1. | Onderstepoort Biological Products © | October 2012 Portfolio Committee 9 th October 2012

2. | Onderstepoort Biological Products © | October 2012

3. Outline of Presentation | Onderstepoort Biological Products © | October 2012  Introduction  Historical perspective  Vision, mission and mandate  Values, acceptance and key strategic goals  Visionary themes (Vision 2020)  Governance of OBP  Governance Report  Board of Directors  Board meetings (including special and sub-committees)  Executive Team  Organizational Structure  Performance Report  Key Strategic Thrusts and Outcomes  Non-financial Performance Highlights for 2011/12 FY  Human Resources Report  Workforce Profile  Race, gender and disability distribution.  Skills Development

4. Outline of Presentation (continued) | Onderstepoort Biological Products © | October 2012  Financial Performance 2010/11  Financial Performance Highlights for 2010/11 FY  Income statement for 2011/12 FY  Financial ratios  Organizational performance  Five year financial performance  Cash flow and reserves  Report of Auditor General  Our customers  Our products

5. Introduction | Onderstepoort Biological Products © | October 2012

6. Historical Perspective 1908: Establishment of Onderstepoort Veterinary Research Institute 1968: Dedicated vaccine facility established 1981: Vaccine facility operated with trade account and able to begin to fund operations from sale of vaccines 1992: OBP separated from OVI (ARC) 2000: OBP incorporated as a SOE on 6 th September 2001:OBP received funding of R9 million (last grant received, to date) 2005: State owned land and buildings officially transferred to OBP 2007:Achieved ISO 9001:2008 certification 2010: Achieved a revenue milestone > R 100 million 2011: Achieved revenue milestone > R 150 million | Onderstepoort Biological Products © | October 2012

7. Vision, mission and mandate | Onderstepoort Biological Products © | October 2012 Vision: To be a global biotech manufacturer of animal health products, underpinned by a skilled, innovative and passionate staff Mission: The mission of OBP is to translate science into biological and health products, knowledge and technology resulting in improved animal and human health, food security and safety, for all stakeholders. Mandate: Onderstepoort Biological products SOC Ltd’s mandate is to prevent and control animal diseases that impact food security, human health and livelihoods. The mandate is delivered through continued development of innovative products and efficient manufacturing that ensures vaccine affordability and accessibility through varied distribution channels.

8. | Onderstepoort Biological Products © | October 2012 Values: Onderstepoort Biological Products SOC Ltd conducts its business in such a way to ensure:  A high level of integrity;  A high level of ethical standards;  High standards of quality;  Excellence in everything that we do. We accept that:  Our employees are our enduring advantage;  As a SOC we have a responsibility to provide for the public as well;  We have a responsibility to our society and environment. Key strategic goals:  Build a successful high performance organisation;  Improve business processes and management practices;  Build a profitable and sustainable company.

9. Visionary Themes | Onderstepoort Biological Products © | October 2012 Vision 2020 To become a global centre of excellence in veterinary vaccinology driven by our innovative employees Recognised centre of scientific excellence Profitability and growth sustainability Production efficiencies and optimisation Product range expansion Employer of choice Employer of choice Products and processes Products and processes Diversification into human health Diversification into human health Recognised brand locally and globally Recognised brand locally and globally Effective distribution network and satisfied customers Effective distribution network and satisfied customers Cost efficiencies and optimisation Regulatory compliance company wide Innovative organisation >> > > > > > > > > > > > > >>>>>> >>>>

10. Governance of OBP State owned company (SOC) of the Department of Agriculture, Forestry and Fisheries (DAFF) 3B entity under Public Finance Management Act (PFMA) and Treasury Regulations Registered taxpayer Own OBP Incorporation Act (OBP ACT no 19, 1999) Corporate governance codes & protocols National Key Point ISO standards & business specific regulatory authorities | Onderstepoort Biological Products © | October 2012

11. Governance Report | Onderstepoort Biological Products © | October 2012

12. Board of Directors | Onderstepoort Biological Products © | October 2012

13. Appointed 1 March 2011

14. Board Meetings | Onderstepoort Biological Products © | October 2012

15. Special Board meetings | Onderstepoort Biological Products © | October 2012

16. Remuneration, Human Resources and Ethics Committee | Onderstepoort Biological Products © | October 2012

17. The Research and Development, Sales and Marketing, Operations and Quality Committee | Onderstepoort Biological Products © | October 2012

18. Executive Team | Onderstepoort Biological Products © | October 2012

19. Organisational Structure | Onderstepoort Biological Products © | October 2012

20. Performance Report | Onderstepoort Biological Products © | October 2012

21. Key Strategic Thrusts and Outcomes | Onderstepoort Biological Products © | October 2012

22. Key Strategic Thrusts and Outcomes continued | Onderstepoort Biological Products © | October 2012

23. Sales & Marketing Performance | Onderstepoort Biological Products © | October 2012 The animal health sector experienced a decline of almost 3.8% in the current financial year compared to 2010-2011 as reported by the South African Animal Health Association.

