TransCentury Gro oup An Overview INVESTING IN AFRICA Executive - PowerPoint PPT Presentation

TransCentury Gro oup An Overview INVESTING IN AFRICA

Executive Summary � T Trans-Century Limited (“TCL”) is a Kenya–headqu C Li i d (“TCL”) i K h d uartered infrastructure group with investments d i f i h i across East, Central & Southern Africa − Operating profit of circa KES 1.6 billion − Total assets of circa KES 20 billion Total assets of circa KES 20 billion � Industry sectors include: Power Infrastructure - T Tanelec, Kewberg, EA Cables, Cableries Du Congo; T Transport Infrastructure - Rift Valley Railways; t I f t t Rift V ll R il and Engineering - Civicon, Avery d E i i Ci i A � Uniqueness of TCL: � Entrepreneurial Entrepreneurial − Founded by entrepreneurial Kenyan busines ss people and investors � − Focus on power infrastructure, transport inf frastructure and Infrastructure engineering focus focus − Subsidiary operating companies led by dyna amic management with extensive experience & in-depth except tional capabilities � Ability to execute � TC investment view: � African markets display under-penetration & & inefficiency, particularly infrastructure − Poor service delivered expensively to to oo few people � Opportunity to build scale businesses that be enefit from market inefficiencies − Focus on strong cash generation and ca apital gains 1

TCL’s industry focus Tra ans-Century Ltd Transport Affiliated Power Divisions: Engineering infrastructure infrastructure holdings g � E.A.Cables – manufacture � � Civicon – civil, mechanical � Rift Valley Railwa ays - Chai Bora - tea blender & Existing Existing aluminium & copper cable engineering, craneage & Kenya Uganda railw way packager investments: � Tanelec – transformers, � erection and logistics, oil & concession Development Bank of switchgear etc gas EPC services Kenya - complimentary � Kewberg - specialty cables � Avery – Weigh Bridges, banking services manufacturer � generators, bearings, sub- Karen Mall- property for � CDC – manufacture copper CDC f stations development cables � Fund of Funds � � Rift Valley Railwa ays: � Electricals Consolidation: Engineering & Contracting: Focus: recapitalization of p f Kenya y consolidation of current power consolidation of current power specialised engineering & specialised engineering & Uganda rail infrastructure assets contracting � Power Generation & Transmission Opportunities Transport 1 Engineering Power Other Total 1 H1 2012 Revenues: 3,567 3,063 7,064 1,056 434 (KesM) Note: 1. Total revenues do not include TCL’s share of RVR revenues, which are not consol lidated in TCL financials 2

Geographical Presence & Dis tribution Tunisia Morocco Algeria Libya Egypt Mauritania Mal li Niger Senegal Eritrea Chad Djibouti Sudan Gambia Guinea Bissau Burkina Guinea Nigeria Somalia Ethiopia Sierra Leone Ivory Coast Central African Liberia Republic Cameroon Benin Ghana Equatorial Democratic Uganda Guinea Republic of Congo Kenya Togo Gabon Rwanda Congo Burundi Tanzania Presence & Distribution Mozambique Angola Malawi � Presence in 14 countries across East, Central Zambia and Southern Africa Zimbabwe Namibia Botswana � 8 factories and a vast distribution network Madagascar across these countries Swaziland Lesotho � Physical presence bolstered by cross-border � Physical presence bolstered by cross border South Africa trade into neighbouring countries Market Presence 3

Investment considerations � Strong fundamentals in target markets of Power Strong fundamentals in target markets of Power r and Transport Infrastructure as well as Engineering r and Transport Infrastructure as well as Engineering − Under penetration of power sector with stro ong commitments from utilities − Various economies in the region are experien ncing growing cargo traffic and consequently demand for cargo logistics solutions − Regional oil & gas finds open numerous opp ortunities for engineering & contracting � Strong market positioning − Physical operations in 8 countries within Ea ast, Central and Southern Africa; including Kenya, Uganda, Tanzania, Rwanda, South Sudan DR RC, Zambia and South Africa � Leveraging scale for execution − Strong balance sheet with shareholder funds s of KES 11.6 billion � Strong management teams with deep hands-on experience in operations, strategy and execution; incentivized by an entrepreneurial board � Impressive financial performance – Average revenue growth of 26% over the pa ast 5 years, driven by strategic acquisitions & organic growth growth – H1 2012 turnover growth of 56% and six-fol ld earnings growth for the same period 4

