Updated trading statement LIFE HEALTHCARE GROUP HOLDINGS LIMITED (Incorporated in the Republic of South Africa) (Registration number: 2003/002733/06) ISIN: ZAE000145892 Share Code: LHC (“Life” or “the Group”) UPDATED TRADING STATEMENT Further to the announcement released on the Stock Exchange News Service (“SENS”) of the JSE Limited on 5 April 2017, and leading up to the interim results release on or around 12 May 2017, the Company is able to provide additional clarity on the estimated results for the six months ended 31 March 2017. Shareholders are therefore advised that the previously estimated reversal of contingent consideration (income) related to the acquisition of Alliance Medical of between R180 million – R220 million will change to an estimated expense of R12million – R20million as a result of Alliance Medical performing better than anticipated and signing six Community Diagnostic Centre contracts, two more than the initial estimate of four contracts. This will result in an estimated GBP21 million of the contingent consideration being payable. The fair value of the GBP40 million contingent consideration at acquisition was estimated at GBP20 million. The final amount will be subject to audit and is a non- trading related item. The Group updated estimated results for the six months ended 31 March 2017 are as follows: Measure Estimated Six months Estimated Six months Six months Note Range ended 31 Range ended 31 ended 31 March 2017 March 2017 March 2016 As communicated Updated 5 April 2017 Normalised EBITDA +11% to R2 330m to +13.5% to R2 382m to R2 099m 1 +15% R2 414m +17.5% R2 466m Earnings per share (cents) -60% to -70% 37.2 to 27.9 -80% to -90% 18.6 to 9.3 93.0 2 Headline earnings per share -50% to -60% 46.5 to 37.2 -70% to -75% 27.9 to 23.3 93.0 2 (cents) Notes: 1. Normalised EBITDA is the primary measure the Group uses to assess underlying financial performance. The impact of the acquisition and the trading of Southern Africa and Poland resulted in an increase in Normalised EBITDA of between 13.5% to 17.5% (previously estimated to be 11% to 15% higher). - Normalised EBITDA for the Southern Africa operations will be between 1.5% to 2.5% below last year (previously estimated to be 2.5% to 3.5% lower) primarily due to the lower trading in the Southern Africa operations and the impact of the loss of the Gauteng Mental Health contract in the healthcare services division in July 2016. - Alliance Medical has performed to Life Healthcare’s expectations. The business has performed well against the comparative period with normalised EBITDA up between 4.5% to 5.5% on a constant currency basis. 2. Earnings per share (“EPS”) and Headline earnings per share (“HEPS”) are below the comparative period last year primarily due to the impact of the acquisition of Alliance Medical and once off items related to the investment in Poland. The impact of these once off non- trading related items are: Relating to the Alliance Medical acquisition: - Transaction costs relating to the acquisition are estimated to be between R240m – R260m; - Interest costs related to the acquisition funding are estimated to be between R370m – R390m for the period. Debt funding of approximately R9 billion has been repaid in April 2017 from the equity raised as part of the rights offer and will reduce the interest cost going forward correspondingly; - The additional contingent consideration expense related to the acquisition of Alliance Medical is estimated to be between R12m – R20m; Relating to the Poland investment: - A further impairment required in Poland of up to R150m as a result of the additional reduction in tariffs in cardiology from 1 January 2017; and - The release of contingent consideration relating to the Poland business in the comparative period last year has not reoccurred during the six months ended 31 March 2017. Headline earnings per share for the six months ended 31 March 2017 will also be impacted by the updated contingent consideration and is estimated to be between 23.3 cps and 27.9 cps, a movement of between a decline of 75% and 70.0% below the headline earnings per share for the six months ended 31 March 2016 of 93.0 cps. The financial information on which this trading update is based has not been reviewed and reported on by the Company’s external auditors. The Company expects to release its interim financial results for the six months ended 31 March 2017 on SENS on or about 12 May 2017. Illovo Wednesday, 3 May 2017 Sponsor RAND MERCHANT BANK (A division of FirstRand Bank Limited) Date: 03/05/2017 09:53:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.