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ATTACQ LIMITED - Summarised provisional consolidated financial statements for the year ended 30 June 2017

Release Date: 12/09/2017 09:06
Code(s): ATT     PDF:  
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Summarised provisional consolidated financial statements for the year ended 30 June 2017

Attacq Limited
(Incorporated in the Republic of South Africa)
(Registration number 1997/000543/06)
JSE share code: ATT ISIN: ZAE000177218
("Attacq" or "the Company" or "the Group")

SUMMARISED PROVISIONAL CONSOLIDATED FINANCIAL RESULTS
for the year ended 30 June 2017

Summarised consolidated statement of financial position

                                                                                         Audited      Audited   
                                                                                         30 June      30 June   
                                                                                            2017         2016   
                                                                                           R'000        R'000   
ASSETS                                                                                                          
Non-current assets                                                                                              
Property, plant and equipment                                                             52 272       33 925   
Investment properties                                                                 19 735 365   18 043 192   
  Per valuation                                                                       20 536 861   18 644 041   
  Straight-line lease debtor                                                           (801 496)    (600 849)   
Straight-line lease debtor                                                               801 496      600 849   
Deferred initial lease expenditure                                                         7 666        6 539   
Intangible assets                                                                        290 539      312 599   
Goodwill                                                                                  67 774       67 774   
Investment in associates and joint ventures                                            3 153 392    3 126 328   
Other financial assets                                                                   304 368      222 651   
Other investments                                                                         11 941      408 339   
Deferred tax assets                                                                        3 329       24 627   
Total non-current assets                                                              24 428 142   22 846 823   
Current assets                                                                                                  
Taxation receivable                                                                          951        2 411   
Trade and other receivables                                                              174 623      290 579   
Inventory                                                                                 25 278            -   
Loans to associates and joint ventures                                                 1 250 278    2 302 472   
Other financial assets                                                                   193 590      100 266   
Cash and cash equivalents                                                                447 846      437 281   
Total current assets                                                                   2 092 566    3 133 009   
Non-current assets held for sale                                                         801 483    1 649 845   
Total assets                                                                          27 322 191   27 629 677   
EQUITY AND LIABILITIES                                                                                          
Equity                                                                                                          
Stated capital                                                                         6 456 633    6 442 805   
Distributable reserves                                                                 6 945 483    5 891 513   
Available-for-sale reserve                                                               282 329      847 499   
Share-based payment reserve                                                              128 216      100 453   
Foreign currency translation reserve                                                     238 254      318 734   
Acquisition of non-controlling interests reserve                                       (104 215)    (116 483)   
Equity attributable to owners of the holding company                                  13 946 700   13 484 521   
Non-controlling interests                                                               (43 087)     (13 201)   
Total equity                                                                          13 903 613   13 471 320                                 


                                                                                         Audited      Audited   
                                                                                         30 June      30 June   
                                                                                            2017         2016   
                                                                                           R'000        R'000   
Non-current liabilities                                                                                         
Long-term borrowings                                                                   7 976 110   10 445 221   
Deferred tax liabilities                                                               1 932 140    1 892 145   
Other financial liabilities                                                              164 696       50 705   
Cash settled share-based payments                                                          1 496          787   
Finance lease obligation                                                                  83 150       77 745   
Total non-current liabilities                                                         10 157 592   12 466 603   
Current liabilities                                                                                             
Other financial liabilities                                                              137 145      109 400   
Loans from associates                                                                          -        2 880   
Taxation payable                                                                           7 665        2 260   
Cash settled share-based payments                                                          1 684        5 172   
Trade and other payables                                                                 501 380      557 662   
Provisions                                                                                 2 777        2 081   
Short-term portion of long-term borrowings                                             2 279 802      265 276   
Total current liabilities                                                              2 930 453      944 731   
Liabilities directly associated with non-current assets held for sale                    330 533      747 023   
Total liabilities                                                                     13 418 578   14 158 357   
Total equity and liabilities                                                          27 322 191   27 629 677   
The following information does not form part of the statement of financial position                             
Net asset value per share (cents)                                                          1 984        1 923   
Net asset value per share adjusted for deferred tax (cents)                                2 259        2 189   