Power Products Under-penetration of Regional Electrification Under-penetration of Regional Electrification n n – Copper house wires – Interior data cables – Specialty cables p y – Aluminum conductors Description � Leading power cable manufacturer with 5 plants in East and Central Africa � Predominant manufacturer of transformers and d – Transformers switchgear in East and Central Africa � Investment in tripling of capacity across power division – Switchgear � 2011 divisional revenues: USD 89mm 5

Power Fundamentals: strong growth Fundamentals: strong growth Market potential: still underserved Market potential: still underserved Cement and Electricity Consumption Electrification Rate: % of population 3.4mt 2.1 3.6mt Kenya 3.1mt 6 25% 3.2mt 1.8 CAGR: CAGR: 13% 2.7mt 2.8mt tomers (Millions) 1.7 Uganda onnes)millions consumption 9% 5 consumption 2.4mt 1.5 2.2mt n millions) 2.1mt 2.0mt Tanzania 1.3 14% 4 1.3 1.6mt (MT in KPLC cust Cement 1.1 Cement (Metric t Ghana 61% 3 1.2mt 0.9 CAGR: 18% 0.9 0.8mt South Africa KPLC customers 75% 2 Cement Consumption 0.4mt 0.5 0 5 0 0mt 0.0mt USA USA 100% 1 2007 2008 2009 2010 2011 Source: KPLC &KNBS Source: UNDP Power Generation Capacity Installed Capacity (MW) Kenya 1,570 1,589 1,700 1,589 1,600 Uganda ty (MW) 570 CAGR: 1,471 1,500 7% 1 095 1,095 Tanzania Tanzania Installed Capacit 1,400 1,361 1,310 Ghana 2,085 1,300 1,197 1,200 39,000 39,000 South Africa I 1 100 1,100 USA 1,078,000 1,000 2007 2008 2009 2010 2011 Source:UNDP Source: KPLC 6

Transport Congestion on the Northern Corridor Congestion on the Northern Corridor Growth Story Growth Story � Strong market fundamentals – 20mm tones of cargo at Mombasa Port – R il h Rail should be cheaper than road for ld b h th d f homogenous point-to-point cargo � America Latina Logistica as the technical partner partner � Strong financial partners – Equity partner is a strong African private equity player; key lenders from DFI equity player; key lenders from DFI community Assets Description � Awarded a 25 year Kenya & Uganda railway concession which includes the management of : – ~2,800 km of track 2 800 km of track – ~100 locomotives – ~4,000 wagons � 2011: Initiation of RVR strategic turnaround g plan resulting in increased volumes and reduced operating costs 7

Fundamentals Remain Strong: Tran nsport Infrastructure Containerised Cargo Growth Mombasa Port Evacuation 800 771 25 750 20 19 s) 20 CAGR: CAGR: go (TEUs 000's 696 8% 700 MT in Millions 15 13 650 619 616 10 8 7 600 4 8 4.8 M Carg 5 2.5 2 1.6 1.5 550 0 1980's 1990's 2000's 2010 2011 500 2008 2009 2010 2011 Port Volume RVR Turnaround Plan Progress to Date � � There is an opportunity to quickly increase capacity of All equity injected 1 st material debt drawdown completed 2 nd at RVR with relatively limited capital outlay by: V t e at e y ted cap ta out ay by � � 1 material debt drawdown completed, 2 at year end – Managing selective upgrade of the permanent way � 70km of rail being installed – Managing upgrade of locomotives and wagons to � Locomotive rehabilitation underway improve availability p y � Hiring of C-suite complete – Managing purchase of new/refurbished locomotives � Key material cargo being transported: – Mombasa – Kampala, refined petroleum – Reducing operating costs by focusing on fuel and – Mombasa Mombasa – Nairobi, container cargo Nairobi container cargo labor costs labor costs – Mombasa – Kampala, crude palm oil and – Working with ALL technicians to re-establish cereals efficient operations – Athi – Kampala, cement 8