HOME AFFAIRS HIGH SECURITY DOCUMENTS

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GPW 2007/08 Strategic Plan Portfolio Committee5
June 2007Cape Town
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THE GPW CONTEXT

• An organisation in transition
• Converting to a Schedule 3b company
• Organisational renewal process
• New systems processes
• New skills
• New culture
• Migration to a new production facility end of
  2008
• Key and strategic contributor to DHA turnaround

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The Strategic Blueprint
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The GPW Current Reality

• Aging Staff 54 of staff over the age of 40.
• Old Inefficient Production Equipment
• Old Plant Facility 114 years
• Obsolete skill sets

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GPW STRATEGY

• GPWs strategy hinges on 4 pillars or key
  objectives
• Corporitisation
• Business transformation
• Legal conversation
• Technological Upgrading
• Systems
• IT
• Production Process Optimisation
• New plant facility
• New equipment
• Quicker turnaround times
• Marketing Effectiveness Alignment
• Consolidation growing current market position

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Four Pillars of Success
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Long-Term Shareholder Value
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MARKETING

• Maintain and grow the current product mix
• Security printing
• Standard printing
• Publications
• Grow security printing into Africa
• Restore and maintain customer confidence

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Defining value in Customer Terms
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Strategic Initiatives to Drive Customer value
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Internal Business Process
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DEVELOP RD STRATEGY

• Define RD requirements
• Define expectations for RD in line with business
  strategy
• Identify RD risks and mitigating measures
• Develop appropriate RD matrix to measure
  contribution on ongoing basis
• Develop interface/communication channels between
  RD and rest of organisation (esp.
  sales/marketing and production)
• Prepare and approve RD budget

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IMPORTANCE OF RD STRATEGY

• Advantages of Research and Development
• Scoping new products (experimental research)
• Development proof of concept, testing, ideal
  levels delivery
• Manufacturing new technologies
• Increase investment economic impact (/-3.5 of
  revenue)
• Forensics

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Understand our People Requirements
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Financial Projections
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Financial Projections - Assumptions

• Strong growth in sales in Security Printing,
  Publications and Stationery from 6 in year one,
  stepping up by 5 each year to a projected growth
  in sales in year 5 of 26 (needed to
  operationally fund the Unomatic equipment)
• Growth in Sales unaffected by loss of exclusive
  rights as per draft Security Printers Bill in
  year 3
• Gross Profit Margin Year one 39, stepping up to
  43 in year five, the strongest contribution
  coming from improved supply chain management,
  inventory management and transformation processes
  within the factory environment
• Salaries as 16 of Revenue (in line with industry
  benchmark)
• Marketing Costs as 2 of Revenue
• New Passport production equipment requires OPEX
  budget of R30 million per year
• CAPEX of R340 million spread over 5 years

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Financial Projections - Assumptions

• Impact on GPW of business integration of current
  Passport Assembly Personalization process at DHA
  from a people and process perspective
  discussions proposed for alignment
• Impact on GPW of implementing E-Passport as a new
  product and a change to the current product mix
  is pending clarification with DHA discussions
  proposed for alignment
• Impact of operating from a new plant from a
  process and people perspective with DHA
  discussions proposed for alignment

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Revenue Budget 2007/08
DIVISION Revenue Profit Margins Profit Margins
Origin 17 621 681 839 128 5
Letterpress 22 414 042 1 067 335 5
Litho 7 111 410 (660 623) -8
Book Binding 10 665 458 (678 751) -6
Form Binding 26 937 141 657 003 2
PoD Section 11 190 374 978 484 10
Security Binding 37 571 636 7 884 555 27
Rubber Stamp 2 361 910 525 991 29
SUB TOTAL 135 873 653 10 613 123 8
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Revenue Budget 2007/08
DIVISION Revenue Profit Margins Profit Margins
Contract Printing 95 000 000 3 928 216 4
Face Value Services 39 937 874 1 597 515 4
Regional Offices 21 375 231 855 009 4
Paper Stores 77 816 062 0 0
Stationery Stores 143 331 453 5 733 258 4
Publications 0 0 0
Government Gazettes 46 192 727 3 598 707 8
SUB TOTAL 423 653 347 15 712 705 4

CONSOLIDATED REVENUE/SURPLUS 2007/8 559 526 999 26 325 827 5
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Priorities 2007/2008

• Corporatisation
• Business case
• Draft Security Printers Bill
• New Printing Factory
• Technological Upgrading
• Transformation
• Marketing and Branding

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• THANK YOU