TABLE OF CONTENTS

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TABLE OF CONTENTS

• Introduction
• Area of service and operation
• Corporate Governance

4. Major achievements in 2005/2006 5.
Strengthening Service Delivery 6.
Strategic Challenges and Remedial Plan 7.
Financial performance
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1. Introduction

• Long term strategies for sustainability are
  embedded in annual report
• Progress on all strategic imperatives are
  highlighted
• Ongoing strategic reviews aligned to performance
  management system
• Short interval business reviews to focus on key
  priorities
• Presentation based on performance reviews and
  audited financial statements

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• 2. AREA OF SUPPLY
• AND
• OPERATION

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Service Level Agreements

• LOCAL MUNICIPALITIES
• Matjhabeng Local Municipality
• Nala Local Municipality
• Maquassi Hills Local Municipality
• Greater Taung Local Municipality
• Phokwane Local Municipality
• Moshaweng Local Municipality
• Ga-Segonyane Local Municipality
• Kagisano Local Municipality
• Bophirima District Municipality
• OTHER CONSUMERS
• Beatrix (2 Mines)
• Harmony (6 Mines)
• President Steyn Gold Mine
• Ster Diamante Mine

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3. CORPORATE GOVERNANCE
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Corporate Governance

• Board appointment
• Performance contract
• Executive and Senior Management
• Committees
• Board (Executive, Remuneration, Audit Committees)
• Management( Executive, Management, Divisional,
  Procurement, Bursary, Trustee, Safety Health
  Committees etc)

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Corporate Governance (Cont.)

• Committees continued
• Labour Forums
• Stakeholders ( Co-ordinating Committee, Catchment
  Management Committee, Provincial Water Sector
  Forums, etc.)

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4. MAJOR ACHIEVEMENTS IN 2005/2006
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Operational Performance

• The following savings were achieved on processes
  
• R 2.1m for Energy
• R 0.8m for Chemical
• R 1.3m for Procurement
• Water quality maintained at Class 1 except for
  periodic colour and turbidity.

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Project Consolidate

• Sedibeng Water carried out the following projects
  under project consolidate in Phumelela Local
  Municipality
• Site functional assessment, skills audit and
  technical gap analysis at the Water Purification
  and Sewage Treatment Plants
• Seconded and trained operators in Warden and
  Memel WTP.
• Refurbishment of Warden WTW
• Refurbishment of Memel Water Sewage Treatment
  Works and training of temporary operators.
• Upgrading of Warden Bulk Sewer (in progress)
• Capacity building SETA training of operators
  within the Free State( Wepener, Ladybrand,
  Bethlehem Xhariep)

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Market development

• Presentations on the capability statement of
  Sedibeng Water, technical audits on treatment
  works, service agreements and the establishment
  of co-ordinating committees were conducted.
• Sedibeng Water assisted the following
  municipalities in line with the signed Strategic
  Support contracts
• Siyanda DM
• !Kheis LM
• Kgatelopele LM
• Mier LM
• Kai!Garib LM

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Commercial Equity

• Commercial Equity
• Average BEE expenditure is 40
• Annual targets set were met
• Promoting BEE participation though
• Hand holding and training of SMME
• monitoring and verifying of BEE status
• Encourage establishment of BEE
• companies and joint ventures

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Corporate Social Investment

• Invested approximately R1.3m to communities
  within our service area.
• The programme concentrated on the following
• NGO initiated by youth focusing on education
• Youth entrepreneurial venture
• Special needs and farm schools
• Learnership on Water Purification Process
  Operation.

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Human Resources (Cont.)

• Training
• Financial assistance(24 employees)
• ABET (154 employees)
• Learnership in Water Purification and Process
  Operation(10 employees and 10 community members)
• Experiential training (6 students)
• About 95 of learners who participated in the
  above programmes were absorbed within the
  organisation
• Focus on courses such as Leadership, management,
  finance etc.

