1. INVESTOR PRESENTATION
INTERWASTE HOLDINGS LTD. (JSE : IWE)
INVESTOR PRESENTATION
April 2017

2. AGENDA Company Introduction CEO Commentary Financial Performance
Market Opportunities
Outlook
Conclusion

3. Company Overview

4. COMPANY OVERVIEW Established 1989 27 Years Operational Experience
JSE Altx Listing 2007
Main Board Listing 2014
National and SADC Footprint
Fully Accredited/Licensed Service Provider
Shareholding
40% Management Owned
BEE Level 3

5. COMPANY OVERVIEW – BUSINESS MODEL

6. COMPANY OVERVIEW – INTEGRATED WASTE MANAGEMENT
Legal Compliance
Technical Services
On-Site Solutions
Resource Recovery
Solid & Liquid Waste Treatment
Commodity Trading
Waste Logistics
Waste Disposal & Facilities Management

7. CEO COMMENTARY Trading environment Half year comparative
Competitive
Economic Growth
Half year comparative
EPS Performance improvement second half
H1/ %
H2/ %
Volume decline existing customer base
Up to 20%
Margin improvement
Logistics
Facilities
Discontinued operations
Earth 2 Earth
Enbitec

8. CEO COMMENTARY FINANCIAL PERFORMANCE SUMMARY

9. CEO COMMENTARY FG Landfill Site Design Nuisance abatement actions
Continues to challenge
Ongoing media coverage
Site Design
Class B
Nuisance abatement actions
Gas flare
Leachate dam cover
Effluent management
Continued operation of facility
Landfill Permit
Increased legal and operational costs

10. Financial Performance
5 Year Financial Review

11. FINANCIAL PERFORMANCE – INCOME STATEMENT
2016 Rm
2015
% Change
Revenue
923,403
851,300 8%
Gross Profit
501,836
439,762
14%
EBITA
204,244
165,185
24%
Results from operating activities
96,648
71,468
35%
Headline earnings attributable to ordinary shareholders
43,218
40,837 6%
Continuing operations
Enbitec
Earth 2 Earth
Currency loss
Operational efficiency improvement
Logistics
Increased depreciation
On balance sheet finance
Poor performing assets
Blending platform
Recovered position in H2

12. FINANCIAL PERFORMANCE – 5 YEAR REVIEW*

13. FINANCIAL PERFORMANCE – 5 YEAR REVIEW*

14. FINANCIAL PERFORMANCE
Logistics
Facilities

15. FINANCIAL PERFORMANCE
Logistics
Facilities
Segment Overview
Low Barriers to Entry
Low Capital Requirements
Highly Competitive
Performance Drivers
Logistical Efficiencies
Area Density
Fixed vs. Variable 50/50
Facilities Dependant
Capex Requirements - Financed
Segment Overview
High Barriers to Entry
High Capital Requirements
Regulated Environment
Few Market Players
Performance Drivers
Legislation
Volumes/Tonnages
Fixed vs. Variable 70/30
Logistics Dependant
Capex Requirements – Internally Funded

16. FINANCIAL PERFORMANCE – LOGISTICS

17. FINANCIAL PERFORMANCE – FACILITIES

18. REVENUE CONTRIBUTION – MARKET SEGMENTS

19. KEY FINANCIAL INDICATORS – 5 YEAR PERFORMANCE

20. FINANCIAL PERFORMANCE – BALANCE SHEET…
2016 Rm
2015
Non current assets
778,914
737,099
Property plant and equipment
713,290
674,804
Goodwill
64,009
61,082
Deferred tax asset
1,616
1,213
Current Assets
236,239
249,709
Inventories
8,143
11,472
Current tax receivable
6,066
4,745
Trade and other receivables
191,209
180,338
Cash and equivalents
30,851
53,154
Total Assets
1,015,183
986,808