Summarised consolidated statement of comprehensive income

                                                                    Audited        Audited
                                                                    30 June        30 June
                                                                       2017           2016
                                                                      R'000          R'000
Gross revenue                                                     2 060 895      1 621 018
  Rental income                                                   1 861 093      1 472 656
  Straight-line lease income adjustment                             199 802        148 362
Property expenses                                                 (742 277)      (502 745)
Net rental income                                                 1 318 618      1 118 273
Other income                                                         60 463        448 579
Operating and other expenses                                      (585 730)      (347 315)
Operating profit                                                    793 351      1 219 537
Amortisation of intangible asset                                   (22 060)       (19 964)
Fair value adjustments                                              527 581      1 041 553
  Investment properties                                             664 525      1 074 224
  Other financial assets and liabilities                          (136 944)       (32 452)
  Other investments                                                       –          (219)
Gain on available-for-sale financial assets                               –        507 524
Net income from associates and joint ventures                       249 880         35 098
Investment income                                                   189 536        235 785
Finance costs                                                     (987 411)      (839 975)
Profit before taxation                                              750 877      2 179 558
Income tax expense                                                (150 599)      (794 559)
Profit for the year                                                 600 278      1 384 999
Attributable to: 
  Owners of the holding company                                     630 164      1 387 828
  Non-controlling interests                                        (29 886)        (2 829)
Other comprehensive loss 
Items that will be reclassified subsequently to profit and loss 
(Loss) gain on available-for-sale financial assets                (117 827)        315 813
Taxation relating to components of other comprehensive income      (11 269)         93 720
Realisation of available-for-sale financial assets                        –      (507 524)
Other comprehensive loss for the year net of taxation             (129 096)       (97 991)
Total comprehensive income for the year                             471 182      1 287 008
Attributable to:  
  Owners of the holding company                                     501 068      1 289 837
  Non-controlling interests                                        (29 886)        (2 829)
  
Earnings per share  
Basic (cents)                                                          89.7          197.9
Diluted (cents)                                                        89.0          196.7


Reconciliation between earnings and headline earnings
  
                                                                    Audited        Audited   
                                                                    30 June        30 June   
                                                                       2017           2016   
                                                                      R'000          R'000   
Profit for the year                                                 630 164      1 387 828   
Headline earnings adjustments                                     (468 558)    (1 303 490)   
Profit on disposal of associates                                   (35 695)      (116 734)   
Profit on disposal of other investments                                   –       (30 862)   
Profit on disposal of investment property                          (15 217)          (836)   
Impairment of associates and other investments                      244 540         53 880   
Realisation of available-for-sale financial assets                        –      (507 524)   
Impairment of intangible asset                                            –         11 960   
Fair value adjustments                                            (527 581)    (1 041 553)   
Net income from associates and joint ventures                     (249 880)       (35 099)   
Loss on disposal of subsidiary                                            –          6 033   
Tax effect of adjustments                                           123 110        369 517   
Non-controlling interests' share                                    (7 835)       (12 272)   
Headline earnings                                                   161 606         84 338   
Number of shares in issue*                                      702 815 224    701 395 224   
Weighted average number of shares in issue*                     702 389 882    701 388 667   
Diluted weighted average number of shares in issue*             708 079 085    705 418 136   
Headline earnings per share                                                                  
Basic (cents)                                                          23.0           12.0   
Diluted (cents)                                                        22.8           12.0   
*Adjusted for 46 427 553 treasury shares (2016: 46 427 553)                                  


