Financial track record to June 2003

1
Financial track record to June 2003

• 2002/2003 produced a net attributable income of R
  787 million

• Balance sheet remains strong. Capital and
  reserves grew at an average rate of 11.6 per
  annum over the past five years to reach R 22.1
  billion at the end of the 2002/2003 financial
  year.

• Loan book value stood at R 6.5 billion
• Investments stood at R 16.6 billion
• The DebtEquity ratio was 28
• Total assets value was R 29.8 billion

2
Financial year 2002/2003

• Assisted in the creation of over 17 500 new job
  opportunities
• Additional export earnings worth R 3 837 million
  facilitated

3
Financial year 2002/2003

• Assisted in the creation of over 17 500 new job
  opportunities
• Additional export earnings worth R 3 837 million
  facilitated

• Finance to empowerment companies represented 46
  of the total number of approvals and 33 of total
  value

4
Challenges

• Creating sustainable jobs
• Economic environment particularly in
  manufacturing sectors
• Inflexible labour market
• Capital bias in manufacturing
• Addressing the challenge through labour intensive
  sectors
• Tourism
• Franchising

5
Challenges cont.

• Rural development and penetration of poor
  provinces
• Structure of the SA economy (bias towards big
  cities)
• Industrial infrastructure (transport,
  telecommunication )
• Labour migration
• Formation of a development agencies unit (R30m)
• Development Funding of R50m as a subsidy
• Need for grant funding
• Linkages with established businesses

6
Challenges cont.

• Black Economic Empowerment
• Concentration
• Demographics
• Skills
• Market gap (capital)
• Acquisitions of existing businesses
• Desire to take risk on the economy
• Broad based participation and ownership
• Need for more entrepreneurial support
• Transformation charters
• Funds (Mining, Women, NEF)
• 2,5 contribution by BEE

7
Challenges cont.

• Small and Medium Enterprise
• Legislation
• Cost of doing business
• Market access
• Skills
• Rigidity of financiers
• Portfolio approach to risk management
• Hand-holding and mentorship required
• Concessional funding required

8
Prospects

• Play a leading role in facilitating empowerment
  deals.
• Continue to seek local and international
  co-financing opportunities.
• Increased human resource development within the
  IDC.
• Entrench IDCs financial sustainability through
  improved internal systems.

9
In conclusion
IDC will continue to .

• Invest on economic merit based on sound business
  principles
• Utilise resources to achieve development by
  addressing market failures
• Focus on Governments policy objectives
• Align with the dti strategy
• Be flexible to quickly respond to change
• Be a leading DFIs
• Achieve our goal of prosperity for all