GROUP ANNUAL RESULTS for the year ended 31 March 2024 19 December 2024 Our suite of reports and summarised performance commentary are available at www.eskom.co.za/investors/integrated-results/ What we’ll cover today … 1 2 3 4 5 INTRODUCTION OVERVIEW OF 2024 2024 FINANCIAL 2025 HALF-YEAR STRATEGY AND PERFORMANCE OVERVIEW PERFORMANCE OUTLOOK To provide stakeholders with the most up-to-date information available, this presentation covers the 2024 annual results as well as an update on performance during 2025 1 INTRODUCTION Mteto Nyati Several key challenges delayed the publication of the FY2024 results • Bulk generation of illegal prepaid electricity tokens on Eskom’s online vending system for prepaid meters o Collusion is suspected between Eskom staff and illicit operators who breached controls within the prepaid ecosystem to facilitate the creation and sale of fraudulent prepaid electricity tokens o A forensic investigation is underway to determine the root causes and make recommendations o Inability to reliably estimate the potential obligation from the exposure that illicit tokens can be used in the future due to the high level of uncertainty around the number of illicit prepaid electricity tokens that remain in circulation and compatible with Eskom meters • Challenges involving NTCSA o Determination of take-on balances at 31 March 2024 following the disposal of the Transmission business to NTCSA o Subsequent derecognition of a deferred tax asset of R36.6 billion following the transaction o Valuation of an upstream guarantee from NTCSA for third-party debt secured by NTCSA’s assets • Responding to reportable irregularities raised by the external auditors Operational challenges and the lack of adherence to internal controls urgently need to be addressed, to ensure that Eskom can return to a normal audit cycle, which allows for sufficient time to address audit findings INTRODUCTION 3 A sustainable Eskom is essential to powering growth for South Africa and the SADC region A dysfunctional energy utility Affordable, secure and sustainable leads to economic decline electricity fuels growth FY2024 saw exceptionally poor performance Performance in FY2025 is much improved • 329 days of loadshedding • No loadshedding, with > 250 days of steady • OCGT spend of R33.9 billion electricity supply • Loss before tax of R25.5 billion • Savings on OCGT spend of R11.9 billion during the • Municipal arrear debt escalated to R74.4 billion first six months • Breakdown in internal controls and matters • After-tax profit of > R10 billion forecast for the year leading to repeat audit findings • Enforcing discipline and adherence to internal controls Eskom must be financially and operationally sustainable to deliver on its mandate to enable growth INTRODUCTION 4 Eskom is facing several systemic issues, which require focus, focus and more focus to resolve Operational Financial Sustainability • Outdated vertically integrated business model Systemic issues • Unreliable generation plant resulting in • Weak balance sheet due to high debt burden poor performance • Tariff not reflective of prudent and efficient • Need to transition to clean energy • Grid constraints to connect additional costs • Prevalent crime, fraud and corruption capacity • Revenue pressure due to non-payment by • Lack of adherence to internal controls and • Dysfunctional organisational culture customers and declining sales volumes ineffective combined assurance • Execute Generation Recovery Plan • National Treasury debt relief programme, • Drive legal separation of Eskom – settle • Curtailment and grid capacity allocation as well as municipal debt interventions NTCSA, unbundle Distribution and Interventions rules; execute Transmission Development • Migrate towards unbundled cost- Generation Plan reflective tariff structure • Pursue clean energy project pipeline and • Appoint strong and inspirational leaders • Improve revenue collection and cost- JET, including partnerships at all levels efficiency initiatives • Enhance governance and controls to • Drive a high-performance values-driven • Reduce unplanned losses and excessive eradicate crime, fraud and corruption culture OCGT usage → end loadshedding INTRODUCTION 5 OVERVIEW OF 2024 PERFORMANCE Dan Marokane FY2024 was exceptionally challenging, operationally and financially. However, we have laid a solid foundation for FY2025 Plant availability declined to 329 days loadshedding Emissions performance Transmission 54.56% (2023: 56.03%), with (2023: 280 days), worsened to network reliability 15 500MW unavailability and despite diesel usage of 0.79kg/MWhSO improved significantly (2023: 0.70kg/MWhSO) 13.2TWh lost to loadshedding R33.9 billion Distribution Distribution energy losses 2 employee and Lost-time injury rate network escalated, with 13.9TWh 3 contractor fatalities deteriorated to 0.29 performance improved lost due to electricity theft (2023: 2 employees and (2023: 0.26) 3 contractors) Net loss before tax improved Tariff increase of Arrear municipal debt escalated to R76 billion to R25.5 billion 18.65%, in Government debt