THE FOSCHINI GROUP LIMITED CONSOLIDATED …

1 THE FOSCHINI GROUP LIMITEDCONSOLIDATED annual financial STATEMENTS The reports and statements set out below comprise the CONSOLIDATED annual financial statements presented to the shareholders: Directors responsibility for and approval of the CONSOLIDATED annual financial statements1 Directors report 2 4 Company Secretary s certificate 5 Board audit committee report6 11 Independent auditor s report12 13 CONSOLIDATED statement of financial position14 CONSOLIDATED income statement15 CONSOLIDATED statement of comprehensive income16 CONSOLIDATED statement of changes in equity17 18 CONSOLIDATED cash flow statement19 CONSOLIDATED segmental analysis20 23 Notes to the financial statements24 85 Appendix 1: Company financial statements*86 89 Appendix 2: Shareholdings*90 91 Appendix 3.

2 Definitions*92 Administration and shareholders calendar*IBCT hese CONSOLIDATED financial statements represent the financial information of The FOSCHINI GROUP LIMITED and were audited in compliance with section 30 of the Companies Act, No. 71 of 2008. These financial statements were prepared by the TFG Finance and Advisory department of The FOSCHINI GROUP LIMITED , acting under supervision of Anthony Thunstr m CA(SA), CFO of The FOSCHINI GROUP LIMITED . These statements were authorised by the board of directors on 29 June 2016 and published on 18 July 2016.* The supplementary information presented does not form part of the financial statements and is CONSOLIDATED annual financial STATEMENTS 2016 RESPONSIBILITY FOR AND APPROVAL OF THE CONSOLIDATED annual financial STATEMENTSFOR THE YEAR ENDED 31 MARCH 2016 The directors are responsible for the preparation and fair presentation of the CONSOLIDATED annual financial statements of The FOSCHINI GROUP LIMITED , comprising the statement of financial position at 31 March 2016, and the income statement and the statements of comprehensive income, changes in equity and cash flows for the year then ended.

3 And the CONSOLIDATED segmental analysis and the notes to the financial statements which includes a summary of significant accounting policies and other explanatory notes, in accordance with International financial Reporting Standards and the requirements of the Companies Act of South Africa, and the directors report. The directors are also responsible for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and for maintaining adequate accounting records and an effective system of risk management as well as the preparation of the supplementary schedules included in these financial directors have made an assessment of the ability of the company and its subsidiaries to continue as going concerns and have no reason to believe that the businesses will not be going concerns in the foreseeable auditor is responsible for reporting on whether the CONSOLIDATED financial statements are fairly presented in accordance with the applicable financial reporting framework.

4 APPROVAL OF CONSOLIDATED annual financial STATEMENTSThe CONSOLIDATED annual financial statements of The FOSCHINI GROUP LIMITED , as identified in the first paragraph, were approved by the board of directors on 29 June 2016 and signed by: M Lewis A D Murray Chairman Chief Executive Officer Authorised director Authorised director TFG CONSOLIDATED annual financial STATEMENTS 2016 OF ACTIVITIES Nature of business The FOSCHINI GROUP LIMITED (TFG) is an investment holding company whose subsidiaries, through their retail brands @home, @homelivingspace, American Swiss, Charles & Keith, Colette (newly acquired refer to note 42), DonnaClaire, Duesouth, Exact, Fabiani, The FIX (previously Fashion Express), FOSCHINI , G-Star Raw, hi, Markham, Mat & May, Next (new franchise agreement), Phase Eight, SODA Bloc, Sportscene, Sterns, Totalsports and Whistles (newly acquired refer to note 42)

5 Retail clothing, jewellery, cellphones, accessories, cosmetics, sporting and outdoor apparel and equipment, and homeware and furniture across diverse LSM groupings from value to upper-end consumers internationally. The GROUP operates predominantly within the South African Common Monetary Area. Retail turnover emanating from Botswana, Nigeria, Zambia and Ghana accounts for 1,7% of the GROUP s turnover, while the remaining international turnover emanating from Phase Eight accounts for 17,1% of the GROUP 's turnover. Dress Holdco A LIMITED is the ultimate United Kingdom (UK) holding company of Phase Eight and Whistles. Phase Eight and Whistles operate through retail outlets throughout the UK and internationally, as well as online.

