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A N N U A L R E P O R T 2 010

HIGHLIGHTS

for the year ended 30 June 2010

Annual distribution up 15,3% to 109,25 cents per unit Realisable net asset value per linked unit up to 1299 cents from 1124 cents Occupancy at 99,2% Internalisation of the asset management function is underway which will further align management objectives with shareholders expectations.

Front cover and above picture - Architects visuals of the new additional offices completed in May 2010 at Maerua Mall regional retail & office block centre - Cnr Jan Jonker and Robert Mugabe Avenues, Windhoek.

CONTENTS

PAGE HIGHLIGHTS CHAIRMAN'S STATEMENT PROFILE, INVESTMENT OBJECTIVES AND GROUP SALIENT INFORMATION DIRECTORATE ADMINISTRATION MANAGEMENT COMPANY'S REPORT CORPORATE GOVERNANCE AND RISK REVIEW UNITHOLDERS' DIARY DIRECTORS' RESPONSIBILITY FOR AND APPROVAL OF THE ANNUAL FINANCIAL STATEMENTS INDEPENDENT AUDITOR'S REPORT ANNUAL FINANCIAL STATEMENTS DIRECTORS' REPORT STATEMENTS OF FINANCIAL POSITION STATEMENTS OF COMPREHENSIVE INCOME STATEMENTS OF CHANGES IN EQUITY STATEMENTS OF CASH FLOW NOTES TO THE ANNUAL FINANCIAL STATEMENTS REAL ESTATE PORTFOLIO NOTICE OF ANNUAL GENERAL MEETING PROXY FORM 24 - 28 29 30 31 32 33 - 61 62 - 63 64 - 66 67 - 68 INSIDE FRONT COVER 2 3 4-5 6 7 - 16 17 - 20 21 22 23

A N N U A L R E P O R T 2010

1

CHAIRMAN'S STATEMENT

for the year ended 30 June 2010

Oryx Properties Limited ("Oryx") had another good year despite continued global economic uncertainty impacting our economy. The pace of economic recovery has clearly been slower than expected globally, on the back of increasing government debt and rising unemployment in many of the developed countries. Surprising many analysts, the local economy is not only resilient, but growth forecasts are in fact strong on the upside. The Bank of Namibia, for example is forecasting a GDP growth rate of 4.2% for 2010 (against the 0.8% contraction experienced in 2009). Anticipating a difficult year ahead, Oryx focused on reducing the vacancy rate and adding yield-enhancing properties to the portfolio at the start of the financial year. The quality of the property portfolio, combined with the efforts of our focused and highly committed management team have meant that our shareholders were provided with a set of excellent financial results. For the year to June 2010, Oryx reported a three-fold increase in profits, growing from N$26,7 million in 2009 to N$80,5 million this year. The increase is mainly attributable to the N$89,9 million positive revaluation adjustment of the property portfolio. Our total distributions to unit holders grew by 15.3% to 109.25 cpu, up from 94.75 cpu a year ago. We attribute this excellent growth in distributions to the following main factors: · · · · Increased rental income from long-term contractual leases with built-in escalation rates, reduced vacancies in lettable space, as well as turnover rental contributions received from the Maerua Mall Shopping Centre tenants; A contribution from the South African listed property investment; The lower interest rate environment and good management of debt facilities; and A reduction in management fees payable, as a result of the lower unit price.

All the properties in the Oryx portfolio were independently valued at N$908 million as at end June 2010, representing an increase of 21.1% over the prior year. The realisable net asset value (RNAV) increased by 15.5% to 1 299 cents resulting from the increase in valuations and the combined effect of disposals, acquisitions and developments during the year. At the current price of 1 101 cents per linked unit, Oryx units are trading at a 15.0% discount to NAV. Oryx invested N$95 million during the year in acquiring and developing properties, with a specific focus on yield enhancement. This included three industrial properties in Johannesburg and Port Elizabeth with 10-year fully repairing leases. The South African properties provide greater geographic and sectoral diversification within the portfolio which reduces the company's risk profile. The current sectoral spread based on value is 60.0% in retail, 29.0% in industrial and 11.0% in office. Most of the Group's portfolio is located in Windhoek with 7.0% in South Africa. While global economic growth is likely to remain slow for the remainder of 2010 and early 2011, a full-blown global downturn is generally considered to be unlikely. We expect markets to remain volatile over the short-term, but the sector is showing a gradual recovery in property returns. We are confident that through the quality of our property portfolio, low gearing and available facilities we are well positioned to effectively utilise yield-enhancing opportunities and to continue delivering reliable and growing returns for investors from our Namibian and South African properties in the years ahead. I wish to thank my fellow board members, committed staff and service providers for their dedicated and valued efforts and participation during the year to make these results possible.

Francois Uys Chairman 20 October 2010

2

PROFILE, INVESTMENT OBJECTIVES AND GROUP SALIENT INFORMATION

30 June 2010

Profile

Oryx Properties Limited ("Oryx") is a property loan stock company listed in the "Financial-Property" sector on the Namibian Stock Exchange ("the NSX"). The Company was listed on 4 December 2002 and together with its subsidiaries ("the Group") own a premier quality retail, industrial and office real estate portfolio, which generates and offers investors a sustainable and growing income stream.

Investment objectives

Oryx owns a premier quality real estate portfolio and seeks to grow the portfolio by the acquisition or development of additional properties which will have escalating income streams derived from quality tenants so as to secure long term earnings growth. In addition, Oryx may from time to time invest in Johannesburg Securities Exchange ("the JSE") listed real estate securities to allow for flexibility in respect of new direct real estate investment opportunities, portfolio diversification and yield enhancement.

Group salient information

12 months 30 June 2010 · Distribution per linked unit (cents) · Percentage increase in distributions over previous year · Headline earnings per linked unit (cents) - Excluding rental straight line basis adjustment - Rental straight line basis adjustment · Earnings per linked unit (cents) · Units in issue (000's) · Market capitalisation (N$m) as at 30 June 2010 · Net asset value (NAV) (cents per unit) - On IFRS basis - Realisable NAV (excluding deferred tax on revaluations and before providing for the distribution still to be paid) · Listed market price (cents per unit) · Listed market price (discount)/premium to net asset value - On IFRS basis - Realisable NAV (excluding deferred tax on revaluations and before providing for the distribution still to be paid) · Tradability of units (see page 27) · Value of property portfolio (N$m) - At valuation - Rental straight line basis adjustment · Vacancy factor (based on lettable space) · Fixed interest rate debt (N$m) · Variable interest rate debt (N$m) · Weighted cost of fixed debt funding · Cost of variable debt funding · Interest bearing debt to total assets ratio (26.5%) 5.3% 883 908 (25) 0.8% 140 47 10.3% 8.7% 20.4% 11.2% 0.6% 722 750 (28) 1.5% 140 10.4% 9.5% 18.1% (12.5%) 31.6% 1 299 955 1 124 1 250 1 091 950 109,25 15.3% 107,13 109,35 (2,22) 255,50 55 042 526 12 months 30 June 2009 94,75 6.8% 97,13 94,93 2,20 143,34 55 042 688

A N N U A L R E P O R T 2010

3

DIRECTORATE

as at date of this report

Oryx Properties Limited Board of Directors Back row from left to right: Jens Kuehhirt, Andre Swanepoel, Stefan de Bruin (CFO), Kelly Clinton, Brian Azizollahoff, Nick Harris (alternate to Lauren Tapping) Front row from left to right: Bennie Joseph, Lauren Tapping, Francois Uys (Chairman), Len van Niekerk, Hein Smit (CEO) Absent: Hosea Angula (Alternate to Andre Swanepoel) Directors of Oryx Properties Limited (Registration number: 2001/673) [email protected] www.oryx.com.na The directors at the date of this report are: Francois Uys BA, BCom (Hons), MCom, (63 years) (Nam) Chairman, Non-Executive Member of the Risk, Audit and Compliance Committee Member of the Investment Committee Is a director of FP du Toit Transport (Proprietary) Limited, Intercape Ferreira Mainliner (Proprietary) Limited and MacDonalds Transport Group (Proprietary) Limited. He was previously a director of Ambit Properties Limited (listed on the JSE) and was senior executive in the Trencor Group from 1970 to 1989, managing director of TransNamib Limited from 1989 to 1996 and of Metje & Ziegler from 1996 to 2004, Chairman of the Namibian Stock Exchange from 1999 until 2001 and served on the executive committee from 1997 to 2004. He has served on various Government and advisory bodies both in Namibia and in South Africa. BH Azizollahoff MBA, (49 years) (SA) Non-executive director He is an Executive Director of Redefine Properties, a listed property company which has grown from a company with R1,1 billion assets to around R25 billion, largely due to the recent merger of Redefine, ApexHi Properties Limited and Madison Property Fund Managers Limited. Prior to the merger, he was the CEO of Redefine Income Fund Limited since 2003. Brian was instrumental in the establishment and listing of ApexHi Properties and served as the Managing Director. He has extensive experience in the listed property sector. Brian chairs the marketing sub-committee of the Property Loan Stock Association of South Africa and serves on the Owners Committee of the South African Property Owners Association.

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DIRECTORATE (continued)

as at date of this report

SI de Bruin B.Com (Hons), CA (Nam), H Dip (Tax), (37 years) (Nam) Executive director: Finance Member of the Investment Committee Invited to attend the Risk, Audit and Compliance Committee meetings He joined Old Mutual Investment Group Property Investments (Proprietary) Limited (OMIGPI) in August 2008 and is currently a Director of Oryx Management Services (Proprietary) Limited. He was previously a Senior Manager for Tax and Legal Services at PricewaterhouseCoopers from 2001 - 2003, Financial Manager at Siemens Namibia (Proprietary) Limited from 2003 - 2005 and Financial Director of Siemens Namibia (Proprietary) Limited from 2005 - 2008. KF Clinton H.Dip.Eng, B.Com (Hons), (49 years) (SA) Non-executive director Chairman of the Investment Committee He previously was the Chief Executive Officer of Ambit Properties Limited, a property loan stock company listed on the JSE. He has 30 years experience in the South African property market, including construction, lecturing, property management, facilities management, asset management, township development, property development and valuations. B Joseph (68 years) (Nam) Non-executive director Is the managing director of Joseph & Snyman (Proprietary) Limited, a real estate specialist group currently managing over N$2 billion worth of real estate. A director of Oryx Management Services (Proprietary) Limited. JC Kuehhirt B.Com, CA (Nam), CA (SA), (60 years) (Nam) Non-executive director Chairman of the Risk, Audit and Compliance Committee Member of the Investment Committee A independent financial consultant since January 2007. Retired from the auditing profession in December 2006 as senior partner of Deloitte & Touche in Namibia after 35 years of service with the firm in South Africa, Germany and Namibia. He was a partner of the firm for 24 years in Namibia, and has gained extensive experience in the banking and other financial services, mining, fishing, retail and manufacturing sectors, serving mainly large blue chip and listed clients. He was a member of the board and tax committee of the Institute of Chartered Accountants in Namibia for a number of years. Directorships include Old Mutual Life Assurance Company (Namibia) Limited. JH Smit, DIP.BUS.MAN, (57 years) (SA) Executive director: CEO Member of the Investment Committee Was an Alternate Director of Murray & Roberts Properties during the period 1980 - 1987 and Joint Managing Director of Richard Ellis / Dunlop Heywood from 1989 - 1994. He was also Managing Director (Property Marketing) of Marriott Property Services after their acquisition of Richard Ellis. Gained extensive experience of Property Management, Consulting, Development and Valuations over more than 37 years in the Property Industry. A Swanepoel B.Com, LLB, (56 years) (Nam) Non-executive director Managing director of Dr Weder, Kauta & Hoveka Inc. Legal Practitioners, with over 25 years experience in the legal field. Former member of the Law Society's Standing Committee on Conveyancing, as well as former member of the Board for Legal Education, member of the Standing Committee overseeing the amendment of the Sectional Title Act, member of the Screening Committee of the Namibian Stock Exchange, extensive experience in commercial and property law and structuring of sectional title and other property transactions. LC Tapping B.Compt (Hons), CA (SA), (39 years) (SA) Non-executive director Member of the Risk, Audit and Compliance Committee Has 15 years real estate experience with particular emphasis on the listed property sector. She was previously a director of SA Corporate Real Estate Fund Managers Limited which is the management company of JSE listed SA Corporate Real Estate Fund, Oryx Management Services (Proprietary) Limited and Marriott Property Services (Proprietary) Limited. LB van Niekerk B.Com, B.Com (Hons), (37 years) (SA) Non-executive director He has 12 years investment experience, the first 10 of which covers real estate. He worked at Standard Bank's Economics Division before moving to the Bank's stock broking business as the listed real estate analyst. Len moved to Old Mutual Investment Group South Africa (OMIGSA) in 2006 as Head of Quoted Property overseeing the research and asset management of various listed property funds. He joined OMIGPI in June 2009 at the time he was appointed as Managing Director of SA Corporate Real Estate Fund. Alternate directors NBS Harris (FRICS) - Alternate to LC Tapping EHT Angula (B.Proc) - Alternate to A Swanepoel Changes to the Board There were no changes to the Board of Directors between 30 June 2010 and the date of this report.

A N N U A L R E P O R T 2010

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ADMINISTRATION

as at date of this report

Company secretary and registered office Oryx Management Services (Proprietary) Limited (a subsidiary of Old Mutual Investment Group Property Investments (Proprietary) Limited) 61 Independence Avenue Windhoek P O Box 3644, Windhoek Managers Oryx Management Services (Proprietary) Limited (a subsidiary of Old Mutual Investment Group Property Investments (Proprietary) Limited) 61 Independence Avenue Windhoek P O Box 3644, Windhoek Trustee Fisher Quarmby & Pfeifer 1st Floor Swabou Building Corner Independence Avenue and Post Street Mall Windhoek P O Box 37, Windhoek Transfer secretary Transfer Secretaries (Proprietary) Limited Shop 8 Kaiser Krone Centre Post Street Mall Windhoek P O Box 2401, Windhoek Auditors Deloitte & Touche Chartered Accountants (Namibia) Deloitte Building Maerua Mall Complex Jan Jonker Road Windhoek P O Box 47, Windhoek Commercial banks Bank Windhoek Limited - Maerua Mall Branch Maerua Mall - Shop 22 Cnr Jan Jonker and Robert Mugabe Avenues Windhoek P O Box 15, Windhoek Nedbank Limited - Corporate Branch 2nd Floor West Entrance Mall 91 Jan Smuts Avenue Mutual Park Pinelands

Sponsors Simonis Storm Securities (Proprietary) Limited 4 Koch Street, Klein Windhoek P O Box 3970, Windhoek

Legal advisors H D Bossau & Co 15th Floor Frans Indongo Gardens 19 Dr Frans Indongo Street Windhoek

6

MANAGEMENT COMPANY'S REPORT

for the year ended 30 June 2010

1. Introduction

This management company's report reviews the Group's results, its business activities and investment strategies, as well as the commitments for the year ahead.

2. Economic and real estate review

Over the past year the South African listed property sector has outperformed both equities and bonds. In comparison with equities, the property investment business model is more transparent because it is based on contractual leases and listed property investments are asset rich and high yielding. In times of economic uncertainty, this model serves listed property investment well. Listed property is expected to grow by 7% in South Africa over the next 12 months. Vacancy rates, especially in office space, have increased, but appear manageable. Rental escalations of 6% to 9% are being achieved on renewals, and expiring rents are not too far from market rents due to rapid increases during the up cycle. Namibia's overall annual inflation stood at 7.5% during June 2010. The Bank of Namibia has cut interest rates by 75 basis points during the year to bring the prime lending rate to 10.75%. Commercial banks only dropped their prime lending rate very much later, after pressure from the Bank of Namibia. Although still at a slower pace, the Namibian economy continued to show signs of improvement during the first quarter of 2010. The domestic economy is expected to expand by about 4.2% in 2010. Although the Namibian economy was severely impacted by the decrease in specifically diamond mining revenue, Swakopmund has experienced significant growth due to Uranium mining and exploration. The first ever institute for the uranium industry has opened in Swakopmund which currently houses five potential uranium mines. Of these five mines, three would possibly come on stream in the next few months, while there are mining uranium deposit areas where pre-mining exploration is yet to take place. The envisaged higher uranium production in Namibia would catapult the country from fourth place to the largest producer in the world. Attempts to discover oil which can be extracted on a commercial basis have not yielded good results in Namibia. However, the effort to prospect is still ongoing. Namibia therefore still continues to be a net oil importer and a small economy faced with a price- taking classification. Only a slight improvement in the property market is predicted for the last quarter of 2010, despite signs of recovery in the economy. No substantial growth in property market rentals is however foreseen and there might even be a slight increase in vacancies from current levels. Increases in electricity and higher municipal rates may affect rental affordability and consequently exert pressure on rental margins. The Oryx unit price traded at 955 cents per unit at 30 June and recovered to 1101 cents per unit at 18 October 2010.

3. Oryx's financial results

Oryx has declared distributions to unitholders of N$60,1 million, or 109,25 cents per linked unit for 2010, a 15.3% increase on the 2009 distribution. The increase in distributions is mainly attributable to improved performance from the property portfolio, a 4,75 cents per unit contribution from the SA listed property investment and savings in asset management fees as a result of the lower unit price. Occupancy rates across the portfolio are at 99.2% (2009 : 98.5%).

