RESULTS PRESENTATION. for the year ended 29 February 2016

Transcription

1 RESULTS PRESENTATION for the year ended 29 February 2016

2 INTRODUCTION SANDILE NOMVETE SARS Randburg

3 INTRODUCTION TO DELTA Dsds Sovereign underpinned JSE listed asdasdas REIT 74% Diversifying $ investment 26.3% Market capitalisation # of R4.7bn of revenue from sovereign tenants in Mara Delta * up from R3.5bn at 29 Feb 2016 Dominant in Durban & Pretoria CBDs Average property value of R101.3m Assets under management of R10.5bn by 100% black-owned asset manager 3 * % holding as at 30 April 2016 # closing share price of R6.90 and 688,327,947 shares in issue as at 12 May 2016

4 HIGHLIGHTS SINCE LISTING March 2010 November 2012 May 2013 July 2013 February 2014 June 2014 March 2015 September 2015 February 2016 March 2010 The company is founded - inaugural acquisition is the Forum Building in Pretoria November 2012 Delta lists on the JSE main board with a portfolio value of R2.1 billion May 2013 Successful capital raise of R1 billion through rights issue for acquisitions July 2013 Launches R2 billion Domestic medium Term Note Programme ( DMTN Programme ) February 2014 Achieves growth aspiration target of a of R7 billion asset portfolio by February REIT Status approved June 2014 March 2015 Launches and lists Delta International (rebranded to Mara Delta), the first specialist pan-african (excl. South Africa) property fund to be listed on JSE Successful capital raise of R680 million, allowing Delta to pay down bridging facilities and to conclude acquisitions 4 September 2015 Restructures asset management company and is the first in the industry to ensure no poison pill carried forward in contract, and asset manager 100% owned by black employees February 2016 Achieves third consecutive year of inflation-beating growth in distributions. Investment portfolio exceeds R10 billion.

5 SNAPSHOT Listing date: 02 November 2012 JSE classification: Real Estate Holdings & Development Asset manager: Delta Property Asset Management (Pty) Ltd JSE code: DLT Asset management fee: 0.35% of enterprise value 29 February February 2015 Shares in issue 533,097, ,409,836 Market capitalisation R3.47 billion R4.08 billion Share price (closing) R6.50 R8.90 NAV per share R10.61 R10.02 No. of properties Valuation of property portfolio R10.1 billion R8.4 billion Average value per property R101.3 million R102.4 million Gross lettable area 813,505 m² 703,103 m² Tenant Sectorial profile (GLA) Office - Sovereign: 67.5% Office - Sovereign: 63.2% Office - Other: 21.4% Office - Other: 26.2% Industrial: 3.9% Industrial: 5.7% Retail: 7.2% Retail: 4.9% Occupancy rate 91.02% 92.9% Weighted average net rent (per m 2 ) R R Weighted average escalation 7.84% 7.97% Loan to value # 47.2% 49.9% Fixed : Floating (excluding revolvers) 83% 78% * Weighted Average Cost of Debt 8.75% 8.10% 5 # c.a 42.3% post the transfer of the Redefine portfolio *Restated with revolver facilities excluded

6 Auditor General Polokwane HIGHLIGHTS SANDILE NOMVETE

7 HIGHLIGHTS OF FY2016 Industry leading Distribution growth of 8% Gearing reduced to 42.3% Level 2 Fourth consecutive period of growth in half-year distribution at May 2016, from 47.2% at Feb 2016 B-BBEE rating Successfully concluded Reaffirmed Tenant retention = R1.76bn A2(za) 80% 7 Redefine and Free State portfolio acquisitions short term GCR credit rating of expiring GLA * * % of GLA due for expiry in FY2016 as at Feb 2015 that was successfully renewed or continuing on month to month basis

8 PRIORITIES AND STRATEGY REVIEW SANDILE NOMVETE CMH Building

9 PRIORITIES - FEEDBACK Priorities Status Detail Replacement of CFO Complete Shaneel Maharaj appointed Dec 2015 Dispose non-core assets Ongoing Concluded R659m Strengthening of balance sheet - Gearing - Improve credit rating Ongoing Gearing reduced to 42.3% at May 2016, Increase in unencumbered assets Focused asset management Ongoing CAPEX projects underway, stabilise acquired portfolios Inner city focus Ongoing Commitment to inner city nodes CAPEX and improvements underway Focus on Sovereign Underpin Ongoing Dominant sovereign specialist 9 International diversification Ongoing Holding in $ based Mara Delta

