Presentation to Portfolio Committee
2005/2006 Annual Report
24 October 2006
Bruce Tashe
•Achievements 2005/2006•Operations and Research •Human Capital Management•Other Achievements•Challenges•Performance Against Goals•Financial Results
•Goals 2006/2007•Recapitalisation plan
CONTENTS
•Theme 2005/06 – Modernisation
Endengering customer focusUpgrading radar networkExpanding automatic weather stations (cover rural areas)Launch Meteosat 2nd generation training centreInstallation of lightning detection network – detect 95% of strikes over RSA
ACHIEVEMENTS
ACHIEVEMENTS
•Theme 2005/06 – Modernisation
98.8% uptime in networksLaunch early warning system for severe weatherInvest in cutting edge technologyRefurbish ageing meteorological and upper air sounding instruments abroad SA Agulhas (Norwegian funding)Run global atmospheric watch programOzone monitoring
ACHIEVEMENTS
•Theme 2005/06 – Modernisation
AMDAR software – increase atmospheric temperature and wind soundings over AfricaIncreased upper air observations – highest since 1990’s – 18 per day up 100%Installed 7 ground receiving stations – reduced satellite data communication costs with 20%
ACHIEVEMENTS
ACHIEVEMENTS
Lightning Detection Network (LDN)
Vast improvement in observation network
Installed 19 LD sensors over the country
Detection accuracy 500 meters
3.4 million strikes detected in January 2006 and
3.9 million in February 2006
ACHIEVEMENTS
The SAWS LDN
The SAWS LDN:Detection Efficiency
Floods and Storms
Floods and severe stroms
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Floods Severe Storms Linear (Floods) Linear (Severe Storms)
National Weather Radar Network
Network of 11 integrated radar systems
Provide detailed monitoring of weather over
major part of country
Linked to Mozambique – establish regional
weather radar network for Southern Africa, next
Botswana
ACHIEVEMENTS
Automatic Weather Stations (AWS)
Purchased equipment and components for 34
AWS and 200 electronic rain gauges
50 rain gauges assembled in March 2006
15 AWS deployed in Natal and Eastern Cape,
next roll out Western Cape
SMS messaging
ACHIEVEMENTS
Components within the AWS Electronics Enclosure
ACHIEVEMENTS
Aviation Weather Display System (AWDS)
•Up to date global aeronautical meteorological
information – installed at air traffic control towers
aerodome reports, forecasts, en-route
weather, wind conditions, satellite and radar images
Major tool in implementation of advanced air traffic
management
ACHIEVEMENTS
Research
Enhance Meteorological Early Warning System
by integrating current related activities with
focused goals
Use new Meteosat 8 and LDN
To improve warning detection procedures at
forecasting offices
Collaboration with disaster management centers
ACHIEVEMENTS
0 – 2 Hours
2 Days
7 Days
14 Days
Month
3-Month Season
F
ore
ca
st
Un
ce
rta
inty
Observations NWP GCM & Ensembles
-Satellite
-Radar
-Lightning
-Weather Data
-Regional
-Mesoscale
-Ensembles
-MOS
-Medium range
-Ensembles
-MOS
-Ensembles
-MOS
-Ensembles
-MOS
-Statistical Models
GCM Ensembles
-MOS
OutlookGuidance
Advisories
Warnings
Detail Warnings
R
es
ea
rch
P
rog
ram
me
s S
ys
tem
sPrediction Research
Short-range Forecasting
Long-range Forecasting
NWP
Ensembles
F
ore
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sti
ng
Pe
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Research
Research on the Utilisation of Meteosat Second
Generation (MSG) satellite data in Southern
Africa
Pollution monitoring project co-funded by DEAT
and Norwegian government was conducted
ACHIEVEMENTS
Research
Acquired Cloud Condensation Nuclei counter
Awarded for best scientific contribution to science
of rainfall enhancement research - presented to
SAWS at annual WMO commission for
Atmospheric Sciences
ACHIEVEMENTS
Research TRACM – Trace gas research and atmospheric
change monitoring - Maintaining trace gas
measurements to detect and monitor climate
change signals within atmosphere
Submitted national ozone report to United Nations
Environmental Program on behalf of DEAT
Provided trace gas analysis to DEAT for inclusion
in National Statement of Environment report
ACHIEVEMENTS
Research
The Cape Point GAW trace gas measurement program for close to 30 years are based primarily on measurements of pristine clean air that moves in from over the southern oceans.