A N N U A L R E P O R T 2010

7

MANAGEMENT COMPANY'S REPORT (continued)

for the year ended 30 June 2010

3. Oryx's financial results (continued)

Distributable earnings for the twelve months are calculated as follows: Group 2010 N$'000 Property portfolio Standing portfolio - property held for 12 comparative months Rent and recoveries (excluding straight-line adjustment) Property expenses Additions Properties acquired or developed in the current or comparative year Rent and recoveries (excluding straight-line adjustment) Property expenses Disposals Properties disposed of in the current or comparative year Rent and recoveries (excluding straight-line adjustment) Property expenses Net operating income from property portfolio Fund cost and other expenses Asset management fees Audit fees Directors fees Other expenses Profit from operations Net funding costs Interest paid Interest income Distribution from listed investment Deferred taxation Distributable earnings 74 624 94 664 (20 040) 2009 N$'000 70 716 88 283 (17 576) % Change 6 7 14

2 411 2 463 (52)

-

1 762 1 807 (45) 78 797 (5 684) (3 642) (455) (723) (864) 73 113 (11 394) (17 443) 738 5 311 (1 540) 60 179 Units

178 227 (49) 70 894 (5 865) (4 146) (529) (695) (495) 65 029 (12 893) (14 608) 1 715 119 52 255 Units 55 041 675 Cents 94.75 46.25 48.50 15.3 17.8 12.9 11 (3) (12) (14) 4 75 12 (12) 19 (57) 100 (1 394)

Units in issue at end of the year

55 041 675 Cents

Distribution (cents per unit) - interim - final

109.25 54.50 54.75

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MANAGEMENT COMPANY'S REPORT (continued)

for the year ended 30 June 2010

3. Oryx's financial results (continued)

Distributable earnings are reconciled to the operating profit before debenture interest as detailed below: 2010 N$'000 Distributable earnings Capital profit on sale of listed investment Capital profit on sale of investment property Amortisation of debenture premium Revaluations of investment property Deferred taxation Operating profit before debenture interest Valuations The real estate portfolio was revalued on 30 June 2010 by independent professional valuer Tim Moulder FRICS FIV (SA) of CB Richard Ellis at N$908 million, which resulted in a N$89,9 million positive revaluation adjustment. The valuation translates into a realisable net asset value of 1299 cents per unit. The current trading price of 1101 cents per unit represents a discount of 15% to the realisable net asset value of 1299 cent per unit. Investment property was valued on a discounted cash flow basis whilst the vacant industrial land was valued based on the purchase prices for similar land and after taking into account the size, location and physical attributes. The portfolio has a weighted average capitalisation rate of 9.6% and reflects a weighted discount rate of 15.1% (2009 : 9.7% and 15.1% respectively). The sector analysis is set out in the table below: Property type Retail Industrial Office Portfolio average The rental expenses to revenue ratios are as follows: Retail % 2010 2009 22.4 22.1 Industrial % 6.7 6.5 Office % 22.9 22.0 Group % 18.4 18.0 Capitalisation rate % 2010 2009 9.0 9.0 10.6 11.2 10.1 10.4 9.6 9.7 Discount rate % 2010 2009 14.4 13.9 16.3 17.5 16.2 16.0 15.1 15.1 60 179 45 1 450 2 777 89 897 1 540 155 888 2009 N$'000 52 255 1 313 2 777 30 158 (119) 86 384

Note: Letting commissions and tenant installation costs have been excluded in the calculation of the above ratios. Rental expenses to revenue have increased mainly due to higher rates and common area electricity.

A N N U A L R E P O R T 2010

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MANAGEMENT COMPANY'S REPORT (continued)

for the year ended 30 June 2010

4. Oryx's investment strategy

Oryx owns an investment portfolio of premium quality retail, industrial and office real estate and seeks to grow this by the acquisition or development of additional properties which will have escalating income streams derived from quality tenants so as to secure long term earnings growth and capital appreciation. The investment portfolio incorporates both directly held properties, as well as investments in SA listed property companies. Oryx aims to be investors' first choice in the Namibian property sector. The strategic objectives underpinning this are: · Investment performance - To achieve a rolling five year average distribution growth which exceeds CPI; and - To achieve a rolling five year average total return of at least CPI +5%. · Grow the property portfolio - To increase the assets under management to N$1.5 billion by the end of 2012 year end. The focus will remain on distribution and not on portfolio growth. · Investor relations - To increase the profile of the fund and enhance investor relations. The following key investment criteria continue to be pursued by management: · A sectorally diversified portfolio with a long term objective to achieve a weighting of 50-70% in the retail sector, 3040% in the industrial sector and 10-20% in the office sector; · In view of the limited investment opportunities available to Oryx, especially those that do not dilute earnings, all investments that meet the criteria for asset quality, security of income and earnings growth will be considered, notwithstanding that it may take Oryx outside its target ranges ; · The industrial component will focus on distribution warehouses and industrial facilities; · At least 50% of the gross lettable area will be leased to established major Southern African companies; · At least 50% of the gross lettable area will be subject to leases with a duration of at least five years; · A maximum exposure of 15% of the monthly rental being received from any single tenant; and · A geographically diversified portfolio with a long term objective to achieve a weighting of 75% Namibian and 25% South African. When deemed appropriate, Oryx may invest in yield enhancing listed property stock with positive capital growth prospects. Oryx will consider such investments on its merits up to an amount of N$50 million. During the year Oryx made a N$59 million investment in three industrial properties in South Africa at yields of 11% with 8.5% escalations. Further investment opportunities will be considered on merit. Oryx's strategy is to invest in properties that are not management intensive and secured by long leases from A and B grade tenants. The focus will remain on well located, modern and large industrial properties in the larger metropolitan areas of Gauteng, Cape Province and Kwa-Zulu Natal. Oryx is limited by its articles to a debt ratio of 60% of its assets, but the investment strategy is not to exceed a 40% debt to assets ratio in the long term.

5. Salient features of the real estate portfolio

Oryx's real estate portfolio comprises 29 properties (see page 62) with a value of N$908 million at 30 June 2010. 5.1 Analysis by geographic region A total of 93% of the value of the portfolio is situated in Windhoek and 7% is situated in South Africa.

10

MANAGEMENT COMPANY'S REPORT (continued)

for the year ended 30 June 2010

5. Salient features of the real estate portfolio (continued)

5.2 Analysis by sector Analysis by real estate sector by value (before straight-lining) Industrial 29% (2009 : 27%)

Retail 60% (2009 : 64%) Offices 11% (2009 : 9%)

Analysis by real estate sector by contractual revenue Industrial 26% (2009 : 26%)

Retail 64% (2009 : 64%)

Offices 10% (2009 : 10%) Analysis by real estate sector by gross lettable area ("GLA") Offices 9% (2009 : 9%)

Retail 36% (2009 : 39%)

Industrial 55% (2009 : 52%)

A N N U A L R E P O R T 2010

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MANAGEMENT COMPANY'S REPORT (continued)

for the year ended 30 June 2010

5. Salient features of the real estate portfolio (continued)

5.3 · Portfolio analysis and transactions Retail The portfolio has a 60% (2009 : 64%) value weighting in the retail sector primarily through the Maerua Mall complex, the premier retail centre in Namibia. The current weighting in the retail sector is within the target range of 50% 70% and allows for future expansion in the retail sector, specifically the Maerua Mall Shopping Centre where the demand for retail space is eminent. During the year 730m2 was added to Oryx's retail space in Maerua Mall through the acquisition of a sectional title unit previously occupied by Mike's Kitchen. The Maerua Mall Shopping Centre recorded a 9% growth in turnover for the 2010 financial year (2009 : 33.5%). The number of vehicles parking in the basement showed a year on year growth of 30% (2009 : 20.5%) and consequently parking income followed the trend. Turnover rentals increased by N$1,7 million from 2009 and therefore further indicate that tenants enjoy favorable trading conditions at the Mall. 63% of the total portfolio comprises the Maerua Mall node which includes the office blocks. The risk of this high weighting is however mitigated by: · · · · Office The portfolio has a 11% (2009 : 9%) value weighting in the office sector. The weighting in the office sector is within the target range of 10% - 20%. Further development in this sector will be tenant driven coupled with long term leases. The office portfolio was expanded by N$24,5 million (including the June 2010 valuation) with the completion of the Deloitte Office block at Maerua. The tenant occupied the property from 1 June 2010. · Industrial The portfolio has a 29% (2009 : 27%) value weighting in the industrial sector. Management's objective to achieve a 30% - 40% weighting in the industrial sector will be achieved in line with the approved investment strategy to acquire industrial properties in South Africa up to a value of approximately N$200 million. The Board has approved the acquisition of an additional industrial property in South Africa at a cost of N$51,5 million with a yield of 12% and an escalation rate of 7.5%. Transfer is expected during October 2010. The property is let on a triple net basis with a termination date on 30 September 2018. The industrial portfolio enjoyed strong occupancy levels during the year. Land and building cost has escalated exponentially, but rental levels remain under pressure. There were no vacancies in the industrial portfolio during the year, except for the Tal Street premises which is currently undergoing major alterations to accommodate the new Audi display area and workshop as well as the Volkswagen workshop. The current Audi / Autohaus premises in Lazarette Street will be vacant from the end of October 2010, but management is confident that the premises will be re-let easily due to the location and visibility of this site. The construction of three warehouses on the vacant land in Prosperita industrial area is underway and completion is expected during April 2011. The development will cost approximately N$18,6 million with a total gross lettable area ("GLA") of 4 500m2. The development is expected to yield an income return of 11%. Three industrial properties measuring 20 101m2 were acquired during the year at a total cost of N$59 million at a yield of 11% with 8.5% escalations, while erf 5188 Windhoek and erf 380 Tsumeb with GLA's of 7 968m2 and 1 890m2 respectively were sold for a total consideration of N$25,3 million. A diversified tenancy profile with a very high percentage of space let to major Namibian and South African corporates with leases ranging from 5 to 10 years; Entrenchment of the node as the prime decentralised retail node of Windhoek; and The critical mass will deter potential competitors, which should bode well for rental growth and asset value.

12

MANAGEMENT COMPANY'S REPORT (continued)

for the year ended 30 June 2010

5. Salient features of the real estate portfolio (continued)

5.4 Tenant analysis The total floor area of the portfolio is 129 739m2 (2009 : 117 244m2) and is occupied by approximately 200 tenants. The five tenants occupying the most space are set out below: Tenant 2010 % of total rental 10% 8% 5% 4% 1% 28% 2009 % of total rental 14% 9% 6% 4% 3% 36%

CIC Metje & Ziegler Edcon Group Shoprite Checkers FP du Toit

Of the total floor space, 90% (2009: 85.2%) is occupied by major Southern African companies or their franchisees. The GLA per sector is as follows as at 30 June 2010: 2010 GLA Industrial Retail Offices 71 754m2 46 113m2 11 872m2 129 739m2 5.5 Lease expiry profile The following graph depicts Oryx's lease expiry profile (based on rent): 30% 25% 20% 15% 10% 5% 0% 2010 2011 2012 2013 Financial Year During 2010, three of the larger tenancies in Maerua Mall Phase Two expired. These leases have been renewed successfully. The 2011 lease expiries consist of the remainder of the large tenancies in Maerua Mall Phase Two. Management considers the risk of non-renewal to be small due to the good turnover growth recorded in the Maerua Shopping Centre. Management has commenced negotiations with a tenant occupying five industrial properties with renewal dates during 2012. The tenant is interested in an additional 10 000m2 warehouse and indications are already that most of the rental agreements will be renewed, with the exception of a 810m2 warehouse in Keetmanshoop. 2014 2015 Thereafter 2009 GLA 61 022m2 45 383m2 10 839m2 117 244m2

A N N U A L R E P O R T 2010

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MANAGEMENT COMPANY'S REPORT (continued)

for the year ended 30 June 2010

5. Salient features of the real estate portfolio (continued)

5.6 Tenant retention The tenant retention ratios across the different sectors in 2010 are set out below and underscore the quality of the property portfolio and the demand for the space. Property type Retail Industrial Offices Totals 5.7 Vacancies The vacancy factor at 30 June 2010 of 0.8% (2009: 1.5%) is lower than the previous year and is mainly attributable to the successful filling of vacant office space in the Maerua Park office node and Channel Life Towers. The table below sets out the vacancies at 30 June 2010: Property type Retail Industrial Offices Totals Rentable area in m2 46 113 71 754 11 872 129 739 Actual vacancies in m2 783 265 1 048 % Of rentable area 1.7 2.2 0.8 Monthly rental value N$ 95 158 16 902 112 060 Expiries m2 3 999 477 3 403 7 879 Retention m2 3 977 477 3 403 7 857 % Retained 99.5 100.0 100.0 99.7 Expiries No 48 1 8 57 Retained No 47 1 8 56 % Retained 97.9 100.0 100.0 98.3

The retail vacancy relates mainly to the acquisition of an additional 730m2 retail area in Maerua Park, which is currently undergoing alterations.

6. Real estate transactions

6.1 One strategic industrial erf was acquired in December 2009 in Lafrenz, Windhoek for N$7,4 million. The development of this erf will be tenant driven and indications are that a 10 000m2 warehouse will be erected on this site. The new building for Deloitte & Touche at Maerua was completed during May 2010 and has been let on a 5 year lease commencing June 2010. The total cost of this development was N$17 million with an initial yield of 12%. The development of three warehouses in Prosperita is underway. The cost of this development is anticipated to be N$18,6 million and completion is expected at the end of April 2011. The expected yield on this development is 11%. An additional 730m2 retail unit was acquired in Maerua Park for N$11,5 million and is currently undergoing alterations. A yield of 10.5% is expected on this retail unit. Three industrial properties with a total gross lettable area of 20 101m2 were acquired in South Africa during the last quarter of the 2010 financial year. The properties were acquired for a total consideration of N$59 million at yields of 11% with 8.5% escalations. Two of these properties are situated in Port Elizabeth and the third is situated in Johannesburg.

6.2

6.3

6.4

6.5

14

MANAGEMENT COMPANY'S REPORT (continued)

for the year ended 30 June 2010

6. Real estate transactions (continued)

6.6 The Board has approved the acquisition of a fourth industrial property in Port Elizabeth for N$51,5 million at a yield of 12% and escalation at 7.5%. The gross lettable area ("GLA") of the property is 38 725m2 and the lease expires in September 2018. Transfer is expected during October 2010. An industrial property on erf 5188 in Windhoek measuring 7 968m2 was sold for N$23,4 million during March 2010. An industrial property on erf 380 in Tsumeb measuring 1 900m2 was sold for N$1,9 million during March 2010. A Maerua Park sectional title unit measuring 381m2 was sold for N$3,4 million during April 2010.

6.7 6.8 6.9

7. Funding arrangements

Oryx has a N$400 million credit facility with Bank Windhoek, comprising N$200 million variable interest rate funding and N$200 million fixed interest rate funding. The variable interest rate funding facility has an outstanding balance of N$47,3 million as at 30 June 2010 (2009 : N$nil). The facility expires in August 2011 and carries interest at prime less 2%, currently at 8.75% (2009 : 9.50%). Negotiations are currently underway to renew the facility. Oryx currently has total fixed interest rate debt of N$140 million, expiring between November 2011 and November 2012, at a weighted average cost of 10.3% p.a. (2009: 10.4%). The interest bearing long-term debt to total assets ratio is currently 20.4% (2009: 18.1%). The expiry profile and interest rates are: Maturity date 9 November 2011 9 November 2012 Total N$'000 100 000 40 000 140 000 Rate 10.29% 10.44% Weighted average 10.33%

Management is currently negotiating with a South African bank to re-finance the South African properties on a 60% loan to value basis. This will enable the fund to benefit from the lower interest rate environment in South Africa.

8. Management of Oryx

Oryx is managed by Oryx Management Services (Proprietary) Limited, a company owned by South African real estate specialists, Old Mutual Investment Group Property Investments (Proprietary) Limited and Namibian real estate managers and leasing agents, Joseph & Snyman (Proprietary) Limited. Also refer to paragraph 9 regarding the internalisation of the asset and finance management functions. The composition of the Oryx Board and its sub-committees are set out on pages 4 to 5. Collectively the directors and management of Oryx bring a wealth of experience and ensure that the debate on matters of strategy, policy and performance is robust, informed and consultative.

A N N U A L R E P O R T 2010

15

MANAGEMENT COMPANY'S REPORT (continued)

for the year ended 30 June 2010

9. Commitments/subsequent events

During May 2010 the Board approved the acquisition of an industrial property in Port Elizabeth for a total consideration of N$51,5 million. Transfer of the property is expected during October 2010. The property will be funded by a South African bank loan on a 60% loan to value basis, with the remaining 40% being funded by existing cash and facilities. On 25 August 2010 the Board approved a cancellation fee of N$4,1 million payable to Oryx Management Services (Pty) Ltd for the early cancellation of the asset and finance management agreement with Oryx Properties Limited. The transaction is expected to be finalised by the end of November 2010, whereafter Oryx Properties Limited will have an in-house asset and finance management function. Joseph & Snyman (Proprietary) Limited will continue to provide property management services to Oryx.

10. Prospects

The solid base of the core portfolio coupled with low gearing places Oryx in a position to further utilise yield enhancing opportunities in both Namibia and South Africa. The low vacancies and sound capital growth of the real estate portfolio is further evidence of the underlying quality of the Group assets. The internalisation of the asset management function of Oryx will further align management objectives with shareholders expectations and will result in cost savings to the fund in the medium to long term. The Board anticipates that the Group will achieve real distribution growth for the next financial year.