10 88 Field Street FINANCIAL REVIEW SHANEEL MAHARAJ

11 FINANCIAL HIGHLIGHTS OF FY2016 Dsds Growth in assets of asdasdas Weighted average cost of debt Disposals of R1.6bn 8.75% R659m assets under management > R10.5bn, R11.8bn at May 2016 R108m transferred, R551m under sale agreement Gearing reduced to Fixed debt % of Extended ave. fix period to 42.3% 83% at May 2016 from 47.2% at Feb 2016 (Feb 2015: 49.8%) compared to 78% at Feb 2015 years, up from 1.91 at Aug 2015

12 FOUR YEAR REVIEW 29 Feb Feb Feb Feb 2013 Revenue (R 000) 1,247,582 1,009, , ,949 Net property income (R 000) 925, , , ,396 Finance costs (R 000) (412,713) (316,380) (151,149) (55,446) Cost to income ratio (net / gross) 12.2% /26.4% 10.2% / 26.0% 10.8% / 25.5% 14.1% / 23.6% Investment property (R 000) 10,095,181 8,420,400 6,965,730 2,119,112 Listed securities (R 000) 472, , ,637 - Borrowings (R 000) 5,094,310 4,508,565 3,197, ,442 Gearing level 47.2% 49.9% 47.5% 38.7% Weighted average interest rate 8.75% 8.10% 7.50% 8.90% 12 Average debt expiry period (years) Average debt fix expiry period (years) Fixed % * 83% 78% 36% 96% Net asset value per share (excl deferred tax) R10.61 R10.02 R9.28 R7.89 * Figures restated to exclude revolver facilities

13 GROWTH IN DISTRIBUTIONS Historic distribution per share Cents / share % % % % % % Nov (Listing) FY2013 HY Aug-13 HY Feb-14 FY2014 HY Aug-14 HY Feb-15 FY2015 HY Aug-15 HY Feb-16 FY2016

14 DISTRIBUTABLE INCOME STATEMENT R 000 FY2016 FY2015 Change % Net property income (excl. straight line accrual) 898, , % Administration expenses (82,744) (51,008) 62.00% Realised foreign exchange loss (39) - - Net finance costs (386,120) (312,415) 23.59% Dividend received from Mara Delta 36,779 18, % Accrued distribution from other listed investments - 11,905 - Sundry income 7,266 13,590 (46.53%) Add back of debt structuring fees 6, Antecedent interest 9,010 3, % Taxation - 2,381 - Retained distributable earnings (912) - - Distributable income for the period 487, , % Number of shares in issue 533,097, ,409, % Distribution per share / linked unit (cents) % 14

15 STATEMENT OF FINANCIAL POSITION R Feb Feb 2015 Change % Assets Non-Current assets 9,085,759 8,396, % Investment property 8,684,700 8,393, % Fair value of property portfolio 8,500,183 8,213, % Straight line rental income accrual 184, , % Investment in associate 383, Other non-current assets 17,732 2, % Current assets 519, , % Assets classified as held for sale - 2,110,030 - Non-current assets held for sale and assets of disposal group 1,410,481 26,500 5,222% Total assets 11,015,353 10,879, % Equity and liabilities Total Equity 5,656,629 5,074, % Equity 5,656,629 4,620, % Non-controlling interests - 453,190 - Liabilities 5,358,724 4,632, % Non-current liabilities 3,610,815 3,673,309 (1.70%) Current liabilities 1,747, , % Liabilities associated with disposal group held for sale - 1,172,343 - Total equity and liabilities 11,015,353 10,879, % 15

16 DEBT SUMMARY As at 29 February 2016 Facility Type R m Weighted Ave. Rate Floating bank facilities 2, % Fixed bank facilities % Revolving bank facilities % Total bank facilities 4, % DMTN programme - floating % DMTN programme - fixed % Vendor loans % Total borrowings, net of accrued interest 5, % Accrued interest 53 N/A TOTAL 5,093 Total fixed bank and DMTN facilities 1, % Interest rate swap contracts 2, % Cross currency swap 225 Libor % Total fixed 3,523 Fixed % and total WACC 70% 8.75% Fixed % excluding revolving bank facilities 83% 16

17 DEBT EXPIRY PROFILE R m 1, Feb Feb Feb Feb Feb Feb DMTN Programme Fixed Bank Facilities Floating Bank Facilities Revolving Bank Facilities Vendor Loans Swap Contracts