ACHIEVEMENTS
Global Atmosphere Watch Laboratories around the world
ACHIEVEMENTS
Trace gas
ACHIEVEMENTS
Human Capital Management
Implemented performance management
system based on balanced scorecard
Reduced capped leave liability with R 6.7
million
32 new appointments of which 88% were
historically disadvantage
ACHIEVEMENTS
Race and Gender (365 employees)
125
87
31
8
5844
7 5
0
20
40
60
80
100
120
140
Black White Coloured Asian
Male
Femal
50% 36% 10% 4%
ACHIEVEMENTS
Training
Forecaster training – 30 forecasters during past 5 years trained, 2005/2006 – 5 of 6 students passed, 10 enrolled for next year
Observer training – 10 students completed successfully, 11 new students started
MSG International training – 3 national and 2 international training sessions conducted
141 Staff members attended short courses
ACHIEVEMENTS
Training
31 Staff members attended in house MAP course
12 Staff members attended ABET program
A total of 2161 days spent on training
Total amount spent for training R 4.2 million
which is 5.9% of total employee expenses
Received more than R 150 000 back from the SETA for discretionary grant
ACHIEVEMENTS
7 peer review articles were published
Participated in 7 air shows
Participated in several science related exhibitions
World Meteorological Day held in Polokwane and
Deputy Minister addressed users about hazards of
severe weather
1023 media reports covered SAWS
7598 climate data enquiries were answered by SAWS
OTHER ACHIEVEMENTS
PERFORMANCE AGAINST GOALSGOAL Performance Result
Good corporate governance Develop an effective and efficient organisation aligned with the strategic intent of SAWS
•Developed 37 policies of which 27 were finally approved by the Board at year end.•The SAWS Board and Committees are effective and meet regularly•Internal Auditors were appointed and executed the internal audit plan as approved by the Board.•An unqualified audit report was received •All legislative submissions was done on time•The Workplace Skills Plan submitted•The SAWS achieved the 40% BEE target through procurement processes•Implementation of Performance Management system for all employees was achieved.
Develop new sector specific products that will attract new customersMount research programmes and projects that will improve products and service offerings as well as operational efficiency
•Data availability of the data from weather radars was 75%.•An agreement to maintain meteorological equipment at all 9 ACSA airports was renewed•Maintenance was done on all 11 radars in the network •A weather radar has been commissioned for installation in Skukuza. An environmental impact assessment report in support of the radar installation process has been completed•MSG ground receiving equipment to receive real time satellite images was installed in 5 major forecasting stations and at the Bethlehem Weather Office for research purposes•Installation of 19 lightning detection sensors and development of in-house lightning display system.•Replacement of the automatic weather stations •50 automatic rainfall stations prepared and made ready for deployment
Mainstream SAWS products
•Ordering of new NEC super computer •Improvement of accuracy of monthly and seasonal prediction system•Improvement in the use of ensemble forecasting systems•Deployment of a new SQL in –house development system to finish automation of CLIMOS•Participation in airborne pollution monitoring over air pollution hotspots in South Africa
Play an active role in improving relationships with international communities
•Continuous participation in the Global Atmospheric Watch programme and we achieved continuous collection, archiving and analyses of long term data sets of atmospheric trace gases and solar radiation as per laid down international guidelines. Certified data sets were provided to international data centers
PERFORMANCE AGAINST GOALSGOAL Performance Result
Maintain and improve existing partnerships with institutions of higher learning and to forge new partnerships
•5 of 6 forecasting students passed •10 Observers completed training and were placed within SAWS•15 staff members completed Management Advanced Programme (MAP)•7 staff members graduated to the next level of ABET
Generate revenue streams that will ensure the sustainability and profitability of SAWS
•Generated R 60.2 million commercial revenue which is an increase of 12.5 % form 2004-05.
Reduce the vulnerability of communities against adverse weather conditions in partnership with other players
•Daily forecasts to public and specialised communities were issued •Over 400 severe weather advisories were issued through the media.