SI de Bruin Chief Financial Officer 20 October 2010

JH Smit Chief Executive Officer

16

CORPORATE GOVERNANCE AND RISK REVIEW

for the year ended 30 June 2010

The Board of directors is committed to maintaining good corporate governance within the Group and endorses the principles of openness, integrity, accountability and transparency. The directors recognise the need to conduct the Group with integrity in accordance with generally accepted corporate policies. This includes timely, relevant and meaningful reporting to its unitholders and other stakeholders, providing a proper and objective perspective of the Group. The directors have accordingly established mechanisms and policies appropriate to the Group's business in keeping with its commitment to the best practices in corporate governance in order to ensure compliance, where appropriate, with the King II Report. These mechanisms and policies are reviewed by the directors from time to time. The implications of the amended Companies Act 2004 (Act 28 of 2004) will be analysed and appropriate steps taken. Board of directors and its sub-committees Oryx is managed by Oryx Management Services (Proprietary) Limited in terms of a management contract. As a result the Board of directors consists of predominantly non-executive directors with two executive directors. The directors bring to the Group a wide range of skills and experience that enables them to contribute an independent view and to exercise objective judgment in matters requiring the directors' decisions. All non-executive directors are subject to retirement by rotation and re-election by Oryx unit holders at least once every three years in accordance with Oryx's articles of association. The Board, which meets at least quarterly, retains full and effective control over the Group and its service providers. Through a disciplined approach to reporting and accountability within a formal approval framework, the Board monitors the performance of its sub-committees and the Group's service providers. The Board and its sub-committees, the Investment Committee and the Risk, Audit and Compliance Committee have been established and operate within defined, written terms of reference. These terms of reference are reviewed at least annually. The composition of the board and its sub-committees as at the date of this report are set out on pages 4 and 5. During the year under review, the following directors did not attend certain Board meetings, which they were eligible to attend: Mr EHT Angula (one absence) Mr KF Clinton (one absence) Mr A Swanepoel (two absences) Investment Committee Oryx has an Investment Committee, which is accountable to the Board for monitoring and supervising the Group's strategic objectives and implementing the Board's instructions, as well as the recommendation and/or approval of individual real estate transactions based on predetermined authority levels. The Committee meets on an ad hoc basis, with at least one scheduled meeting per annum. During the year under review there were four meetings held and absences by Mr A Swanepoel (two absences) and Mr JH Smit (one absence) were noted. Risk, Audit and Compliance Committee The Board's Risk, Audit and Compliance Committee has as its primary objectives to provide the Board with additional assurance regarding the efficiency and reliability of the financial information used by the directors and to assist them in the discharge of their duties. The Committee provides comfort to the Board that adequate and appropriate financial and operating controls are in place, that significant business, financial and other risks have been identified and are being suitably managed and that satisfactory standards of governance, reporting and compliance are in operation.

A N N U A L R E P O R T 2010

17

CORPORATE GOVERNANCE AND RISK REVIEW (continued)

for the year ended 30 June 2010

Board of directors and its sub-committees (continued) The objective of risk management is to identify, assess, manage and monitor the risks to which the business is exposed. Oryx pursues active management policies designed to minimise the impact of risk. The identification, assessment and management of risk is a key responsibility of the Board. In this process directors need to find a balance between minimising risk to acceptable levels and the cost and practicalities involved in achieving this. Accordingly, the Board has developed and maintains a thorough understanding of the various risks facing the Group and ensures that appropriate internal controls are in place to create a strong control environment to address key risk areas. The Board also continuously satisfies itself of the adequacy, accuracy and effectiveness of information and reporting in the area of management and controls. Oryx views risk management as the systematic process of understanding, measuring, controlling and communicating the orginasation's risk exposure to achieve its objectives. The activities involved in risk management consist of planning, organising, co-ordinating and managing a business environment that minimises the adverse impact of risk on the Group's activities, earnings and cash flows. Oryx is primarily exposed to strategic and business risk, financial risk, regulatory and compliance risk and human resource risk. Strategic and business risk This is the risk of not achieving critical objectives such as meeting stakeholder expectations, achieving portfolio and earnings growth and complying with key funding requirements: · Inappropriate and inaccurate investment decisions The Group undertakes regular strategic analysis and planning, maintains a thorough market knowledge and carefully monitors past performance and results. It also ensures that it employs competent service providers to assist in the management of the Fund and its assets and adheres to its approval framework which limits the delegation of responsibilities to acceptable levels. Post acquisitions review are performed and reported to Board and the Investment Committee. Capital risk management The risk is the Group will not have access to capital and debt to grow assets at the opportune time. To mitigate this risk the Group has a business planning process that runs on an annual cycle with regular updates and projections. It is through this process, which includes risk and sensitivity analyses of forecasts and cash flows, that the Group's capital is managed. The relative cost and availability of debt and equity funding are considered as a key part of all acquisition considerations. This risk is closely linked to liquidity risk which is more fully dealt with later in this report. In addition management ensures proper communication with investors and capital markets. It also identifies and maintains relationships with current and potential investors and funders and focuses on the timing and approach in capital raising exercises to ensure that investors support the transactions. Financial Risk This is the risk that changes in the financial environment will impact on the financial condition of the Group and comprises four main categories: · Interest rate risk The Group has a policy of limiting the negative impact of interest rate movements on cash flows and profits. It achieves this through careful cash monitoring and maintaining an appropriate mix of fixed and floating rate funding. By year end 25.25% of it's debt was left as a floating rate facility. Interest rate risk also impacts interest received on cash held by the Group. The proceeds from disposals will generate further cash and management is monitoring all available investment options for the proceeds.

·

18

CORPORATE GOVERNANCE AND RISK REVIEW (continued)

for the year ended 30 June 2010

Financial Risk (continued) · Liquidity risk The Group has the responsibility to ensure that funds are available to settle obligations when they become due and to do this at reasonable cost. This is accomplished through cash flow monitoring and regularly assessing working capital requirements. It also constantly reviews funding alternatives, gearing levels and funding costs and maintains relationships with existing and potential funders. Oryx has low gearing by industry standards. It's interest bearing debt as a percentage of total assets was a conservative 20.4% at 30 June 2010. There are no liabilities maturing which would require refinancing in the short term, with the first maturity only in August 2011. General market consensus is that interest rates will continue to remain static during 2011. The Fund has therefore decided to maintain a level of floating rates to its total debt structure. · Market risk Market risk is the impact of changes in the economic and business environment. The risk directly impacts the value of the portfolio and financial instruments and indirectly impacts the Group by the impact on tenants and funders. Market risk needs to be managed to limit the impact on asset values, financial assets and liabilities and funding arrangements. The impact on tenants is managed as part of the credit risk management process while the impact on funders is managed as part of the liquidity and interest rate risk management process. Properties are valued annually by external valuers and directors approve these valuations. Investors and financiers are kept informed of these valuations and the reasons for changes in the valuations. Debt gearing levels are maintained at below industry levels to provide flexibility. · Credit risk Credit risk is managed to limit the financial loss as a result of the default of a counterparty. The Group is primarily exposed to credit risk with respect to trade debtors and cash resources. A large and diverse tenant base is maintained with thresholds and geographic and sectoral spreads within ranges agreed as part of investment strategy. Tenant creditworthiness is thoroughly assessed before leases are signed and, where possible, exposure to tenants is limited to acceptable levels of default risk and recovery of receivables. This is achieved through assessing tenants' business plans, performing credit checks and calling for deposits and sureties where required. Arrears are managed on an ongoing basis with appropriate action taken. Tenants over 60 days are handed over to attorneys, where appropriate and where suitable, tenants are rehabilitated through the implementation of payment plans. The tenant approval process is an important risk mitigator in terms of managing bad debts. Cash is invested with reputable financial institutions. Regulatory and compliance risk This is the risk that the entity does not comply with all legal requirements. The risk is managed through standard systems, controls and procedures with clearly defined responsibilities, checklists that continuously verified and the appointments of skilled and experienced managers and asset managers. Compliance is monitored by the Risk, Audit & Compliance Committee. The Board and its sub-committees also complete an annual checklist to monitor compliance with the relevant charter, scope and responsibilities.

A N N U A L R E P O R T 2010

19

CORPORATE GOVERNANCE AND RISK REVIEW (continued)

for the year ended 30 June 2010

Human resources risk This is the risk that key staff are not recruited/retained or that they are unable to meet expectations. This is an indirect risk for Oryx as the Group employs no staff and has contracted out all operational responsibilities. The risk is managed by ensuring that salaries are market related and that service providers maintain an adequate group of skilled staff to fulfill their responsibilities. The Risk, Audit and Compliance Committee meet at least twice a year. During the year under review all members attended the two meetings that were held. Remuneration Committee Executive directors are employed by the external management company and not by Oryx. No costs of employment have been borne by the Group and as a result a Remuneration Committee is not considered necessary. The non-executive directors' fees are decided upon by the full Board, after consideration by the Risk, Audit and Compliance Committee of the fees in similar South African Loan Stock Companies, as well as norms for directors' fees in Namibia. Directors' dealings and professional advice Group policy prohibits dealings by directors and certain other managers in periods immediately preceding the announcement of its interim and year-end financial results and at any other time deemed necessary by the Board. At all other times approval from the Chairman of the Board or other appointed Board member is required before trading in units.

F Uys Chairman 20 October 2010

JC Kuehhirt Chairman ­ Risk, Audit and Compliance Committee

20

UNITHOLDERS' DIARY

Financial year-end Annual general meeting Distribution plan dates in respect of the financial year ending 30th June 2011: Financial period 1st half to 31st December 2010 2nd half to 30th June 2011 Declaration date Last date to register Payment date 30th June 23rd November 2010

Friday 25th February 2011 Friday 26th August 2011

Friday 11th March 2011 Friday 9th September 2011

Thursday 31st March 2011 Friday 30th September 2011

A N N U A L R E P O R T 2010

21

DIRECTORS' RESPONSIBILITY FOR AND APPROVAL OF THE ANNUAL FINANCIAL STATEMENTS

for the year ended 30 June 2010

The directors are responsible for the preparation of the annual financial statements that fairly present the state of affairs of the Company and the Group at the end of the financial year as set out on pages 24 to 61. In order for the Company and the Board to discharge its responsibilities, management has developed and continues to maintain a system of internal control. The Board has ultimate responsibility for the system of internal control and periodically reviews its operation, primarily through the Risk, Audit and Compliance Committee. The internal controls include a risk-based system of internal accounting and administrative controls designed to provide reasonable, but not absolute assurance that assets are safeguarded and that transactions are executed and recorded in accordance with generally accepted business practices and the Group's policies and procedures. These controls are implemented by trained, skilled personnel of the managing company, Oryx Management Services (Proprietary) Limited, with appropriate segregation of duties, are monitored by Executive Directors and the Risk, Audit and Compliance Committee and include a comprehensive budgeting and reporting system operating within an appropriate control framework. The financial statements have been audited by the independent auditors, Deloitte & Touche, who were given unrestricted access to all financial records and related data including minutes of all meetings of the Board of directors and committees of the Board. The directors believe that all representations made to the independent auditors during the audit are valid and appropriate. The audit report of Deloitte & Touche is presented on page 23. The annual financial statements are prepared in accordance with International Financial Reporting Standards and incorporate disclosures in line with the accounting philosophy of the Group. They are based on appropriate accounting policies consistently applied, except where otherwise stated, and are supported by reasonable and prudent judgements and estimates. The directors believe that the Group will be a going concern in the year ahead, as adequate funding facilities are in place and the operational and cash flow budget support this statement. Accordingly the going concern basis has been adopted in the preparation of the annual financial statements. The annual financial statements for the year ended 30 June 2010 as set out on pages 24 to 61 were approved by the Board of directors on 20 October 2010 and are signed on its behalf by:

F Uys Chairman 20 October 2010

JC Kuehhirt Chairman ­ Risk, Audit and Compliance Committee

22

INDEPENDENT AUDITOR'S REPORT

To the members of Oryx Properties Limited We have audited the annual financial statements and group annual financial statements of Oryx Properties Limited, which comprise the directors' report, the consolidated and separate statements of financial position as at 30 June 2010, and the consolidated and separate statements of comprehensive income, consolidated and separate statements of changes in equity and consolidated and separate statements of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pages 24 to 61. Directors' responsibility for the financial statements The company's directors are responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards and in the manner required by the Companies Act of Namibia. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditor's responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated and separate financial statements present fairly, in all material respects, the consolidated and separate financial position of Oryx Properties Limited as at 30 June 2010, and its consolidated and separate financial performance and consolidated and separate cash flows for the year then ended in accordance with International Financial Reporting Standards and in the manner required by the Companies Act of Namibia.

Deloitte & Touche Registered Accountants and Auditors Chartered Accountants (Namibia) ICAN practice number: 9407 Per VJ Mungunda Partner PO Box 47 WINDHOEK 20 October 2010 Regional executives: GG Gelink (Chief Executive), A Swiegers (Chief Operating Officer), GM Pinnock Resident partners: VJ Mungunda (Managing Partner), RH McDonald, J Kock, H de Bruin

A N N U A L R E P O R T 2010

23

DIRECTORS' REPORT

The directors have pleasure in presenting their report for the year ended 30 June 2010. NATURE OF BUSINESS Oryx Properties Limited is a real estate investment company listed on the NSX under the "Financials - Property" sector. The Group derives its income from a portfolio of investment properties in the retail, industrial and office sectors. ISSUED SHARE CAPITAL As at 30 June 2010 there were 55 041 675 (2009: 55 041 675) linked units in issue, each comprising one ordinary share of 1 cent and one unsecured variable rate debenture of 449 cents. FINANCIAL REVIEW 2010 Headline earnings per linked unit (cents) - Excluding straight line basis adjustment - Rental straight line basis adjustment Earnings per linked unit (cents) Distribution per linked unit (cents) - Interest The results of the Group are fully set out in the financial reports on pages 29 to 61. SUBSIDIARIES Details of the company's subsidiaries are reflected in note 7. DIRECTORATE Details of the directors are set out on pages 4 to 5 of this report. Changes to the directorate during the year and up to the date of this report were the appointment of Mr SI de Bruin as Financial Director on 24 November 2009 and Mr LB van Niekerk and BH Azizollahoff as non-executive directors on 24 February 2010, following the resignation of Mr NBS Harris and Mr EHT Angula on 24 February 2010. Mr NBS Harris and Mr EHT Angula were appointed as alternate directors to Ms LC Tapping and Mr A Swanepoel respectively on 24 February 2010. The directors at the date of this report are: F Uys (Chairman) JH Smit (Executive)* SI de Bruin (Executive) BH Azizollahoff* KF Clinton* B Joseph JC Kuehhirt A Swanepoel LC Tapping* LB van Niekerk* Alternates: NBS Harris* EHT Angula * South African 107,13 109,35 (2,22) 255,50 109,25 2009 97,13 94,93 2,20 143,34 94,75

24

DIRECTORS' REPORT (continued)

DIRECTORS' FEES Directors' fees were paid for services as directors as follows: Changes during the period F Uys # (Chairman) EHT Angula # (Alternate) KF Clinton # SI de Bruin * (Executive) CJ Ewin * NBS Harris # (Alternate) AM Hyatt B Joseph JC Kuehhirt # JH Smit * (Executive) A Swanepoel # LC Tapping ^ # CS Young * BH Azizollahoff LB van Niekerk * Total Resigned on 24 February 2010 Appointed 24 November 2009 Resigned 27 May 2009 Resigned 24 February 2010 Resigned 1 September 2008 2010 N$'000 115 25 70 25 65 50 90 65 65 90 13 25 25 723 2009 N$'000 107 50 50 50 65 13 50 90 65 65 90 695

Appointed 27 May 2009 and resigned on 08 September 2009 Appointed 24 February 2010 Appointed 24 February 2010

# Independent at date of this report * Directors fees are paid directly to Old Mutual Investment Group Property Investments (Proprietary) Limited ^ 2009 Fees were paid to Old Mutual Investment Group Property Investments (Proprietary) Limited COMPANY SECRETARY Oryx Management Services (Proprietary) Limited, a subsidiary of Old Mutual Investment Group Property Investments (Proprietary) Limited. DIRECTORS' INTERESTS The joint beneficial interests of directors in the equity of the company as at 30 June 2010 were 0.1% (2009: 0.13%) and can be analysed as follows: Director 2010 SI de Bruin ^ NBS Harris * B Joseph JH Smit ^ LC Tapping F Uys LB van Niekerk 2009 NBS Harris B Joseph JH Smit ^ LC Tapping ^ F Uys CS Young Direct beneficial Linked units 2 318 10 411 10 000 22 729 2 318 10 411 10 000 22 729 % 0.00 0.02 0.02 0.04 0.00 0.02 0.02 0.04 Indirect beneficial Linked units 35 2 972 5 229 1 576 1 648 22 136 586 34 182 3 896 7 115 1 576 2 118 34 925 2 460 52 090 % 0.00 0.01 0.01 0.00 0.00 0.04 0.00 0.06 0.01 0.01 0.00 0.00 0.06 0.00 0.08 Linked units 35 2 972 7 547 1 576 12 059 32 136 586 56 911 3 896 9 433 1 576 12 529 44 925 2 460 74 819 Total % 0.00 0.01 0.01 0.00 0.02 0.06 0.00 0.10 0.01 0.02 0.00 0.02 0.08 0.00 0.13