18 PRO-FORMA STATEMENT OF FINANCIAL POSITION R Feb May Feb 2017 Assets Non-Current assets 9,085,759 10,334,647 11,080,900 Investment property 8,684,700 9,933,588 10,679,841 Investment in associate 383, , ,327 Other non-current assets 17,732 17,732 17,732 Current assets 519, , ,826 Non-current assets held for sale and assets of disposal group 1,410,481 1,410,481 - Total assets 11,015,353 12,255,954 11,601,725 Equity and liabilities Total Equity 5,656,629 6,884,509 6,606,289 Liabilities 5,358,724 5,371,445 4,995,436 Interest bearing liabilities 5,175,919 5,107,031 4,731,022 Current liabilities 182, , ,414 Total equity and liabilities 11,015,353 12,255,954 11,601, Interest bearing borrowings less cash balances 4,988,557 4,986,278 4,545,269 Income producing assets 10,567,727 11,792,749 11,128,521 Loan to value ratio 47.21% 42.28% 40.84%

19 th Street Parkmore PORTFOLIO REVIEW SANDILE NOMVETE

20 PORTFOLIO BREAKDOWN By Building Sector unless stated other ways Office - Sovereign * Office - General Industrial Retail Total Number of properties Gross lettable area (m 2 ) Vacancy (%) 5.9% 13.7% 28.5% 5.4% 9.0% Value R7.39bn R2.13bn R0.18bn R0.40bn R10.10bn Average rental (R/m 2 ) Weighted ave. escalation (%) 7.9% 7.7% 7.9% 7.3% 7.8% Weighted ave. lease expiry (by revenue) - by building type 2.12 years 1.76 years 3.04 years 8.24 years 2.30 years Weighted ave. lease expiry (by revenue) - tenant specific # 2.03 years 2.06 years 3.04 years 5.01 years 2.30 years 20 Cost to income ratio (net) 10.45% 17.99% 12.13% 7.12% 12.15% Cost to income ratio (gross) 22.70% 35.53% 31.02% 35.35% 26.37% * Multi-tenant buildings are classified according to majority tenant type. Office - General buildings therefore contain a minority element of Sovereign tenants # This classification looks specifically at the tenant type within each building

21 ACQUISITIONS Property Sector Location Purchase Price Yield GLA Effective Date WALE Tembisa Retail Tembisa, Midrand 230,316, % 14, ABSA Florida Office - Sovereign Johannesburg 77,000, % 6, th Street Office - Sovereign Johannesburg 84,000, % 2, Veritas Building Office - Sovereign Pretoria 101,000, % 8, Free State portfolio Office - Sovereign Free State 507,000, % 77, & 56 Barrack Street Office - Sovereign Cape Town 64,000, % 4, Chambers of Change Office - Other Johannesburg 79,985, % 5, Total / Aggregate: 1,143,301, % 119, Final asset of Free State portfolio transferred in April of 15 Redefine assets transferred to date, remainder expected by end of June 2016

22 DISPOSALS Property Sector Location GLA Sales price (R) Transfer Date Transferred Richmond Forum Office - Other Johannesburg 3,968 22,500, SAPS - Bell Street Office - Sovereign Nelspruit 590 5,070, Yarona Shopping Centre Retail Tembisa, Midrand 5,979 80,000, Sale agreements concluded 107,570,00 6 Assets Various Various 49, ,318, * 59, ,888, * Anticipated disposal date

23 SECTORAL SPLIT GLA - by building GLA - by tenant * Office - Sovereign (66.4%) Office - Sovereign (67.5%) Office - Other (25.2%) Office - General (21.4%) Industrial (4.9%) Retail (7.2%) Retail (3.5%) Industrial (3.9%) Rental - by building Office - Sovereign (74.8%) Rental - by tenant Office - Sovereign (73.9%) Office - Other (19.8%) Office - General (16.5%) 23 Retail (3.7%) Retail (7.9%) Industrial (1.7%) Industrial (1.7%) * Excludes vacancies

24 DETAILED TENANT BREAKDOWN Tenant Profile - GLA National Government (27.2%) Provincial Government (25.9%) 67.5% State-Owned Enterprise (14.0%) Local Government (0.4%) Tenant Profile - Rental 73.9% National Government (29.1%) Provincial Government (30.7%) State-Owned Enterprise (13.7%) Local Government (0.4%) 24

25 GEOGRAPHICAL AND GRADE SPLIT GLA - by building Gauteng (36.5%) Kwazulu-Natal (31.2%) Free State (10.5%) Limpopo (5.5%) Northern Cape (4.9%) Western Cape (4.7%) Mpumalanga (3.1%) Eastern Cape (2.9%) North West (0.7%) Rental - by building Gauteng (38.0%) Kwazulu-Natal (24.9%) Limpopo (10.8%) Free State (8.4%) Northern Cape (5.3%) Western Cape (5.1%) Eastern Cape (3.5%) Mpumalanga (3.4%) North West (0.6%) Office grade - by GLA Office grade - rental A (25%) A (31%) 25 B (75%) B (69%)

