INTEGRATED ANNUAL REPOR T - HCI – Hosken …

1 I N T E G R A T E D A N N U A L R E P O R T. HCI Properties KAROSHOEK. YEARS OF: ENDURANCE, PATIENCE. and SYSTEMATIC. GROWTH. CONTENTS. 2 Scope of INTEGRATED report and assurance 71 Directors' report 4 Letter to shareholders 73 Approval of ANNUAL financial statements 8 20 year timeline 73 Declaration by company secretary 10 20 year review 74 Summarised audited financial statements 13 Distribution of Value - 2017 Consolidated statement of financial position 14 Operating structure Consolidated income statement 16 Geographical footprint Reconciliation of headline earnings 18 Operational overview Consolidated statement of other comprehensive

2 Income 36 Shareholders' snapshot Consolidated statement of changes in equity 38 Board of directors Consolidated statement of cash flows 40 Corporate governance Segmental analysis 41 King IV - application register Notes to the summarised audited financial statements 47 report of the audit committee 83 Notice to members 49 report of the remuneration committee Corporate administration (inside back cover). 56 report of the social and ethics committee 57 Sustainability report 67 Corporate social investment Proxy form (inserted).

3 I N T E G R AT E D A N N U A L R E P O R T 2 017 H O S K E N C O N S O L I D AT E D I N V E S T M E N T S L I M I T E D 1. SCOPE OF INTEGRATED report . AND ASSURANCE. Reporting approach Grant Thornton Johannesburg Partnership;. We are pleased to present our INTEGRATED ANNUAL report The South African broad-based black economic to our stakeholders for the year ending 31 March 2017. empowerment information was verified by Empowerdex;. The report provides a review of the Group's financial, social and environmental performance on matters The groups governance principles in respect of King IV.

4 Material to the Group and those of interest to the Group's have been measured using the Governance Assessment key stakeholders. Instrument;. In line with the requirements of the King report on The carbon and water information was compiled with Corporate Governance, HCI is aiming for enhanced the assistance of Ibis Consulting;. SCOPE OF INTEGRATED report . reporting systems and measures so as to provide The sustainability information included in this report has increased value added information to stakeholders. been guided by the Greenhouse Gas Protocol and has Generally, detailed forward-looking information is not AND ASSURANCE.

5 Been disclosed to the Carbon Disclosure Programme. provided. The financial and other information has been prepared in accordance with the requirements of IFRS, Scope and boundaries the South African Companies Act 2008, the JSE Listings Requirements and the International <IR> framework as HCI is a publicly owned investment holding company listed applicable. on the JSE with a diverse investment base. The company has investments as reflected on pages 14 and 15 of this The group is continuously improving its combined INTEGRATED report .

6 Assurance model. Combined assurance is a work in progress and the group has, as yet, not achieved The Group operates principally in South Africa, and optimal coordination of the different forms of assurance. generates the majority of its revenue from South Africa. Assurance was provided for different aspects of our The geographical footprint of the group is provided on reporting from a variety of sources which include: pages 16 and 17 of the report . The ANNUAL financial statements and related financial The content of INTEGRATED report addresses material information was audited by independent auditors issues for all our subsidiaries, but does not extend to 2.

7 Cover all issues relating to subsidiaries and associates. ANNUAL financial statements, including the report from The scope limitation does not impact on the completeness the audit and risk committee and directors' report , are of the report as separate INTEGRATED ANNUAL reports for available online or can be requested directly from our the listed entities are published and can be found on company secretary at ; ; ;. and The report covers the Board approval period from 1 April 2016 to 31 March 2017 except where The board, assisted by the audit and risk committee, material transactions have occurred post year-end.

8 Is ultimately responsible for overseeing the preparation, In accordance with the stated objectives of INTEGRATED presentation and integrity of the INTEGRATED report . reporting, this report focuses on those issues that have The directors collectively reviewed the content of the a material impact on the Group to create and sustain INTEGRATED report and believe that it addresses the value. This report should be read in conjunction with material issues of the company and is a fair representation the following supporting reports available on our website of the INTEGRATED performance of the Group.

9 The board ; approved the report for release on the 30 August 2017. We welcome any feedback on the INTEGRATED report at Governance register ANNUAL financial statements Forward-looking statements The notice of the ANNUAL general meeting, proxy form and This REPOR t contains cer tain for ward-looking other administrative information also form part of the statements which relate to the financial position report and can be found on pages 83 to 88. and results of the operations of the Group and its Financial statements underlying investments.

10 These statements by their nature involve risk and uncer tainty as they relate to We have provided summarised financial statements in the events and depend on circumstances that may occur INTEGRATED report , which includes an executive review of our in the future. These for ward looking statements have performance, as published on SENS and in the Business not been reviewed or REPOR ted on by the Group's Day on 25th May 2017. The full set of consolidated independent auditors. I N T E G R AT E D A N N U A L R E P O R T 2 017 H O S K E N C O N S O L I D AT E D I N V E S T M E N T S L I M I T E D 3.