2002/015527/06 2 Contents of presentation 1.Highlights for the year 1 1.Challenges requiring ongoing focus 2 1.Business results for 2008/9 3 1.Outlook for 2009/ Building for the future 5 1.Conclusion 6

Eskom Holdings Limited Reg. No. 2002/015527/ Highlights for the year 1 1.Challenges requiring ongoing focus 2 1.Business results for 2008/9 3 1.Outlook for 2009/ Building for the future 5 1.Conclusion 6

Eskom Holdings Limited Reg. No. 2002/015527/06 4 Highlights for the year Reframing the role of Eskom Eskom’s role is visibly and vividly embedded in the aspirations for the country The key role we play in the South African economy

Eskom Holdings Limited Reg. No. 2002/015527/06 5 Highlights for the year Keeping the lights on No load shedding since April 2008 Coal stocks now at an optimum level Improved plant performance Increased capacity – return to service and open cycle gas turbine stations Countrywide collaboration (energy efficiency) Economic slow-down reduced demand and created additional opportunity for additional maintenance

Eskom Holdings Limited Reg. No. 2002/015527/06 6 Highlights for the year Shareholder support R177 billion guarantee R60 billion equity loan Support on pricing policy application Energy efficiency drive Investor relations

Eskom Holdings Limited Reg. No. 2002/015527/06 7 Highlights for the year Managed the cash Mobilised organisation around liquidity Cash from operations remains positive and under control despite: - Significant cash outflows - Difficult funding conditions

Eskom Holdings Limited Reg. No. 2002/015527/06 8 Highlights for the year People of Eskom Remained focused to serve the country Continued loyalty to Eskom We continue to attract and retain scarce and critical skills

Eskom Holdings Limited Reg. No. 2002/015527/06 9 Highlights for the year Credit rating Despite the earlier downgrade, rating agencies are holding their rating until the funding solution is finalised Fitch moved from negative to stable

Eskom Holdings Limited Reg. No. 2002/015527/06 10 Highlights for the year Collaboration with stakeholders Support for finding a sustainable funding solution Support for the build programme Ongoing dialogue Various independent forums established

Eskom Holdings Limited Reg. No. 2002/015527/06 11 Highlights for the year Paying for the recovery Conscious decision to keep the lights on Planned operating loss contained Long-term sustainability important

Eskom Holdings Limited Reg. No. 2002/015527/06 12 Highlights for the year Board support and Governance Significant number of meetings Effective collaboration with management Dedication and commitment

Eskom Holdings Limited Reg. No. 2002/015527/ Highlights for the year 1 1.Challenges requiring ongoing focus 2 1.Business results for 2008/9 3 1.Outlook for 2009/ Building for the future 5 1.Conclusion 6

Eskom Holdings Limited Reg. No. 2002/015527/06 14 Challenges requiring ongoing focus Primary energy Managing cost Managing availability Transportation Securing future sources Industry-wide collaboration

Eskom Holdings Limited Reg. No. 2002/015527/06 15 Challenges requiring ongoing focus Executing the build programme Largest capital expansion programme in the country Managing cost, schedule and quality Access to funding

Eskom Holdings Limited Reg. No. 2002/015527/06 16 Challenges requiring ongoing focus Commodity- linked pricing Strategy used during the excess capacity phase Current plan to limit exposure to commodity-linked pricing Limit embedded derivative volatility

Eskom Holdings Limited Reg. No. 2002/015527/06 17 Challenges requiring ongoing focus Financial sustainability Aiming to achieve ‘break even’ position for 2009/10 A sustainable funding solution going forward Ongoing business efficiency

Eskom Holdings Limited Reg. No. 2002/015527/06 18 Challenges requiring ongoing focus Safety Driving the culture of zero harm Managing increased number of contractors on our sites Road safety Continued focus on public safety

Eskom Holdings Limited Reg. No. 2002/015527/06 19 Challenges requiring ongoing focus Public perception Concerns about: financial sustainability; and keeping the lights on Transformation of company culture Transparency and keeping the public informed

Eskom Holdings Limited Reg. No. 2002/015527/06 20 Challenges requiring ongoing focus Security of supply The supply system will remain tight until the next major power station (Medupi) comes online Energy efficiency is critical

Eskom Holdings Limited Reg. No. 2002/015527/ Highlights for the year 1 1.Challenges requiring ongoing focus 2 1.Business results for 2008/9 3 1.Outlook for 2009/ Building for the future 5 1.Conclusion 6

Eskom Holdings Limited Reg. No. 2002/015527/06 Group income statement

Eskom Holdings Limited Reg. No. 2002/015527/06 23 Income statement indicators Sales volume trend Revenue Primary energy Operating expenditure Operating loss before embedded derivatives Embedded derivatives Finance charges Profit/(loss) after tax Interest cover

Eskom Holdings Limited Reg. No. 2002/015527/06 24 % Electricity % sales growth Sales volume trend  Negative growth as a result of the slowdown in the economy and customer load curtailment  Negative growth first time in over 10 years

Eskom Holdings Limited Reg. No. 2002/015527/06 25 R’m Revenue  Revenue reflects positive move in electricity

Eskom Holdings Limited Reg. No. 2002/015527/06 26 R’m Primary energy  Significant increase of 38%  Impact of keeping the lights burning

Eskom Holdings Limited Reg. No. 2002/015527/06 27 Primary energy, manpower and maintenance account for 85% of the operating costs Total operating costs

Eskom Holdings Limited Reg. No. 2002/015527/06 28 Operating expenditure increased by 32% Manpower: Specific focus on growing and retaining staff resulted in a review of the remuneration practice Maintenance costs: Mainly a result of increased maintenance due to ageing plant and high load factor Operating costs

Eskom Holdings Limited Reg. No. 2002/015527/06 29 R’m Operating profit/(loss) before embedded derivatives & net finance cost  Anticipated loss  Prioritised reliability of supply as part of recovery

Eskom Holdings Limited Reg. No. 2002/015527/06 30 R’m Embedded derivatives Commodity-linked pricing contracts mainly with aluminum producers The remaining life of contract spans between years Fair value of embedded derivatives based on: - Exchange rate - Aluminum price - Standard electricity price Unrealised accounting loss of R9,5billion largely due to aluminum price drop

Eskom Holdings Limited Reg. No. 2002/015527/06 31 R’m Finance charges before capitalisation  Increased interest burden