26 LEASE EXPIRY PROFILE Total portfolio - by GLA Total portfolio - by rental vacant (9.0%) 28 Feb 17 (34.6%) 28 Feb 18 (20.1%) 28 Feb 19 (11.1%) 29 Feb 20 (7.3%) 28 Feb 21 (11.1%) Beyond 28 Feb 2021 (6.8%) 28 Feb 17 (39.1%) 28 Feb 18 (18.8%) 28 Feb 19 (14.7%) 29 Feb 20 (7.6%) 28 Feb 21 (12.4%) Beyond 28 Feb 2021 (7.4%) 26

27 LEASING Total leases concluded since 1 March 2015 No of Leases Total Area Weighted Ave. Rate / m 2 Weighted Ave. Escalation Renewals ,515 m 2 (50.3% 1 ) R % 2 Historic exit rentals R New leases 61 11,515 m 2 (23.1% 3 ) R % Of the 124,282 m 2 up for renewal as at 28 February 2015, 79.8% of tenants either renewed or remain on month-to-month leases Top 5 leases signed by area Property Tenant Type Total Area Term Rate / m 2 Escalation Beacon Hill Provincial DPW Renewal 13, % 101 De Korte Metropolitan Health Renewal 6, % 27 Samora Department of Human Settlements Renewal 5, % 1 & 3 Ferreira St Nedbank Renewal 3, % Delta Towers Ithala Soc Limited Renewal % 1 % of total GLA (124,282 m 2 ) up for renewal as at 28 February Excludes short term renewals of 12 months or less that are not subject to escalation. If these leases are included, the weighted average escalation is 5.92% 3 % of total vacant GLA (49,856 m 2 ) as at 28 February 2015

28 UPDATE ON GOVERNMENT Delta tenant breakdown - GLA 32.5% 0.4% 27.2% National Government (NDPW) 2 nd Treasury directive - renewals between 1-3 years, max. esc. of 6%. Over 3 years - tender NDPW engagement Rode report as guideline. Renewed leases at market rentals 14.0% 25.9% New system automated payments National Government Provincial Government State-Owned Enterprise Local Government Other Tender - 500,000 sqm in Pretoria CBD 28

29 UPDATE ON GOVERNMENT Delta tenant breakdown - GLA Provincial Government Operates independently 25.9% Secure long term leases 27.2% Pay rentals on time 14.0% 32.5% National Government Provincial Government State-Owned Enterprise Local Government Other 0.4% Local Government Governed by Municipal Finance Management Act Redefine acquisition - increasing exposure Renewed Shell House 10 years, 8% escalation Pay rentals on time 29

30 UPDATE ON GOVERNMENT Delta tenant breakdown - GLA 27.2% 25.9% 14.0% 0.4% 32.5% State-owned enterprises SARS, Eskom, DTI and various Chapter 9 institutions. Not governed by Treasury directive Own lease negotiations Concluded 3-5 years at market related rates and escalations These tenants pay rentals on time Favoured tenant National Government Provincial Government State-Owned Enterprise Local Government Other Overall Actively relationship - internal DPW Task Team Focusses on lease negotiations, timeous payments The team made significant inroads 30

31 CAPEX - EXISTING PORTFOLIO Property (All figures in Rands) CMH Dealership 88 Field Commission House Embassy Building The Forum Total Approved budget 156,000,000 85,000,000 28,250,000 # 21,843, ,093,000 Spent in FY ,976, ,976,214 Spent in FY ,357,082 37,037,624-1,591, ,986,404 Budget for FY ,462,376 28,250,000 20,251,302 30,000,000* 130,963,678 Description Development of new dealership showroom and parking facility. Complete Internal refurbishment of tenanted floors for DPW Internal refurbishment # budget reduced in line with tenant driven project Façade Upgrade Façade Upgrade * pending approval 31

32 REDEVELOPMENT STRATEGY Delta to deploy CAPEX into existing portfolio and Redefine assets Enhancing earnings and value uplift Securing long term stable returns Spend of approximately R250m for FY2017 (including projects on previous slide) Appointed Head of Capital Projects to oversee all Delta capital expenditure Andries Schoeman Identify assets where greatest value can be added, through value enhancing developments, renewal of long term leases and activation of under-utilised area or available bulk 32