24. Quality Performance Retained ISO 9001:2008 certification which was extended to include the Pharmaceutical Inspection Convention scheme guidelines therefore this becomes the basis for Good Manufacturing Practice compliance. Statistical method validation course was completed and the iILU verification system for training was implemented to provide evidence in progress. Omni Log Microarray system procured and will allow identification of bacterial cultures and determine optimal growth. | Onderstepoort Biological Products © | October 2012

25. Operations Performance Successfully produced 1 259 305 unites of viral vaccines, 684 198 bacterial vaccines, 95, 862 unites of protozoal vaccines and 1 074 776 units of sterile diluents. Continued improvement in manufacturing efficiencies ensuring improved higher yields, reduced losses, reduced change-over times between products, reduced cleaning and validation process, etc. Identification, specifications drafting, tendering, procurement and installation of critical production and packaging equipment was developed, reviewed and being implemented to assist OBP to improve capacity and meet GMP requirements for future growth. | Onderstepoort Biological Products © | October 2012

26. Operations Performance continued … Procurement of equipment for filling and capping freeze-dried products in the pipeline for delivery and installation by end of 2012-2013 financial year Plant maintenance registers, equipment registers and schedules developed and maintained. The ERP system which incorporates an Asset Management system to be implemented in the 2012-2013 financial year to enable EMU to a computerised maintenance management system. Implementation of energy-saving programme on-going. Health and Safety Policy in review. | Onderstepoort Biological Products © | October 2012

27. Research & Development Performance New collaborations and license agreements were established with local and international research institutes to allow OBP to fast-track new product development. Established bacterial fermentation pilot plant assisted with production of a number of antigens for successful completion of current projects. A new vaccine was registered in South Africa, CoryzaPlus, consisting of a number of antigens which will offer protection against Haemophilus. | Onderstepoort Biological Products © | October 2012

28. Company Secretary Organisation-wide risk registers monitored and updated regularly to ensure that we are current and dynamic, creating a culture of continuous learning and improvement of risk management system while embedding it into OBP systems and processes. Continued support and participation in communities around OBP through programmes such as the Mandela Day etc. Continuous stakeholder relations with provinces to supply animal vaccines and training. | Onderstepoort Biological Products © | October 2012

29. Human Resources Report

30. Workforce Profile | Onderstepoort Biological Products © | October 2012

31. Race, gender and disability distribution | Onderstepoort Biological Products © | October 2012

32. Skills development – employees trained | Onderstepoort Biological Products © | October 2012

33. Employees trained | Onderstepoort Biological Products © | October 2012

34. Financial Report

35. Financial Performance Highlights for 2011/12 FY o Revenue o Revenue decreased to R98.4m from R160.2m o Cost of sales o Gross profit of 61% was realised as compared to gross profit of 73% for the same period last year. o Other income o Other income increased to R3.2m fro the year under review from R0.5m in the previous financial year. o Operating and administrative expenses o These were reduced by 21% as a cost saving measure. o Investment income This increased to R6.5m in the current financial year as compared to R6.4m in the previous financial year | Onderstepoort Biological Products © | October 2012

36. Income Statement – 2011/12 Account20122011 R ’000 Revenue98,402160,193 Cost of sales(37,913)(43,811) Gross Profit60, 470116,381 Other income3,242500 Operating expenses(62,390)77, 436 Administrative expenses (13,761)(18,798) Operating (loss) profit(12, 439)20, 648 Investment revenue6,5474,840 Appreciation of deferred gov grants 2,9582,975 Fair value adjustment-1,551 (Loss) profit before tax(2,933)30,016 Taxation453(7,995) Net profit/ (loss)(3,387)22,021 | Onderstepoort Biological Products © | October 2012

37. Financial ratio performance | Onderstepoort Biological Products © | October 2012

39. Five year financial performance | Onderstepoort Biological Products © | October 2012

41. Report of Auditor General | Onderstepoort Biological Products © | October 2012 OBP was audited by the Auditor General for the second time in over 6 years Opinion given for 2011/12 financial year is a unqualified Audit Emphasis of matter: Material decline in revenue.

42. | Onderstepoort Biological Products © | October 2012 Our customers

43. Our products | Onderstepoort Biological Products © | October 2012

44. THANK YOU