JOE MADUNGANDABA MD: JASCO ELECTRONICS HOLDINGS LTD

1
JOE MADUNGANDABAMD JASCO ELECTRONICS HOLDINGS
LTD Dr STUART ROBERTSONCEO JASCO ELECTRONICS
HOLDINGS LTD

• Electronics Conference
• 6 April 2005

2
JASCOSHAREHOLDER PROFILE

• BEE/CIH (35,1)
• Public (33,2)
• Management and directors (21,5)
• Institutions (10,2)

.
3
JASCOS BEE PROFILE

• Currently a BEE entity (51 voting rights)
• Will become black owned in 2008 (conversion of
  prefs to ords based on CPIX5 hurdle rate)
• 2nd most empowered company in listed industrials
• Broad based empowerment independently verified by
  EmpowerDEX BBB rating, based on balanced
  scorecard approach
• Ongoing plans to improve rating in place
• BEE status has already won new business and
  brought many new opportunities
• BEE partners active on the Board/Exco

4
JASCOs BEE PARTNERS - THE CIH GROUP

• Founded in 1995 as the Malesela Group, now called
  Community Investment Holdings (Pty) Ltd (CIH)
• Led by Dr Anna Mokgokong (Chair) Joe
  Madungandaba (CEO)
• Entrepreneurial business with turnover currently
  in excess of R4 billion p.a.
• Key investment strategy focused on
• Businesses involved in infrastructure development
• Medium/large companies with above average growth
  potential established management
• Ensuring active/ongoing management involvement

5
THE CIH GROUP
MALESELA TAIHAN ELECTRICAL CABLE
(M-TEC) MTD NU-LEC CONLOG DARTCOM MCT
TELECOMS CZ MANUF. TOFO COSOURCE SUKUMANI
JASCO ELECTRONICS
6
JASCOS PERFORMANCE
7
JASCOS PERFORMANCE
8
STRATEGIC OVERVIEW
9
GROUP STRUCTURE VISION
3X OPERATING DIVISIONS
A provider of specialised, value added
solutions, products and services to telecoms
networks
An integrator and supplier of surveillance
other security systems
A focused component manufacturer to the
electrical and electronics industries

10
TELECOMMUNICATIONS I

• Webb Industries
• 30 years, 3 sub-divisions
• Wireless/RF - antennas (design manufacture own
  and agencies), cables connectors (agencies),
  equipment (agencies) for PMR operators
• Mast Towers lattice (Meccano) type steel
  structures (design manufacture own) for
  wireless operators in SA and Africa
• Hi-sites 22 Gauteng sites on high ground, own
  mast, rent out space to security companies, asset
  trackers, ICASA, wireless operators, etc

11
TELECOMMUNICATIONS II

• Telesciences
• 5 years
• Access network equipment agencies of leading
  niche equipment suppliers focused on the metro
  rather than trunk networks. Includes test
  equipment and billing software
• Tasslelane
• 2 years
• 3M agency for telecoms connectors and joint
  boxes used by African telecommunications players

12
MANUFACTURING

• Special Cables
• 20yrs,3 sub-divisions
• Components for domestic appliances such as
  fridges and stoves/cookers. Established alliance
  with Defy, Whirlpool others to manufacture
  wiring harnesses and plastic parts (proxy for
  AMAP Nu-World)
• Components for the automotive industry
  controllers for wipers/aircons, tail lights and
  braking systems
• Pool equipment manufacture own pool chlorinator
  (Just-Chlor) and related products (e.g. lights)
  for local export markets

13
SECURITY

• Multivid
• 10 years
• Security Systems Integrator designs, installs
  maintains CCTV, access control and alarm
  systems (electronic security systems)
• Focused in these market segments
• City surveillance/government
• Financial institutions (RD and manufacturing of
  specialised alarm systems for banks)
• Retail
• Mining

14
BUSINESS MODELCurrent vs (Target)
(25)
(33)
(66)
(25)
(50)
15
COMPETITOR ANALYSIS

• Telecoms
• Grintek
• Spescom
• Andrews
• Sietel
• Alan Dick
• Altron

• Manufacturing
• Smaller engineering shops
• Backward integration by customers

• Security
• Intervid
• Siemens (ESD)
• Cuincidence/ BAC
• Guarding Cos

Combination of a competitor and/or customer
and/or a supplier
16
MARKETS/SHARE GROWTH

• Telecommunications
• Wireless and access networks in South Africa and
  Africa gt R1b p.a.
• Jasco share lt1 (niche player)
• Growth rates gt25

17
MARKETS/SHARE GROWTH

• Manufacturing
• Large appliance local componentry gt R100m (Jasco
  has approx. 40 share)
• Auto components gt R500m (lt1 niche player)
• Plastic extrusion market huge
• Growth currently gt25 (consumer demand)

18
MARKETS/SHARE GROWTH

• Security
• Electronic security market gt R600m in SA alone
• Jasco currently has lt10 local market share
• Worldwide growth gt25 (post 9/11)

19
STRENGTHS

• Telecommunications
• Own IP
• Antennas
• Masts
• Kits
• Hi-sites
• Best of breed agencies/products
• 30yrs wireless skills
• 3-5 year Telkom SA supply contracts

20
STRENGTHS

• Manufacturing
• Sophisticated plant machinery
• Skilled workforce
• Entrenched alliances
• Local IP and value add

21
STRENGTHS

• Security
• Experienced team
• Own IP (Alarms)
• Best of breed agencies/products
• Maintenance contract (Banks)
• Countrywide infrastructure

22
GROUP STRENGTHS

• Balanced interests
• 3 growing markets
• Local export income
• BEE status and partners
• Businesses strongly cash generative
• Niche markets are still growing
• Low/no gearing
• No forex losses
• Good governance
• Experienced committed management

23
OPPORTUNITIES

• Leverage BEE status
• New revenue streams
• New deal flow (agencies, acquisitions and
  alliances)
• Telecoms liberalisation in SA (SNO, wireless)
• Low tele-density in Africa
• Strong consumer demand for appliances ongoing
  electrification
• NEPAD infrastructure spend
• Exports of own IP/products
• Antennas for asset tracking
• Security alarms for banks
• Pool related products

24
STRATEGIC INTENT

• Short/medium term
• Sustained delivery in all businesses
• Generate cash to strengthen balance sheet
• Resume dividend payments (3X cover)
• Exploit experience and BEE status to grow
  organically
• Grow annuity type income to reduce earnings
  volatility
• Medium/longer term
• Fund organic growth diversification from cash
  cows
• Use BEE status partners to expand
  portfolio/acquire new companies

25
SUMMARY

• Well established, diverse businesses in growing
  markets (incl. exports) that are cash generative
• Strong BEE credentials and hands on BEE
  partners underpin future growth potential
• Experienced committed management
• Major shareholders with long term goals
• Sustainable turnaround gathering momentum
• Positive prospects

26
QUESTIONS
27
THE BEE STRUCTURE
CIH
STEP 1. ACQUIRE TASSLELANE FOR R31m AS PER DUE
DILIGENCE
STEP 2. ISSUE 21m ORDS _at_R1.45 EACH 30m
REDEEMABLE PREFERENCE SHARES AT 1c EA.