33 REDEVELOPMENT STRATEGY - REDEFINE SENS announcement on 03 December 2015, anticipated spend of R600m over 3 years To be committed on the back of long term lease renewals First tranche of projects Pine Parkade Approximately R38m to upgrade façade, retail offering and structural refurbishments Target return accretive at > 11% Shell House 10 year renewal to be concluded. Project will upgrade lifts and aircon and provide tenant installation Target return accretive at > 11% Isivuno House 33 R45m upgrade to façade and tenant installations, 10 year lease renewal Target return accretive at > 11%

34 MARA DELTA Shareholding 26.34% at 30 April 2016 Valued at R472.5m at Feb 2016 Interim dividend (July - Dec 2015) received of US$6.17c / share Equates to R22.8m for Delta Total FY2016 earnings of R36.8m for Delta Highlights * Total investment property US$257m Capital raised of US$138.3m NAV of US$1.75 per share (excluding FCTR movements) Approval of Pivotal Merger On track to meet full year distribution 34 * Per latest Mara Delta results presentation

35 Phamoko Towers LOOKING FORWARD SANDILE NOMVETE

36 KEY FOCUS AREAS Risks / Challenges Sovereign downgrade & economic headwinds Increased cost of debt Liquidity Government spending Mitigants / Response Cost of debt 83% of debt fixed Multi-banked Debt mix (Short & long term; banks & DCM) Optimal use of assets through flexible security structures Government spending Invested in nodes critical to government Renewals / new leases at market rentals Curtailment of tenant expenses Investment strategy Pressure on B-Grade offices Uncertainty around government policies Pressure on B-Grade offices Sovereign underpin - greater tenant retention Invested in nodes critical to government Uncertainty around government policies Working with government to guide leasing policies (long term leases; market rentals) that support B-BBEE DPW Task Team well established and operational Sector-leading B-BBEE Level 2 rating 36

37 KEY FOCUS AREAS Risks / Challenges Capital management Gearing levels Large redevelopment strategy Sustainable returns Mitigants / Response Gearing levels Consolidation approach moving forward, limited acquisitions expected Disposals of non-core assets and pay-down of debt Intensive asset management to support portfolio values Redevelopment strategy CAPEX to be spent in line with lease renewals (affordability) Value enhancing activities targeted Appointment of appropriate staff Sustainable returns Efficiencies obtained through critical mass Redevelopments Obtain long term leases Staffing & skills Appointments Replacement COO for Bronwyn Corbett underway Appointment of Andries Schoeman as Head of Capital Projects 37 Share price Gearing reduction plan Working on providing clarity around government Earnings enhancing Free State and Redefine acquisitions

38 CONCLUSION Distribution target met and significant inroads made in strengthening balance sheet Delta will continue to focus on its sovereign underpin Further entrench - dominant player in National and Provincial government and parastatal tenants Leverage excellent empowerment credentials and understanding of government to secure long term leases Disposal of non-core assets Long term gradual international diversification Sustainable growth in distributions and NAV Prudent capital management 38 Intensive asset and property management Distribution guidance for FY2017: 7% to 8% growth

39 Hallmark Building Q & A THANK YOU

40 LexisNexis ANNEXURES

41 ANNEXURES Board of directors Shareholder profile Top 10 properties by value Mara Delta investment timeline GLA and vacancy reconciliation Income and expense components Property operating expenses breakdown Admin expenses breakdown Profitability ratios Municipal expense ratios Lease expiry profiles by sector 41

42 BOARD OF DIRECTORS - EXECUTIVE MANAGEMENT Executive Directors Sandile Nomvete Chief Executive Officer Bronwyn Corbett Chief Investment Officer & Chief Operating Officer Shaneel Maharaj Chief Financial Officer (appointed 1 December 2015) Exec Dep. & Prop Dev. Prog. (Wits & UCT Business Schools) BCom (Acc) (Hons) (Univ. of Natal), CA(SA) BCom (Acc) (Hons) (Univ. of Natal), HDipTax, CA(SA) Sandile co-founded Motseng Investment Holdings which eventually became the empowerment partner to Marriot Property Group. A series of mergers and acquisitions within the sector provided the opportunity for Motseng to become the largest 100% blackowned property management company in South Africa. Sandile serves as a director on a number of other listed entities, including KAP Limited. He has nearly a decade and a half of experience in executive and non-executive positions. Sandile is a graduate of the Property Development Programme from the University of Cape town Graduate School of Business, and holds an Executive Development Programme and Finance for non-financial managers Diploma from the University of Witwatersrand Graduate School of Business. Bronwyn has over ten years experience in the property sector with a specific focus on property ownership. Prior to joining Motseng in April 2009 as the CFO, Bronwyn was the Financial Director and joint founder of Universal Retail Construction Company and also the Financial and Operations Director for Universal Property Professionals, a development and property ownership company with a portfolio in excess of R12 billion. Bronwyn was integral in the establishment of Delta Property Fund Ltd ( Delta ) and built the property portfolio to over R2 billion, ultimately leading to the listing of Delta on the JSE. Bronwyn has the ability to secure essential finance and seller relationships which has been paramount to the success of Delta Property Fund. She holds a Bachelor of Commerce in Accounting from the University of Natal and is a member of the Institute of Chartered Accountants. Bronwyn is also a registered auditor. Shaneel is a Chartered Accountant with over fifteen years work experience. He graduated from the University of Natal and completed his articles at Deloitte and Touche. He started his career in 2002 with Imperial Fleet Services head office and progressed to Financial Manager of its Government Business Unit. Shaneel then joined Cargo Carriers Limited in 2006 as Group Financial Manager and played an integral role in the restructure and growth within the business. He was appointed to the board of Cargo Carriers as Financial Director in Shaneel joined Delta Property Fund in December 2015, bringing with him a wealth of experience and excellent track record of stakeholder engagement, relationship building, effectively managing the treasury function and implementing new systems. 42

