Umgeni WaterAnnual Report2011/2012PRESENTATION TOSTAKEHOLDERS25 th OCTOBER 2012
CHAIRMAN’S ADDRESSA MAHLALUTYE
CHIEF EXECUTIVE’SREPORTCYRIL VUYANI GAMEDEOrganisationalPerformance 2011/2012
Organisational Performance2011/2012OverallGood performance trends to be maintained 83%Targets not completely met, but can be explained 17%
Management Philosophy• Based on well researched Outcomes Framework• Outcomes as basis for Performance Management• Outcomes as basis for Shareholder Compact / 5Year Business Plan• Objective Dashboard
Strategic Objective: Exceed customer expectations•Continuing to provide excellent quality potable water to customers.Water quality challenges addressed through interventions: 2Ml/dpackage plant at the Mvoti WTW, Capacity Upgrade of MaphephethwaWTW to 5Ml/d, and Turnaround strategy for the iLembe schemes.•Progress made in treated wastewater quality performanceVariance addressed through process optimisation and rehabilitation andupgrade projects including major works upgrade at Darvill WWTW.
Strategic Objective : Exceed customer expectationsEnsured customer satisfaction: met all customer requirements ‐ supply•agreements for : Water volume demands and Pressure requirements.Sustainable management of the service interruptions experienced earlier inthe year with our supplies to Ballito in the North Coast.Customer collaboration ‐ 9 joint Blue Drop certifications for drinking waterquality management excellence.• Significant milestone– signing of one‐year agreement with Msunduzi WSA.The long‐term agreement finalisation is in progress.
Strategic Objective: Grow / Increase customer base• R485m or 82% of target Capex spent:R411m to support economic growth and livelihoodsR74m for asset upgrades and refurbishments.Major projects include: 3 augmentation, 8 rural expansion
• R485m or 82% of target Capexspent:R411m to support economic growth and livelihoodsR74m for asset upgrades and refurbishments.Major projects: 3 augmentation, 8 rural expansion
Umgeni Water Strategic Objective : Grow / Increasecustomer base• Umgeni Water continued to monitor, assess, optimise and plan raw watersupply resources :•Mhlabatshane Dam (UW) construction is complete.•Imvutshane Dam (UW) is in tender phase.•Spring Grove Dam (DWA‐TCTA) is under construction.•Mkomazi Project (DWA) detailed feasibility study in progress.•Hazelmere Dam raising (DWA) detailed design is in progress.•The reuse project at Darvill WWTW is in progress with completion of theOzone and GAC lab scale plants.•The detailed feasibility for the seawater desalination plants for the EastCoast Region is underway
Strategic Objective : Manage Stakeholder Relations• Positive engagement of stakeholders including: Portfolio Committee forWater and Environment Affairs; National Treasury, DWA, KZN ProvincialGovernment and MECs, and Customer Municipal Mayors.• Provided information and engaged: Media, Community, Environmental lobbygroups, Academia and other stakeholders on plans and performanceincluding supply incidents and resolution.• Constructive engagement and feedback with: Employees, Organised Labour,Investors, and Suppliers.Internal climate survey currently underway.
Umgeni Water Strategic Objectives: Contribute to an affordable tariff,Maintain an optimal debt level, Enhance shareholder value.6.• Overall a financially viable entity.Reversal in downward trend in bulk water volume sales. Surplusof R591million generated and reinvested:•Fund the R4.2billion Capex Programme to assist municipalitieseliminate water backlogs•Reduce debt•Ensure affordable bulk water tariffs.
Umgeni Water Strategic Objective : Contribute todevelopmental agenda and the social economy7.• Preferential Procurement ‐ spend of 68.8%.New BBBEE Policy will further facilitate human capital development in poorcommunities.• 1,010 jobs created through Capex.• Interventions for four adopted schools.Water education ‐ over 100 structured lessons at UW water classroomsCSI Policy developed.
Strategic Objective : Ensure Functional Excellence• 48 learners in Learnerships training programme. Learners replaced as theyqualify. The first batch expected to qualify in 2013.18 graduate trainees were developed in the fields of engineering, science andother scarce professional fields.An additional 38 graduate engineers enrolled as part of our trainingpartnership programme with National Treasury.10 bursary students enrolled in engineering and related fields
Strategic Objective: Ensure Operational Competence• SABS contracted to undertake a gap analysis to establish the status ofcorporate‐wide implementation to ISO 9001.• 92% of strategic risks mitigated to ≥ 50% overall control strength.Risks ranked in accordance with the risk appetite and risk tolerance levels.• 10 organisational risks greater than risk appetite level, of which1 risk is outside both risk appetite and tolerance level ‐ final wastewatereffluent quality compliance. Capital improvement programme in place
Umgeni Water Strategic Objective : Ensure Operational Competence• Resource efficiency interventionsCompletion of an energy audit of main sitesActions to reduce usage or improve energy efficiency proposedInitiation of chemical plant trialsRecommendations for optimising chemical usage.
Strategic Objective: Maintain StrategicEffectiveness• Strategy aligned to operating environment, Executive Authority expectationsand emerging issues and trends for Water Boards.The role of state‐owned enterprises is embedded in economic transformation ina developmental state.Outlook:•Alignment of DWA and water boards’ vision, strategy, plans and ShareholderCompact with National Government priorities.•Water regulation reform and restructure.•Skills for the water value chain system.•Rationalisation of public entities. 9 WMAs (CMAs) and 8 Water Boards.Major customer ‐ Section 78 process•Sustainable bulk and raw water pricing.
GENERAL MANAGER: FINANCENICA GEVERSFinancial Performance2011/2012