Summarised consolidated statement of cash flows

                                                                    Audited        Audited
                                                                    30 June        30 June
                                                                       2017           2016
                                                                      R'000          R'000
Cash flow generated from operating activities                       124 022        140 551
  Cash generated from operations                                  1 033 295        837 693
  Investment income                                                 119 368        336 949
  Finance costs                                                   (934 930)      (839 975)
  Taxation paid                                                    (93 711)      (194 116)
Cash flow generated from (utilised in) investing activities         310 427    (1 166 362)
  Property, plant and equipment acquired                           (27 319)       (28 499)
  Property, plant and equipment disposed                                  –            180
  Investment properties acquired                                (1 098 009)    (2 586 047)
  Investment properties disposed                                     50 017        282 572
  Associates and joint ventures acquired                           (36 227)      (152 488)
  Associates and joint ventures disposed                            744 845        263 299
  Other investments acquired                                              –       (27 681)
  Other investments disposed                                              –         90 000
  Other financial assets (raised) repaid                          (175 041)        327 997
  Additions to deferred initial lease adjustments                   (4 845)        (6 401)
  Cash flow relating to non-current assets held for sale            857 006        670 706
Cash flow (utilised in) generated from financing activities       (423 884)        735 296
  Capital raised                                                     13 828          3 386
  Acquisition of additional interest in subsidiary                        –       (13 000)
  Long-term borrowings raised                                     2 355 304      4 944 286
  Long-term borrowings repaid                                   (3 254 770)    (2 672 714)
  Loans to associates and joint ventures repaid (advanced)          468 643    (1 477 314)
  Loans from associates repaid                                            –       (68 109)
  Payment of cash settled share-based payments                      (2 097)              –
  Other financial liabilities (repaid) raised                       (4 792)         18 761
Total cash movement for the year                                     10 565      (290 515)
Cash at the beginning of the year                                   437 281        727 796
Total cash at the end of the year                                   447 846        437 281

Summarised consolidated statement of changes in equity

                                                                                                  Acquisition
                                                                                                           of         Equity
                                                                           Share–       Foreign          non–   attributable
                                                           Available–       based      currency   controlling   to owners of          Non–
                                  Stated  Distributable      for–sale     payment   translation     interests    the holding   controlling        Total
                                 capital       reserves       reserve     reserve       reserve       reserve        company     interests       equity
                                   R'000          R'000         R'000       R'000         R'000         R'000          R'000         R'000        R'000
Audited balance at 1 July   
2015                           6 439 419      4 815 584       682 579      90 359        45 740     (116 483)     11 957 198         7 252   11 964 450
Total comprehensive income             –      1 387 828      (97 991)           –             –             –      1 289 837       (2 829)    1 287 008
  Profit for the year                  –      1 387 828             –           –             –             –      1 387 828       (2 829)    1 384 999
  Other comprehensive    
  loss                                 –              –      (97 991)           –             –             –       (97 991)             –     (97 991)
Foreign currency translation    
reserve                                –              –             –           –       431 306             –        431 306             –      431 306
Issue of shares                    3 386              –             –           –             –             –          3 386             –        3 386
Derecognition reserves and    
non-controlling interests due    
to sale of subsidiaries                –      (311 899)       262 911           –     (158 312)        13 000      (194 300)      (17 624)    (211 924)
Recognition of non-    
controlling interests reserve          –              –             –           –             –      (13 000)       (13 000)             –     (13 000)
Modification of equity-    
settled share based    
payments                               –              –             –     (9 035)             –             –        (9 035)             –      (9 035)
Recognition of share-based    
payment reserve                        –              –             –      19 129             –             –         19 129             –       19 129
Audited balance at 30 June    
2016                           6 442 805      5 891 513       847 499     100 453       318 734     (116 483)     13 484 521      (13 201)   13 471 320
Total comprehensive income             –        630 164     (129 096)           –             –             –        501 068      (29 886)      471 182
  Profit for the year                  –        630 164             –           –             –             –        630 164      (29 886)      600 278
  Other comprehensive    
  loss                                 –              –     (129 096)           –             –             –      (129 096)             –    (129 096)
Foreign currency translation    
reserve                                –              –             –           –      (80 480)             –       (80 480)             –     (80 480)
Issue of shares                   13 828              –             –           –             –             –         13 828             –       13 828
Derecognition reserves and     
non-controlling interests due     
to sale of subsidiaries                –        423 806     (436 074)           –             –        12 268              –             –            –
Recognition of share-based     
payment reserve                        –              –             –      27 763             –             –         27 763             –       27 763
Audited balance at 30 June   
2017                           6 456 633      6 945 483       282 329     128 216       238 254       (104 215)   13 946 700      (43 087)   13 903 613
 