43 BOARD OF DIRECTORS - CONTINUED Non-Executive directors JB Magwaza Independent Non-Executive Chairman Nooraya Khan Lead Independent Non-Executive Director Jorge Da Costa Independent Non-Executive Director Paul Simpson Independent Non-Executive Director Ian Macleod Independent Non-Executive Director Committees: NRC*, SETC Committees: IC, ARC*, NRC Committees: IC*, NRC Committees: IC Committees: IC, ARC 43 Dumo Motua Independent Non-Executive Director Committees: NRC, SETC* Marelise de Lange Independent Non-Executive Director Appointed 2 November 2015 Committees: ARC Nombuso Afolayan Independent Non-Executive Director Appointed 29 February 2016 Andrew Konig Non-Executive Director Appointed 01 April 2016 Board Committees IC = Investment Committee, ARC = Audit, Risk and Compliance Committee, NRC = Nomination and Remuneration Committee, SETC = Social, Ethics & Transformation Committee * Denotes chairperson

44 SHAREHOLDER PROFILE As at Feb 2016 Units held Holding Coronation Fund Managers % Public Investment Corporation % Stanlib Asset Management % Grindrod Asset Management % Sanlam Investment Management % Kagiso Asset Management % Directors Holdings % Investec Asset Management % Prudential Investment Managers % 44 Subtotal % Other % Total %

45 SHAREHOLDER PROFILE - CONTINUED As at April 2016 Units held Holding Redefine % Coronation Fund Managers % Stanlib Asset Management % Grindrod Asset Management % Public Investment Corporation % Sanlam Investment Management % Kagiso Asset Management % Directors' Holdings % Investec Asset Management % Prudential Investment Managers % 45 Subtotal 551,769, % Other 136,558, % Total %

46 TOP 10 PROPERTIES (BY VALUE) Forum Building Hallmark Building Liberty Towers Delta Towers Location Pretoria Location Pretoria Location Durban Location Durban Sector Office - Sovereign Sector Office - Sovereign Sector Office - Other Sector Office - Other 46 GLA 41,003 m 2 GLA 26,255 m 2 GLA 40,095 m 2 GLA 40,993m 2 Vacancy Nil Vacancy Nil Vacancy 1.49% Vacancy 29.39% Valuation R660 mil Valuation R410 mil Valuation R395 mil Valuation R358 mil

47 TOP 10 PROPERTIES - CONTINUED Hensa Towers Embassy Building The Marine Delta Heights Location Polokwane Location Durban Location Durban Location Pretoria Sector Office - Sovereign Sector Office - Sovereign Sector Office - Other Sector Office - Sovereign 47 GLA 13,675 m 2 GLA 32,788 m 2 GLA 24,591 m 2 GLA 19,122 m 2 Vacancy Nil Vacancy 25.72% Vacancy 19.54% Vacancy 1.78% Valuation R343 mil Valuation R325 mil Valuation R304 mil Valuation R275 mil

48 TOP 10 PROPERTIES - CONTINUED Phomoko Towers Beacon Hill Location Polokwane Location Sector Office - Sovereign Sector King Williams Town Office - Sovereign 48 GLA 13,058 m 2 GLA 13,648 m 2 Vacancy Nil Vacancy 0% Valuation R262mil Valuation R228 mil

