Overview of Business to Business Research Division

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PRESENTATION TO THE PARLIAMENTARY PORTFOLIO
COMMITTEE 12 MARCH 2003
2
COMMITMENT TO THE SHAREHOLDER

• ? WORLD-CLASS AIR TRAFFIC SERVICES
• ? ENSURE SAFE NAVIGATION
• ? DELIVER A REAL RETURN ON INVESTMENT
• ? KEY ROLE PLAYER IN AVIATION SAFETY
• ? EMPLOYER OF DEMOGRAPHICALLY REPRESENTATIVE
• WORKFORCE
• ? ACTIVE ROLE IN REGION AVIATION DEVELOPMENT

3
STRATEGIC OBJECTIVES

• ? CREATE SUSTAINABLE/IMPROVED RSA SERVICE
  DELIVERY
• -PEOPLE CAPACITY TALENT MANAGEMENT
• -IMPLEMENTATION OF NEW SAAATS SYSTEM
• -STRENGTHEN CUSTOMER RELATIONSHIPS
• MAINTAIN FINANCIAL INTEGRITY
• -REGULATED VS NON-REGULATED REVENUE
• ? PRIORITISE STRATEGIC OPPORTUNITIES
• ? SOUND PARTNERING STRUCTURES

4
KEY NUMBERS
2002/2003? AIRCRAFT MOVEMENTS 550 000 ?
TARIFF TURNOVER R285M ? FULL
SERVICE 9 AIRPORTS?
SERVICE ON CONTRACT 12 AIRPORTS
AIRCRAFT MOVEMENTS 100 000 ? TOTAL EMPLOYEES
600? ATS STAFF
330? TOTAL AIRSPACE
22 000 000KM2


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FINANCIAL PERFORMANCE
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FORECAST RESULTS 2002/03
? Aircraft movements expected to increase from
432,300 to ?460,000 (Growth of 6.8) ?
Tariff related turnover expected to increase by
17 from R244M to R285M ? Other revenue decreases
by R7M due to - Forex loss on revaluation of
dollar assets of R7M vs profit of R6M last year -
Lower income from AIS services - R1M - Lower
interest income of R1,7M vsR4M - due to capital
projects down payments
? Partially offset by increases in - VSAT
revenue R1.3M - higher movements - Training
revenue R6,3M (36)
? Expenditure higher than budget due to -
Additional staff costs - Higher insurance costs

• ? Core business profit (excl. VSAT) - expect to
  achieve target of R38M before tax
• compared to last years R27M (40)
• ? Expected ROCE of 7,4 vs target of 14

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MOVEMENT COUNTS OVER TIME
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INTERNATIONAL COMPARISON OF EN-ROUTE ANS
CHARGES-900nm



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REVENUE
RMs
10
NET PROFIT BEFORE TAX
RMs
11
REVENUE PER MOVEMENT
Rs
12
INCOME STATEMENT
RMillion
13
BALANCE SHEET

1999/0 2000/1 2001/2 2002/3
2003/4 2004/5 2005/6 2006/7 CAPITAL
EMPLOYED Shareholders Equity 310
330 355 387 424
469 534 618 Long Term
Liabilities 43 59
52 191 172 146
116 83 353 389
407 578 596 615
650 701 EMPLOYMENT OF
CAPITAL Fixed Assets 338
347 388 446 500
499 568 638 Net
Current Assets 15 42
19 132 96 116
82 63 353
389 407 578 596
615 650 701
RMillion
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ATNS INVESTMENT IN INFRASTRUCTURE

• R365M OVER PAST 5 YEARS
• COMMUNICATION R86M
• NAVIGATION R30M
• SURVEILLANCE R204M
• FACILITIES R45M
• FURTHER R225M IN THE NEXT 2 YEARS

ATNS
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CAPITAL EXPENDITURE
RM
16
KEY RATIOS

1999/0 2000/1 2001/2 2002/3
2003/4 2004/5 2005/6 2006/7 Return on
Capital Employed 6.94 6.02
7.37 8.52 9.22 10.76 13.46
15.11 Return on Equity 6.97
6.15 7.33 8.64 9.16
10.03 12.92 14.72 Return on Turnover
7.92 7.93 8.20 9.61
10.33 11.61 14.12 16.11 Gearing
Ratio 0.04 0.08
0.06 0.41 0.33 0.24
0.16 0.08
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OUR PEOPLE
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HR PRIORITIES
- LEADERSHIP DEVELOPMENT -
COMMERCIAL AWARENESS - CAREER PLANNING AND
DEVELOPMENT - CLIENT SERVICE CULTURE -
MANAGEMENT OF DIVERSITY - REPRESENTIVITY
OF BLACK PEOPLE AND WOMEN IN ALL LEVELS
OF THE ORGANISATION