Summarised segmental analysis

                                                              Audited                                                  Audited
                                                           30 June 2017                                             30 June 2016
                                                            Net
                                                        profit       Investment     Net asset                 Net profit    Investment   Net asset
                                           Revenue       (loss)      properties         value      Revenue        (loss)    properties       value
Business segment                Notes        R'000        R'000           R'000         R'000        R'000         R'000         R'000       R'000
Brooklyn Bridge Office Park         1       79 533     (53 539)         525 735       219 475       80 683         4 472       636 999     308 217
Great Westerford*                   2            –           –                –             –       33 904        10 792             –           –
Lynnwood Bridge – Offices                  112 685       47 979         859 473       499 341      100 565        39 666       825 629     483 448
Aurecon Building                            99 187       30 836         673 537       323 998       98 556        26 705       662 560     281 201
Newtown Junction – Offices                  80 955       23 285         645 869       110 873       68 852       (1 024)       626 693     196 487
Majestic Offices                            19 460        9 217         132 940        30 057       21 136       (1 652)       132 510      29 687
PwC Sunninghill                             45 861     (56 121)         289 735      (89 150)       45 533       (2 154)       345 199    (44 001)
Waterfall – Altech Building*       3         1 097        3 617               –             –        6 431         4 546        43 944      29 991
Waterfall – Cell C Campus                  127 477       71 078         831 089       968 462      135 372        65 671       794 486     396 015
Waterfall – Group Five                      77 940       48 068         595 727       307 999       71 570        36 430       562 318     238 546
Waterfall – Maxwell Office
Park*                                       59 250       32 420         525 062       309 287       43 170        37 334       486 240     290 359
Waterfall – Novartis                        28 199       10 779         220 259       103 109       25 247         9 443       207 963      63 930
Waterfall – Allandale Building              27 696       42 937         414 839       180 544            –             –             –           –
Office and mixed–use                       759 340      210 556       5 714 265     2 963 995      731 019       230 229     5 324 541   2 273 880
Glenfair Boulevard Shopping
Centre                                      58 124       32 851         455 501       259 152       56 849        27 256       419 044     222 217
Lynnwood Bridge – Retail                    47 453        8 212         346 552       200 051       44 858        21 616       335 267     175 244
Newtown Junction – Retail                   81 525     (46 696)         601 929        20 060       83 465      (40 331)       637 826    (56 580)
Garden Route Mall                          152 651       48 329       1 318 172       641 973      139 701        56 848     1 247 711     502 504
Brooklyn Mall #                             77 300     (10 903)         736 390       347 850       75 601        49 971       740 972     330 398
MooiRivier Mall                            122 731       15 284       1 128 318       526 456      119 751        51 998     1 106 356     459 450
Eikestad Mall Precinct^                    109 939       31 157         838 609       415 054      104 153        63 512       851 983     380 957
Waterfall – Mall of Africa^                444 953      327 184       4 138 982     2 737 350       79 675       528 840     3 730 216   2 125 461
Waterfall – Waterfall Corner                30 378      (1 126)         212 747       217 483       29 268        18 503       204 741     136 623
Waterfall – Waterfall Lifestyle             21 143        5 772         119 183        49 634       21 142           464       116 153      40 125
Retail                                   1 146 197      410 064       9 896 383     5 415 063      754 463       778 677     9 390 269   4 316 399
Waterfall – Angel Shack            3             –            –               –             –        2 587         3 546        36 692      27 505
Waterfall – Medtronic              3             –            –               –             –        9 434        11 741       137 800      55 670
Waterfall – Cummins*               3             –            –               –             –        9 074         9 187        94 740      34 339
Waterfall – Dräger                 3             –            –               –             –        5 663         1 626        75 294      31 073
Waterfall – Massbuild                       39 010       21 817         283 776       117 382       39 793        16 486       256 380      87 619
Waterfall – Torre                           13 139       21 477         129 905        59 099            –             –             –           –
Waterfall – Dimension Data                   9 258       14 255          85 581        27 917            –             –             –           –
Waterfall – Amrod                           26 143       36 029         370 869       100 136            –             –             –           –
Waterfall – Westcon                3             –            –               –             –        8 718         2 990       106 068      39 501
Waterfall – Hilti                  3             –            –               –             –        4 591         3 148        59 276      28 978
Waterfall – Servest                3             –            –               –             –       11 999        12 581       157 013      69 180
Waterfall – Stryker                3             –            –               –             –        4 511         2 820        61 314      24 896
Light industrial                            87 550       93 578         870 131       304 534       96 370        64 125       984 577     398 761
Newtown Junction – City 
Lodge                                       14 195        3 411         110 701        26 298        5 298        11 894       109 484      23 015
Lynnwood Bridge – City 
Lodge                                       24 560       13 737         191 466       111 887       21 042        14 089       180 838      91 234
Waterfall – City Lodge                      13 935       11 182         105 073        58 817       12 897       (1 858)        94 526      44 980
Hotel                                       52 690       28 330         407 240       197 002       39 237        24 125       384 848     159 229