relief, (2023: R34.6 billion) tempered by a 3% decline in R74.4 billion subsequently converted to sales volumes (2023: R58.5 billion) equity OVERVIEW OF 2024 PERFORMANCE 7 Qualified audit opinion received, with several matters requiring intense management focus Qualified external audit opinion based on Detailed information is available in the Report of the Audit PFMA records were not complete or accurately maintained in and Risk Committee and the independent auditor’s report line with legislative requirements relating to: • Irregular expenditure AFS • Fruitless and wasteful expenditure Notable matter note • Losses due to criminal conduct 3.2 Going concern assessment Prior year audit qualification issues have not been adequately 12 Disposal of Transmission Division to NTCSA addressed and continued into 2024 14 Derecognition of deferred tax asset 44.2 Contingent liability relating to non-technical Emphasis of matters, including energy losses • Material uncertainty relating to Eskom’s ability to continue 47 Events after the reporting date as a going concern 48 Restatement of comparative figures • Impact of open internal and external investigations • Restatement of comparative figures 51 PFMA information1 • Events after the reporting date 52 Reportable irregularities 1. Refer to the integrated report for detailed disclosure required by the Public Finance Management Act, 1999 (PFMA) OVERVIEW OF 2024 PERFORMANCE 8 A clear time-based action plan is being rolled out to enforce controls Reportable irregularities Consequence management and interventions being actioned 1. Breaches of environmental legislation relating to emissions and • Executive team strengthened with appropriate skills for internal water (reported from 2021 onwards) controls, risk management and PFMA oversight 2. Management’s inability to confirm that all matters relating to • Consolidation of Eskom’s forensics, security and investigative PRECCA1 were reported (2022 onwards) functions under the Group Investigations and Security function 3. Non-compliance with recordkeeping requirements of PFMA reporting directly to the Group Chief Executive and Companies Act, 2008 (2022 onwards) • Established a dedicated project management office to address 4. Investigations and consequence management relating to PFMA findings from data analytics as well as internal and external non-compliance not done timeously (2022 onwards) investigations 5. Failure to submit complete and accurate financial statements • Address the backlog in investigations and disciplinary action to National Treasury and external auditors by 31 May • Strengthen the culture of accountability and consequence (2022 onwards) management 6. Incorrect draft information provided to the Standing • Enforce discipline and adherence to internal controls Committee on Public Accounts (reported in 2023) • Resourcing drive to adequately capacitate the finance, internal 7. Certain prescribed officers breached their fiduciary duty audit and forensics functions relating to short-term IPP programmes (reported in 2024) • Comply with Eskom’s environmental duty of care • Execute Generation Recovery Plan and strengthen focus on environmental compliance 1. Prevention and Combatting of Corrupt Activities Act, 2004 OVERVIEW OF 2024 PERFORMANCE 9 We are stopping the leakage by eradicating crime, fraud and corruption Key initiatives Outcomes Dedicated State Capture Task Team • Instituting criminal charges 304 arrests • Consequence management against employees and suppliers • Pursuing director delinquency proceedings 17 convictions • Civil recovery of financial losses suffered by Eskom Security risks and threats to infrastructure and people 526 of 729 vetting Partnerships with stakeholders and law enforcement agencies cases in progress or complete Security Vetting Programme Focusing on non-executive directors, executives and employees in critical areas 145 cases Optimisation of processes and technology referred to the supplier • Reviewing policies, processes, systems, controls and structures disciplinary process for assessment • Embarking on technology optimisation, security contract management and driving integrated security strategies Supplier consequence management 28 cases 79 suppliers closed with no received sanctions or Supplier disciplinary process in place to review contracts of suppliers implicated in further action suspended sanctions malfeasance OVERVIEW OF 2024 PERFORMANCE 10 2024 FINANCIAL OVERVIEW Calib Cassim Eskom’s loss after tax was affected by a once-off accounting adjustment to deferred tax related to the NTCSA separation Standard tariff increase Sales volumes Revenue 18.65%  3%  to 183.3TWh 14%  to R295.8 billion (2023: 9.61%) (2023: 188.4TWh) (2023: R259.5 billion) Primary energy costs EBITDA EBITDA margin 11%  to R173.7 billion 26%  to R43.4 billion 14.67% (2023: R156.8 billion) (2023: R34.6 billion) (2023: 13.32%) Deferred tax asset of Loss before tax Loss after tax R36.6 billion 26%  to R25.5 billion 2x  to R55 billion derecognised following (2023: R34.6 billion) (2023: R26.1 billion) NTCSA separation