* Alternate ^ These directors were employed by Old Mutual Investment Group Property Investments (Proprietary) Limited at year end, but have no beneficial interest in any equity held by Old Mutual. There were no changes in the directors' interest between 1 July 2010 and 11 October 2010, being the latest practical date prior to the finalisation of this annual report. A N N U A L R E P O R T 2010

25

DIRECTORS' REPORT (continued)

BORROWINGS The directors are authorised to borrow funds, on behalf of the Group, up to an amount not exceeding 60% of the directors' bona fide valuation of the consolidated real estate portfolio and any other assets of the Group. The Group's interest bearing borrowings at 30 June 2010 are disclosed in note 11.2 to the annual financial statements, representing only 20.1% (2009 : 18.1%) of the total assets including the directors' bona fide valuation of the consolidated real estate portfolio. Debentures are excluded from the interest bearing borrowings for the purpose of the calculation. ACQUISITIONS, DEVELOPMENTS AND DISPOSALS The table below provides a summary of the acquisitions, developments and disposals during the year. Property area Acquisitions Industrial erf in Lafrenz Retail unit in Maerua Park Industrial properties in SA Developments New offices at Maerua Prosperita Warehouses * Disposals Erf 5188 Windhoek Erf 380 Tsumeb Maerua Park sectional title unit Gross lettable area 10 000m2 730m2 20 101m2 1 400m2 4 500m2 7 968m2 1 890m2 381m2 Transaction price (Rounded) N$'000 7 400 11 500 59 000 17 074 728 23 400 1 900 3 400 Transfer date Yield

January 2010 February 2010 February/March 2010 Completed May 2010 In Progress March 2010 March 2010 April 2010

10.5% 11.0% 12.0% 11.0% 10.6% 11.2% Vacant

* The total expected development cost is N$18,6 million and construction is underway with estimated completion in April 2011. The real estate portfolio at 30 June 2010 is set out on pages 62 and 63. The Board has also approved the acquisition of an additional industrial unit in South Africa to the value of N$51,5 million. The expected initial yield on this property is 12% and transfer is expected during October 2010. MANAGEMENT BY THIRD PARTY Oryx has entered into a specific service agreement with Oryx Management Services (Proprietary) Limited ("OMS"), a joint venture management company owned by Joseph & Snyman (Proprietary) Limited and Old Mutual Investment Group Property Investments (Proprietary) Limited, in respect of the asset management, financial management and property management of the portfolio and its properties. Subsequent to year end, this contract has been cancelled and the asset and financial management in-sourced as referred to in the post balance events below. GOING CONCERN The directors are of the opinion that the Company and the Group have adequate resources to continue in operation for the foreseeable future and the annual financial statements have accordingly been prepared on a going concern basis. POST BALANCE SHEET EVENTS The Board has approved the internalisation of the asset and financial management functions of Oryx Properties Limited. The transaction entails the cancellation of the asset and financial management agreement between Oryx Management Services (Pty) Ltd and Oryx Properties Limited. The Board has approved an early cancellation fee of N$4,1 million payable to Oryx Management Services (Pty) Ltd. The effective date of this transaction is 30 November 2010. The Board is of the opinion that the internalisation of the asset and financial management functions will further align management objectives with shareholders' expectations. Asset management internalisation is currently an industry trend followed by listed property companies and will further result in savings to Oryx as the asset base expands. Property management will continue to be outsourced to Joseph & Snyman (Proprietary) Limited. These events occurred after the balance sheet date and therefore do not require any adjustments to the financial statements.

26

DIRECTORS' REPORT (continued)

ANALYSIS OF LINKED UNITHOLDERS 2010 Analysis of unitholders Size of holding 1 10 000 10 001 25 000 25 001 50 000 50 001 100 000 100 001 500 000 500 001 - 1 000 000 Over 1 000 000 Type of unitholders Individuals, trusts & estates Companies & corporations Nominee companies 154 7 2 6 14 2 9 194 160 3 31 194 79.4 3.6 1.0 3.1 7.2 1.0 4.7 100.0 82.5 1.6 15.9 100.0 173 97 70 500 587 093 519 041 024 577 460 041 042 933 000 602 170 210 718 675 384 269 022 675 0.3 0.2 0.1 0.9 4.7 2.0 91.8 100.0 1.9 26.5 71.6 100.0 Number of unitholders % of unitholders Number of units held % of issued units

2 1 50 55 1 14 39 55

Significant unitholders Unitholders invested in 5% or more of the company Standard Bank Namibia Nominees (Pty) Ltd* Ambit Properties Ltd Marriott Property Fund Nominees (Pty) Ltd* CBN Nominees (Pty) Ltd* * Shares held by nominees consist of units held on behalf of various unit holders Unitholder spread Non-public Held by Directors: Direct Indirect Holdings > 10% of issued units Public TOTAL Number of unitholders 3 7 3 181 194 % 1.6 3.6 1.5 93.3 100.0

Number of units held 21 14 14 3 53 358 554 019 308 240 023 269 055 756 103

% 38.8 26.4 25.5 6.0 96.7 % 0.0 0.1 90.7 9.2 100.0

Number of units held 22 34 49 931 5 053 55 041 729 182 347 417 675

A N N U A L R E P O R T 2010

27

DIRECTORS' REPORT (continued)

ANALYSIS OF LINKED UNITHOLDERS (continued) 2009 Analysis of unitholders Size of holding 1 10 000 10 001 25 000 25 001 50 000 50 001 100 000 100 001 500 000 500 001 - 1 000 000 Over 1 000 000 Type of unitholders Individuals, trusts & estates Companies & corporations Nominee companies 154 8 2 6 13 2 9 194 159 4 31 194 Significant unitholders Unitholders invested in 5% or more of the company Standard Bank Namibia Nominees (Pty) Ltd* Ambit Properties Ltd Marriott Property Fund Nominees (Pty) Ltd* CBN Nominees (Pty) Ltd* * Shares held by nominees consist of units held on behalf of various unit holders Unitholder spread Non-public Held by Directors: Direct Indirect Holdings > 10% of issued units Public TOTAL Units traded and issued Number of units traded on the NSX Number of units traded off market Units traded as a weighted percentage of issued capital NSX price history (cents) 12 month high 12 month low Number of unitholders 3 6 3 182 194 % 1.6 3.0 1.6 93.8 100.0 2010 2 891 259 5.3% 1250 948 79.4 4.1 1.0 3.1 6.7 1.0 4.7 100.0 82.0 2.0 16.0 100.0 173 860 114 451 59 826 499 332 2 466 668 1 112 210 50 615 328 55 041 675 1 055 589 14 577 469 39 408 617 55 041 675 Number of units held 21 248 962 14 554 269 14 019 055 3 364 105 53 186 391 Number of units held 22 729 52 090 49 822 286 5 144 570 55 041 675 0.3 0.2 0.1 0.9 4.5 2.0 92.0 100.0 2.0 26.4 71.6 100.0 % 38.6 26.4 25.5 6.1 96.6 % 0.0 0.1 90.5 9.4 100.0 2009 306 312 0.6% 1270 1250

Number of unitholders

% of unitholders

Number of units held

% of issued units

F Uys Chairman 20 October 2010

JC Kuehhirt Chairman ­ Risk, Audit and Compliance Committee

28

STATEMENTS OF FINANCIAL POSITION

as at 30 June 2010

Group Notes ASSETS Non-current assets Investment properties - At valuation - Rental straight-line basis adjustment Property and Equipment Interest in subsidiaries Deferred expenditure Rental receivable - straight-line basis adjustment Current assets Trade and other receivables - Trade and other receivables - Rental receivable straight-line basis adjustment Cash and cash equivalents TOTAL ASSETS EQUITY AND LIABILITIES Capital and reserves Share capital Non-distributable reserves Distributable reserves Non-current liabilities Debentures Debenture premium Long-term loans Deferred taxation Current liabilities Trade and other payables Subsidiary company current accounts Deferred income Linked unitholders for distribution TOTAL EQUITY AND LIABILITIES 2010 N$'000 2009 N$'000 2010 N$'000 Company 2009 N$'000

5

6 7 8.1

883 121 908 365 (25 244) 1 1 488 20 332 904 942 11 179 6 267 4 912 2 205 13 384 918 326

722 356 749 879 (27 523) 321 1 816 24 584 749 077 7 071 4 132 2 939 18 369 25 440 774 517

231 683 236 115 (4 432) 1 493 196 96 7 465 732 441 4 639 1 589 3 050 2 205 6 844 739 285

151 666 154 879 (3 213) 2 480 371 301 10 486 642 826 3 631 1 264 2 367 18 369 22 000 664 826

8.2 8.3

9 10

550 303 706 1 034 305 290 247 137 48 332 187 292 92 709 575 470 7 417 30 149 37 566 918 326

550 223 258 984 224 792 247 137 51 109 140 000 77 448 515 694 5 951 1 373 26 707 34 031 774 517

550 93 451 1 879 95 880 247 137 48 332 187 292 8 897 491 658 4 681 116 917 30 149 151 747 739 285

550 78 839 669 80 058 247 137 51 109 140 000 9 817 448 063 2 994 105 631 1 373 26 707 136 705 664 826

11.1 11.1 11.2 12

7 13

A N N U A L R E P O R T 2010

29

STATEMENTS OF COMPREHENSIVE INCOME

for the year ended 30 June 2010

Group Notes REVENUE - Rental - cash flows inherent in leases - Rental - straight-line adjustment Rental expense NET RENTAL INCOME Investment income Dividend received Amortisation of debenture premium Profit on sale of listed investment Profit on sale of investment property Changes in fair value of investment property - As per valuations - Straight-line basis adjustment Other expenses OPERATING PROFIT BEFORE FINANCE COSTS AND DEBENTURE INTEREST Less: Finance costs OPERATING PROFIT BEFORE DEBENTURE INTEREST Less: Debenture interest PROFIT BEFORE TAXATION Less: Taxation PROFIT FOR THE YEAR Other comprehensive income TOTAL COMPREHENSIVE INCOME FOR THE YEAR EARNINGS PER SHARE (CENTS) EARNINGS PER LINKED UNIT (CENTS) DISTRIBUTION PER LINKED UNIT (CENTS) 18 18 18 17 18 16 173 331 (17 443) 155 888 (60 129) 95 759 (15 261) 80 498 80 498 146,25 255,50 109,25 100 992 (14 608) 86 384 (52 152) 34 232 (7 485) 26 747 26 747 48,59 143,34 94,75 92 474 (17 443) 75 031 (60 129) 14 902 920 15 822 15 822 28,75 138,00 109,25 67 665 (14 608) 53 057 (52 152) 905 1 717 2 622 2 622 4,76 99,51 94,75 5 5 15 11.1 14 5 14 2010 N$'000 96 655 98 934 (2 279) (20 137) 76 518 6 049 2 777 45 1 450 92 176 89 897 2 279 (5 684) 2009 N$'000 90 368 88 510 1 858 (17 616) 72 752 1 715 2 777 1 313 28 300 30 158 (1 858) (5 865) 2010 N$'000 34 917 37 256 (2 339) (5 757) 29 160 50 594 2 777 45 12 829 14 047 (1 218) (2 931) Company 2009 N$'000 32 511 33 365 (854) (5 029) 27 482 42 547 680 2 777 (1 001) (1 111) 110 (4 820)

30

STATEMENTS OF CHANGES IN EQUITY

for the year ended 30 June 2010

Nondistributable reserves N$'000 196 614 30 158 (7 604) 4 090 223 258 89 897 (13 721) 4 272 303 706 Share capital N$'000 Group Balance at 30 June 2008 Total comprehensive income for the year Transfer to non-distributable reserve · Change in fair value of investment properties · Deferred taxation on change in fair value of investment properties · Other Balance at 30 June 2009 Total comprehensive income for the year Transfer to non-distributable reserve · Change in fair value of investment properties · Deferred taxation on change in fair value of investment properties · Other Balance at 30 June 2010 550 (89 897) 13 721 (4 272) 1 034 305 290 550 (30 158) 7 604 (4 090) 984 80 498 224 792 80 498 550 881 26 747 198 045 26 747 Distributable reserves N$'000

Total N$'000

Company Balance at 30 June 2008 Total comprehensive income for the year Transfer to non-distributable reserve · Change in fair value of investment properties · Rental straight-line adjustment · Deferred taxation on change in fair value of investment properties and straight-line rental adjustment · Other Balance at 30 June 2009 Total comprehensive income for the year Transfer to non-distributable reserve · Change in fair value of investment properties · Rental straight-line adjustment · Deferred taxation on change in fair value of investment properties and straight-line rental adjustment · Other Balance at 30 June 2010 550 (1 300) (2 822) 1 879 1 300 2 822 93 451 95 880 (14 047) 3 557 14 047 (3 557) 550 (1 262) (2 777) 669 15 822 1 262 2 777 78 839 80 058 15 822 1 111 744 (1 111) (744) 550 231 2 622 76 655 77 436 2 622

A N N U A L R E P O R T 2010

31

STATEMENTS OF CASH FLOW

for the year ended 30 June 2010

Group Notes 2010 N$'000 2009 N$'000 2010 N$'000 Company 2009 N$'000

OPERATING ACTIVITIES Cash generated by operating activities Investment income Finance costs Distribution to linked unitholders Net cash inflow from operating activities INVESTING ACTIVITIES Acquisition of and additions to investment properties Acquisition of listed investment Investment in subsidiary companies - loans Acquisition of property and equipment Proceeds from disposal of investment properties Proceeds from disposal of listed investment Net cash outflow from investing activities FINANCING ACTIVITIES Long term loans raised Net cash inflow from financing activities NET CHANGE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR CASH AND CASH EQUIVALENTS AT END OF YEAR 8.3 8.3 47 292 47 292 (16 164) 18 369 2 205 1 246 17 123 18 369 47 292 47 292 (16 164) 18 369 2 205 1 246 17 123 18 369 6 5 (95 476) (49 856) 28 647 49 901 (66 784) (4 642) (310) 3 463 (1 489) (67 188) (49 856) (12 825) 49 901 (79 968) (3 836) (10 133) (13 969) 20 14 16 21 71 409 6 049 (17 443) (56 687) 3 328 66 127 1 715 (14 608) (50 499) 2 735 40 048 50 594 (17 443) (56 687) 16 512 37 775 42 547 (14 608) (50 499) 15 215

32

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

30 June 2010

1. GENERAL INFORMATION Oryx Properties Limited ("the Company") is a limited company incorporated in Namibia. The address of its registered office is disclosed in the administration section of the annual report. The principal activities of the Company and its subsidiaries ("the Group") are described in the Directors' report. 2. ADOPTION OF NEW AND REVISED STANDARDS The Company's annual financial statements have been prepared in accordance with International Financial Reporting Standards ('IFRS') and interpretations issued by the International Financial Reporting Interpretations Committee ('IFRIC') of the IASB. At the date of authorisation of these financial statements the following Standards and Interpretations are not yet effective and will be adopted, where applicable, in future years. The following Standards and Interpretations have been issued but are not yet effective: IAS/IFRS number IFRS 1 Title First-time adoption of International Financial Reporting Standards Amendments relating to oil and gas assets and determining whether an arrangement contains a lease First-time adoption of International Financial Reporting Standards - Limited Exemption from Comparative IFRS 7 Disclosures for First-time adopters First-time adoption of International Financial Reporting Standards Amendments resulting from May 2010 annual improvements to IFRS Share-based Payment - Amendments relating to group cash-settled share-based payments Business Combinations - Amendments resulting from May 2010 annual improvements to IFRS Non-current Assets Held for Sale and Discontinued Operations Amendments from the April 2009 annual improvements to IFRS Financial Instruments Disclosures - Amendments resulting from May 2010 annual improvements to IFRS Operating Segments - Amendments resulting from the April 2009 annual improvements to IFRS Financial Instruments - Classification and Measurement Presentation of Financial Statements - Amendments resulting from the April 2009 annual improvements to IFRS Presentation of Financial Statements - Amendments resulting from May 2010 annual improvements to IFRS Statements of cash flows - Amendments resulting from the April 2009 annual improvements to IFRS Leases - Amendments from the April 2009 improvements Related Party Disclosures - Revised definition of related parties Consolidated and Separate Financial Statements - Amendments resulting from May 2010 annual improvements to IFRS Financial Instruments: Presentation - Amendments relating to classification of rights issues Interim Financial Reporting - Amendments resulting from May 2010 improvement to IFRS Effective date Years Commencing

1 January 2010 1 July 2010 1 January 2011 1 January 2010 1 July 2010 1 January 2010 1 January 2011 1 January 2010 1 January 2013 1 January 2010 1 January 2011 1 January 2010 1 January 2010 1 January 2011 1 July 2010 1 February 2010 1 January 2011

IFRS 1 IFRS 1 IFRS 2 IFRS 3 IFRS 5 IFRS 7 IFRS 8 IFRS 9 IAS 1 IAS 1 IAS 7 IAS 17 IAS 24 IAS 27 IAS 32 IAS 34

A N N U A L R E P O R T 2010

33

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

2. ADOPTION OF NEW AND REVISED STANDARDS (continued) IAS/IFRS number IAS 36 IAS 39 IFRIC 13 IFRIC 14 Title Impairment of Assets - Amendments resulting from April 2009 annual improvements to IFRS Financial Instruments: Recognition and Measurement - Amendments resulting from April 2009 annual improvements to IFRS Customer Loyalty Programmes - Amendments resulting from May 2010 annual improvements to IFRS AS 19 - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction - November 2009 amendments with respect to voluntary prepaid contributions Extinguishing Financial Liabilities with Equity Instruments Effective date Years Commencing 1 January 2010 1 January 2010 1 January 2011

IFRIC 19

1 January 2011 1 July 2010

The impact of the above Standards and Interpretations will be assessed when they become effective. 3. ACCOUNTING POLICIES The financial statements incorporate the principal accounting policies set out below. 3.1 Statement of compliance The financial statements are prepared in accordance with International Financial Reporting Standards and the requirements of the Companies Act of Namibia. 3.2 Basis of preparation The financial statements are prepared on the historical cost convention, as modified by the revaluation of investment properties, availablefor-sale financial assets, and financial assets and liabilities (including derivative instruments) at fair value through profit or loss and incorporate the principal accounting policies set out below. These accounting policies have been applied consistently with the previous year. The functional currency of the Group is the Namibian Dollar ("N$") and all amounts are rounded to the nearest thousand. The Group has implemented the revised IAS1 "Presentation of Financial Statements" and IFRS 8 "Operating Segments". The changes in both standards are of a presentation and disclosure nature only. 3.3 Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries). Control is achieved where the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The results of subsidiaries acquired or disposed of during the year are included in the consolidated statement of comprehensive income from the effective date of acquisition or up to the effective date of disposal, as appropriate. The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group. The cost of an acquisition is measured in accordance with the purchase price agreed for the company plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group's share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in profit and loss.