                                                            Audited                                                   Audited
                                                          30 June 2017                                             30 June 2016
                                                            Net
                                                        profit       Investment     Net asset                 Net profit    Investment   Net asset
                                           Revenue       (loss)      properties         value      Revenue        (loss)    properties       value
Business segment               Notes         R'000        R'000           R'000         R'000        R'000         R'000         R'000       R'000
Le Chateau                                       –          (4)           5 000         2 752            –      (12 004)         5 000       2 753
Waterfall – Development 
rights                             4             –     (50 862)       1 081 968     1 081 968            –     (178 510)     1 174 018   1 174 022
Waterfall – Infrastructure and    
services                           4             –      (7 229)         737 172       713 619            –      (24 502)     1 115 750     832 447
Vacant land                                      –     (58 095)       1 824 140     1 798 339            –     (215 016)     2 294 768   2 009 222
Waterfall – PwC Tower and 
PwC Annex~                                       –       28 562       1 027 098       236 553            –        13 106       463 401     170 114
Waterfall – Gateway West                         –        4 348         291 787       275 073            –             –             –           –
Waterfall – K101 warehouse                       –        7 443          45 609        23 576            –             –             –           –
Waterfall – BMW                                  –       13 709         206 448       178 568            –             –             –           –
Waterfall – Waterfall Point                      –        (143)               –        25 278            –             –             –           –
Waterfall – Corporate 
Campus                                           –        2 756          28 024        20 481            –             –             –           –
Newtown – Carr Street              3             –            –               –             –            –             –        27 577      27 418
Waterfall – Allandale Building                   –            –               –             –            –        52 542       322 095     242 397
Waterfall – Torre Industries                     –            –               –             –            –         7 003        78 301      50 108
Waterfall – Amrod                                –            –               –             –            –        12 490       261 942     131 537
Waterfall – Dimension Data                       –            –               –             –            –         4 879        59 345      34 868
Developments under  
construction                                     –       56 675       1 598 966       759 529            –        90 020     1 212 661     656 442
MAS Real Estate Inc.                             –      106 014               –     2 729 308            –       192 968             –   2 722 460
Atterbury Cyprus Limited           3             –       32 866               –             –            –       124 060             –     891 980
Atterbury Africa Limited                         –    (104 971)               –     (121 169)            –       (1 685)             –      13 380
Stenham European Shopping
Centre Fund Limited                              –    (142 104)               –       197 677            –        43 747             –     380 803
Atterbury Serbia B.V.              3             –        8 383               –             –            –         (557)             –      34 237
Gruppo Investment Nigeria   
Limited                                          –     (26 491)               –        86 976            –      (23 396)             –     324 751
Grove Mall of Namibia   
Proprietary Limited                              –       16 324               –       184 085            –        36 521             –     163 049
Bagapop Limited                    2             –            –               –             –            –       145 019             –           –
Other international                              –     (32 502)               –       143 889            –         5 633             –     104 369
International                                    –    (142 481)               –     3 220 766            –       522 310             –   4 635 029
Head office/other                           15 118    (127 445)               –     (755 615)         (71)     (207 462)             –   (977 642)
Total                                    2 060 895      471 182      20 311 125    13 903 613    1 621 018     1 287 008    19 591 664  13 471 320

Notes:
1. Held for sale at 30 June 2017.
2. Sold during the prior year.
3. Sold during the current year.
4. Portion held for sale at 30 June 2017.
Represents Attacq's undivided share in the property: *50%;#25%;^80%;~75%.