Strong improvement in EBITDA, reducing the loss before tax 2024 FINANCIAL OVERVIEW 12 EBITDA improved mainly due to the tariff increase, while systemic and operational challenges continued to impact profitability Leading factors negatively affecting profitability GROUP INCOME STATEMENT FOR THE YEAR ENDED 31 MARCH 2024 1 R33.9 billion spent on OCGTs (2023: R29.6 billion) R million Revenue 2024 295 814 2023 259 543 % 14▲ Other income 1 295 2 742 53▼ 2 loadshedding → ±R22 billion* revenue impact Estimated 13.2TWh demand not met due to Primary energy (173 729) (156 819) 11▲ Net employee benefit expenses (35 096) (32 321) 9▲ Net impairment loss and write-downs (3 433) (2 182) 57▲ 3 Estimated 13.9TWh of electricity theft → ±R23 billion* revenue impact Other operating expenses (41 441) (36 398) 14▲ EBITDA 43 410 34 565 26▲ Depreciation and amortisation expenses (33 239) (31 941) 4▲ 4 Net R8.9 billion revenue not recognised due to collectability criteria not met (2023: R8.2 billion) Operating profit (EBIT) 10 171 2 624 288▲ Net fair value and foreign exchange gain/(loss) 2 644 (285) 1 028▲ Net finance cost (38 389) (37 015) 4▲ Share of profit of equity-accounted investees 105 93 13▲ Regulated return on assets of 1.7% lower Loss before tax (25 469) (34 583) 26▼ than nominal cost of capital of ± 11% Income tax (29 546) 8 501 448▼ Loss for the year (55 015) (26 082) 111▲ * Based on the average electricity price of 165.43c/kWh ▲ Income/gain increased ▼ Income/gain declined ▼ Expense/loss declined ▲ Expense/loss increased 2024 FINANCIAL OVERVIEW 13 Revenue grew by 14% driven by a 18.65% tariff increase, tempered by a 3% decline in sales volumes impacted by loadshedding and self-generation Electricity breakdown by destination1 Electricity sales by customer category Sales and revenue trend 1% 14% 6% R billion TWh 11% 3% 300 -3% 220 5% <1% 5% 5% 250 200 41% 200 180 208.2TWh 15% 183.3TWh 150 160 100 140 50 120 83% 24% 0 100 2020 2021 2022 2023 2024 Local Energy losses Distributors Mining Commercial Rail Sales, TWh Revenue, R billion International Internal use and unaccounted Industrial Residential Agricultural International 1. Net of pumping and excluding wheeling Sales volumes mainly impacted by loadshedding and load curtailment of 13.2TWh (around 7% of sales volumes) Increase in embedded self-generation capabilities across many sectors (rooftop solar capacity estimated at 6.1GW) Biggest decline in distributor (4.3% ), international (9.4% ) and residential (6.7% ) customer segments International customers subjected to load curtailment given South Africa’s supply constraints 2024 FINANCIAL OVERVIEW 14 Primary energy costs increased by 11% to R174 billion due to higher OCGT usage, despite a 2% overall decrease in production Electricity breakdown by supplier1 Electricity supplied by technology1 Generation cost by source 4% 3% 2% 4% <1% Unit cost, R/MWh 2024 2023 % 10% 4% Coal 541 503 8▲ 6% Nuclear 113 106 7▲ Eskom-owned OCGTs 6 579 7 077 7▼ 208.2TWh 208.2TWh IPPs 2 367 2 326 2▲ IPP OCGTs 6 348 7 278 13▼ 80% Renewable IPPs 2 029 1 986 2▲ 86% Other IPP programmes 1 018 – Imports 883 748 18▲ Eskom IPPs Imports Coal Hydro (net) Solar Other Wind Nuclear Diesel 1. Net of pumping and excluding wheeling Supply constraints due to: • Poor Eskom generation performance (±1.7TWh shortfall against budget) Higher usage of OCGTs to mitigate loadshedding, leading to a higher • Delays in IPP programmes (±8.8TWh shortfall) overall cost of production • Lower-than-budget imports (±1.6TWh shortfall) Marked improvement in primary energy costs expected in 2025 due to lower OCGT usage 2024 FINANCIAL OVERVIEW 15 Balance sheet stabilised by Government’s debt relief, which enabled cash from operations to be invested in capital expenditure and working capital GROUP STATEMENT OF FINANCIAL POSITION AT 31 MARCH 2024 Current ratio Cash interest cover R million 2024 2023 % 684 388 671 709 2▲ 0.98 1.18 Property, plant and equipment and intangible assets Working capital – current inventory and receivables 65 692 51 819 27▲ (2023: 0.89) (2023: 1.29) Liquid assets – cash and cash equivalents and investments 40 063 23 145 73▲ Derivatives held for risk management 27 016 26 992 Debt/equity ratio Gross debt/EBITDA Other assets 49 163 52 079 6▼ 1.99* 11.58 Total assets 866 322 825 744 5▲ (2023: 1.88) (2023: 13.92) Equity 222 858 233 944 5▼ Debt securities and borrowings 412 200 423 929 3▼ * Includes subordinated shareholder loan not yet converted to equity at year end Loan from shareholder 32 000 – Movement in debt securities and borrowings Working capital – current payables 67 199 58 064 16▲ R billion Derivatives held for risk management 593 2 029 71▼ 7.5 Non-current decommissioning liabilities 52 294 50 025 5▲ 423.9 16.0 Contract liabilities and deferred income 38 371 28 097 37▲ 54.6 Other liabilities 40 807 29 656 38▲ 6.6 12.8 Total equity and liabilities 866 322 825 744 5▲ 412.2 ▲ Asset/equity increased ▼ Asset/equity decreased ▼ Liability decreased ▲ Liability increased Opening Pre-funding DFI Debt repaid Fair Interest Closing balance secured drawdowns value adj