AGENDA

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AGENDA

• A five year track record
• Scorecard for 2006
• Looking forward to 2007

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CELEBRATING FIVE GREAT YEARS
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CELEBRATING FIVE GREAT YEARS
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AGENDA

• A five year track record
• Scorecard for 2006
• Looking forward to 2007

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SCORECARD FOR 2006

• Distributions total R557-million, 244 cents per
  combined unit
• 109,80 cents per A unit
• 143,20 cents per B unit
• 10 growth in distributions
• A unit 8
• B unit 11

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SUMMARISED OPERATING RESULTS
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SCORECARD FOR 2006

• Threshold distribution of 227 cents per combined
  unit, per annum, was exceeded for the first time
  this financial year
• Basis for distribution changes
• A units get 45
• B units get 55
• Combined closing unit price increased by 17,
  closing at 2500 cents on 30 June
• High trading volumes have been maintained
• 54 of the A units traded
• 49 of the B units traded

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VOLUMES TRADED
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SCORECARD FOR 2006

• ApexHi delivered a total return of 28 for the
  year to end June 2006 compared to the property
  loan stock average of 23

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SCORECARD FOR 2006
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SCORECARD FOR 2006

• Market capitalisation plus debt has grown from
  R5,2-billion to R7,8-billion
• Property portfolio grown from R4-billion to
  R6,7-billion
• Conduit funding was introduced, resulting in
  savings of R3,5-million per annum going forward

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• INSERT ANIMATION OF CAR RALLY INTEREST RATES

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SCORECARD FOR 2006

• History of fixes

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BALANCE SHEET
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BALANCE SHEET cont
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SCORECARD FOR 2006

• Properties all valued by external valuers
  resulting in fair value adjustment of
  R690-million
• Forward yield on portfolio approximately 13
• 215 properties acquired for R1,723-billion
• At average yield before gearing of 11,9
• 15 properties sold for R219,5-million
• Surplus on original cost of R45,5-million
• Selling yield of 15
• R171-million was invested in upgrades and
  refurbishments

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SCORECARD FOR 2006

• INSERT ANIMATION OF DARTS

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SCORECARD FOR 2006

• Total property portfolio
• Portfolio grown to 444 properties
• With a GLA of 2 525 962 m2
• Valued at R2 640/m2

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• INSERT ANIMATION OF MARC ON THE BALANCE BEAM

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SCORECARD FOR 2006

• Retail increased from 40 to 44
• Office decreased from 44 to 39

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SCORECARD FOR 2006

• Leases valued at more than R1-billion were
  concluded
• Vacancy levels have reduced from 10 to 9

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LETTING ACTIVITY
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SCORECARD FOR 2006

• Corporate Social Investment
• Member of the Johannesburg Inner City Coalition
  involved in transformation of Johannesburg and
  Braamfontein
• Ongoing supporter of the Johannesburg Housing
  Company
• Involved in conversions of office accommodation
  into residential apartments

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AGENDA

• A five year track record
• Scorecard for 2006
• Looking forward to 2007

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APEXHI STRUCTURE
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THE BEE CHALLENGE

• The Property BEE Charter has been signed
• ApexHis objective is to have a 10 BEE
  participation in its equity
• At ApexHis market capitalisation of over
  R6-billion this would require a substantial
  investment of R600-million
• At current returns on ApexHi units, against
  borrowing rates for BEE transactions, this would
  not be possible unless current unit holders sold
  their units to the BEE partner at a discount!

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• INSERT LADUUUUMA SLIDE

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THE BEE OPPORTUNITY

• ApexHi has proposed to introduce a new C unit
  that will
• facilitate an achievable BEE transaction in
  accordance with
• the new Property Charter
• retain the bond element of the A unit
• create an inexpensive method for both A and B
  unit holders to achieve 100 of the annual growth
  in ApexHi
• create an inexpensive volatile ApexHi unit

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APEXHI STRATEGY FOR 2007

• Concentrate on building income in the core
  portfolio

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APEXHI STRATEGY FOR 2007

• Focus on operating costs
• For the year ended 30 June 2006, costs were 26
  of revenue
• Depending on gross rentals and ability to save
  costs, 2007 operating costs range from 23 to
  26 of revenue

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APEXHI STRATEGY FOR 2007

• Grow the portfolio with revenue enhancing assets
• Our target is to grow the portfolio during the
  year by R1-billion
• The acquisitions will be revenue enhancing by 1

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APEXHI STRATEGY FOR 2007

• Property disposals
• Sell properties during the year to the value of
  R300-million
• Disposals will not be revenue-diluting or
  enhancing

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APEXHI STRATEGY FOR 2007

• Head office and company costs to remain stable

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APEXHI STRATEGY FOR 2007

• One off gains
• Every year there are one off profits eg
  Assessment rates refunds, lease cancellation
  fees, etc
• In the June 2006 report a profit of R15-million,
  arising from the repayment of a loan to Matemeku
  Property Acquisitions, is forecast
• Gains would be offset by unbudgeted expenses
  such as additional maintenance incurred across
  the portfolio

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APEXHI STRATEGY FOR 2007

• Interest on debt funding less interest on surplus
  cash
• Because ApexHi has fixed rates there should be no
  exposure to changing rates

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GOING FORWARD - SCENARIO 1

• The Bogey Scenario
• Income growth of 8
• Operating costs at 26 of income
• No acquisitions or disposals
• Head office costs maintained
• One off benefit of R15-million
• Interest cost stable

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GOING FORWARD - SCENARIO 2

• The Par Scenario
• Income growth of 9
• Operating costs at 24 of income
• R300-million acquisitions net of disposals
• Head office costs maintained
• One off benefit of R15-million
• Interest cost stable

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GOING FORWARD - SCENARIO 3

• The Birdie Scenario
• Income growth of 10
• Operating costs at 23 of income
• R700-million acquisitions net of disposals
• Head office costs maintained
• One off benefit of R15-million
• Interest cost stable

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INCOME STATEMENT 3 SCENARIOS
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BALANCE SHEET 3 SCENARIOS
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THANKS TO

• Broll Property Group
• Directors and staff of ApexHi
• Grant Thornton
• Java Capital
• Madison Property Fund Managers
• Ogilvy PR
• And to you, the investment community for your
  continued support!