HIGHLIGHTS
- Announced revised strategy with planned conversion to a REIT from the 2019 financial year;
- Compounded annual growth rate based on net asset value per share ("NAVPS") adjusted for deferred tax ("Adjusted NAVPS")
  for three years ended 30 June 2017 of 11.95% and 28.31% since inception;
- Adjusted NAVPS growth for the current year of 3.2% to R22.59;
- Recycled R1.9 billion of capital;
- Group gearing ratio improved from 39.9% to 37.1%;
- First anniversary of the opening of the crown jewel, Mall of Africa on 28 April 2017;
- Cash generated from operations increased by 23.4% to R1.0 billion;
- Assumed full control of the Waterfall development pipeline with the internalised development team; and
- Fair market value of investment in MAS Real Estate Inc ("MAS") increased by 18.9% to R3.5 billion.

COMMENTARY

Introduction
Attacq's vision is to be the premier property company in South Africa with its unique value proposition being its Waterfall
development pipeline. This financial year was a year in which Attacq revisited its existing strategy, taking cognisance of lessons
learned and implementing a revised strategy with a more focused approach. The business model has been simplified, creating the
platform for future growth centred on Attacq's four value drivers. Attacq also took the next step in its journey with the announcement
of its planned conversion to a REIT. The revised strategy is focused on delivering both sustainable income distributions and
capital growth, through the four value drivers. The anticipated REIT conversion is subject to JSE approval and is targeted to be in
place for the financial year commencing 1 July 2018. The repositioning to achieve REIT status has commenced with the reduction
of debt from the proceeds received from the disposal of its Central and Eastern European investments, including the investment
in Stenham European Shopping Centre Fund Limited ("Stenham").

Attacq's value proposition has four key value drivers, namely its:
1.  Quality South African operational portfolio;
2. Strategic investment in MAS;
3. Waterfall development portfolio; and
4. Rest of Africa retail investments.

Performance
Notwithstanding the disappointing low growth in NAVPS caused mainly by a R243.2 million foreign exchange loss and
impairments of R220.0 million relating to the Rest of Africa assets and the Stenham investment, good progress was made in
disposing non-core assets and improving gearing levels. Attacq will continue to focus on maximising value creation from the four
value drivers to deliver capital and distribution growth.  

Net asset value ("NAV") and NAVPS
Adjusted NAVPS increased by 3.2% from R21.89 to R22.59, and NAVPS increased by 3.2% from R19.23 to R19.84.

Quality South African operational portfolio

Overview
Attacq has a high-quality operational portfolio of retail, commercial and industrial properties with a weighted average lease
expiry profile of 6.4 years (2016: 6.7 years). The value of the existing South African operational portfolio increased to R18.1 billion
(2016: R17.1 billion), comprising 66.1% (2016: 61.9%) of total gross assets. During the financial year, four newly developed buildings
totalling 70 914m2 primary gross lettable area ("PGLA") were added to the portfolio whilst eight industrial and one office
building were sold.

                                                                                                Practical         PGLA   Occupancy
Property                                                                     Sector       completion date         (m2)           %
Allandale Building                                                           Office           August 2016       15 359         >69
Dimension Data                                                           Industrial           August 2016        8 291         100
Torre Industries                                                         Industrial           August 2016        9 327         100
Amrod                                                                    Industrial         December 2016       37 937         100
Total                                                                                                           70 914         >93
Net rental income
Net rental income, which includes straight-line lease income adjustments, increased by 17.9% to R1.3 billion. A year-on-year
comparison of the net rental income is less meaningful, due to the four buildings that were completed during the current year
(2016: eight buildings) as well as the inclusion of the Mall's operational results for only two months in the previous financial year.
The Mall has created 4 000 permanent jobs and generated an average monthly trading density of 2 564 m2 during the financial
year, which is exceptional in the first year of trading of a regional mall.

Vacancies
Overall portfolio vacancies, measured in terms of PGLA, increased by 4 690 m2 when compared with vacancies at 30 June 2016. Subsequent to
year-end, 4 431 m2 of PGLA was let, reducing vacancies as a percentage of total PGLA to 2.4%. Vacancies that were filled post
year-end relate mainly to the Allandale Building, the Mall and Waterfall Corner. The remaining vacancies are mainly attributable to
Brooklyn Bridge Office Park, Newtown Junction and The Majestic. Attacq's industrial and hotel properties are fully tenanted. 

