Investor Western Cape 1

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www.ppc.co.za25 March 2011

Investor Site VisitWestern Cape


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Todays program

07h45 Welcome at PPCs Montague Gardens depot

08h00 Overview of PPCs Western Cape operations

08h45 By bus to PPCs De Hoek factory, Piketberg (2 hours)

10h45 Presentation and site tour at De Hoek factory

12h45 By bus to PPCs Riebeeck Factory, Riebeeck West (1 hour)

13h45 Presentation and site tour at Riebeeck factory

15h00 Lunch and final Q&A in Riebeeck West

16h30 Depart by bus for return journey (1.5 hour)

18h00 Arrive at Cape Town airport or Montague Gardens depot

Enjoy the day!


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Todays objectives

Investors

An overview of PPCs operations in the Western Cape province (WC)

First-hand knowledge of cement manufacturing processes and equipment

A better understanding of PPCs modernisation plans in the WC

Meeting a wider group of PPC management

PPC

Interaction with important stakeholders

Showcase our operations in the WC

Clearly articulate our modernisation and expansion plans for the WC


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PPC in southern Africa

De Hoek

Riebeeck Port Elizabeth

Hercules

Jupiter

Dwaalboom

Colleen Bawn

Bulawayo (Mill)

Gaborone (Mill)

Slurry

Zimbabwe

Botswana

Moza

mbiq

ue

Namibia

Saldanha (Mill)

PPC CementMontague Gardens (Depot)

George (Depot)

Johannesburg

Cape Town

PPC Aggregates

PPC Lime

Lime Acres


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PPC in the Western Cape Province

De Hoek

Riebeeck

Saldanha (Mill)

George (Depot)

Cape Town

Northern Cape

Western Cape

1

7

140km

60km

100km

Montague Gardens (Depot)

Vanryhnsdorp

PPC in the Western Cape


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Orientation

De Hoek

Riebeeck

Saldanha (Mill)

George (Depot)

Cape Town

Northern Cape

Western Cape

1

7

Montague Gardens (Depot)

Vanryhnsdorp

PPCs Western Cape integrated network

Significant WC limestone reserves

Indicates rail interconnectivity


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PPCs Western Cape integrated network

Exploiting the closest, significant limestone reserves to the Cape Townmarket

Vanryhnsdorp and Saldanha limestone reserves not owned by PPC

All WC sites connected by both rail and road

All WC sites can distribute bulk or bag to customers

De Hoek factory, 220 employees, capacity ~1.2mtpa cement

Riebeeck factory, 180 employees, capacity ~ 600ktpa cement

Saldanha factory, 40 employees, capacity ~ 500k tons of slag per annum

Currently limited to ~240k tons per annum due to slag availabilityMontague Gardens and George depots, (20 operations employees)

Exports possible through Cape Town harbour


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Products

OPC (ordinary portland cement)

Construction industry, concrete product manufacturers and ready-mix concrete producers

RHC (rapid hardening cement)

Specialised applications where high early strength concrete is

required e.g. brick and roof tile manufacturers

Surebuild (general purpose cement)

A premium multipurpose cement

All products are available in bag and bulk


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Customer segments and projects in the WC

Retailers are the largest customer segment followed by ready-mix concrete producers and concrete product manufacturers

Planned infrastructure projects ~R13bn

New N1/N2 toll road R4.8bn

BRT (bus rapid transit) project R4.6bn (phase 1A)

Retail/shopping centres >R1.6bn

Distribution depots for retailers ~R1.3bn

Mitchells Plein Hospital R400m

Note: Includes only the major projects for the next 3 to 5 years

All values listed above are estimated project costs


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Annual cement demand

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000

16 000

1996

1997

19

98

19

99

2000

20

01

20

02

20

03

2004

20

05

20

06

20

07

2008

20

09

20

10

-

500 000

1 000 000

1 500 000

2 000 000

2 500 000

3 000 000

3 500 000

4 000 000

4 500 000

5 000 000

SA domestic Western Cape

WC demand analysis

WC market is between 10 -15% of SA domestic market through a cycle

Source: CNCI data, Western Cape 2010 - PPC estimate

0

500

1 000

1 500

2 000

10 000

12 000

16 000

8 000

14 000

000

to

ns


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WC demand analysis (continued)

Annual cem ent demand index1996 = 100

6 0

8 0

10 0

12 0

14 0

16 0

18 0

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

SA Do m e stic W este rn Cap e

SA domestic demand back to 2004/2005 levels and WC demand back to 2002 levels

WC demand has been more volatile than the overall SA domestic marketSource: CNCI data, PPC calculations, Western Cape 2010 a PPC estimate


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WC replacement and expansion plan

Why?