49 DELTA AFRICA / MARA DELTA INVESTMENT TIMELINE May 2014 July 2014 December 2014 February 2015 March - April 2015 July - October 2015 November 2015 February 2016 April 2016 May 2014 July 2014 December 2014 February 2015 March 2015 March - April 2015 July - October 2015 November 2015 Shares in shell company acquired Delta International lists on AltX and Bermuda Stock Exchange. By end of July, Delta owns 53.32% of share capital at total cost of R501m Delta International declares maiden dividend of US$6.63c / share Delta receives dividends from Delta International of R18.2m for it s FY2015 period Listing of Delta International migrates to JSE Main Board and to Stock Exchange of Mauritius, maintaining 2 primary listings Delta accounts for Delta International investment as a subsidiary held for sale, as 52.41% shares held at February 2015, however capital raise conclude on 22 April 2015 dilutes Delta s holding to 31.78% (loss of control for accounting purposes). Accounted for investment in associate from this point forward Leon van de Moortele appointed CFO in July 2015 and Bronwyn Corbett appointed as CEO in August Rebranded to Delta Africa to be more aligned with investment strategy of pan-african investment fund in October 2015 Merger with Mara and Pivotal announced. Name to be changed to Mara Delta on conclusion of merger and once approved by shareholders 49 December 2015 Delta Africa declares dividend of US$6.17c / share for 6 months ended December 2015 February - April 2016 Delta owns 29.34% of Mara Delta valued at R472.5m (R19.80 / share) at end of FY2016, and earns R36.8m dividends for the period. Mara Delta issues additional shares in April 2016, Delta is subsequently diluted to 26.34%

50 GLA AND VACANCY RECONCILIATION Total GLA m 2 Vacant GLA m 2 Vacancy % As at 28 February ,103 49, % Disposals (10,536) (2,738) Acquisitions 119,864 7,881 Leases terminated - 30,334 Head leases 5,249 Regular leases 25,085 New letting of vacant space - (11,515) 50 Adjustments 1,074 (801) As at 29 February ,505 73, %

51 INCOME AND EXPENSE COMPONENTS Income Expense Contractual rental income - R1.22 bn Fair value adjustments - R259.1m Share of profit in associate - R33.5m Straight line rental income accrual - R27.0m Interest income - R26.6m Other income - R7.3m Finance costs - R412.7m Property operating expenses - R322.1m Administration expenses - R82.7m Loss on foreign exchange differences - R57.8m Loss from discontinued operations - R38.1 Cancellation fee - R11.5 Share of loss in joint venture - R2m 51

52 PROPERTY OPERATING EXPENSES Municipal expenses (66.22%) (R'000s) Service contracts (10.79%) Property Management fees (7.00%) Repairs and maintenance (3.22%) 34,722 22,542 10,350 10,001 Sundry property manager expenses (3.11%) 8,274 Staff costs - onsite (2.57%) Rental paid - Parking rental (2.25%) 7,232 5,346 4,395 Insurance (1.66%) 2,925 1,939 Provision for doubtful debts (1.36%) 1, Other property expenses (0.91%) Consumables (0.60%) 213,169 Sundry & admin expenses (0.31%)

53 ADMIN EXPENSES Asset Management fees (37.8%) Directors fees (15.8%) (R'000s) Reversal of prior year accrual (12.1%) Professional fees (8.6%) Rental paid Head office (5.6%) 7,161 4,604 2,958 2,954 2,267 Travel and entertainment (3.6%) Audit fees, reporting and announcements (3.6%) Depreciation (2.7%) Administration & sundry expenses (2.1%) Corporate social responsibility (1.8%) Bank charges (1.7%) Share based payment expense (1.4%) 13,107 10,000 1,721 1,495 1,434 1,159 1, Sponsorship and donations (1.4%) Insurance (0.9%) Compliance and regulatory (0.6%) 31,270 Market data (0.3%)

54 PROFITABILITY METRICS 100% 90% 80% Profitability per sector 93% 80% 80% 85% 81% 90% 80% 70% Municipal recoveries 85% 82% 79% 81% 70% 60% 50% 40% 30% 20% 10% 23% 10% 36% 35% 18% 7% 31% 26% 12% 12% 60% 50% 40% 30% 20% 10% 43% 23% 0% Office - Sovereign Office - Other Cost to Income Ratio (Net) Cost to Income Ratio (Gross) Municipal Recovery Ratio Retail Industrial Total 0% Rates Electricity Water & Effluent Refuse Levies, meter reading and other Total 54

55 MUNICIPAL RECOVERIES BY SECTOR 120% 100% 110% 100% 93% 105% 104% 93% 80% 80% 80% 66% 64% 70% 85% 60% 48% 53% 56% 48% 40% 34% 40% 28% 32% 20% 18% 19% 20% 0% Office - Sovereign Office - Other Retail Industrial 0% 55 Rates Water & effluent Levies, meter reading and other Electricity Refuse Total