Invest in cutting edge technology
•Achieved a 98.8% communication network uptime between regional offices and international hubs•Capturing of 92.2% of available data into climate databank to ensure improved quality of climate data•Introduced an ICT helpdesk
CHALLENGES
Capacity constraints – ICT and Science
Transfer of land – lack of office space
Aviation debt – ongoing dispute
Commercialisation – lack of contractsOld radars – awaiting financingSAWS corporate brandTurnover in top managementDelay in installation of Skukuza Radar
2006 Audit Report
AUDIT REPORT
2006 2005 ImprovementEmphasis of matters *** 3 5 40%Significant matters 0 5 100%
***
Title deed of land - (28) 1 Certificate from land affairs outstanding
Policies formulation - All done
Performance information - Improvement in new strategic targets
2006 Financial Results
2006 2005R R Variance
Revenue 167.2 153.8 8.7% Aviation Income 7.8%, Grant 7%
Administrative Expenses (2.4) (1.8) 33.3% Increased executive functions by Board
Employee benefits expense (70.7) (65.4) 8.1% Increases and vacancies
Armortisation (0.2) (0.2) 0.0%
Depreciation (9.8) (6.4) 53.1% Recap plan
Other operating expenses (80.8) (58.8) 37.4% Detail to follow
Finance costs (0.2) (100%)
Operating surplus 3.30 21.00 (84.3%) Improved reduction
Revaluations of land 3.3 20.3 Garsfontein land
Suplus for the year 6.60 41.30 (84%)
2006 Financial Results
Commercial: Automatic Weather Stations and Aviation 12.5 %
REVENUE
2006 2005 Variance
Rm Rm %
Government Grant 103.7 96.9 7.0%
Commercial and Other 60.2 53.5 12.5%
Project Income 1.2 (100%)
Investments 3.3 2.2 50.0%
Total Income 167.2 153.8 8.7%
2006 Financial Results
Operating Expenses 2006 2005IncreaseIncrease
Rm Rm Rm %
Radiosondes 10.4 4.5 131.1% Increased accuracy of forecasting
Conference Costs 2.1 0.3 600.0% CAS conference hosting
Consulting Fees 5.7 8.2 (30.5%) Due to completion of baseline policies and procedures
Repairs and Maintenance 2.5 1.4 78.6% Aircrafts
Legal costs 2.5 0.9 177.8% Legal retainer - CFO dismissal, contracts, corp. governance
Training 4.2 0.9 366.7% Bursaries and management development
Vat deregistration 8.20 - 100.0%
Travelling 6.40 3.80 68.4% Manage international relationships in fullfillment of WMOand ICAO obgligations
2006 Financial Results
Note: 2005 – Reduction in Aviation income due to tariff adjustments retrospectively for 2004
Commercial Income (R million)
0
10
20
30
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50
60
70
80
2002 2003 2004 2005 2006
Aviation Income
Commercial and Other Income
2006 Financial Results
Operating surplus (deficit)
-10
-5
0
5
10
15
20
25
2002 2003 2004 2005 2006
R million
Huge improvement in budget management and control for 2006, obtained approval from National Treasury to roll over surplus cash for recap plan implementation
2006 Financial Results
SAWS Ratio Analysis R'000 R'000 R'000
2005/6 2004/5 2003/4
Current Ratio 2.86 1.78 1.45
Total Income / Total Expenses 1.02 1.16 1.15
Employee costs / Total costs 43.1% 49.2% 48.0%
Employee costs/ Total revenue 42.3% 42.5% 41.6%
Debt (current) to revenue 10.7% 23.9% 20.9%
Revenue growth rate 8.7% 8.9% 50.0%
Internal revenue growth rate 12% -6% 283%
External income as % of total income 62% 63% 57%
Internal income as % of total income 38% 37% 43%
Solvency ratio 3.79 2.78 2.49
Debt collection days 64 89 117
Creditor payment days 21 54 44
Top management remuneration % of staff costs 3.3% 3.6% 3.2%
Goals 2006/2007
STRATEGIC OBJECTIVES
Strategic Objective 1: Ensure financial viability and sustainabilityManage operational costIncrease revenue baseInfrastructure modernisation
Strategic Objective 2: Ensure corporate governance and strategic leadershipDevelop and implement a Corporate Communication StrategyPlan Review and consolidate organisational policies and proceduresDevelop and implement a Management CharterTransformation strategiesAmend and improve delegation of authority
Strategic Objective 3: Ensure SAWS becomes a learning organizationPursue scientific and business excellence Knowledge management strategy (KMS)
Strategic Objective 4: Create a client-centric organizationExternal Customer Relationship Management Internal Customer Relationship Management Technology that supports customer needs
Strategic Objective 5: Improve internal business processesQuality ManagementModernisation PlanClient safety and well being
Recapitalisation Plan
RECAPITALISATION PLAN
2005/6R'000
2006/7R'000
2007/8R'000
2008/9R'000
2009/10R'000
2010/11R'000
2011/12R'000
TOTAL Five year
Surface observations 2,238 3,152 5,225 6,518 6,938 7,066 7,241 32,988
Weather radars 900 7,083 91,405 83,600 55,805 42,415 78,431 351,656
Lightning detection 14,000 1,700 1,500 500 1,000 500 0 3,500
Aircraft instrumentation 1,500 1,460 500 500 1,000
Upper air observations 1,500 5,120 5,500 3,000 3,000 3,000 2,000 16,500
Software display systems 2,000 2,012 2,000 1,000 2,000 0 2,000 7,000
Computer System 1,000 3,143 0 0 0 0 0 0
Satellite receiving systems 680 0 1,000 500 500 500 1,000 3,500
Other (office, furniture 2,430 2,576 2,730 2,894 3,068 3,252 14,519
Total 23,818 26,100 109,705 98,348 72,137 56,549 93,924 430,664
Critical additional capital investment from Government 0 0 85,000 80,000 52,000 39,000 256,000
Current capital investment funding 5,000 5,000 5,000
Future capital funding needs 75,000 75,000
Contribution from SAWS 18,818 21,100 24,705 18,348 20,137 17,549 18,924 120,763
COVERAGE WITH NEW RADARS
END