Kilns are old (average 40 years) but well-maintained and still produce goodquality cement however much less energy efficient

Impact of new environmental legislation (from 2015) will require significantcapex investment

To align WC capacity with future market demand

Brown fields preferred to green fields approach:

Deliver the same capacity and energy efficiency

Lower capital cost spread over a longer period

Reduced environmental impact

Capacity (increase of 50%)

De Hoek: replacement (phase 1) and expansion (phase 3)

Riebeeck: replacement with some expansion (phase 2)


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WC replacement and expansion plan (continued)

3 phases, including Riebeeck and De Hoek

Phase 1 A new clinker cooler, coal firing system and bag filter for

De Hoek kiln 6

Capex R 280m - Currently in progress to be completed early 2012

Phase 2 New kiln 3 and upgrading of kiln feed and cement milling capacity

at Riebeeck

Capex R 1,300m Commencing 2012 to be completed 2016

Phase 3 Further increased capacity and energy efficiency of

De Hoek kiln 6 by installing a pre-calciner

Capex R 1,400m Commencing 2016 to be completed 2018

Other advantages of this plan?

Can expedite or delay phase 3 to match market demand

Optimal utilisation of limestone resources

Each phase will be discussed in more detail at the respective factories


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www.ppc.co.za

Montague Gardens depotCape Town


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Montague Gardens depot

Bulk handling and packaging facility completed in 1980

Includes WC sales, marketing and administration offices

35 sales and marketing employeesBulk handling and packaging facility

Receives bulk cement from De Hoek and Riebeeck factories by rail

Bulk cement storage capacity 18 000t (OPC and Surebuild)

Ability to dispatch both bagged and bulk cement by road

Key advantage

Ability to optimise rail/road logistics between plants and Cape Town market

Ability to service customers with short lead times


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Questions?


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www.ppc.co.za

Investor Site VisitDe Hoek factory - Piketberg


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Introduction to De Hoek factory

History

Limestone discovered in 1919 by the Hermon Piquetberg Lime Company

Cape Portland Cement started production of cement in 1923

In 1983 name changed to PPC Integrated cement factory

Products Surebuild and Rapo in bag/bulk dispatched by road and rail

Capacity to produce 1.2mtpa of cement using

2 kilns DHK5 (1974) and DHK6 (1980)

2 cement mills

2 rotary packers each capable of 2900 bags per hour

2 automated cement bag palletisers

On-site limestone reserves for more than 30 years

Coal from Saldanha (230km) and Limpopo province (1800km) by rail

All other raw materials locally sourced


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Cement manufacturing process

crushing plant Kiln feed preparationand blending

coal stockpile

coal mill

raw mill

cement milling & dispatchpre-heater, kiln line & cooler

Limestone mining

clinker storage


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crushing plant limestone blending coal stockpile

coal mill

raw mill


mining limestone

clinker storage


coal mill

raw mill


mining limestone

clinker storage

Cement manufacturing process (continued)


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coal mill

raw mill


mining limestone

clinker storage


coal mill

raw mill


mining limestone

clinker storage


Clinker

Cooler

CoalMill

Flame to produce 1400oC

Most thermal energy intensivestage of the process

Most thermal energy intensivestage of the process


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ClinkerCooler

CoalMill

Flame to produce 1400oC

Raw meal feed to the kiln:

~90% limestone

Source of calcium carbonate

~10% other (shale, sand, iron)

~1.5 ton raw meal = 1 ton clinker

Calcination process

Calcium carbonate + heat = calcium oxide + carbon dioxide

CaCO

3

+ 1400oC heat = CaO + CO

2

~1.5 tons + 1400

oC heat = 1 ton clinker + 500kg CO2*

Approximately half of CO2 produced in the clinker process is derivedfrom the dissociation limestone, not from burning coal

* Excludes CO2 from coal and electricity used in the process


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coal mill

raw mill


mining limestone

clinker storage


coal mill

raw mill


mining limestone

clinker storage


Clinker is finely ground with gypsum

(to control the setting time of cement)

CEM I (pure cement) consists

predominantly of clinker and gypsum

Extended cements contain extender

materials, such as limestone, fly ash

or slag


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De Hoek upgrade and expansion plan

Phase 1 (De Hoek kiln 6)

Currently in progress and due for completion in early 2012

Kiln shell and inlet seal replacement

New grate type clinker cooler

Indirect coal firing conversion and installation of a modern kiln burner

New bag filter for kiln exhaust gas

Advantages

New shell = improved kiln uniformity and refractory life

Rapid cooling of clinker improves grindability and handling

Multi-channel burner = burning of alternative/waste fuels

Improved kiln thermal efficiency = lower fuel consumption and higher output

Increased coal mill capacity = use of lower grade coal

Reduced kiln dust emissions

Enables future capacity expansion (Phase 3)


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De Hoek upgrade and expansion plan (continued)

Indirect firingsystem

Kiln shellreplacement

Planetary coolersreplaced withgrate cooler


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De Hoek upgrade and expansion plan (continued)

Phase 3 (De Hoek kiln6)

Timing of this phase is flexible and will be aligned with market demand as itdevelops

Main features will include the installation of a kiln pre-calciner and the upgradeof kiln feed, coal milling and other ancillary equipment to cater for the increasedkiln6 capacity

Advantages

Will result in a significant thermal efficiency (coal) improvement

Will increase De Hoek kiln 6 output by 100%

Resulting in ~1.3mtpa* modernised cement capacity

Overall De Hoek factory capacity will increase to 1.8mtpaDe Hoek Kiln6 will be upgraded to world-class technology

Together with new Riebeeck kiln 3 will produce the base requirement for WC

De Hoek kiln 5 will become the swing unit for the WC

*Current estimate and ma var accordin to final desi n and e ui ment s ecifications


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www.ppc.co.za

Questions?