accrual balance Mar 2023 & other 2024 FINANCIAL OVERVIEW 16 Received R76 billion debt relief towards servicing debt obligations, which has improved liquidity and unlocked Eskom’s positive performance spiral Improved Benefits of the debt relief liquidity • Assisted in addressing debt servicing outflows of R89.8 billion (principal and interest) • Allowed focus on executing strategy by freeing up cash from Improved operations and alleviating funding challenges Improved financial Government planning • Supported cash flow certainty, unlocking improved execution of the performance debt relief Generation Recovery Plan • The full R76 billion has been converted to equity since year end based on Eskom’s compliance with the debt relief conditions • Credit rating upgrades received, which will support future capital expenditure needs Improved Improved operational investment in Municipal debt challenges are undoing the positive benefits of performance assets Government’s debt relief Government debt relief, together with cost-reflective tariffs and an ongoing focus on cost efficiencies, are anchoring enablers for Eskom’s financial and operational recovery 2024 FINANCIAL OVERVIEW 17 The municipal debt relief programme is not delivering the desired results. Unless a new solution is found, the separation of Distribution is in jeopardy Arrear municipal and metro debt Top 10 defaulting municipalities and metros at Nov 2024 R billion % +28% Mar Mar Nov 100 95 +27% R billion 2023 2024 % 2024 % 80 90 Emalahleni Local Municipality* 7.4 8.5 15▲ 9.9 17▲ 60 85 95.4 Maluti-A-Phofung Local Municipality* 7.2 8.0 10▲ 8.6 7▲ 40 74.4 80 58.5 Emfuleni Local Municipality* 5.9 7.1 19▲ 8.1 15▲ 20 44.8 75 28.0 35.3 City of Tshwane Metro 1.1 3.1 194▲ 6.7 114▲ 0 70 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024 Nov 2024 YTD Matjhabeng Local Municipality* 5.3 5.8 10▲ 6.3 9▲ Arrear municipal debt, R billion Municipal payment levels (including metros), % City of Johannesburg Metro – 1.1 5.3 393▲ Govan Mbeki Local Municipality* 3.7 4.5 20▲ 5.2 17▲ Municipal debt relief programme Lekwa Local Municipality* 1.9 2.2 18▲ 2.6 17▲ Accounting for 95% of 71 municipalities City of Matlosana Local Municipality* 1.4 1.8 22▲ 2.3 33▲ March 2023 arrear debt participating targeted for write-off Ngwathe Local Municipality* 1.7 2.0 17▲ 2.3 15▲ HOWEVER Total 35.6 44.1 23▲ 57.3 30▲ By March 2024, only By November 2024, only * Participating in the municipal debt relief programme 23 municipalities 10 municipalities honouring current accounts honouring current accounts Arrear debt continues to escalate due to poor adherence to the (12% of the arrear debt) (2% of the arrear debt) municipal debt relief conditions, with more recent challenges with metros 2024 FINANCIAL OVERVIEW 18 Liquidity improved on the back of the debt relief from Government, addressing most of Eskom’s R89.8 billion debt servicing obligations CASH FLOWS FOR THE YEAR ENDED 31 MARCH 2024 R billion 295.8 173.7 Primary energy Cash and cash equivalents  to R23.6 billion (2023: R7.5 billion) Employee benefits 35.1 Working capital 13.6 Repairs, maintenance 33.0 and other (255.4) 40.4 44.9 10.9 16.1 4.5 18.4 23.6 54.6 76.0 35.3 Revenue Operating Cash from Capital Balance before Debt repaid Interest repaid Government Balance Debt raised Other funding Net cash outflows operations expenditure and debt servicing debt relief before funding activities movement other investing Sufficient liquidity is essential to ensure a consistent runway of capex execution and planned maintenance, to support sustainable operational performance 2024 FINANCIAL OVERVIEW 19 We increased our investment into existing generation infrastructure to address poor plant performance and lay a solid foundation for the future Repairs and maintenance expenditure R billion Repairs and maintenance breakdown 30% 30 R billion 2024 2023 % 25 Generating plant 22.8 16.6 38▲ 20 Transmission network 1.1 1.2 3▼ 15 28.7 Distribution network 4.8 4.4 8▲ 10 22.1 Total repairs and maintenance 28.7 22.1 30▲ 17.4 19.1 14.0 5 0 2020 2021 2022 2023 2024 Eskom funded capex Capex breakdown R billion 40 9% R billion 2024 2023 % 35 Generating plant (including future fuel) 29.3 27.4 7▲ 30 Transmission network 4.3 3.5 20▲ 25 Distribution network 2.9 2.6 11▲ 20 37.0 33.9 Other 0.6 0.4 35▲ 15 30.2 23.4 23.9 10 Total group funded capex 37.0 33.9 9▲ 5 0 2020 2021 2022 2023 2024 2024 FINANCIAL OVERVIEW 20 Sufficient liquidity will enable the necessary investments to sustain and expand infrastructure over the next decade Indicative view, including aspirational and unfunded projects Current energy mix Energy mix by FY2035 Generation capex requirements (FY2025 to FY2035) 5% Coal R billion 4% 5% 1% 28% Nuclear 834 OCGT/Gas 52% 495 Average expansionary capex of ±R45 billion p.a. Pumped storage 8% Renewables 339 Average sustaining capex of ±R31 billion p.a. 85% 16% Total + 17GW 4% NTCSA capex requirements (FY2025 to FY2035) R billion 449 Average expansionary capex of ±R34 billion p.a. + 15 446km lines  46% 376 Average sustaining capex of ±R7 billion p.a. + 151 550MVA capacity  97% 