34

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

3. ACCOUNTING POLICIES (continued) 3.3 Basis of consolidation (continued) Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated, with the exception of inter-company interest during the period of construction or refurbishment, which is capitalised to the cost of the property. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. 3.4 Investment properties Investment properties are properties held for long term investment purposes and are not owner occupied. Investment properties are initially recorded at cost. Subsequent expenditure, other than tenant installation costs, relating to investment properties is capitalised when it is probable that future economic benefits from the use of the asset will be increased. All other subsequent expenditure is recognised as an expense in the period in which it is incurred. After initial recognition investment properties are measured at fair value. Fair values are determined bi-annually. Gains or losses arising from changes in the fair values are included in net profit for the period in which they arise. Unrealised gains are transferred to a nondistributable reserve in the statement of changes in equity. Unrealised losses are transferred against a non-distributable reserve to the extent that the decrease does not exceed the amount held in the non-distributable reserve. The fair value of the investment property reflects, among other things, rental income from current leases and assumptions about rental income from future leases in the light of current market conditions. The fair value also reflects, on a similar basis, any cash outflows that could be expected in respect of the property. On disposal of investment properties, the difference between the net disposal proceeds and the carrying value is charged or credited to the statement of comprehensive income and then transferred from/to non-distributable reserves provided that such transfer shall not result in an accumulated loss. Non-current assets and disposal groups are classified as "held for sale" if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from date of classification. Non-current assets (and disposal groups) classified as held-for-sale are measured at the lower of their previous carrying amount and fair value less costs to sell. 3.5 Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation. All other borrowing costs are recognised in profit or loss in the period in which they are incurred. 3.6 Property and equipment Property and Equipment is stated at cost less accumulated depreciation. Equipment is depreciated on the straight line basis over the period over which the assets are expected to be available for use by the Group. The following depreciation rates have been used: Equipment 33.33% per annum

A N N U A L R E P O R T 2010

35

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

3. ACCOUNTING POLICIES (continued) 3.6 Property and equipment (continued) The gain or loss arising on the disposal or retirement of an item of property and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss. The useful lifes and residual values of equipment are reviewed annually. 3.7 Taxation Tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the statement of comprehensive income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred taxation is provided for using the liability method, based on temporary differences. Temporary differences are differences between the carrying amounts of assets and liabilities for financial reporting purposes and their tax base. Deferred taxation is charged to the statement of comprehensive income except to the extent that it relates to a transaction that is recognised directly in equity, or a business combination that is an acquisition. Deferred tax charges reflect the tax consequences that follow from the manner in which the entity expects, at the balance sheet date, to recover or settle the carrying amount of its assets and liabilities. Deferred tax assets or liabilities that arise from the revaluation of a non-depreciable asset are measured on the basis of the tax consequences that would follow from recovery of the carrying amount of that asset through sale. This is regardless of measuring the carrying amount of that asset. The revaluation of the land portion of investment properties is not taxable in Namibia, accordingly no deferred tax is recognised. Deferred tax is recognised on the land portion of investment property based in South Africa, as the revaluations are subject to capital gains tax on disposal. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred taxation assets are recognised to the extent that it is probable that future taxable profits will be available against which the associated unused tax losses and deductible temporary differences can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised. Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and interest in joint ventures, except where the Group is unable to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis. 3.8 Impairment Assets that are subject to amortisation or depreciation are reviewed at each balance sheet date to determine whether there is any indication of impairment. An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount, which is the higher of an asset's net selling price and value in use. For the purpose of assessing impairment, assets are grouped at the lowest level for which there are separately identifiable cash flows. 3.9 Investment in Subsidiaries In the company's separate annual financial statements, investments in subsidiaries are carried at cost less any accumulated impairment.

36

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

3. ACCOUNTING POLICIES (continued) 3.10 Financial instruments Financial instruments as reflected on the statement of financial position include all assets and liabilities, including derivative instruments, but exclude investment properties, investments in subsidiaries, property and equipment, deferred taxation, taxation, leases, deferred income, deferred expenses and rental straight-line adjustments. Financial Instruments are accounted for under IAS 32: Financial Instruments: Presentation, IAS 39: Financial Instruments: Recognition and Measurement and IFRS 7: Financial Instruments: Disclosures. (i) Initial recognition Financial assets are recognised on the statement of financial position when the Group becomes a party to the contractual provisions of a financial instrument. All purchases of financial assets that require delivery within the time frame established by regulation or market convention ("regular way" purchases) are recognised at trade date, which is the date on which the Group commits to purchase the asset. Financial liabilities are recognised on trade date, which is when the Group becomes a party to the contractual provisions of the financial instruments. Initial measurement Financial instruments are initially recognised at fair value plus, in the case of a financial asset or liability not at fair value through profit and loss, transaction costs that are incremental to the Group and directly attributable to the acquisition or issue of the financial asset or financial liability. Subsequent measurement Subsequent to initial measurement, financial instruments are either measured at fair value or amortised cost, depending on their classification: · Financial assets and financial liabilities at fair value through profit or loss Financial instruments at fair value through profit or loss consist of trading instruments and instruments that the Group has elected, on initial recognition date, to designate as fair value through profit or loss. Trading instruments are financial assets or financial liabilities that were acquired or incurred principally for the purpose of sale or repurchase in the near term, form part of a portfolio with a recent pattern of short-term profit-taking or are derivatives that do not form part of a designated and effective hedging relationship. Financial assets and financial liabilities that the Group has elected, on initial recognition date, to designate as at fair value through profit or loss are those that meet any one of the following criteria: - where the fair value through profit or loss designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise from using different bases to measure and recognise the gains and losses on financial assets and financial liabilities; or - the instrument forms part of a group of financial instruments that is managed, evaluated and reported on using a fair value basis in accordance with a documented risk management or investment strategy; or - the financial instrument contains an embedded derivative, which significantly modifies the cash flows of the host contract or where the embedded derivative would clearly require separation. · Other financial liabilities All financial liabilities, other than those at fair value through profit and loss, are classified as other financial liabilities and are measured at amortised cost. The fair value amounts are disclosed in the notes to the financial statements. Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market, other than those classified by the Group as at fair value through profit or loss. Financial assets classified as loans and receivables are carried at amortised cost less any impairment, with interest income recognised in profit or loss. The fair value amounts are disclosed in the notes to the financial statements.

(ii)

(iii)

·

A N N U A L R E P O R T 2010

37

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

3. ACCOUNTING POLICIES (continued) 3.10 Financial instruments (continued) (iv) Measurement basis of financial instruments · Amortised cost Amortised cost financial assets and financial liabilities are measured at fair value on initial recognition, plus or minus the cumulative amortisation using the effective interest rate method of any difference between that initial amount and the maturity amount, less any cumulative impairment losses. For financial assets, the effective interest rate method calculates the amortised cost of a financial asset and allocates the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset. Cash receipts include all fees that form an integral part of the effective interest rate, transaction costs and other premiums or discounts. For financial liabilities, the effective interest rate method calculates the amortised cost of a financial liability and allocating the interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability. · Fair value Direct and incremental transaction costs are included in the initial fair value of financial assets and financial liabilities, other than those at fair value through profit or loss. The best evidence of the fair value of a financial asset or financial liability at initial recognition is the transaction price, unless the fair value of the instrument is evidenced by comparison with other current observable market transactions in the same instrument or based on a valuation technique whose variables include market observable data. When market related measures are not available, observable market data is modified to incorporate relevant factors that a market participant in an arm's length exchange motivated by normal business considerations would consider in determining the fair value of the financial instrument (non-observable market inputs). Consideration is given to the nature and circumstances of the financial instrument in determining the appropriate non-observable market input. The fair value of a financial liability with a demand feature is not less than the amount payable on demand, discounted from the first date on which the amount could be required to be paid. In cases where the fair value of financial liabilities cannot be reliably determined, these liabilities are recorded at the amount due. Investments in equity instruments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured, and derivatives that is linked to and has to be settled by delivery of such unquoted equity instruments, is not measured at fair value but at cost. Fair value is considered reliably measured if: - the variability in the range of reasonable fair value estimates is not significant for that instrument, or - the probabilities of the various estimates within the range can be reasonably assessed and used in estimating fair value. (v) Derecognition All financial assets and financial liabilities are derecognised on trade date, which is when the Group commits to selling a financial asset or redeeming a financial liability. The Group derecognises a financial asset when and only when: The contractual rights to the cash flows arising from the financial assets have expired or been forfeited by the Group; or It transfers the financial asset including substantially all the risks and rewards of ownership of the asset; or It transfers the financial asset, neither retaining nor transferring substantially all the risks and rewards of ownership of the asset, but no longer retains control of the asset.

38

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

3. ACCOUNTING POLICIES (continued) 3.10 Financial instruments (continued) (v) Derecognition (continued) A financial liability (or part of a financial liability) is derecognised when and only when the liability is extinguished, that is, when the obligation specified in the contract is discharged, cancelled or has expired. The difference between the carrying amount of a financial liability (or part thereof) extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss for the year. The difference between the carrying amount of a financial asset (or part thereof) derecognised and the consideration received, including any non-cash assets received or liabilities extinguished, is recognised in profit or loss for the year. (vi) Impairment of financial assets The Group assesses at each balance sheet date whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred if, and only if, there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a 'loss event') and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. Objective evidence that a financial asset or group of assets is impaired includes observable data that comes to the attention of the Group about the following loss events: significant financial difficulty of the issuer or obligor; a breach of contract, such as a default or delinquency in interest or principal payments; the disappearance of an active market for that financial asset because of financial difficulties; or observable data indicating that there is a measurable decrease in the estimated future cash flows from a group of financial assets since the initial recognition of those assets, although the decrease cannot yet be identified with the individual financial assets in the Group, including national or local economic conditions that correlate with defaults on the assets in the Group. Assets carried at amortised cost If there is objective evidence that an impairment loss on loans and receivables or held-to-maturity investments carried at amortised cost has been incurred, the amount of the loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset's original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account and the amount of the loss is recognised in profit or loss for the year. The Group first assesses whether objective evidence of impairment exists individually for financial assets that are individually significant, and individually or collectively for financial assets that are not individually significant. If the Group determines that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. If, in a subsequent year, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed by adjusting the allowance account. The reversal does not result in a carrying amount of the financial asset that exceeds what the amortised cost would have been had the impairment not been recognised at the date on which the impairment is reversed. The amount of the reversal is recognised in profit or loss for the year.

·

A N N U A L R E P O R T 2010

39

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

3. ACCOUNTING POLICIES (continued) 3.10 Financial instruments (continued) (vii) Financial liabilities and equity instruments issued by the Group Classification as debt or equity Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement. Equity instruments An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Group are recorded at the proceeds received, net of direct issue costs. (viii) Offsetting financial instruments, related income and expense items Financial assets and liabilities are offset and the net amount reported in the statement of financial position only when there is a legally enforceable right to set off and there is intention to settle on a net basis or to realise the asset and settle the liability simultaneously. Income and expense items are offset only to the extent that their related instruments have been offset in the statement of financial position. 3.11 Debentures Debentures are recognised at the proceeds net of transaction costs. Debenture premium is separately disclosed and is amortised on a straight line basis over the minimum contractual term of the debt instrument, namely the remaining portion of 25 years from December 2002. In terms of the Debenture Trust Deed the interest entitlement on each debenture shall be not less than 90% of the net earnings of the company before providing for debenture interest, depreciation, amortisation and taxes (other than deferred taxation charges) and before taking into account any revaluation surpluses and income which is to be transferred to any non-distributable reserves but after provision for funding cost, whether interest or dividend in nature, and also after transfers to non-distributable reserves. 3.12 Provisions Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the balance sheet date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably. 3.13 Revenue recognition Rental income Revenue comprises gross rental income as determined in terms of 3.17, including all recoveries from tenants. Contingent rents (turnover rentals) are included in revenue when the amounts can be reliably measured. Interest income Interest income is recognised at the effective rates of interest on a time related basis. Dividend income Dividends are recognised when the right to receive them is established.

40

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

3. ACCOUNTING POLICIES (continued) 3.14 Deferred expenses Deferred expenses comprise tenant installation costs and letting commissions which are amortised on a straight line basis over the lease period to which they relate. 3.15 Segment reporting Information reported to the Group's chief operating decision maker, for the purpose of resource allocation and assessment of its performance, is based on the economic sectors in which the investment properties operate. The Group's reportable segments are: On a primary basis the Group operates in the following segments: · Retail · Industrial · Offices 3.16 Leases Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term. Properties leased out under operating leases are included in investment property in the statement of financial position (Note 5). 4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS Estimates and judgements are continually evaluated and are based on historical experience as adjusted for current market conditions and other factors. 4.1 Critical accounting estimates and assumptions The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below. (a) Estimate of fair value of investment properties

The best evidence of fair value is current prices in an active market for similar leases and other contracts. In the absence of such information, the Group determines the amount within a range of reasonable fair value estimates. In making its judgement, the Group considers information from a variety of sources including: I. II. III. Current prices in an active market for properties of different nature, condition or location (or subject to different lease or other contracts), adjusted to reflect those differences; Recent prices of similar properties in less active markets, with adjustment to reflect any changes in economic conditions since the date of the transactions that occurred at those prices; and Discounted cash flow projections based on reliable estimates of future cash flows, derived from the terms of any existing lease and other contracts and (where possible) from external evidence such as current market rents for similar properties in the same location and condition, and using discount rates that reflect current market assessments of the uncertainty in the amount and timing of the cash flows.

A N N U A L R E P O R T 2010

41

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued) (b) Estimate of fair value of land for the purposes of deferred tax calculations

Land has been valued as though it were vacant. Valuations are based on limited research and take into account the location, size, shape, topography, zoning and development parameters. (c) Principal assumptions for management's estimation of fair value

If information on current or recent prices or assumptions underlying the discounted cash flow approach of investment properties is not available, the fair values of investment properties are determined using discounted cash flow valuation techniques. The Group uses assumptions that are mainly based on market conditions existing at each balance sheet date. The principal assumptions underlying management's estimation of fair value are those related to: the receipt of contractual rentals, expected future market rentals, maintenance requirements and appropriate discount rates. These valuations are regularly compared to actual market yield data, and actual transactions by the Group and those reported by the market. The expected future market rentals are determined on the basis of current market rentals for similar properties in the same location and condition. (d) Estimate of useful lives of equipment

The useful lives of equipment are reviewed on an annual basis. 4.2 Critical judgements in applying the Group's accounting policies Allocation of share premium and debenture premium The Group has determined, in terms of the requirements of accounting standards, that the linked unit premium should be classified as debenture premium and not share premium. Debenture premium will be amortised over the minimum contractual period of the debentures, namely the remaining portion of 25 years from December 2002. Non-distributable reserves The Group transfers all capital profits and unrealised profits to non-distributable reserves. Balances arising due to accounting anomalies are transferred to non-distributable reserves at the discretion of the directors and these currently comprise: Straight line adjustments Deferred taxation on revaluations Amortisation of debenture premium Deferred taxation on investment properties The Group provides for deferred tax on the revaluation of investment buildings at the corporate tax rate applicable in the relevant country. In addition the capital gains tax rate is applied on the revaluation of investment land based in South Africa due to realised gains being subject to capital gains tax. If the investment buildings are reclassified as non-current assets held-for-sale, deferred tax on the revaluation of the buildings is provided for on the basis of the tax consequences that would follow from recovery of the carrying amount of that asset through sale. In Namibia the taxation rate is 0% on the amount that exceeds the cost of the building. For investment properties based in South Africa the capital gains tax rate is applied, which is 16,5% on the amount that exceeds the initial cost of the land and buildings.

