2002interimresults

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I N T E R I M R E S U L T S P R E S E N T A T I O N F E B R U A R Y 2 0 0 2

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Other Flat Products Long Products 63% 32% 5% Revenue Vanderbijlpark Saldanha Newcastle Vereeniging Suprachem Iron ore rights 50% MacSteel Intl 50% CWI 60% Collect-a-Can ISCOR G R O U P S T R U C T U R E A focussed steel company 2

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C U R R E N T S T A T U S Business environment  Bottom of the price cycle  Weaker exchange rate  Pick-up in domestic demand  Reduction in imports  Final restructuring at Vanderbijlpark (Vdb) Results highlights Sharp improvement in turnover and earnings  Strong cash flow Saldanha Steel ahead of turnaround programme Business Assistance Agreement with LNM Group in place Roll-out of shareholder value 3

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O P E R A T I N G P R O F I T (R Million) 6 months ended December Operating profit up 137% 4

H E A D L I N E E A R N I N G S (R Million)6 months ended December : 

H E A D L I N E E A R N I N G S (R Million) 6 months ended December Positive earnings in tough market 5

S A L D A N H A S T E E L - R E S U L T S (R Million): 

S A L D A N H A S T E E L - R E S U L T S (R Million) * Currency revaluation of inventories and receivables R55 million Improvements offset by prices 6

A T T R I B U T A B L E I N C O M E (R Million)6 months ended December : 

A T T R I B U T A B L E I N C O M E (R Million) 6 months ended December Positive net exceptional income 7

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C A S H F L O W (R Million) 6 months ended December Strong operating cash flow 8

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D E B T S T R U C T U R E (R Million) * Bridging facility of R1,67 billion repayable from rights issue Well-spread debt redemption 9

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R I G H T S O F F E R Note: All dates are indicative at this stage and subject to change Last phase of unbundling 10

F I N A N C I A L R A T I O S6 months ended December : 

F I N A N C I A L R A T I O S 6 months ended December Improved fundamentals 11

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L I Q U I D S T E E L P R O D U C T I O N (‘000/t) 6 months ended December 12

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T O T A L S A L E S V O L U M E S (‘000/t) 6 months ended December Vanderbijlpark Long Products Saldanha Steel Total 72% 1274 67% 1492 45% 811 57% 869 52% 2484 53% 2816 399 455 +17% +14% +7% +13% Strong domestic sales 13

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G E O G R A P H I C S A L E S D I S T R I B U T I O N (incl. Saldanha) 6 months ended December Responsible market approach 14

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L O C A L M A R K E T S E G M E N T A T I O N 6 months ended December Broad market spread 15

E X P O R T P R I C E S N O M I N A L (USD/t) FOB Durban : 

E X P O R T P R I C E S N O M I N A L (USD/t) FOB Durban 100 150 200 250 300 350 400 450 Bottom of cycle 16

E X C H A N G E R A T E (USD): 

E X C H A N G E R A T E (USD) Cover policy to secure margins 4 6 8 10 12 17

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O P E R A T I O N A L E X C E L L E N C E Re-engineering performance since 1994 Re-engineering successfully concluded 18

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S A L D A N H A P R O D U C T I O N (‘000/t) Average tons / month Tons / quarter Progressive production build-up 0 50 100 150 200 250 300 19

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S A L D A N H A T U R N A R O U N D T A R G E T S Jun ‘02 Jun ‘03 Jun ‘04 Cash in on Corex reline Break-through Stabilise Continuous improvement Jun ‘01 Continuous improvement culture established $201/t $187/t $178/t Throughput Revenue benefit 0.95 Mtpa $9/t 1.1 Mtpa $13/t 1.3 Mtpa $18/t Cash cost Turnaround on track 20

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B U S I N E S S A S S I S T A N C E A G R E E M E N T Delivery features Procurement optimisation  Capex evaluation  Target setting and performance measurement  Technical support  Research & development  Benchmarking programme  Market support Key performance leverage 21

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Basis for share allocation B U S I N E S S A S S I S T A N C E A G R E E M E N T Shareholder value enhancement 22

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R S A I N D U S T R Y C O N S O L I D A T I O N Current initiatives Saldanha Steel integration  Recommended by Competition Commission  Approval awaited from Competition Tribunal Duferco Steel Processing due diligence in process Phased programme underway 23

O U T L O O K: 

O U T L O O K Positive business developments Domestic demand  Q3 stronger than expected  Sustainability depends on economy International prices  Signs of firming Exchange rates  Limited cover: $23 million @ R9.70  Lag in implementing import parity pricing  Positive impact of weak currency Saldanha Steel  Corex rebuild Q4  Negative profit impact for H2 Restructuring benefits to flow through 24

O U T L O O K: 

Earnings  Further improvement in H2 Cash flow  Higher capex and working capital in H2  Rights offer – R1,67 billion  Reduction in net debt at Y/E < R1,8 billion O U T L O O K Healthy base for earnings growth 25