73 Total Distribution capex requirements1 (FY2025 to FY2035) R billion 162 Average expansionary capex of ±R12 billion p.a. + 13 807km lines  4% 130 Average sustaining capex of ±R3 billion p.a. + 7 270MVA capacity  5% 32 Total + 7 million smart meters, microgrids, grid modernisation, rooftop solar and fleet (electric vehicles and charging stations) Expansionary capex Sustaining capex 1. Excluding Government-funded electrification connections 2024 FINANCIAL OVERVIEW 21 21 Borrowings must be limited beyond the three-year debt relief period, to move Eskom to a more sustainable debt level of R250 billion over time Debt securities and borrowings (including new borrowings from FY2028)* • New projects will require extensive R billion 450 funding, through a combination of 400 on-balance sheet funding and 350 partnerships with external parties 300 • New borrowings must be limited to 250 ±R15 billion per year to ensure that 200 debt service costs are capped at 150 ±R50 billion per year 100 50 0 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Base debt New borrowings * Indicative view based on financial modelling We must generate sufficient operating cash flows to fund most of our capital expenditure requirements, without further leveraging the balance sheet. This is highly dependent on achieving an adequate tariff path, resolving the municipal arrear debt challenge and achieving cost efficiencies 2024 FINANCIAL OVERVIEW 22 All four pillars of the financial strategy must be addressed to support the positive spiral that will lead to sustainable performance Our financial strategy Although Government debt relief is essential in the short term, it is unsustainable for the country in the  REVENUE SECURITY AND BALANCE SHEET OPTIMISATION ✔ long term. Systemic challenges must be addressed to ENHANCEMENT R250 billion debt relief achieve standalone financial sustainability Cost-reflective tariffs Dispose non-core assets Strengthen balance sheet Improve income statement Unbundled tariffs Diversify funding mix New products and services Operations Fix systemic issues … ✔ COST EFFICIENCIES Review cost trajectories MUNICIPAL DEBT REDUCTION  ✔ Obtain cost- and drive efficiencies Improve payment levels reflective tariff path, with Improved Enhance financial controls Pursue legal rights measures to address liquidity Root out crime, fraud and Address poor affordability for vulnerable corruption adherence to municipal sectors Improved ✔ Resolve municipal debt debt relief conditions Improved financial planning performance challenge … to enable Eskom’s positive The path to investment-grade credit ratings is dependent on spiral and remove Eskom’s Improved Improved all four pillars being executed within appropriate timeframes burden on the fiscus operational performance investment in assets 2024 FINANCIAL OVERVIEW 23 23 2025 HALF-YEAR PERFORMANCE Dan Marokane The first six months of FY2025 showed remarkable improvement, with substantial efficiencies achieved Plant availability improved No loadshedding Emissions performance Transmission significantly to62.97% (Sep 2023: 183 days), improved to network reliability (Sep 2023: 55.27%), with with diesel usage reducing by 0.55kg/MWhSO performance declined R11.9 billion YOY (Sep 2023: 0.92kg/MWhSO) significantly higher planned maintenance Distribution Distribution energy losses 1 employee and Lost-time injury rate network escalated to10.42% 2 contractor fatalities worsened to 0.30 performance improved (Sep 2023: 9.64% ), with (Sep 2023: 1 employee) (Sep 2023: 0.28) 8.7TWh lost due to theft Net profit after tax 12.74% Tariff increase of Arrear municipal debt R64 billion significantly  (Sep 2023: 18.65%) coupled escalated to Government debt relief (profit after tax of > R10 billion* with 4% YOY increase in sales volumes R90.1 billion committed for FY2025 forecast for FY2025) (Mar 2024: R74.4 billion) (Mar 2024: R76 billion) * Unaudited 2025 HALF-YEAR PERFORMANCE 25 Customers have reported a positive outlook on the back of the suspension of loadshedding for more than 250 days Sentiment towards the real estate sector has The suspension of loadshedding in South While there were macroeconomic improved dramatically. With more than 230 Africa resulted in significant savings on diesel positives of no loadshedding, days with no loadshedding … contributing and other generator-related costs. These increased political stability … to improved business confidence with is savings of R243 million were fully reinvested ~ Mr Price evident in our operational performance. The into lower prices for customers, particularly prospect of imminent interest rate cuts … on essential food and grocery items together with no loadshedding since ~ Pick n Pay Generator diesel costs declined from R124 March 2024, will positively influence million in FY2023 to retailers’ operations and performance R47 million, mostly due to reduced ~ Growthpoint In South Africa, the outlook is positively loadshedding during the year. Key buoyed by the formation of the Government indicators such as a significant reduction of National Unity, suspension