42

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 5. INVESTMENT PROPERTIES Balance at fair value at beginning of year Acquisitions Additions through subsequent expenditure Transferred from property and equipment Disposals at cost Reversal of revaluation on disposal of investment property Fair value adjustments Rental straight-line basis adjustment Balance at end of the year Reconciliation to valuation: Add: Cumulative rental straight-line adjustments Investment properties at valuation 722 356 77 873 17 603 310 (13 560) (13 637) 89 897 2 279 883 121 25 244 908 365 690 229 3 538 1 104 (292) (523) 30 158 (1 858) 722 356 27 523 749 879 151 666 66 401 787 14 047 (1 218) 231 683 4 432 236 115 148 830 3 538 229 (1 111) 110 151 666 3 213 154 879 2009 N$'000 2010 N$'000 Company 2009 N$'000

Property descriptions of freehold investment properties are detailed on pages 62 and 63 of this report. Investment properties were independently valued at their market value at 30 June 2010 by T Moulder FRICS FIV (SA) of CB Richard Ellis, based on the discounted cashflow method. The vacant industrial land was valued based on the purchase price for similar land and after taking into account the size, location and physical attributes. The valuator has extensive experience in commercial, retail and industrial valuations throughout South Africa and Namibia. Initial yields varied from 9.5% to 16.1% (2009: 9.3% to 14.8%) reflecting the nature and location of the property, the tenant and duration of the lease, and whether the passing rentals were market related. Erf 5188 Windhoek, Erf 380 Tsumeb and three sectional title units in Maerua Park were sold during the year and realised a profit of N$1,45 million (2009 : N$1,31 million). This was transferred to the non-distributable reserve. Revenue Rental - straight-line adjustment Contractual property rental income earned from investment property Direct operating expenses arising on the investment properties Net rental income excluding straight line adjustment 96 655 2 279 98 934 (20 137) 78 797 90 368 (1 858) 88 510 (17 616) 70 894 34 917 2 339 37 256 (5 757) 31 499 32 511 854 33 365 (5 029) 28 336

A N N U A L R E P O R T 2010

43

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

6. PROPERTY AND EQUIPMENT Cost N$'000 Group Balance at 30 June 2008 Additions / Depreciation Balance at 30 June 2009 Additions / Depreciation Transferred to investment property Balance at 30 June 2010 Company Balance at 30 June 2008 Additions / Depreciation Balance at 30 June 2009 Additions / Depreciation Balance at 30 June 2010 The additions of N$310 000 during the 2009 financial year consisted of costs incurred for the construction of the new office building at Maerua which was transferred to investment properties (see note 5) in the current year. Company 2010 N$'000 7. INTEREST IN SUBSIDIARIES Details of the company's subsidiaries are as follows: Total interest in subsidiaries - shares at cost and loans Subsidiary company current accounts Comprising: 2010 Name of subsidiary Place of incorporation and operation Namibia Namibia Namibia Namibia Namibia Namibia Namibia Namibia Current accounts N$000 (18) 9 (8 567) (17 422) 609 10 418 (91 956) (116 917) Total interest in shares and loan accounts Issued share capital N$000 10 000 15 000 20 000 400 200 100 1 100 % Holding 100 100 100 100 100 100 100 100 Share investment N$'000 26 062 1 188 7 230 7 818 1 573 168 44 039 Indebtedness N$'000 (5 052) 3 023 137 626 114 981 617 5 861 17 669 174 432 449 157 493 196 Company 2009 N$'000 142 310 452 (310) 142 Accumulated depreciation N$'000 (84) (47) (131) (10) (141) Net book value N$'000 58 263 321 (10) (310) 1

28 28 28

(16) (10) (26) (1) (27)

12 (10) 2 (1) 1

493 196 (116 917)

480 371 (105 631)

CIC Property Holding Trust (Pty) Ltd Allied Cargo (Pty) Ltd Maerua Mall (Pty) Ltd Maerua Park Properties (Pty) Ltd Triple A (Pty) Ltd Verona Investments (Pty) Ltd United Fitness House (Pty) Ltd Phase Two Properties (Pty) Ltd

44

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

7. INTEREST IN SUBSIDIARIES (continued) 2009 Name of subsidiary Place of incorporation and operation Namibia Namibia Namibia Namibia Namibia Namibia Namibia Namibia Current accounts N$000 (18) 9 (12 119) (24 001) 609 10 266 (70 387) (105 631) Total interest in shares and loan accounts All the subsidiary companies are property investment companies. Company 2010 N$'000 Directors' valuation The directors' valuation is based on the net asset value of the subsidiaries before providing for deferred tax on revaluations. The above loans bear interest at variable rates, with no fixed dates of repayment, however the lender undertakes to give at least 13 months written notice to the borrower of any required repayment of the capital sums advanced. The holding company's shares in and loan to Phase Two Properties (Pty) Ltd, Maerua Mall (Pty) Ltd and Maerua Park Properties (Pty) Ltd have been encumbered as stated in note 11.2. Profits of subsidiaries attributable to the holding company Group 2010 N$'000 8. OTHER ASSETS 8.1 Deferred expenditure Opening balance Additions Amortisations Movement in short term portion included in current assets Closing balance 1 816 1 775 (1 929) (174) 1 488 2 581 1 111 (1 672) (204) 1 816 301 344 (627) 78 96 700 194 (529) (64) 301 2009 N$'000 2010 N$'000 64 676 24 125 Company 2009 N$'000 771 001 Company 2009 N$'000 680 246 Issued share capital N$000 10 000 15 000 20 000 400 200 100 1 100 % Holding 100 100 100 100 100 100 100 100 Share investment N$'000 26 062 1 188 7 230 7 818 1 573 168 44 039 Indebtedness N$'000 20 205 3 023 119 960 106 965 617 5 861 17 669 162 032 436 332 480 371

CIC Property Holding Trust (Pty) Ltd Allied Cargo (Pty) Ltd Maerua Mall (Pty) Ltd Maerua Park Properties (Pty) Ltd Triple A (Pty) Ltd Verona Investments (Pty) Ltd United Fitness House (Pty) Ltd Phase Two Properties (Pty) Ltd

Leasing commissions and tenant installations are capitalised to deferred expenditure and are amortised over the remaining lease period of the respective tenant on a straight line basis.

A N N U A L R E P O R T 2010

45

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 8. OTHER ASSETS (continued) 8.2 Trade and other receivables Trade receivables Short term portion of deferred expenses Other receivables Less: Provision for impairment 3 910 1 765 1 004 (412) 6 267 The directors consider that the carrying amount of trade and other receivables approximates their fair value. 8.3 Cash and cash equivalents Cash at bank The Group's principal financial assets are bank balances and cash and trade and other receivables. The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings. The Group's credit risk is primarily attributable to its trade receivables. The amounts presented in the balance sheet are net of allowances for doubtful receivables. An allowance for impairment is made where there is an identified loss event which, based on previous experience, is evidence of a reduction in the recoverability of the cash flows. The Group has no significant concentration of credit risk, with exposure spread over a large number of counterparties and customers. Refer to note 25 for detailed information relating to trade and other receivables. 9. SHARE CAPITAL Share capital Authorised 200 000 000 (2009 : 200 000 000) ordinary shares of 1 cent each 1 000 Class A variable rate redeemable preference shares of N$1,00 each 1 000 Class B variable rate redeemable preference shares of N$1,00 each 1 000 Class C variable rate redeemable preference shares of N$1,00 each 1 000 Class D variable rate redeemable preference shares of N$1,00 each 1 000 Class E variable rate redeemable preference shares of N$1,00 each 1 000 Class F variable rate redeemable preference shares of N$1,00 each Issued 55 041 675 (2009: 55 041 675) ordinary shares of 1 cent each The unissued units/shares are under the control of the directors, subject to the provisions of the Companies Act, 1973 (Act 61 of 1973), as amended, and the Listing Requirements of the NSX. 2 137 1 591 847 (443) 4 132 533 455 721 (120) 1 589 531 533 273 (73) 1 264 2009 N$'000 2010 N$'000 Company 2009 N$'000

2 205

18 369

2 205

18 369

2 000 1 1 1 1 1 1 2 006 550

2 000 1 1 1 1 1 1 2 006 550

2 000 1 1 1 1 1 1 2 006 550

2 000 1 1 1 1 1 1 2 006 550

46

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 10. NON-DISTRIBUTABLE RESERVES The Group transfers the following amounts to non-distributable reserves: I. Straight line adjustments of rental streams II. Fair value adjustments on investment properties, properties held for sale and financial instruments III. Realised capital gains or losses on the disposal of investment properties, properties held for sale and investments IV. Amortisation of debenture premiums V. Taxation on any of the above Balance at beginning of the year Movement during the year Balance at end of the period Comprising: Capital reserves - Realised capital profits - Unrealised capital profits (net of deferred taxation) - Rental straight-lining - Amortisation of debenture premium - Fair value adjustment on investment properties 2009 N$'000 2010 N$'000 Company 2009 N$'000

223 258 80 448 303 706

196 614 26 644 223 258

78 839 14 612 93 451

76 655 2 184 78 839

42 057 261 649 12 471 249 178 303 706

40 562 182 696 9 694 173 002 223 258

40 039 53 412 4 016 12 471 36 925 93 451

39 994 38 845 6 267 9 694 22 884 78 839

The unrealised capital reserve is not distributable. Realised capital reserves are under the control of the directors, subject to the requirements of the Trust Deed. 11. BORROWINGS

Non-current 11.1 Debentures 55 041 675 (2009: 55 041 675) unsecured variable rate debentures of 449 cents each Debenture premium Premium arising on listing Premium arising on new issues Share issue expenses Amortisation of debenture premium - prior years - current year

247 137

247 137

247 137

247 137

20 544 48 878 (8 619) (9 694) (2 777) 48 332

20 544 48 878 (8 619) (6 917) (2 777) 51 109

20 544 48 878 (8 619) (9 694) (2 777) 48 332

20 544 48 878 (8 619) (6 917) (2 777) 51 109

A N N U A L R E P O R T 2010

47

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 11. BORROWINGS (continued) The debenture premium is amortised on a straight-line basis over the minimum contractual term of the investment, namely the remaining portion of 25 years from December 2002. In terms of the debenture trust deed, the interest entitlement of every debenture linked to each ordinary share shall not be less than 90% of net earnings of the company before debenture interest, depreciation and amortisation, taxes (other than deferred taxation charges) and before taking into account both realised and unrealised capital profits but after provision for funding costs, whether interest or dividend in nature and also after transfers to reserves. The interest is payable bi-annually. The debentures are redeemable at the option of the holder after 25 years from 2nd December 2002 being the first date of the allotment of debentures. 11.2 Long term loans The terms of the loan facility with Bank Windhoek are as follows: 5 Year Fixed Rate - Loan expires on 9 November 2011 - Loan bearing interest at a fixed rate of 10.29% 3 Year Fixed Rate - Loan expired on 9 November 2009 - Loan bearing interest at a fixed rate of 10.77% 3 Year Fixed Rate - Loan expired on 3 March 2010 - Loan bearing interest at a fixed rate of 10.20% 3 Year Fixed Rate - Loan expires on 9 November 2012 - Loan bearing interest at a fixed rate of 10.44% Variable interest loan - Loan expires on 1 August 2011 - Loan bearing interest at Bank Windhoek prime lending rate less 2% 2009 N$'000 2010 N$'000 Company 2009 N$'000

100 000

100 000

100 000

100 000

-

30 000

-

30 000

-

10 000

-

10 000

40 000

-

40 000

-

47 292 187 292

140 000

47 292 187 292

140 000

On 27 August 2009 the Board approved the extension of N$40 million for a period of three years at a fixed rate of 10.44% with effect from 9 November 2009. The N$40 million fixed rate loan replaced the fixed rate borrowing of N$30 million and N$10 million. The fair value of the fixed interest rate loans, based on the best estimate of market related rates, amount to N$117 million (2009 : N$107,5 million). The loans are secured as follows: · Cession of all Oryx Properties Limited's rights, title and interest in and to all payments due to Oryx Properties Limited by Maerua Mall (Pty) Ltd, Maerua Park Properties (Pty) Ltd and Phase Two Properties (Pty) Ltd under the inter company loan agreements;

48

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 11. BORROWINGS (continued) · Cession of all Maerua Mall (Pty) Limited, Maerua Park Properties (Pty) Ltd and Phase Two Properties (Pty) Ltd rights, title and interest in and to all future rental payments to become due to said companies under rental agreements in respect of the letting and hiring of immovable property; and Pledge of shares in Maerua Mall (Pty) Ltd, Maerua Park Properties (Pty) Ltd and Phase Two Properties (Pty) Ltd Limited surety of N$200 million by Maerua Mall (Pty) Ltd, Maerua Park Properties (Pty) Ltd and Phase Two Properties (Pty) Ltd. 482 761 438 246 482 761 438 246 2009 N$'000 2010 N$'000 Company 2009 N$'000

· ·

Total borrowings The company's articles of association limit the Group's borrowing capacity (excluding debentures) to 60% of its consolidated total assets. Borrowing capacity Less: borrowings (excluding debentures) Unutilised borrowing capacity 12. DEFERRED TAXATION Balance at beginning of the year Disposals Deferred taxation charged to the statement of comprehsive income during the year - on revaluations - building allowance - rate change adjustment - rental straight-line adjustment - other Balance at end of the year Comprising temporary differences relative to: Building allowances Investment property revaluations Tenant installation costs Prepaid expenditure Deferred income Deposits received Straight-line basis adjustment Tax losses 13. DEFERRED INCOME Rental received in advance

550 995 (187 292) 363 703

464 710 (140 000) 324 710

443 571 (187 292) 256 279

398 895 (140 000) 258 895

77 448 (108)

69 963 (57)

9 817 -

11 534 -

15 424 5 166 (2 692) (2 529) 92 709

7 604 4 129 (4 191) 77 448

199 692 (279) (1 209) (323) 8 897

(1 002) (260) (455) 9 817

54 409 84 265 1 107 140 (582) (46 630) 92 709

50 700 69 130 1 198 159 (480) (551) (42 708) 77 448

692 6 799 187 58 (113) 2 068 (794) 8 897

6 852 292 70 (480) (92) 3 374 (199) 9 817

-

1 373

-

1 373

A N N U A L R E P O R T 2010

49

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 14. INVESTMENT INCOME Interest received Distribution from listed investment Dividends received from unit trust investment During the year a listed property investment was acquired and sold. The sale realised a capital profit of N$45 000 which was transferred to the non-distributable reserve. Two distributions totalling N$5,3 million (2009 : nil) were received from this listed investment. 15. OTHER EXPENSES Other expenses include the following: Directors' emoluments - executive - non-executive Auditors' remuneration - current year - prior year (Reversal)/Provision for impairment of receivables Asset management fees Other 90 633 455 (32) 3 642 896 5 684 65 630 408 121 (155) 4 146 650 5 865 90 633 455 47 957 749 2 931 65 630 408 121 (52) 3 009 639 4 820 250 5 311 488 6 049 979 736 1 715 44 795 5 311 488 50 594 41 811 736 42 547 2009 N$'000 2010 N$'000 Company 2009 N$'000

16.

FINANCE COSTS Interest paid The above finance costs are incurred on financial liabilities excluding debentures at amortised cost. Interest on debentures is separately disclosed in the Statement of Comprehensive Income. 17 443 14 608 17 443 14 608

17. TAXATION Namibian normal taxation Deferred tax - revaluation of investment property* Deferred tax - building allowance Deferred tax - rental straight-line adjustment Deferred tax - other* Total * Deferred tax net of rate change adjustment Tax losses available Less: Applied to reduce deferred tax liability Balance unutilised 137 209 (137 209) 122 024 (122 024) 2 397 (2 397) 570 (570) 13 721 5 166 (3 626) 15 261 7 604 4 129 (4 248) 7 485 199 692 (1 209) (602) (920) (1 002) (260) (455) (1 717)

50

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 17. TAXATION (continued) % Reconciliation of effective tax rate: Statutory rate Rate change adjustment Capital gains Exempt income Disallowable expenditure Prior year adjustment Foreign country adjustment Effective rate 34.0 (2.8) (13.7) (1.7) 0.1 (0.1) 0.1 15.9 2010 N$'000 18. HEADLINE EARNINGS PER SHARE The calculation of headline earnings per share attributable to the ordinary equity holders of the Group is based on the average number of units in issue of 55 041 675 (2009: 55 041 675) for the year and is calculated as follows: Group Earnings attributable to shares Debenture interest Earnings attributable to linked units Adjustments for: Amortisation of debenture premium Changes in fair value of investment property - As per valuations - Deferred tax on fair value adjustments - Rental straight-line basis adjustment - Deferred tax on straight line basis adjustment Profit on sale of investment property Profit on sale of listed investment Headline earnings attributable to linked units Debenture interest Headline earnings attributable to shares % 35.0 (8.6) (4.9) 0.4 21.9 2009 N$'000 % 34.0 (1.9) (32.0) (7.6) 0.4 (0.4) 1.3 (6.2) 2010 cents per unit/share % 35.0 (67.6) (162.2) 5.1 (189.7) 2009 cents per unit/share 2009 N$'000 2010 N$'000 Company 2009 N$'000

80 498 60 129 140 627 (2 777) (77 396) (89 897) 13 721 (2 279) 1 059 (1 450) (45) 58 959 (60 129) (1 170)

26 747 52 152 78 899 (2 777) (21 346) (30 158) 7 604 1 858 (650) (1 313) 53 463 (52 152) 1 311

146,25 109,25 255,50 (5,05) (140,61) (163,33) 24,94 (4,14) 1,92 (2,63) (0,08) 107,13 (109,25) (2,12)

48,59 94,75 143,34 (5,05) (38,77) (54,79) 13,82 3,38 (1,18) (2,39) 97,13 (94,75) 2,38

A N N U A L R E P O R T 2010

51

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

2010 N$'000 18. HEADLINE EARNINGS PER SHARE (continued) Distribution attributable to linked unitholders The reconciliation to undistributed earnings is based on the actual number of units in issue at the end of the respective distribution period and is calculated as follows: Basic earnings attributable to shareholders Debenture interest Rental straight-lining net of deferred taxation Distributable earnings 1st half distribution 2nd half distribution Undistributed income for the year Distribution attributable to linked unitholders Interest - paid - declared Company Earnings attributable to shares Debenture interest Earnings attributable to linked units Adjustments for: Amortisation of debenture premium Changes in fair value of investment property - As per valuations - Deferred tax on fair value adjustments - Straight line basis adjustment - Deferred tax on straight line basis adjustment Profit on sale of listed investment Headline earnings attributable to linked units Debenture interest Headline earnings attributable to shares Distribution attributable to linked unitholders Interest - paid - declared (1 170) 60 129 (1 220) 60 179 (29 994) (30 135) 50 29 994 30 135 60 129 15 822 60 129 75 951 (2 777) (13 197) (14 047) 5 1 218 (373) (45) 59 932 (60 129) (197) 29 994 30 135 60 129 1 311 52 152 (1 208) 52 255 (25 457) (26 695) 103 25 457 26 695 52 152 2 622 52 152 54 774 (2 777) 39 1 112 (1 002) (110) 39 52 036 (52 152) (116) 25 457 26 695 52 152 2009 N$'000 2010 cents per unit/share 2009 cents per unit/share

109,33 (54,50) (54,75) 0,08 54,50 54,75 109,25 28,75 109,25 138,00 (5,05) (23,98) (25,52) 0,01 2,21 (0,68) (0,08) 108,89 (109,25) (0,36) 54,50 54,75 109,25

94,75 (46,25) (48,50) 0,00 46,25 48,50 94,75 4,76 94,75 99,51 (5,05) 0,07 2,02 (1,82) (0,20) 0,07 94,53 (94,75) (0,22) 46,25 48,50 94,75

19. LEASES The Group rents out its investment properties in Namibia and South Africa under operating leases. Contractual rental income earned during the year was N$98,9 million (2009: N$88,5 million). The properties are managed and maintained by independent real estate managers at a cost of N$1,9 million (2009: N$1,6 million).