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Human Resources

• Employment Equity
• EE targets as per plan exceeded
• Appointments aimed at addressing gender balance
  and disability
• Specific functional levels receiving undivided
  attention e.g. superintendent level

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Customer interaction

• Weekly
• Interaction with Ward Committees
• Improved responsive time and reduction of
  interruptions
• Reduction of complaints
• Improved performance in line with SLA
• Monthly Co-ordinating Committee meetings
• Customer satisfaction monitoring system with KPI
  is in place

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Other

• Assisted Local and District Municipalities in the
  following
• Infrastructure refurbishment projects in the
  North West
• Water quality analysis and scientific services
• Tendered for the management of Vaal Gamagara
  Government Water Scheme
• Appointed as an implementing agent for the
  Masibambane Civil Society Programme
• Market penetration and diversification
• Scientific Services
• water quality monitoring
• environmental management
• operations and maintenance services
• community capacity building on water quality
  related issues

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5. STRENGTHENING SERVICE DELIVERY
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Strengthening service delivery

• The following water conservation and demand
  management measures are implemented by Sedibeng
  Water
• An electronic methodology is used to conduct bulk
  water mass balance in the Free State region
• Household pre-paid meters are installed and the
  reticulation network losses are actively
  monitored in the North West region
• Sedibeng Water has contained water tariff
  increases at 6 without compromising the
  financial sustainability of the organisation.

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Strengthening service delivery (Cont.)

• Research on dealing with the varying water
  quality in the Free State region is carried out
  in an attempt to manage increases in the future
• Sedibeng Water owns a SANAS Accredited Central
  Laboratory used for potable and sewage water
  analysis and tests with a view of extending these
  services to municipalities and other stakeholders
• Sedibeng Water has entered into different
  contracts with a number of municipalities for the
  provision of bulk potable water and reticulation,
  and the operation of sewage plants

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Strengthening service delivery (Cont.)

• Sedibeng Water assisted Municipalities with the
  implementation of refurbishment projects and the
  transfer of assets
• The following projects were carried out
• Basic Water
• Moshaweng LM R4.65m
• Bophirima DM R3.69m
• Supply of operators to Phumelela WTW R0.33m
• Sanitation
• Refurbishment of Warden WTW R0.21m
• Refurbishment of Memel STW WTW
  R0.43m
• Bulk Sewer Upgrading Warden
  R2.26m
• Total Cost R11.57
  million

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Strengthening service delivery (Cont.)

• Cost reduction in operational expenses ( energy,
  chemicals and procurement) and the settlement of
  long term debt
• Continuously pursuing enhancement of relations
  with WSAs and DWAF
• Appointment as implementing agent in the
  provision of basic water and sanitation services
  and training

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Strengthening service delivery (Cont.)

• Assisting the WSAs in accelerated service
  delivery through Project Consolidate
• Participation in water sector forums and other
  stakeholder relationship management initiatives
  that addresses accelerated service delivery
• Acceleration of transformation and equity/gender
  balance
• Dedicated focus on training and development

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6. STRATEGIC CHALLENGES
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Strategic challenges

• Obtaining support from DWAF to maintain raw water
  tariff increases below inflation in line with
  water boards potable water tariff increases
• Concluding multi- year water tariff agreements
  with stakeholders
• Raw water deterioration at the middle and lower
  Vaal River
• Renewal of the WSA/WSP Service Level Agreements
• Managing the uncertainty created by the
  institutional reform process

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Strategic challenges (Cont.)

• Manage relationship with municipalities to
  jointly deal with accelerated service delivery
  challenges
• Augmentation of water supply infrastructure to
  Maquassi Hills Local Municipality
• Continuously ensure that potable water quality in
  the North West region meet required standards

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Strategic challenges (Cont.)

• Successfully managing the impact of HIV/AIDS
• Accelerating transformation efforts to balance
  gender and disability
• Maintaining and improving employee and customer
  satisfaction
• Maintaining water tariff increases at inflation
  target levels and still remain sustainable

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7. FINANCIAL PERFORMANCE
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Financial Overview for the previous five years
Consolidated Abridged Income Statement
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Financial Overview 2005/2006
Income Statement Free State Region
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Financial Overview 2005/2006
Income Statement North West Region
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GRAPH Financial Performance
R000
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Consolidated Abridged Balance Sheet
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Financial Ratio Analysis
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FREE STATE REGION Business Performance Indicators
Expenses as a of total turnover
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NORTH WEST REGION Business Performance
Indicators
Expenses as a of total turnover including
subsidies received
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Sedibeng Water obtained an unqualified
audit opinion again THANK YOU