of in energy loadshedding … provide a In South Africa, … consumer sentiment loadshedding … more favourable outlook for consumers is improving, supported by … the ~ TFG and signal improvements in both the prolonged suspension of economic and operating environment loadshedding ~ Netcare ~ Woolworths … the suspension of loadshedding will enhance customers’ ability to earn an income [supporting] an optimistic Consumer confidence has been buoyed consumer outlook This has had a positive impact on by … the suspension of ~ Pepkor loadshedding Sovereign credit ratings and the ~ Lewis Stores country’s growth prospects 2025 HALF-YEAR PERFORMANCE 26 The suspension of loadshedding is due to a reduction in unplanned losses, driven by disciplined execution of planned maintenance Eskom Generation actual performance on unplanned losses GW Reduction in unplanned Actual monthly unplanned unavailability losses over the period -5.6 18.0 16.5 16.2 16.0 15.9 15.8 16.2 14.9 14.5 13.7 14.6 14.7 14.2 12.7 11.9 11.5 10.8 11.8 11.5 10.6 Apr-23 May-23 Jun-23 Jul-23 Aug-23 Sep-23 Oct-23 Nov-23 Dec-23 Jan-24 Feb-24 Mar-24 Apr-24 May-24 Jun-24 Jul-24 Aug-24 Sep-24 Oct-24 Nov-24 2023 Winter outlook period 2023/24 Summer outlook period 2024 Winter outlook period 2024/25 Summer outlook period • Downward trend observed in unplanned losses from base-load capacity, specifically driven by eight priority stations (Tutuka, Majuba, Kusile, Kendal, Matla, Duvha, Arnot and Kriel) • Unplanned unavailability over the summer period has reduced by about 4GW since the prior year • Unplanned losses are better than anticipated in the Summer outlook, with no loadshedding required since 26 March 2024 To ensure overall supply adequacy, Eskom’s base-load capacity needs to perform 2025 HALF-YEAR PERFORMANCE 27 STRATEGY AND OUTLOOK Dan Marokane Our strategy embraces the essential role we play in South Africa and the need to balance turnaround and long-term strategic objectives Commercial mandate Social mandate Our mandate Lower the cost of doing business in South Africa, Providing electricity in an efficient and sustainable manner enabling economic growth Our vision Our purpose Sustainable power for a better future Powering growth sustainably Strategic objectives Pursue financial and Facilitate a competitive Modernise our power Strive for net zero emissions operational sustainability future energy industry system by 2050 Implement Generation Recovery Plan Operationalisation of Distribution Accelerate Transmission Accelerate Komati, Grootvlei, with EAF to 70% during March 2025 business; followed by Generation Development Plan execution, Hendrina and Camden repowering including alternative funding models and repurposing initiatives Reduce arrear municipal debt and Fine-tune Generation and energy losses Distribution business models Modernise distribution network Implement optimised emissions development, including rollout of reduction technology to achieve Rebase costs towards profitability Establish new holding company smart meters and microgrids Minimum Emission Standards Improve controls to address crime, Accelerate clean energy project compliance Increase flexibility of power system fraud and corruption development infrastructure Participate in distributed energy Improve leadership stability and skills resources and drive eMobility development Create a high-performance Use data analytics to create value Improve procurement and Obtain NERSA approval of Drive socio-economic ethical culture and enhance decision-making governance processes unbundled tariffs transformation STRATEGY AND OUTLOOK 29 29 We have established a new executive structure to embed operational recovery and future-proof Eskom for long-term growth and sustainability Supported by the following permanent invitees: Tembela Kulu Group Investigations and Security Mlawuli Manjingolo Company Secretary Jerome Mthembu Legal and Compliance Ureka Rangasamy Chief Audit Executive Dan Marokane Group Chief Executive Calib Cassim Bheki Nxumalo Segomoco Scheppers Monde Bala Roman Crookes Nontokozo Hadebe Group CFO Generation NTCSA interim CEO Distribution and acting Group Capital Strategy and Sustainability Permanent invitee Human Resources Portia Mngomezulu Alfred Seema Len de Villiers Vacant Vacant Corporate Services Strategic Delivery Chief Technology and Chief People Officer Eskom Renewables Information Officer STRATEGY AND OUTLOOK 30 The legal separation will benefit the electricity supply industry and has gained traction with the operationalisation of NTCSA in July 2024 Objectives of the legal separation process Eskom reinvented 1 Drive operational performance New holding company 2 Strengthen governance established NEDCSA 3 Improve financial management separated 4 Prepare for a liberalised electricity market NTCSA separated 5 Attract investment Completed Functionally In progress separated Vertically integrated STRATEGY AND OUTLOOK 31 Legal separation will create subsidiaries with operational independence while still under Eskom’s corporate structure Future state The Department of Electricity and Energy is the