52

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 19. LEASES (continued) The future minimum lease commitments receivable under noncancellable operating leases are as follows: Not later than 1 year Contractual income Later than 1 year and not later than 5 years Contractual income Later than 5 years Contractual income 20. RECONCILIATION OF NET INCOME BEFORE TAX TO CASH GENERATED FROM OPERATING ACTIVITIES Profit before tax Adjustments: Fair value adjustments to investment property Investment income Finance costs Distributions to linked unitholders Profit on sale of listed investment Profit on sale of investment property Straight-line basis adjustment to revenue Straight-line basis adjustment to fair value adjustment on investment property Amortisation of debenture premium Depreciation Working capital changes: Movement in trade and other receivables Movement in deferred expenditure Movement in trade and other payables Movement in subsidiary company control accounts 95 759 (22 636) (89 897) (6 049) 17 443 60 129 (45) (1 450) 2 279 (2 279) (2 777) 10 (1 714) (2 135) 328 93 71 409 21. DISTRIBUTION TO LINKED UNITHOLDERS Debenture interest paid is reconciled as follows: Amounts unpaid at beginning of the year Amounts charged to the income statement Amounts unpaid at end of the year (26 707) (60 129) 30 149 (56 687) (25 054) (52 152) 26 707 (50 499) (26 707) (60 129) 30 149 (56 687) (25 054) (52 152) 26 707 (50 499) 34 232 30 844 (30 158) (1 715) 14 608 52 152 (1 313) (1 858) 1 858 (2 777) 47 1 051 (453) 765 739 66 127 14 902 13 667 (14 047) (50 594) 17 443 60 129 (45) 2 339 1 218 (2 777) 1 11 479 (325) 205 313 11 286 40 048 905 23 300 1 111 (42 547) 14 608 52 152 854 (110) (2 777) 9 13 570 221 399 (175) 13 125 37 775 2009 N$'000 2010 N$'000 Company 2009 N$'000

89 879

86 557

34 010

33 772

190 591

166 757

79 782

64 383

63 379

14 063

60 952

63

A N N U A L R E P O R T 2010

53

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

TOTAL N$'000 22. SEGMENT INFORMATION Group 2010 Statement of comprehensive income Rental - cash flow basis Rental - straight-line adjustment Revenue Rental expenses Net rental income Investment income Amortisation of debenture premium Portfolio expenses Profit on sale of investment property Profit on sale of listed investment Investment property fair value adjustments Finance costs Debenture interest Taxation Comprehensive income for the year Statement of financial position Properties - at valuation* Current assets* Total assets Current liabilities Deferred taxation Long-term loans Total liabilities Capital expenditure Investment properties * before straight-lining Group 2009 Statement of comprehensive income Rental - cash flow basis Rental - straight-line adjustment Revenue Rental expenses Net rental income Investment income Amortisation of debenture premium Portfolio expenses Profit on sale of investment property Investment property fair value adjustments Finance costs Debenture interest Taxation Comprehensive income for the year RETAIL N$'000 INDUSTRIAL N$'000 OFFICES N$'000 FUND N$'000

98 934 (2 279) 96 655 (20 137) 76 518 6 049 2 777 (5 684) 1 450 45 92 176 (17 443) (60 129) (15 261) 80 498 908 365 8 472 918 326 37 566 92 709 187 292 613 036 95 476

63 319 (174) 63 145 (15 493) 47 652 81 (2 592) 1 493 59 848 (16 333) 90 149 549 000 4 856 555 145 3 715 68 059 71 774 11 523

25 589 (2 881) 22 708 (1 758) 20 950 26 (43) 20 345 4 999 46 277 258 965 784 259 737 1 529 32 218 33 746 67 189

10 026 776 10 802 (2 886) 7 916 21 (230) 11 983 (3 546) 16 144 100 400 627 101 239 (373) (3 766) (4 139) 16 764

5 921 2 777 (2 862) 45 (17 443) (60 129) (381) (72 072) 2 205 2 205 32 695 (3 802) 187 292 511 655 -

88 510 1 858 90 368 (17 616) 72 752 1 715 2 777 (5 865) 1 313 28 300 (14 608) (52 152) (7 485) 26 747

56 669 2 614 59 283 (13 637) 45 646 90 (984) 24 730 (7 134) 62 348

23 001 (1 025) 21 976 (1 537) 20 439 7 2 739 (2 930) 20 255

8 840 269 9 109 (2 442) 6 667 44 (67) 1 313 831 (1 453) 7 335

1 574 2 777 (4 814) (14 608) (52 152) 4 032 (63 191)

54

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

TOTAL N$'000 22. SEGMENT INFORMATION (continued) Statement of financial position Properties - at valuation* Current assets* Total assets Current liabilities Deferred taxation Long-term loans Total liabilities Capital expenditure Investment properties Property and equipment * before straight-lining 23. CONTINGENT LIABILITY There are no contingent liabilities at year end, other than the guarantees to the amount of N$37 550 (2009 : N$37 550) issued in favour of the City of Windhoek for electricity and water deposits. At fair value through profit Notes and loss N$'000 24. BALANCE SHEET - CATEGORIES OF FINANCIAL INSTRUMENTS Group 2010 ASSETS Investment properties Property and Equipment Deferred expenditure Rental receivable - straight-line adjustment Trade and other receivables Cash and cash equivalents Total assets LIABILITIES Debentures Debenture premium Long-term loans Deferred taxation Trade and other payables Linked unitholders for distribution Total liabilities 11.1 11.1 11.2 12 Financial Loans and liabilities at receivables amortised cost N$'000 N$'000 Non-financial assets and liabilities N$'000 749 879 22 501 774 517 34 031 77 448 140 000 549 725 4 642 310 479 700 2 898 484 258 3 048 51 723 54 771 805 199 679 187 199 888 501 40 591 41 092 3 837 70 500 948 71 903 1 642 6 147 7 789 310 18 468 18 468 28 840 (21 013) 140 000 446 073 RETAIL N$'000 INDUSTRIAL N$'000 OFFICES N$'000 FUND N$'000

Total N$'000

5 6 8.1

8.3

-

6 267 2 205 8 472 -

247 137 48 332 187 292 7 417 30 149 520 327

883 121 1 1 488 20 332 4 912 909 854 92 709 92 709

883 121 1 1 488 20 332 11 179 2 205 918 326 247 137 48 332 187 292 92 709 7 417 30 149 613 036

A N N U A L R E P O R T 2010

55

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

At fair value through profit Notes and loss N$'000 24. BALANCE SHEET - CATEGORIES OF FINANCIAL INSTRUMENTS (continued) Group 2009 ASSETS Investment properties Property and Equipment Deferred expenditure Rental receivable - straight-line adjustment Trade and other receivables Cash and cash equivalents Total assets LIABILITIES Debentures Debenture premium Long-term loans Deferred taxation Trade and other payables Deferred income Linked unitholders for distribution Total liabilities Company 2010 ASSETS Investment properties Property and Equipment Interest in subsidiaries Deferred expenditure Rental receivable - straight-line adjustment Trade and other receivables Cash and cash equivalents Total assets LIABILITIES Debentures Debenture premium Long-term loans Deferred taxation Trade and other payables Subsidiary company current accounts Linked unitholders for distribution Total liabilities 11.1 11.1 11.2 12 7 11.1 11.1 11.2 12 13 Financial Loans and liabilities at receivables amortised cost N$'000 N$'000 Non-financial assets and liabilities N$'000

Total N$'000

5 6 8.1

8.3

-

4 132 18 369 22 501 -

247 137 51 109 140 000 5 951 26 707 470 904

722 356 321 1 816 24 584 2 939 752 016 77 448 1 373 78 821

722 356 321 1 816 24 584 7 071 18 369 774 517 247 137 51 109 140 000 77 448 5 951 1 373 26 707 549 725

5 6 7 8.1

8.3

-

449 157 1 589 2 205 452 951 -

247 137 48 332 187 292 4 680 116 917 30 150 634 508

231 683 1 44 039 96 7 465 3 050 286 334 8 897 8 897

231 683 1 493 196 96 7 465 4 639 2 205 739 285 247 137 48 332 187 292 8 897 4 680 116 917 30 150 643 405

56

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

At fair value through profit Notes and loss N$'000 24. BALANCE SHEET - CATEGORIES OF FINANCIAL INSTRUMENTS (continued) Company 2009 ASSETS Investment properties Property and Equipment Interest in subsidiaries Deferred expenditure Rental receivable - straight-line adjustment Trade and other receivables Cash and cash equivalents Total assets LIABILITIES Debentures Debenture premium Long-term loans Deferred taxation Trade and other payables Deferred income Subsidiary company current accounts Linked unitholders for distribution Total liabilities 25. FINANCIAL RISK MANAGEMENT In the normal course of its operations, the Group is inter alia exposed to capital, credit, interest rate and liquidity risk. In order to manage these risks, the Group may enter into transactions that make use of derivatives, namely options. The Group does not speculate in or engage in the trading of derivative instruments. Capital risk management Capital is actively managed to ensure that the Group is properly capitalised and funded at all times, having regard to its regulatory needs, prudent management and the needs of all its stakeholders. The Group has a business planning process that runs on an annual cycle with regular updates to projections. It is through this process, which includes risk and sensitivity analyses of forecasts, that the Group's capital is managed. Specifically the Group has adopted the following capital management policies: · Maintenance, as a minimum, of capital sufficient to meet the statutory requirements and such additional capital as management believes is necessary, · Maintenance of an appropriate level of liquidity at all times. The Group further ensures that it can meet its expected capital and financing needs at all times, having regard to the business plans, forecasts and any strategic initiatives. The Group has both qualitative and quantitative risk management procedures to monitor the key risks and sensitivities of the business. This is achieved through scenario analyses and risk assessments. From an understanding of the principal risks, appropriate risk limits and controls are defined. 11.1 11.1 11.2 12 13 7 Financial Loans and liabilities at receivables amortised cost N$'000 N$'000 Non-financial assets and liabilities N$'000

Total N$'000

5 6 7 8.1

8.3

-

436 332 1 264 18 369 455 965 -

247 137 51 109 140 000 2 994 105 631 26 707 573 578

151 666 2 44 039 301 10 486 2 367 208 861 9 817 1 373 11 190

151 666 2 480 371 301 10 486 3 631 18 369 664 826 247 137 51 109 140 000 9 817 2 994 1 373 105 631 26 707 584 768

A N N U A L R E P O R T 2010

57

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 25. FINANCIAL RISK MANAGEMENT (continued) Credit risk management The Group's financial assets that are potentially subject to credit risk include cash resources and trade and other receivables. The credit risk attached to the Group's cash resources is minimised by its cash resources only being placed with reputable financial institutions. Credit risk with respect to trade and other receivables is limited due to the large and diverse tenant base. In addition tenant creditworthiness is thoroughly assessed before leases are signed. The credit risk relating to the subsidiary loans are regarded as insignificant due to the group structure and loan terms. Total credit exposure Interest in subsidiaries Trade and other receivables (less impairment) Cash resources The total credit exposure relates to cash resources and trade and other receivables. Although the Group does not perceive there to be a credit risk relating to cash resources, the exposure to a single counterparty with respect to tenant receivables could be a potential for risk. The top 5 tenants by rental area are disclosed on page 13 of this report and 90% (2009 : 85%) of total floor space is occupied by major Southern African companies or their franchisees. The following table represents relevant information on trade and other receivables at the balance sheet date: Other receivables Trade receivables 2 357 3 910 6 267 3 910 (412) 3 498 2 438 1 694 4 132 1 694 (443) 1 251 1 056 533 1 589 533 (120) 413 806 458 1 264 458 (73) 385 2009 N$'000 2010 N$'000 Company 2009 N$'000

6 267 2 205 8 472

4 132 18 369 22 501

493 196 1 589 2 205 496 990

480 371 1 264 18 369 500 004

Trade receivables before impairment Bad debt provision Fair value of trade receivables Trade receivables past due* Impaired Not impaired Total Current 30 days 60 days 90+ days

412 3 498 3 910 1 921 140 75 1 774 3 910

443 1 251 1 694 47 169 95 1 383 1 694

120 413 533 227 88 20 198 533

73 385 458 401 57 458

58

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 25. FINANCIAL RISK MANAGEMENT (continued) The current category of the Group includes a provision of N$1,48 million (2009 : nil) for turnover rentals and the 90+ days category includes a provision of N$1,29 million (2009 : N$1,1 million) for turnover rentals. The turnover rental provisions pertain to tenants in the Maerua Complex where lease agreements include turnover rental clauses. The turnover rentals will be collected once the tenants' annual financial results have been confirmed by their auditor. * All outstanding balances with the exception of current are defined as being past due. Provision for doubtful debts Opening balance Additional provisions Reversals Closing balance 2009 N$'000 2010 N$'000 Company 2009 N$'000

443 166 (197) 412

598 161 (316) 443

73 72 (25) 120

125 57 (109) 73

Interest rate risk management Interest rate movements impact on the value of the Group's short-term cash investments, interest bearing borrowings, accounts receivable and payable. The exposure to interest rate risk is managed through monitoring cash flows, investing surplus cash at negotiated rates and fixing interest rates on borrowings when appropriate, which enables the Group to maximise returns while minimising risks. Interest rate sensitivity analysis The Group is exposed to interest rate fluctuations as not all the debts are fixed at year end. Management is monitoring the situation and will fix a portion of the floating debt when interest rate increases are expected. It is estimated that, for the year ended 30 June 2010, a 1% change in interest rates on subsidiary company loans would have affected the Company's profit before debenture interest by N$3,1 million (2009 : N$2,8 million). This would however have not affected the Group's profit. It is estimated that, for the year ended 30 June 2010, a 1% change in interest rates on the variable interest rate loan would have affected the Group's profit before debenture interest by N$472 920 (2009 : N$nil). Liquidity risk management Liquidity risk is the risk that cash may not be available to pay obligations when due at a reasonable cost. The Group proactively manages its liquidity risk by regularly assessing working capital requirements and monitoring cash flows, whilst ensuring surplus cash is invested in a manner to achieve maximum returns. The following table details the Group's remaining contractual maturity for its non-derivative financial liabilities. The table has been drawn up based on the actual settlement amounts of financial liabilities based on the earliest date on which the Group can be required to pay.