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Site tour


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Site tour plan

Visit mine to view:

Extent of limestone reserves

Mining of Zoutkloof and Vondeling pits

Central control room for overview of plant operation

Group splits to visit

Laboratory/packaging plant

Group rotates

Return to training centre


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De Hoeks social development initiatives

A number of projects focussing on education, infrastructure and housing

Construction and upgrading of classrooms and facilities at local schools

Portable skills training in the community (welding, vehicle maintenance,agriculture and woodwork)

Water infrastructure supplied to the Wittewater and Goedverwachtcommunities

Construction of entrance road for Wittewater

Construction of business hub for SMMEs at Porterville

Grade R classrooms at Steynville Primary School

(Local contractor used 20 local workers)


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www.ppc.co.za

Investor Site Visit

Riebeeck Factory Riebeeck West


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Introduction to Riebeeck factory

History

The factory site includes the birth place of General Jan Smuts (1870 - 1950)a national monument maintained by PPC

The factory was founded in 1959

An integrated cement factory

Current products OPC and Rapo in bag/bulk, dispatched by road and rail

Capacity to produce 600 000 tpa of cement using2 kilns RK1 (1959) and RK2 (1968)Both kilns run sustainably at 20% over original design capacity

2 cement mills

1 rotary packer capable of 2000 bags per hour

On-site limestone reserves for more than 100 years

Coal from Limpopo province by rail 1700km distance

All other raw materials sourced locally and Saldanha (237km)


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Aerial view of factory and mine

Riebeeck Westvillage

Limestone mine

Rehabilitatedoverburden

dumps

Cement factorySmuts cottage


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Mine rehabilitation


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Riebeeck upgrade and expansion plan

EIA process based on revised expansion plan commenced late during 2010

Construction expected to commence during 2012

New kiln (RK3) to replace both existing kilns

Kiln feed & coal milling circuits to be upgraded to support larger capacity

Cement milling will be upgraded for larger capacity and future product changes

Existing mining, raw materials handling, product storage and general siteinfrastructure can be used

Advantages

Two old cement kilns replaced with one modern cement kiln

Significantly improved thermal and electrical efficiency

40% increase in overall factory capacity

Brown-fields project with lower capital expenditure

New equipment will exceed new environmental requirements

Result: ~850ktpa* cement capacity at world-class efficiency andenvironmental standards

*Current estimate and may vary according to final design and equipment specifications


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Riebeeck upgrade and expansion plan - scope

crushing plant Kiln feed preparationand blending

coal stockpile

coal mill

raw mill

cement milling & dispatchkiln line & cooler

mining limestone

clinker storage


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Riebeeck upgrade and expansion plan (continued)

Schematic of current plant layout (RK1 & 2 in yellow)


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Schematic of kiln 3 construction (green)


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Schematic of upgraded layout (RK1 &2 dismantled)


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Questions?


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Site tour


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Site tour plan

Mine visit to view:

Extent of limestone reserves

Current mining operation

Future mine layout

Rehabilitated overburden dumps

Factory visit to view:

Existing kilns and material flow

Location of proposed kiln


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PPC Riebeecks social development initiatives

Our vision is the development of our youth as the building blocks for ourfuture in this country

Strategy is to prioritise investment in educating the youth in the area

Projects completed or in progress:

Investment in two crches (completed)

Construction of three grade R classes (completed)

Construction of a youth centre in conjunction with Goedgedacht trust which

specialises in youth development programs (in progress)

Youth centre under construction


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www.ppc.co.za

Thank you for spending time with us today


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Disclaimer

Whilst not intended to contain any profit forecasts or profit estimates, this document including,without limitation, those statements concerning the demand outlook, PPCs expansionprojects and its capital resources and expenditure, may contain certain forward-looking views.By their nature, forward-looking statements involve risk and uncertainty and although PPCbelieves that the expectations reflected in such forward-looking statements are reasonable,no assurance can be given that such expectations will prove to have been correct.Accordingly, results could differ materially from those set out in the forward-lookingstatements as a result of, among other factors, changes in economic and market conditions,success of business and operating initiatives, changes in the regulatory environment, othergovernment action and business and operational risk management.

While PPC takes reasonable care to ensure the accuracy of the information presented, PPCaccepts no responsibility for any damages be it consequential, indirect, special or incidental,whether foreseeable or unforeseeable, based on claims arising out of misrepresentation ornegligence arising in connection with a forward-looking statement. This document is not

intended to contain any profit forecasts or profit estimates, and unless otherwise stated, hasnot been reviewed and reported on by PPCs auditor either in accordance with3.4(B)(VIII)(1)(AA) OR 3.4(B)(VIII)(1)(BB).

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