21. FINANCIAL PERFORMANCE – BALANCE SHEET
2016 Rm
2015
Comment
Equity and Liabilities
541,343
504,163
Equity attributable to shareholders
537,967
500,480
Non controlling interests
3,376
3,683
Non current liabilities
274,046
279,640
Current liabilities
199,794
203,005
Total Equity and Liabilities
1,015,183
986,808

22. FINANCIAL PERFORMANCE – CASH FLOW
Cash Flow Statement
2016 Rm
2015
Commentary
Net cash inflow from operating activities
135,442
142,114
Earth2 Earth
Enbitec
Net cash outflow from investing activities
-145,356
-175,986
Klinkerstene
FG cell 3
FG gas flare
Net cash inflow from investing activities
-7,910
26,538
Total cash movement for the period
-17,823
-7,334
Effect of exchange rate fluctuations
-4,479
-1,418
USD based contracts
Cash and equivalents at the beginning of period
53,154
61,906
Cash and equivalents and the end of the period
30,851
Divisional investments
Facilities' Cash dependent

23. CASH FLOWS – OPERATING ACTIVITIES (Rm)

24. CASH FLOWS – FINANCING ACTIVITIES (Rm)
2014 off balance sheet to on balance sheet financing
Vehicle Term Utilization

25. CASH FLOWS – INVESTING ACTIVITIES (Rm)
Facilities cash dependent – unable to finance
R 15 Million FG gas flare
R 20 Million FG cell 3 preparation
R 25 Million completion of cell 1 Klinkerstene
2016 Includes R 16 Million proceed on sale of Earth to Earth

26. CAPITAL EXPENDIUTURE
FY2015 (Rm)
FY2016 (Rm)

27. FINANCIAL PERFORMANCE – 5 YEAR GEARING

28. OUTLOOK

29. ECONOMIC OUTLOOK Long term GDP growth estimated at 2% (IMF 2016)
Waste Management Industry closely aligned
Subdued levels of growth
Stagnating growth in commercial, manufacturing, industrial, and mining sectors
Increasing levels of competition
Tightening legislation

30. Opportunities

31. OPPORTUNITIES Interwaste Strategically Aligned Legislation
Solution based - Hierarchy of Waste Management
Legislation
Demand Driver
Relatively low Market Share (15% National)
Facilities Operational – Investments Complete
Industry and Service Diversification
80% Annuity Based Income
Capacity within Existing Assets
SADC

32. MARKET OPPORTUNITIES - LOGISTICS
Optimization of asset base
Vehicle Life Cycles
Routing Efficiencies
Vehicle Routing Software Development
Increased Market Share
Aggressive Sales Strategy

33. MARKET OPPORTUNITIES – FACILITIES (ALTERNATIVE)
Impending Legislation
Volume driver to alternative facilities
ZERO Waste to Landfill

34. MARKET OPPORTUNITIES – FACILITIES (LANDFILL)
LANDFILLS IN PTA & JHB 2016
LANDFILLS IN PTA & JHB 2020
FG Landfill
Klinkerstene
FG Landfill
Klinkerstene
Multisands
Gauteng Municipal Landfill Sites Near Capacity
No Municipal Development in Future Capacity
FG Capacity – 2022
Klinkerstein 50 Years
Multisands 50 Years
Source: Case study JHB and Tswane Metros Airspace Study

35. Conclusion

36. CONCLUSION Strategy Based on Organic Growth Sustainable Growth Rates
End of Investments Cycle
Leverage of Existing Infrastructure
Major Investments in Facilities Completed
Klinkersteine Landfill (R30Million)
Sustainable Growth Rates
Positive Cash Flows
Future growth funded by operational cash flows
Maintenance Capex
10% of Revenues

37. CONCLUSION Financial Reporting Focus on Increasing ROE
Facilities and logistics
Focus on Increasing ROE
Targeted ROE improvement
Improved operational performance
Committed to dividend policy
Prudent conserve cash
Dividend payments
Share buy back

38. CONCLUSION
Q & A