A N N U A L R E P O R T 2010

59

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 25. FINANCIAL RISK MANAGEMENT (continued) Less than 3 months - Trade and other payables - Distributions payable - Interest payable Between 3 months and 1 year - Subsidiary company current accounts - Deferred income - Interest payable Between 1 and 5 years - Interest bearing borrowings - Interest payable After 5 years - Debentures and debenture premium 7 417 30 149 2 411 12 055 187 292 10 204 295 469 544 997 5 951 26 707 2 424 1 373 12 068 140 000 24 322 298 246 511 091 4 680 30 149 2 411 116 917 12 055 187 292 10 204 295 469 659 177 2 994 26 707 2 424 105 631 1 373 12 068 140 000 24 322 298 246 613 765 2009 N$'000 2010 N$'000 Company 2009 N$'000

The Group has access to financial facilities, of which N$213 million (2009 : N$260 million) is unutilised at the balance sheet date and has a remaining borrowing capacity in terms of the articles of association of N$364 million (2009 : N$325 million). The Group expects to meet its obligations from operating cash flows and long term debt. The interest bearing borrowings and debentures will be re-financed on maturity. Debentures are required to be discounted in terms of IFRS 7, however due to the nature of a property loan stock company, it is impractical to do so. Returns on debentures are paid in the form of debenture interest, which is calculated based on the profits in the Group at the end of the reporting period. Such profits cannot be reliably estimated to the maturity date of the debentures in December 2027. 26. RELATED PARTY TRANSACTIONS Transactions between the company and its subsidiaries, which are related parties of the company, have been eliminated on consolidation (with the exception of capitalised interest during the course of development) and are not disclosed in this note. Details of transactions between the Group and other related parties are disclosed below: Group 2010 2009 N$'000 N$'000 PARTY CONCERNED TRANSACTION 710 695 Directors' emoluments - Directors' fees The remuneration of directors is determined by the Board Management fees: Oryx Management Services (Proprietary) Limited * Property management fees: Joseph & Snyman (Proprietary) Limited Commission paid: Joseph & Snyman (Proprietary) Limited Rental income: FP du Toit Transport (Proprietary) Limited The following balances were outstanding at the year end: Oryx Management Services (Proprietary) Limited*

- Asset management fees

3 617

4 146

- Collection fees

1 930

1 622

- Placement commission

917

965

2 827

2 644

297

343

60

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

30 June 2010

Group 2010 N$'000 26. RELATED PARTY TRANSACTIONS (continued) * Oryx Management Services (Proprietary) Limited sub-contracts some of these services to Joseph & Snyman (Proprietary) Limitedand Old Mutual Investment Group: Property Investments and remunerates them out of the fees received from Oryx. The property management fees disclosed above are paid directly to Joseph & Snyman. 27. CAPITAL COMMITMENTS Authorised and not contracted Authorised and contracted 18 600 51 940 70 540 17 400 17 650 35 050 2009 N$'000

The above capital expenditure will be funded by way of bank facilities and surplus cash. 28. POST BALANCE SHEET EVENTS The Board has approved the internalisation of the asset and financial management functions of Oryx Properties Limited. The transaction entails the early cancellation of the asset and financial management agreement between Oryx Management Services (Pty) Ltd and Oryx Properties Limited. The Board has approved a cancellation fee of N$4,1 million payable to Oryx Management Services (Pty) Ltd in this regard. The effective date of this transaction is 30 November 2010. The Board is of the opinion that the internalisation of the asset and financial management functions will further align management objectives with shareholders' expectations. Asset management internalisation is currently an industry trend followed by listed property companies and will further result in savings to Oryx over the medium to long term. Joseph & Snyman (Proprietary) Limited will continue to perform the property management function of Oryx. During May 2010 the Board approved the acquisition of an additional industrial property in Port Elizabeth for a total consideration of N$51,5 million. Transfer of the property is expected during October 2010. The property will be funded by a South African bank loan on a 60% loan to value basis, with the remaining 40% being funded by existing cash and facilities. 29. APPROVAL OF FINANCIAL STATEMENTS The financial statements were approved by the Board of directors and authorised for issue on 20 October 2010.

A N N U A L R E P O R T 2010

61

REAL ESTATE PORTFOLIO

30 June 2010

Name 1 MAERUA MALL COMPLEX # Maerua Mall/ Maerua Park/ Triple "A" Description Location Open market valuation (N$) % of portfolio Material leases

Retail regional centre

Cnr Jan Jonker and Robert Mugabe Avenues, Windhoek

214 900 000

23.7

Maerua Mall Phase II

Retail regional centre

Cnr Jan Jonker and Robert Mugabe Avenues, Windhoek

285 000 000

31.3

Shoprite, Truworths, Stuttafords Mr Price Group Ster Kinekor Hi-Fi Corporation Clicks Group Foschini, Edgars/Boardmans Sportsmans Warehouse Woermann Brock Ackermans House and Home Methealth Namibia Deloitte Metje & Ziegler Limited Metje & Ziegler Limited Metje & Ziegler Limited Metje & Ziegler Limited

2 3 4 5 6 7

Maerua Office Block Deloitte Office^ M&Z Autohaus (Audi)* M&Z Tal Street (Chrysler/Mercedes)* M&Z Joule Street (Mercedes Truck) M&Z Edison Street (Colt)* Erf 6406 Windhoek Erf 6621 Windhoek

Office block Office block Industrial showroom and workshop Industrial showroom and workshop Industrial showroom Industrial showroom

Cnr Jan Jonker and Robert Mugabe Avenues, Windhoek Cnr Jan Jonker and Robert Mugabe Avenues, Windhoek

27 000 000 24 500 000

3.0 2.6 1.3 1.9 1.2 1.7

Cnr of Mandume Ndemufayo 12 000 000 and Lazarette Street, Windhoek 60 Tal Street, Windhoek 18 Joule Street, Windhoek Cnr Edison and Mandume Ndemufayo Avenues, Windhoek Cnr Solingen and Iscor Streets, Northern Industrial Area, Windhoek Cnr Kalie Roodt and Tommie Muller Streets, Northern Industrial Area, Windhoek Newcastle Street, Northern Industrial Area, Windhoek 3rd Street East, Walvis Bay 17 000 000 10 800 000 15 000 000

8

Industrial warehousing

56 500 000

6.2

Commercial Investment Company (Proprietary) Limited Commercial Investment Company (Proprietary) Limited Commercial Investment Company (Proprietary) Limited Commercial Investment Company (Proprietary) Limited Commercial Investment Company (Proprietary) Limited Virgin Active

9

Industrial warehousing

11 100 000

1.2

10 Erf 6977 Windhoek 11 Erf 2671 Walvis Bay 12 Erf 334 Keetmanshoop 13 United Fitness House

Industrial warehousing

11 400 000

1.3

Industrial warehousing

4 200 000

0.5

Industrial warehousing

5th Avenue, Keetmanshoop

850 000

0.1

Retail

Centaurus Road, Windhoek

26 000 000

2.9

62

REAL ESTATE PORTFOLIO (continued)

30 June 2010

Name 14 Baines* Description Retail Location Erf 1297PP Fritsche Street, Windhoek Open market valuation (N$) 28 000 000 % of portfolio 3.1 Material leases OK Foods Pionierspark Liquor Store Pionierspark Pharmacy Nucleus Gymnasium US Aid Ministry of Tourism Namibia Tourism Board Major Drilling To be developed To be developed FP Du Toit Transport To be developed To be developed To be developed To be developed Cordustex Manufacturing (Proprietary) Limited Acoustex (Proprietary) Limited Black Ginger (Proprietary) Limited

15 Channel Life*

Office

25 Post Street, Windhoek

44 000 000

4.8

16 Erf 35 Lafrenz* 17 Erf 135 Lafrenz* 18 Erf 139 Lafrenz*^ 19 Erf 51 Prosperita* 20 Erf 383 Prosperita* 21 Erf 385 Prosperita* 22 Erf 386 Prosperita* 23 Erf 387 Prosperita* 24 Erf 6173 Walmer, Port Elizabeth*^ 25 Erf 4076 Walmer Port Elizabeth*^ 26 Erf 89, 90 & 91 Isando Johannesburg*^ TOTAL

Industrial Industrial Industrial Industrial Industrial Industrial Industrial Industrial Industrial

Erf 35, Nordland Street, Lafrenz Townhsip, Windhoek Erf 135, Rendsburger Street Lafrenz Township, Windhoek Erf 139, Rendsburger Street Lafrenz Township, Windhoek 36 to 46 Platinum Street, Prosperita, Windhoek Erf 383 Prosperita, Windhoek Erf 385 Prosperita, Windhoek Erf 386 Prosperita, Windhoek Erf 387 Prosperita, Windhoek Erf 6173, Caravelle Street Port Elizabeth, SA Erf 4076, Bennett Street Port Elizabeth, SA Erf 89, 90, 91 Isando Johannesburg, SA

9 600 000 8 000 000 8 000 000 27 000 000 782 300 1 576 976 1 652 300 3 203 424 17 600 000

1.1 0.9 0.9 2.9 0.1 0.2 0.2 0.4 1.9

Industrial

19 800 000

2.2

Industrial

22 900 000

2.5

908 365 000

100.00

* These properties are owned by the Company # The Maerua Mall complex includes four properties ^ New acquisitions / developments

A N N U A L R E P O R T 2010

63

NOTICE OF ANNUAL GENERAL MEETING

ORYX PROPERTIES LIMITED Reg. No. 2001/673 NOTICE TO ALL UNITHOLDERS PLEASE TAKE NOTICE that the Annual General Meeting of the company will be held in the Joseph & Snyman Board Room, 61 Independence Avenue, Windhoek, Namibia on the 23rd day of November 2010 at 14:00pm. AGENDA 1. 2. 3. 4. 5. Notice convening the Meeting. Apologies. Confirmation of the minutes of the Annual General Meeting held on the 25th day of November 2009. Report of the Chairman of Oryx Properties Limited. Ordinary Resolution Number 1: To receive and adopt the audited annual financial statements of the company and the reports of the auditors and the directors for the year ended 30 June 2010. 6. Ordinary Resolution Number 2: To ratify the remuneration of the executive and non-executive directors for the financial year ended 30 June 2010. 7. Ordinary Resolution Number 3: To consider and, if deemed fit, to pass, with or without modification, the following: a. "Resolved that the authorised but unissued ordinary and preference shares in the capital of the company be and are hereby placed under the control and authority of the directors and that the directors be and are hereby authorised and empowered to allot, issue and otherwise dispose of such shares and linked units to such person or persons on such terms and conditions and at such times as the directors may from time to time in their discretion deem fit, subject to the provisions of the Companies Act, 2004 (Act 28 of 2004), as amended and the Listing Requirements of the NSX." "Resolved that, subject to the listing of the shares/linked units of the company on the NSX, the directors of the company be and they are hereby authorised by way of a general authority, to issue all or any of the authorised but unissued shares and linked units in the capital of the company for cash, as and when they in their discretion deem fit, subject to the Companies Act 2004 (Act 28 of 2004), as amended the Articles of Association of the company and the Listing Requirements of the NSX with the following limitations: I that this authority is valid until the company's next annual general meeting provided that it shall not extend beyond 15 (fifteen) months from the date that this authority is given, that a paid press announcement giving full details, including the impact on the net asset value and earnings per linked unit, will be published at the time of any issue representing, on cumulative basis within 1 (one) financial year, 5% (five percent) or more of the number of shares and linked units in issue prior to the issue,

b.

II

64

NOTICE OF ANNUAL GENERAL MEETING (continued)

III that issues in the aggregate in any 1 (one) financial year may not exceed 15% (fifteen percent) of the number of shares in the company's issued share capital, that in determining the price at which an issue of shares may be made in terms of this authority, the maximum discount permitted will be 10% (ten percent) of the weighted average traded price on the NSX of those shares over the 30 (thirty) business days prior to the date that the price of the issue is determined or agreed by the directors of the company, subject to such issue price not being less than 90% of the last reported net asset value, and that any such issue will only be made to "public shareholders" as defined by the Listing Requirements of the NSX. that a 75% majority of the votes cast in favor of such resolution by all unitholders present or represented by proxy.

IV

V VI c.

"Resolved to re-appoint Deloitte & Touche as auditors for the ensuing year and to authorise the directors to determine their remuneration."

d. "To re-elect retiring and confirm the appointment of any new directors in accordance with the Articles of Association. Motions for re-election will be moved individually. In terms of the company's Articles of Association, one third of the directors is required to retire annually on a rotation basis, but is eligible for re-election. Accordingly, Mr KF Clinton, Mr F Uys and Mr B Joseph retire by rotation but being eligible, offer themselves for re-election." e. "To ratify the appointment of Mr SI de Bruin as a director of the company who was appointed by the Board of Directors on 24 November 2009." "To ratify the appointment of Mr BH Azizollahoff as a director of the company who was appointed by the Board of Directors on 24 February 2010."

f.

g. "To ratify the appointment of Mr LB van Niekerk as a director of the company who was appointed by the Board of Directors on 24 February 2010." 8. Special Resolution Number 1 To resolve to replace Paragraph 23(g) of the Articles of Association now reading: "The company may by special resolution reduce its share capital, stated capital, any capital redemption fund or any share premium account in any manner and with, and subject to any incident authorised, and consent required, by law." With: "The company may by special resolution acquire its own shares and linked units subject to the conditions of section 89 to section 96 of the Companies Act 28 of 2004, as amended and the Namibian Stock Exchange ("NSX") Listings Requirements." 9. To transact any other business which under the Articles of Association, may be transacted at an Annual General Meeting. BY ORDER OF THE BOARD ORYX MANAGEMENT SERVICES (PTY) LTD COMPANY SECRETARIES

A N N U A L R E P O R T 2010

65

NOTICE OF ANNUAL GENERAL MEETING (continued)

NOTE: 1. A member entitled to attend and vote is entitled to appoint a proxy to attend, speak, vote, and on a poll, vote in his stead, and such proxy need not also be a member of the company. The Proxy Form must be deposited at the registered office of the company not less than 48 (FORTY EIGHT) hours before the time of holding the meeting. Dated at WINDHOEK this 20th day of October 2010. Registered Office 61 Independence Avenue Windhoek P O Box 3644 Windhoek Tel. +264 61 278100 Fax. +264 61 278120

2.

66

PROXY FORM

ORYX PROPERTIES LIMITED ("ORYX")

I/We (Name/s in block letters)

being the registered holder/s of

units in ORYX, as at the close of business on 19th November 2010

hereby appoint

of

or failing him or failing him THE CHAIRMAN OF THE MEETING

of

as my/our Proxy to attend, speak and vote for me/us and on my/our behalf at the Annual General Meeting of ORYX to be held on the 23r d N o v e m b e r 2 0 1 0 A T 1 4 : 0 0 P M and at any adjournment thereof and to vote for or against the resolutions or to abstain from voting in respect of the units registered in my/our name/s, in accordance with the following instructions: In favour 5 Resolution to receive and adopt the audited annual financial statements of the Company and Group and the reports of the auditors and directors for the year ended 30 June 2010. Resolution to ratify the remuneration of the executive and non-executive directors for the financial year ended 30 June 2010. Resolution to place the authorised but unissued ordinary and preference shares in the capital of the company under the control and authority of the directors. Resolution to authorise the directors by way of general authority to issue the unissued units in the company for cash. Resolution to re-appoint Deloitte & Touche as auditors for the ensuing year and to authorise the directors to determine their remuneration. Resolution to re-elect the directors of the company for the forthcoming year: i) Mr KF Clinton ii) Mr F Uys iii) Mr B Joseph 7e 7f 7g 8 To ratify the appointment of Mr SI de Bruin as a director. To ratify the appointment of Mr BH Azizollhoff as a director. To ratify the appointment of Mr LB van Niekerk as a director. Resolution to replace Paragraph 23(g) of the Articles of Association to allow the Company to acquire its own units. Against Abstain

6 7a

7b 7c 7d

A N N U A L R E P O R T 2010

67

PROXY FORM

Signed at

on this

day of

2010

Full names (in block letters) Signature(s)

Assisted by (Guardian):

Date:

2010

A member entitled to attend and vote is entitled to appoint a Proxy to attend, speak, vote, and on a poll, vote in his stead, and such Proxy need not also be a member of ORYX.

Registered Office

P O Box 3644 Windhoek 61 Independence Avenue Windhoek Tel. +264 61 278100 Fax. +264 61 278120

INSTRUCTIONS ON SIGNING AND LODGING THE PROXY FORM 1. The Proxy Form must be deposited at the registered office of ORYX not less that 48 (FORTY EIGHT) hours before the time of holding the meeting. A deletion of any printed matter and the completion of any blank space(s) need not be signed or initialled. Any alteration must be signed, not initialled. The Chairman of the meeting shall be entitled to decline to accept the authority of the signatory: (a) under a power of attorney; or (b) on behalf of a company or any other entity unless the power of attorney or authority is deposited at the registered office of the company not less than 48 (FORTY EIGHT) hours before the time scheduled for the meeting. The authority of a person signing a Proxy in a representative capacity must be attached to the Proxy form unless the authority has already been recorded by the Secretaries. The signatory may insert the name of any person(s) whom the signatory wishes to appoint as his Proxy in the blank space(s) provided for that purpose. When there are joint holders of units and if more than one such joint holder be present or represented, then the person whose name stands first in the register in respect of such units or his Proxy, as the case may be, shall alone be entitled to vote in respect thereof. The completion and lodging of this Proxy form will not preclude the signatory from attending the meeting and speaking and voting in person thereat to the exclusion of any Proxy appointed in terms hereof should such signatory wish to do so. The Chairman of the meeting may reject or accept any Proxy form which is completed and/or submitted other than in accordance with these instructions, provided that he is satisfied as to the manner in which a member wishes to vote. If the unitholding is not indicated on the Proxy form, the Proxy will be deemed to be authorised to vote the total unitholding.

2.

3.

4.

5.

6.

7.

8.

9.

68

Maerua Mall regional retail & office block centre - Cnr Jan Jonker and Robert Mugabe Avenues, Windhoek.

Managed by Oryx Management Services a subsidiary of

61 Independence Avenue, Windhoek Tel: +264 61 278 100 Fax: +264 61 278 120 www.oryx.com.na email:[email protected]

A N N U A L R E P O R T 20 1 0

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