6 GENERAL REVIEWThe financial results are reflected in the annual financial statements on pages 14 to 89. The analysis of shareholdings and definitions are contained in the appendices on pages 90 to AND ISSUED SHARE CAPITALThe GROUP s share buy-back programme commenced at the end of May 2001. At 31 March 2016, 1,0 (2015: 1,0) million shares are owned by a subsidiary of the company, 2,5 (2015: 2,3) million shares are held by employees of TFG in terms of share incentive schemes and 2,5 (2015: 2,3) million shares are owned by the share incentive trust. These were eliminated on consolidation. For further details of authorised and issued share capital and treasury shares, refer to notes 11 and 12.

7 On 20 July 2015, 2,2 million fully paid-up ordinary shares were issued to ordinary shareholders by way of a scrip distribution increasing the total shares in issue from 211 005 054 shares to 213 171 190 shares. On 18 January 2016, a further 2,2 million fully paid-up ordinary shares were issued to ordinary shareholders by way of a scrip distribution increasing the total shares in issue from 213 171 190 shares to 215 350 885 ordinary The directors declared an interim scrip distribution with a cash dividend alternative of 306,0 (2015: 263,0) cents per ordinary share, which was paid on Monday, 18 January 2016, to ordinary shareholders recorded in the books of the company at the close of business on Friday, 15 January 2016.

8 Final ordinary The directors declared a final scrip distribution with a cash dividend alternative of 385,0 (2015: 325,0) cents per ordinary share, payable on Monday, 25 July 2016, to ordinary shareholders recorded in the books of the company at the close of business on Friday, 22 July 2016. Preference The company paid the following dividends to holders of 6,5% cumulative preference shares: 21 September 2015 R13 000 (22 September 2014 R13 000) 22 March 2016 R13 000 (23 March 2015 R13 000) DIRECTORS REPORTFOR THE YEAR ENDED 31 MARCH 2016 TFG CONSOLIDATED annual financial STATEMENTS 2016 names of the company s directors at the year end are: Independent non-executive directors M Lewis (Chairman)*Prof F Abrahams S E Abrahams G H Davin*D Friedland B L M Makgabo-FiskerstrandE Oblowitz N V SimamaneNon-executive director R Stein*Executive directors A D Murray (CEO) A E Thunstr m (CFO)*Changes to directors in the current financial year* Mr M Lewis was appointed as Deputy Chairman on 28 May 2015 and as Chairman on 19 June 2015.

9 Mr D M Nurek resigned from the board on 19 June 2015. Mr P S Meiring retired at the end of June 2015 and resigned from the board. Mr R Stein retired as an executive director at the end of June 2015 and remains on the board in a non-executive capacity. On 1 July 2015, Mr A E Thunstr m was appointed as CFO and as an executive director. On 5 November 2015, Mr G H Davin was appointed as an independent non-executive director. The following directors retire by rotation in terms of the memorandum of incorporation (MOI) but, being eligible, offer themselves for re-election as directors: M LewisProf F Abrahams S E AbrahamsIn addition, Mr G H Davin will be proposed for re-election as an independent non-executive details of directors interests in the company s issued shares, refer to note 11.

10 Details of directors remuneration are set out in note 34. AUDIT COMMITTEEThe directors confirm that the audit committee addressed the specific responsibilities required in terms of section 94(7) of the Companies Act, No. 71 of 2008. Further details are contained within the board audit committee report. SUBSIDIARIES The names of, and certain financial information relating to, the company s key subsidiaries appear in note 2 of the company financial statements. TFG CONSOLIDATED annual financial STATEMENTS 2016 RESOLUTIONSOn 1 September 2015, shareholders approved the remuneration to be paid to non-executive directors for the period 1 October 2015 to 30 September 2016 and, in order to align the fee increase date with the annual general meeting, moved the fee increase date from 1 April to 1 October.