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Ita conference digital journey of transnet presentation17 may2018

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Ita conference digital journey of transnet presentation17 may2018

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Ita conference digital journey of transnet presentation17 may2018

  1. 1. ITA Future of Technology Conference I 17 May 2018 Digital Journey of Transnet Presenter: Mandla Mkhwanazi, Digital Business Leader
  2. 2. 1Strictly private and confidential Outline Transnet Strategy History MDS Transnet 4.0 Transnet Digital Business
  3. 3. 2Strictly private and confidential Recap of Transnet growth path • Diversification of Revenue Streams • Geographic Expansion • Digital Transformation Key investments • DDOP Phase 1 • Inland Terminals • Gas Infrastructure Networks • Focused investment in emerging markets 2020-2027 Transnet 4.0 2012-2019 Market Demand Strategy (MDS) Quantum Leap 2008-2011 4-point Turnaround Plan 2005 - 2007 Pre 2005 Pre 4-point Turnaround Plan ▪ Accelerated investment ▪ Create capacity to satisfy market demand Key investments ▪ Rolling stock recapitalisation (Replacement Strategy) ▪ GFB 88 – 180mt ▪ Mn – 16mt ▪ Coal – 97mt ▪ Ore – 72mt ▪ NMPP Phase II ▪ Richards Bay expansion ▪ DDOP land ▪ Volume growth ▪ Improve financial performance ▪ Steadily increasing rate of investment Key investments ▪ NCT ▪ Ore Line – 60mt ▪ Durban port refurbishment ▪ 50 EMD locos for GFB ▪ Business reengineering ▪ Corporate governance ▪ Culture change Key investments ▪ CTCT ▪ Ore Line – 47mt ▪ Coal Line ▪ Locos – 110 dual voltage coal line ▪ NMPP ▪ DHEW ▪ Port of Ngqura ▪ Redirecting business ▪ Restructure balance sheet Key investments ▪ Ore Line – 41mt ▪ Durban 2005 ▪ Ngqura Basic Port Infrastructure Financial stability Building platform for growth Diversification and expansion
  4. 4. 3Strictly private and confidential Outline Transnet Strategy History MDS Transnet 4.0 Transnet Digital Business
  5. 5. 4Strictly private and confidential Market Demand Strategy (MDS)  R300bn capital investment programme  Expanding rail, port and pipeline infrastructure  Increase in capacity to meet market demand  Continued financial stability and strength  Significant productivity and operational efficiency improvements  Shift from road to rail – reducing the cost of doing business and carbon emissions  Enabling economic growth  Job creation, skills development, localisation, empowerment and transformation opportunities
  6. 6. 5Strictly private and confidential Regional integration of the freight system and greater global connectivity is a key priority  Grow Transnet footprint in the region  Pursue options to invest in port, rail and pipeline operating concessions  Transnet International Holdings established  Transhipment revenue to more than double over 7 years  Focus on port alliances, coastal shipping market growth and linkages with rail corridors  Increase cross-border rail volumes by 60% over the next 7 years  Focus on Maputo, North-South and East-West Corridors  Set up “Joint Operating Centres” and inter-rail agreements to improve corridor efficiency  Increase export sales to R2,9 billion p.a. by 2022/23  Position Transnet Engineering as preferred OEM for Africa  Launched the “Trans-Africa” locomotive in 2017 Transnet International Strategy Transnet is the leading logistics service provider in Africa and the Middle East
  7. 7. 6Strictly private and confidential Government departments Regulators Investors Key customers Labour unions Transnet Suppliers Greater collaboration thereby creating and enabling environment for successful execution of MDS Continued support and access to cost effective funding to meet requirements Alignment and collaboration on growth and expansion plans and conversion to Take-or-Pay contracts Labour stability to support execution and competitiveness of SA freight logistics system Partner with Transnet to deliver capital spend and achieve localisation and empowerment objectives Alignment on tariff methodology and regulatory policy to create regulatory certainty Employees Increase in labour productivity to deliver on volume growth and MDS targets Success ultimately depends on a broader South African partnership and support Performance
  8. 8. 7Strictly private and confidential Outline Transnet Strategy History MDS Transnet 4.0 Transnet Digital Business
  9. 9. 8Strictly private and confidential Transnet must deliver growth opportunities aligned to the Transnet 4.0 Strategy 5 Liquids and gas (energy) Facilitate access and distribution of liquid and gas energy resources • Future of Transnet Pipelines • Link to LNG opportunity • TIH – Africa play Digital Leveraging and monetizing freight and infrastructure related digital capabilities • Examples: Fibre and telecoms, data solutions, information driven businesses Compounded organic growth 8.5% p.a. inorganic growth of R20bn pa by 2020 2017 2018 2019 2020 67 73 79 86 20 67 73 79 106 Freight solutions World class, competitive, and customer centric end-to-end freight solutions • Freight Rail and Port Terminals core • Added capabilities and partnerships (4PL etc.) • TIH adds pan Africa dimension – port and rail concessions “100 by 20 in 3” Advanced manufacturing Africa’s own rail, ports, and transport OEM • Customer focused packaged asset life cycle solutions (design, finance, building, maintain, replace) • External: Internal 90:10 to 67:33 Infrastructure, spatial solutions, maritime connectivity (local and regional) Creating and enhancing logistics eco- systems to enable and accelerate economic growth • TNPA and Transnet Property driven • Sea borne trade • Port and inland hubs • Large scale/high yield commercial and transformation opportunities • Optimize local, national and regional freight logistics network • Partner with stakeholders and private sector (PSPs)
  10. 10. 9Strictly private and confidential How is Transnet responding? Agile Fit and focused in a volatile world Admired Trusted, innovative South African brand Digital Evolve or die United Together we succeed
  11. 11. 10Strictly private and confidential Outline Transnet Strategy History MDS Transnet 4.0 Transnet Digital Business
  12. 12. 11Strictly private and confidential Transnet Digital Business - Value Proposition In line with the Transnet 4.0 strategy, Transnet Digital Business is in a process of developing and commercializing an integrated digital products and services and exploit digital capabilities to offer value added services to customers. Below are some of the benefits to be realized by our customers: • Instant access to vital and credible information (operational and commercial) from a single/central portal (from complexity to simplicity); • Total visibility to supply chain "blind spots”; • Enhanced customer responsiveness; • Better stock management (JIT inventory); • Decreased material and labor costs; • Optimized logistics and transportation efficiency; • Visualize the logistics supply chain, activities and delays • Detect, predict and manage delays at any point in the logistics supply chain • Consignment routing, timing and pricing options • Plan, quote, book and track consignment
  13. 13. 12Strictly private and confidential In conclusion • Integrated ecosystems facilitate effective collaboration. • Improve the complex logistics chains consisting of many actors. • Quality analysis is impossible without the supply chain visibility, hence Transnet is embracing 4th Industrial Revolution new technologies to stay ahead of the game, i.e. Internet of Things (IoT) and Machine Learning, Drones, Robotics, 3D Printing, Coding, Artificial Intelligence, Big Data and Analytics.
  14. 14. Thank You Mandla Mkhwanazi Digital Business Leader mandla.mkhwanazi@transnet.net

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