ultimate shareholder of the Eskom group and is accountable to Parliament for the group’s performance and strategic direction Department of Electricity and Energy The new holding company will be accountable to the ultimate shareholder for consolidated group performance and will set the group’s strategic direction and oversee subsidiary performance New Eskom holding company Subsidiaries Legally separate subsidiaries, owned by and accountable to the holding company, will drive subsidiary-specific strategy, aligned to the group’s direction, and be responsible for day-to-day Generation Other subsidiaries subsidiary operations NTCSA NEDCSA Eskom Rotek Industries, etc. All subsidiaries will remain under the Eskom umbrella, but have the freedom to operate their independent businesses within the applicable regulatory and governance boundaries to achieve the outcomes of Government’s Roadmap STRATEGY AND OUTLOOK Source: Eskom Unbundling Working Team 32 Despite good progress, more effort is needed to recover sustainably This will be achieved with greater focus on … ±2 500MW to be brought online by March 2025 (return of Koeberg 2 and Medupi 4, also Kusile 6 synchronisation) R250 billion debt relief to reduce debt levels. Will be converted to equity by continuing to fulfil Government’s debt relief conditions Municipal debt requires structural reforms. We are working with Government to address the escalating municipal and metro debt Unbundling National Energy Distribution Company South Africa (NEDCSA) and establishing a new Eskom holding company Infrastructure execution of capital projects (Transmission Development Plan, distribution network and clean energy) Our people driving several people-focused interventions towards a high-performance ethical culture to ensure the success of Eskom’s turnaround Local communities increase focus on socio-economic initiatives in communities impacted by planned shutdown of coal-fired stations Stabilised leadership, increased accountability and autonomy, and the commitment of Eskom’s employees are key enablers for our success STRATEGY AND OUTLOOK 33 We have launched a programme to return Eskom to profitability, by enabling targeted efficiencies of R21.5 billion in FY2025 Revenue Cost Primary energy Digital Capital growth efficiency optimisation transformation productivity Drive short-term growth Reduce the cost of Obtain savings through Prioritise digital Efficient spend on with pricing incentives producing electricity procurement and initiatives critical growth demand management Ensure connectivity investments Grow cross-border sales Optimise the cost to serve Contract negotiation between processes, Reduce project costs Pursue growth technology, data and and timelines opportunities in new Drive procurement Optimise energy mix people energy excellence Improve processes and Dispose of non-core Reduce costs systems using assets Invest in skills and tools technology Live up to our value of innovation STRATEGY AND OUTLOOK 34 We aim to add 2 500MW to the grid by March 2025 to support security of supply with continued suspension of loadshedding Return to service of units on long-term outage Kusile Unit 5 synchronised to the grid on Koeberg 1 Kusile 1, 2, 3, 5 Tutuka 1, 2, 4, 5 Koeberg 2 Kusile 6 1st sync Medupi U4 31 December 2023. Commercial operation 930MW ~2 880MW ~1 500MW ~930 MW ~800 MW ~794 MW achieved on 30 June 2024 → Completed Tutuka return to service • Unit 4 planned outage for LP turbine rotor Nov 2023 Dec 2023 May 2024 Early Jan 2025 Feb 2025 Mar 2025 and HPH replacement → Completed • Unit 5 on major outage → Completed Despite some delays, three units are Following the Unit 1 completed on expected to return to service by construction of 12 January 2024 March 2025 temporary stacks, Koeberg Unit 2 weld defects on the main Units 3, 1 and 2 were Unit 2 returned on steam pipes required additional inspection and returned to the grid 27 December 2023 weld repairs. Revised date caters for challenges and are providing Unit 4 returned on arising during commissioning power up to 2 160MW 22 April 2024 Kusile Unit 6 synchronisation experienced some delays due to material availability and Unit 5 achieved Unit 5 returned on delays in acid clean commercial operation 7 July 2024 Medupi Unit 4 return to service delayed by on 30 June 2024 unexpected design issues on the second-hand stator STRATEGY AND OUTLOOK 35 Update on Matla Unit 6 incident: nine people confirmed injured, with the investigation underway, but no impact on the Summer Outlook • Preliminary investigations indicate the rupture of a high-pressure steam steel pipe above the Unit 6 9 injuries confirmed transformer on Thursday 12 December 2024 Alberton Trauma ICU, Gauteng • Emergency plans were activated accordingly 3 admitted to ICU • Technical teams remain on site, to assess the extent of the damage, the scope of work and the time ➢ 2 now in general ward required for repairs and restoration ➢ 1 still intubated but stable • At this stage, there is no evidence of sabotage Trichardt Hospital, Mpumalanga • Unit 5, which was taken offline to