AECI LimitedAECI Limited

Presentation to Investors and Media

22 and 23 February 2005

SummarySummary Solid performance of portfolio against background of

relatively strong commodity prices and strengthening rand exchange rate, accompanied by low inflation and interest rates

Headline earnings increased by 10 per cent to new record of 392 cents per share

Headline earnings include restructuring charges equivalent to 27 cents per share

Sound balance sheet; excellent working capital management and prudent capital expenditure continues

Volumes, in aggregate, higher but selling prices marginally lower

SummarySummary

Outstanding performance from property activities

Trading margin at 9.4% the best in recent history

Encouraging response to strong rand environment; actions across Group

Implemented economic empowerment transaction in AEL

DetNet joint venture now operational

CSL back on acquisition trail

SANS’ recovery strategy on track

SHE performanceSHE performance

2004 Total Recordable Incident Rate

0.00

0.50

1.00

1.50

2.00

2.50

3.00

TR

IR

Business environmentBusiness environment Low inflation and interest rate environment prevailed

This resulted in strong consumer-driven demand, such as retail, housing and automotive

Commodity prices including oil remained high, but strong currency restricted inflationary pressures

The local manufacturing industry is progressively addressing the global competitive environment through productivity measures, cost cutting, aggressive purchasing policies and product rationalisation

Opportunities for sales price adjustments ahead of cost increases diminished

Certain raw materials became scarce and prices fluctuated and increased sharply

Chemical industryChemical industry

Global industry no benchmark for AECI; we are portfolio of customer focused specialty product and service solutions businesses, operating in global and regional niche markets

Global industry remains in better shape with improved demand and commodity prices

Prolonged high cost of natural gas and roller coaster crude oil prices and supply and demand imbalances play havoc with results

China is an increasing factor in demand and supply for a vast range of products, and an investment base for multinationals

Results for 200Results for 20044

HEPS +10%

Volumes +4%

TP Margin 9.4% (9.0%)

TP increased by 8%

Exports +2% in rand but +19% in dollars

Headline earnings

per share: cents

310

330

350

370

390

410

2002 2003 2004

7

8

9

1 0

2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4

Trading margin: per

cent

Solid results due to:Solid results due to:

Robust portfolio: specialised, value add, customer focus, diversified (contribution margins stable)

Volumes maintained: local economy sound

Quality properties available when demand improved

SANS stemmed the rand strength effect

Excellent balance sheet management

FinancialFinancial Net borrowings R633m, gearing

24%

Capital expenditure R277m

WC 12% at year-end

Cash interest cover improved to 7 times

Exceptional charge R23m; includes impairment in Botash and closure of resin plant offset by sale of IP to DetNet

Finance charges include R13m mark-to-market adjustments

0

200

400

600

800

1000

1200

1400

1600

'98 '99 '00 '01 '02 '03 '040

10

20

30

40

50

60

Borr Gearing

Share priceShare price

AECI share pricerelative to JSE IND index

0

100

200

300

400

500

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

Relative rating to industrials (at year end) declined from recent trend; but has improved in January

Graph adjusted for R6 special dividend (November 1999)

Economic empowermentEconomic empowerment

The R1.6billion AEL/Tiso transaction now operational. Tiso participates at strategic level. AEL community trust established

Selective investigation in CSL continues, and good progress with first empowered transaction at subsidiary level

Segmental trading profit (Rm)Segmental trading profit (Rm)

-50

0

50

100

150

200

250

300

350

400

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

2003 2004

Includes R33m

restructuring

Group EVA (Rm)Group EVA (Rm)

-300

-250

-200

-150

-100

-50

0

50

'97 '98 '99 '00 '01 '02 '03 '04

Calculated at WACC of 15% for ’97 to ’03

and 14% for ’04

Calculated at WACC of 15% for ’97 to ’03

and 14% for ’04

EVA by business (Rm)EVA by business (Rm)

- 1 2 5

- 1 0 0

- 7 5

- 5 0

- 2 5

0

2 5

5 0

7 5

M in S o l S p C h em S p F ibres D &P C oa t O th er

2 0 0 3 2 0 0 4

Includes goodwill at cost

Includes goodwill at cost

Mining solutionsMining solutions

Revenue R2 140m (+3%); TP R212m (-12%)

Margin 9.9% (11.5%)

Trading profit before restructuring charge is R245m (+2%) and margin unchanged at 11.5%

Restructuring: R33m charge recognised in period and 130 people retrenched

Significant progress made in restructuring the business and footprint reduction nearly complete. Also, new investments in packaged Anfex and bulk explosives plants brought on line in Modderfontein. Automation programme on track.