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20
OPERATIONAL ENHANCEMENTS
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PROGRESS - SOUTH AFRICA
COMPLETE ? FULL SSR - COVERAGE WITH REDUNDANCY ?
FULL VHF - COVERAGE FROM 1500FT ? RNAV ON MAIN
ROUTES ? CHANGED FROM 6 FIRS TO 3 ? ADS/CPDLC -
IN OCEANIC ? RANDOM OPERATIONS ? ELECTRONIC
FLIGHT PLANS/NOTAMS ? CENTRAL AIRSPACE MANAGEMENT
UNIT - PHASE I


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PROGRESS - SOUTH AFRICA

• IN PROGRESS (2003)
• AUTOMATED SEQUENCING (TERMINAL AREAS)
• ELECTRONIC HANDOVER
• ADS/SSR INTEGRATION
• REDUCED SEPARATION - 10 MIN TO 10 MILES
• CENTRAL AIRSPACE MANAGEMENT UNIT - PHASE II

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CLIENT BENEFIT ANALYSIS - APRIL 2004 FOLLOWING
INVESTMENT

RM/annum HOLDING DELAY REDUCTION -
CENTRAL AIRSPACE MANAGEMENT UNIT - TRACK
DEFINITION - AUTOMATED SEQUENCY R
6M REDUCED TRACK - FLEXIBLE USE OF AIRSPACE
R12M RADAR - OPTIMUM FLIGHT LEVELS R40M OCEANIC
RANDOM ROUTING R12M RNAV ROUTES - SHORTER
ROUTES R22M FAJS CAPACITY - 20 INCREASE R
2M TOTAL
R94M


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AVIATION TRAINING ACADEMY
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SERVICES PROVIDED

• FULL RANGE ATS TRAINING
• TECHNICAL SUPPORT TRAINING (SYSTEMS/CONCEPTS)
• AIRPORTS TRAINING
• AVIATION ENGLISH TRAINING
• CONSULTANCY SERVICES

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ROLE IN SADC

• HARMONISATION OF TRAINING STANDARDS
• - ACTIVE WORK GROUP MEMBERS
• - UPLIFTMENT TO POTENTIAL
• - ALL ICAO BASED
• TRAINING CENTER EVALUATION
• - REQUIRED STANDARDS
• - CAA RECOGNITION

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INTERNATIONAL CO-OPERATION

• CO-OPERATION WITH THE FAA (ATS TRAINING)
• FORMAL AGREEMENT WITH IATA/ATDI
• TRAINAIR MEMBERSHIP
• ICAO (AVSEC BASIC AUDITORS COURSE)
• ISO 9001
• CO-OPERATION IN SADC

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EXTERNAL CLIENTBASE

• ALL 14 SADC STATES
• 16 OTHER AFRICAN STATES
• VARIOUS SECURITY COMPANIES IN SA
• PROVINCES

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ATNS IN THE REGION
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Achievements 2001-2002
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4 STRATEGIES

• COMMUNICATION NETWORK FOR AFRICA
• INFRASTRUCTURE RENEWAL
• REGIONAL SERVICE PROVISION
• - UPPER AIRSPACE CONTROL CENTRE
• (UACC)
• TRAINING

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• Middle East VSAT
• 2nd Taskforce meeting scheduled held 3 February
  2003. Meeting went well.
• High level meeting scheduled for 10-11 March with
  MD, GMBD and Mr Zerhouni, ICAO Cairo
• Site visits planned 26 Mar 1 Apr 2003
• Anticipated completion end April 2003

Afisnet Interconnectivity achieved Oct
2002 AFTN JHB - Dakar ATS/DS Antanorivo to
Beira and Antannanorivo to Dar es Salaam CAFSAT
testing 13 -30 Jan 03
SADC Current network operating well overall
servicability above 90. Fortnightly follow up
with all clients Finalising inclusion of
Burundi and Rwanda Proposed new network 3rd
Taskforce meeting scheduled for February 03.
Board presentation March 03

• Nafisat
• ATNS invited by ICAO to the workgroup meeting
  4-5th February
• ATNS currently evaluating the viability of the
  Cape to Cairo network.
• Meeting scheduled for 24-26 February between
  ICAO, MD and GM BD to discuss future of Nafisat
  and ATNS/IATA relationship

Progress VSAT
37

• SADC UACC
• UACC Steering Committee 6 November 2003.
  Contract referred for the additional work
  referred back to ISI and USTDA. Still no reply
  from ISI.
• Next meeting to take place in Mozambique
• SA Hosting proposal development on hold
• Best practice study planned for 2003/2004
• Verification of UACC impact on ATNS Study
  postponed to 2003/2004 financial year

• East African UACC
• Feasibility study underway being funded by
  European bank
• Kenya, Tanzania, Uganda, Rwanda and Burundi to
  participate

Progress Towards Regional Service Provision