AECI LimitedAECI Limited

Presentation to Investors and Media

27 and 28 July 2004

SummarySummary Solid performance against background of

strengthening rand, weak local manufacturing sector and decline in gold mining

Improved trading profit from all businesses in portfolio, except specialty fibres

Volumes, in aggregate, increased by 6%

Pressure on selling prices

Excellent results in property

EE transaction announced in AEL

External environmentExternal environment

Dominated by the strengthening rand

R vs US$ - Monthly Average

6.0

6.5

7.0

7.5

8.0

8.5

9.0

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Months

Ra

nd

s

2003

2004

2003 Avg

2004 Avg

External environmentExternal environment

Favourable commodity prices, lower interest rates and strong retail demand stimulated growth in real GDP

Manufacturing volumes rose on account of domestic demand; export volumes receded

Competition from China and eastern region

Consumer confidence improved

External environmentExternal environment

Global economy gained momentum since mid- 2003, stimulated by growth in China and Asia

Upward trend in crude oil price, supported by growth and geopolitical tensions

High fuel prices and supply/demand imbalances caused fluctuations in certain raw materials

This continued to moderate fortunes of chemical industry

Results for 200Results for 2004 H14 H1 HEPS +5%

Volumes +6%

– Acquisitions and PET

TP margin declined by 0.4 percentage points

– Much influenced by SANS

Revenue +3%

– Domestic revenue +5%

Foreign sales -4% in rand but +16% in dollars

Headline earnings per share: cents

140

150

160

2003 H1 2004 H1

Rand impact on 2004 H1Rand impact on 2004 H1

Well managed on average; Group benefits from lower input costs; contribution margins maintained; deflationary prices

Strong rand has negative impact on Group, particularly export revenues and margins (SANS Fibres) and African businesses (AEL and Dulux)

Import threats increasing, but partly cushioned through value added business proposition

Necessitates continued review of cost base

Solid performanceSolid performance

Maintained earnings in spite of large currency effect, particularly in SANS

0

50

100

150

200

250

300

350

400

'00 '01 '02 '03 '04

EPS in cents

Balance sheetBalance sheet Net borrowings R1 034m,

gearing 41%

Capital expenditure R116m

WC 15%

Cash interest cover improved further to 6.7 times

Tiso transaction effective 1 July 0

200

400

600

800

1000

1200

'00 '01 '02 '03 '04 H1

0

10

20

30

40

50

Borr Gearing

Share priceShare price

Rand per share

0

5

10

15

20

25

30

35

'98 '99 '00 '01 '02 '03 '04Jun

• Graph adjusted for R6 special dividend, November 1999• Declined relative to industrial index

Segmental trading profitSegmental trading profit

-50

0

50

100

150

200

Min Sol Sp Chem Sp Fibres D&P Coat Property Corp

2003 H1 2004 H1

Group EVAGroup EVA®®

(Rm)(Rm)

-300

-250

-200

-150

-100

-50

0

50

'98 '99 '00 '01 '02 '03 '04

Calculated at WACC of 15% for ’98 to ’03 and

14% for ’04

Calculated at WACC of 15% for ’98 to ’03 and

14% for ’04

EVAEVA®®

by business (Rm) by business (Rm)

-150

-125

-100

-75

-50

-25

0

25

50

75

Min Sol Sp Chem Sp Fibres D&P Coat Other

2003 2004 H1

Includes goodwill at cost

Includes goodwill at cost

Mining solutionsMining solutions Revenue R1 045m (+6%); TP R101m (+7%)

Margin 9.7% (9.5%)

Further growth in local platinum partly offset decline in gold mining and currency effects

African markets stable except Zimbabwe

Imports of state-subsidised initiators from China: Response– Aggressive cost reduction options

– Dumping and other regulatory protection being sought

Mining solutionsMining solutions Restructuring: R11m charge recognised in

period and a possible additional R20m expected over next 18 months

EE update

DetNet progress

– Technology development on track

– Joint venture and approvals

– Launch of international product planned for Q4 2004

Specialty chemicalsSpecialty chemicals

Revenue R1 615m (+5%); TP R169m (+3%)

Margin 10.5% (10.7%)

Pressure on rand prices; gross margins maintained

Intensified imported competition

AECI Coatings update and future strategy

Mining chemical cluster; merged Senmin and Pelichem, service package development and growth options

Specialty chemicalsSpecialty chemicals

Continue with exploratory phase for EE opportunities

Operational options; restructuring, plant relocations and/or selective closure

Active working platform for acquisition growth

Specialty fibresSpecialty fibres Revenue R810m (-13%); TP R1m (-98%)

Margin 0.1% (4.8%)

Overriding factor remains currency strength against dollar(R8.02 in H1 2003 compared to R6.65 in H1 2004)

In dollar terms revenue increased by 8% and gross margin by 1%. (Mix effect; larger growth in PET than yarn)

Restructuring on schedule: nylon apparel plant closed end 2003

Employee numbers reduced by 17% year-on-year

New product/market development on schedule

Specialty fibresSpecialty fibres

Break-even at Stoneville compared to R6m loss in H1 2003: improved volumes, prices

Future strategy

Product development to fill LDI plants on track

Improved margin on HDI yarns by moving into more specialised end uses; market short

Further debottlenecking on PET to meet growing local demand

Further cost savings

Specialty fibresSpecialty fibres

Strengthening of rand could put further pressure on profitability at SANS

Invited to visit on 3 September for detailed discussion on actions, strategy, product development and plant tour

Decorative & packaging coatingsDecorative & packaging coatings

Revenue R301m (+3%); TP R12m (+9%)

Margin 4.0% (3.8%)

Seasonal business

Strong performance in South Africa, volume growth

PropertyProperty

Revenue R168m (+100%); TP R37m (+164%)

Healthy demand continues in low interest rate environment and improved business confidence

Good long-term prospects at Modderfontein and Somerset West, depending on demand, remediation and other issues eg. Gautrain

In conclusionIn conclusion

Currency strength had significant impact on results

Portfolio performed well on balance; property activities compensated for reduction in fibres

Several cost control measures introduced and ongoing

EE deal announced for AEL