Mining solutionsMining solutions Volumes down due to decline in gold mining,

importation of Chinese Shocktube and industrial action on platinum mines in H2, somewhat offset by growth in West Africa

Imports of state-subsidised initiators from China continues although penetration in to South Africa slower than anticipated

African markets stable, except Zimbabwe where competitor attack destroyed value

Opportunity for PPAN exports to Australia

Mining solutionsMining solutions DetNet progress

– Joint venture approved and in operation

– Development and testing of first new product (HotShot) completed

– First HotShot product has now in USA and is undergoing proving trials

Presentation on mining solutions and property activities on Friday, 15 April at Modderfontein

First shipment ofHotShot to USA

Specialty chemicalsSpecialty chemicals

Revenue R3 302m (+3%); TP R380m (+2%)

Margin 11.5% (11.6%)

Maintained high trading margin trend, to validate robust specialty chemical model

Company performances in portfolio ranged from pedestrian to brilliant

Rand strength put pressure on prices and export-driven customers

Specialty chemicalsSpecialty chemicals

Mining chemical cluster established, with high service package and local production key initiatives

AECI Coatings returns improved; alternative broad supplier technology strategy implemented, resin manufacturing closed

Acquisitions: First Chemicals (chemical trading) from August, UAP (distributor of specialty agro-chemicals) in January 2005 and Chemiphos (producer of food-grade phosphates) subject to regulatory approvals

Group Sales by Industry Segmentation 2004

17%

11%

8%

8%

7%7%

6%

6%

4%

4%

4%

3%

3%

3%

2%

2%

1% 3%

Mining

Paper and packaging

Automotive

Chemical Industry

Detergents

Agriculture

Plastics & Rubber

Coatings Ink & Adh.

Food & Beverage

Toiletries, cosmetics and Pharmaceuticals

Engineering and foundry

Construction

Appliances and furniture

Oil and refining

Textiles and tanning

Explosives

Steel & metal

Other

Specialty chemicals

Diversified portfolio

5

6

7

8

9

1 0

1 1

1 2

9 4 9 5 9 6 9 7 9 8 9 9 0 0 0 1 0 2 0 3 0 4

C S L T rad in g p ro fi t m arg in %

Specialty fibresSpecialty fibres Revenue R1 595m (-7%); TP R3m

Trading profit includes cost of R6m for ongoing restructuring of business, now essentially complete

In dollar terms revenue increased; volume up 5%

Restructuring resulted in R60m reduction in annualised fixed costs

USA JV approaching break-even; good volume growth

Continued good demand for PET

Specialty fibresSpecialty fibres Future strategy

– Product development strategy to fill LDI plants on track, particularly airbag for automotive

– HDI yarn margin focus by selective growth in specialised markets

– Costs, efficiencies, yields

– Debottlenecking PET

Specialty fibresSpecialty fibres

Overriding factor remains currency strength against dollar

P ro fit an d exch an g e ra te

-40

-20

0

20

40

60

80

100

120

1 H '0 2 2 H '0 2 1 H '0 3 2 H '0 3 1 H '0 4 2 h '0 4

Rm

6 .0

7 .0

8 .0

9 .0

10 .0

11 .0

12 .0

R/$

P B IT R /$

Decorative & packaging coatingsDecorative & packaging coatings

Revenue R671m (+2%)

TP R59m (+13%); Margin 8.8% (7.9%)

Best margin in recent history

Exceptional performance in South Africa, in contrast to unfavourable market conditions and currency issues elsewhere

Thrusts include broader exposure to specialist building suppliers and hardware stores and new product lines

PropertyProperty

Revenue R352m (+70%); TP R130m (+233%)

Healthy demand continued in all areas for commercial, residential and retail sectors

Outstanding net cash flow of R270m

1 100ha of the original 3 700ha excess land available has been sold (including 350ha in 2004)

OutlookOutlook

Progressive benefits of actions taken to emerge more fully in 2005; particularly cost reductions, acquisitions, property pipeline and innovative growth

Expect relatively strong commodity prices and rand exchange rate accompanied by low inflation and interest rate environment to continue