ensure the safety of all employees, was due to be shut down for planned maintenance on Monday 16 December → brought forward to Saturday 14 December 2 remain in hospital • Minster of Electricity and Energy, Dr Kgosientsho Ramokgopa, Dr Tsakani Mthombeni, non-executive 3 discharged director, the GCE, Group Executive: Generation and Group Executive: Strategic Delivery visited the station the following day to offer support and assistance to the Matla leadership team and employees 1 transferred to local hospital burns unit The Summer Outlook, for the period from 1 September 2024 to 31 March 2025 Uninjured members of the work team, the predicted a likely scenario of a loadshedding-free summer. next of kin of the injured and the Matla staff are receiving counselling and support This outlook remains unchanged STRATEGY AND OUTLOOK 36 Eskom has been positioned to deliver positive performance in FY2025, to support 2% economic growth for South Africa • Operational and financial performance has improved significantly, although further Financial outlook for FY2025 work is required to ensure sustainability Sales volumes Tariff increase • We are focusing on the following priorities for FY2025 and beyond 2 – 3% higher 12.74% o EAF of 70% during March 2025 (average 62% projected for FY2025) OCGT spend Primary energy costs 60 – 80% lower 10 – 20% lower o Return to profitability due to operational stability and primary energy savings Operating expenses Debt servicing o Renewed focus on internal controls to shift overall organisational performance 20 – 30% higher requirements 5 – 15% lower o Legal separation to create greater performance transparency, promote efficiency and attract investment into the industry o Pipeline of clean energy projects and revised approach to the Just Energy Transition, EBITDA to mitigate the socio-economic impact of the transition R85 billion – R95 billion (2024: R43.4 billion) • Improved performance will support investor sentiment and a better economic outlook Debt service cover ratio • Enhanced liquidity allows investment into infrastructure to support security of supply 0.90 – 1.10 (2024: 0.46) • Beyond Government’s debt relief and our efficiency measures, resolving the municipal Gross debt / EBITDA ratio debt challenge and an appropriate tariff path which supports vulnerable sectors are 5.00 – 6.00 critical to standalone financial sustainability (2024: 11.58) Arrear municipal debt balance • Leadership stability and recognising and rewarding performance to improve staff morale R95 billion – R110 billion are fundamental to the turnaround (2024: R74.4 billion) STRATEGY AND OUTLOOK 37 Disclaimer This presentation does not constitute or form part of and should not be construed as, an offer to sell, or the solicitation or invitation of any offer to buy or subscribe for or underwrite or otherwise acquire, securities of Eskom Holdings SOC Ltd (Eskom), any holding company or any of its subsidiaries in any jurisdiction or any other person, nor an inducement to enter into any investment activity. No part of this presentation, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. This presentation does not constitute a recommendation regarding any securities of Eskom or any other person. Certain statements in this presentation regarding Eskom’s business operations may constitute “forward looking statements”. All statements other than statements of historical fact included in this presentation, including, without limitation, those regarding the financial position, business strategy, management plans and objectives for future operations of Eskom are forward looking statements. Forward-looking statements are not intended to be a guarantee of future results, but instead constitute Eskom’s current expectations based on reasonable assumptions. Forecasted financial information is based on certain material assumptions. These assumptions include, but are not limited to continued normal levels of operating performance and electricity demand in the Distribution and Transmission Divisions and operational performance in the Generation Division consistent with historical levels, and incremental capacity additions through Group Capital at investment levels and rates of return consistent with prior experience, as well as achievements of planned productivity improvements throughout the business activities. Actual results could differ materially from those projected in any forward-looking statements due to risks, uncertainties and other factors. Eskom neither intends to nor assumes any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In preparation of this document certain publicly available data is used. While the sources used are generally regarded as reliable the content has not been verified. Eskom does not accept any responsibility for using any such information. 38 13 December 2024 Our suite of reports and summarised performance commentary are available at Our suite of reports and summarised performance commentaries are available at www.eskom.co.za/investors/integrated-results/ www.eskom.co.za/investors/integrated-results/