56 LEASE EXPIRY PROFILE BY BUILDING SECTOR GLA - Office Sovereign vacant (5.9%) 28 Feb 17 (40.5%) 28 Feb 18 (19.0%) 28 Feb 19 (9.4%) 29 Feb 20 (6.2%) 28 Feb 21 (12.7%) Beyond 28 Feb 2021 (6.3%) Rental - Office Sovereign 28 Feb 17 (41.5%) 28 Feb 18 (17.2%) 28 Feb 19 (13.7%) 29 Feb 20 (5.5%) 28 Feb 21 (14.9%) Beyond 28 Feb 2021 (7.2%) GLA - Office Other Rental - Office Other vacant (13.7%) 28 Feb 17 (27.9%) 28 Feb 18 (23.3%) 28 Feb 19 (18.7%) 29 Feb 20 (9.1%) 28 Feb 21 (2.4%) Beyond 28 Feb 2021 (4.9%) 28 Feb 17 (38.3%) 28 Feb 18 (22.9%) 28 Feb 19 (20.8%) 29 Feb 20 (12.2%) 28 Feb 21 (2.5%) Beyond 28 Feb 2021 (3.3%) 56

57 LEASE EXPIRY PROFILE BY BUILDING SECTOR GLA - Retail vacant (5.4%) 28 Feb 17 (13.7%) 28 Feb 18 (5.9%) 28 Feb 19 (5.9%) 29 Feb 20 (25.8%) 28 Feb 21 (1.3%) Beyond 28 Feb 2021 (42.0%) Rental - Retail 28 Feb 17 (11.4%) 28 Feb 18 (9.4%) 28 Feb 19 (8.2%) 29 Feb 20 (31.2%) 28 Feb 21 (1.5%) Beyond 28 Feb 2021 (38.3%) GLA - Industrial Rental - Industrial vacant (28.5%) 28 Feb 17 (1.9%) 28 Feb 17 (3.1%) 28 Feb 18 (29.0%) 28 Feb 19 (0.0%) 29 Feb 20 (0.0%) 28 Feb 21 (39.4%) Beyond 28 Feb 2021 (0.0%) 28 Feb 18 (56.3%) 28 Feb 19 (0.0%) 29 Feb 20 (0.0%) 28 Feb 21 (41.8%) Beyond 28 Feb 2021 (0.0%) 57

58 LEASE EXPIRY PROFILE BY TENANT SECTOR GLA - Office Sovereign 28 Feb 17 (44.0%) 28 Feb 18 (21.7%) 28 Feb 19 (9.0%) 29 Feb 20 (6.4%) 28 Feb 21 (12.8%) Beyond 28 Feb 2021 (6.1%) Rental - Office Sovereign 28 Feb 17 (42.9%) 28 Feb 18 (18.1%) 28 Feb 19 (13.0%) 29 Feb 20 (5.4%) 28 Feb 21 (13.9%) Beyond 28 Feb 2021 (6.7%) GLA - Office General Rental - Office General 28 Feb 17 (28.9%) 28 Feb 18 (23.2%) 28 Feb 19 (25.4%) 29 Feb 20 (11.2%) 28 Feb 21 (4.9%) Beyond 28 Feb 2021 (6.4%) 28 Feb 17 (32.7%) 28 Feb 18 (20.1%) 28 Feb 19 (24.6%) 29 Feb 20 (12.3%) 28 Feb 21 (6.1%) Beyond 28 Feb 2021 (4.2%) 58

59 LEASE EXPIRY PROFILE BY TENANT SECTOR GLA - Retail 28 Feb 17 (26.8%) 28 Feb 18 (12.5%) 28 Feb 19 (9.7%) 29 Feb 20 (18.1%) 28 Feb 21 (4.9%) Beyond 28 Feb 2021 (28.0%) Rental - Retail 28 Feb 17 (24.6%) 28 Feb 18 (14.4%) 28 Feb 19 (12.9%) 29 Feb 20 (20.8%) 28 Feb 21 (4.9%) Beyond 28 Feb 2021 (22.4%) GLA - Industrial Rental - Industrial 28 Feb 17 (4.3%) 28 Feb 17 (1.9%) 28 Feb 18 (40.6%) 28 Feb 19 (0.0%) 29 Feb 20 (0.0%) 28 Feb 21 (55.1%) Beyond 28 Feb 2021 (0.0%) 28 Feb 18 (56.3%) 28 Feb 19 (0.0%) 29 Feb 20 (0.0%) 28 Feb 21 (41.8%) Beyond 28 Feb 2021 (0.0%) 59