                                                                                  30 June 2017                     30 June 2016
                                                                                               Vacant                     Vacant
Sector                                                                       Vacancy %        PGLA m2     Vacancy %      PGLA m2
Retail                                                                             2.4          7 869           2.1        7 070
Office                                                                             5.0         13 094           4.0        9 203
Portfolio vacancy                                                                  3.0         20 963           2.4       16 273
Property expenses
Property expenses increased by 47.6% or R239.5 million to R742.3 million mainly due to the inclusion of the Mall's trading
activities for a full year as well as the four completed investment properties that were added to the portfolio. Municipal charges
of R423.9 million (2016: R323.4 million) are included in property expenses. The adjusted cost-to-income ratio on a gross basis
is 35.5% (2016: 34.1%) and 18.9% (2016: 14.6%) on a net basis. The cost-to-income ratios weakened mainly due to increased
marketing, cleaning, refurbishment and security costs.

Restructuring of Eikestad Precinct properties
Attacq entered into a sale agreement with the existing co-owner, Key Capital Property Holdings Proprietary Limited, in terms of
which Attacq sold a 20.0% undivided share in Andringa Walk for an amount of R37.0 million. The effective date of the transaction
was 1 July 2016. The transaction was concluded to create alignment within the entire Eikestad precinct with Attacq's local partner,
as well as to unlock further value from this dominant retail centre in the heart of Stellenbosch.

Disposals
Waterfall industrial properties – joint venture with Equites Property Fund Limited ("Equites")
Attacq and Equites have established a joint venture, EA Waterfall Logistics JV Proprietary Limited ("EAJV"), in respect of a
portfolio of eight industrial properties at Waterfall, effective from 1 July 2016. The following completed industrial properties
were transferred on 31 August 2016 into EAJV: Angel Shack, Cummins (50.0% undivided share), Dräger, Hilti, Medtronic, Servest,
Stryker and Westcon. Equites subscribed for an 80.0% shareholding in EAJV, for a subscription consideration of R292.7 million.
Attacq holds the remaining 20.0% of EAVJ which had an investment value of R91.4 million as at 30 June 2017. This partnership
aligns Attacq and Equites, a Cape Town-based industrial property focused company which has strong relationships within the
industrial sector.

Altech Building
The Altech Building, in which Attacq owned a 50.0% undivided share, was sold in June 2017 for a total consideration of
R101.0 million.

Strategic investment in MAS 

Overview
As at 30 June 2017, Attacq's effective shareholding in MAS was 30.6% down from 41.4% as at 30 June 2016, mainly due to a
capital raising undertaken by MAS in which Attacq did not participate. The market value of Attacq's investment, using the 30 June
2017 MAS share price of R23.50 (2016: R20.12) equates to R3.5 billion (R2.9 billion) representing an annual pre-tax capital growth
of 18.9%. During the financial year Attacq received a dividend of R105.3 million (2016: R101.2 million), representing a 3.6% income
return, based on the 30 June 2016 market value.

Attacq's equity accounted investment at 30 June 2017 is R2.7 billion (2016: R2.7 billion) which is unchanged from the previous year. 
The flat year-on- year result in Rand terms is a result of a 9.0% strengthening of the Rand against the Euro and MAS paying out total 
distributions of 4.9 Euro cents during the year, countered by an 8.0% increase in MAS NAVPS from 115.0 Euro cents per share to 125.4 
Euro cents per share.

The value of the MAS property portfolio benefited from fair value gains of Euro36.8 million during the year, largely attributed
to MAS' New Waverley development located in Edinburgh, Scotland. Phase I of the development, comprising three hotels and
21 retail units, was completed during the year and the 36 000m2 Phase II is underway following the securing of a 25-year UK
government lease for a 19 000m2 office which will introduce 3 500 office users to the node.

MAS' investment joint venture with Prime Kapital acquired three retail properties during the year, namely Nova Park (Gorzów,
Poland), Galeria Burgas (Burgas, Bulgaria) and Galeria Stara Zagora (Stara Zagora, Bulgaria), adding a total of 71 400 m2 GLA
to MAS' property portfolio. The joint venture intends to extract further value from these acquisitions by way of active asset
management and/or expansion possibilities.

The Prime Kapital development joint venture has exceeded MAS' initial expectations in terms of development opportunities
acquired and secured to date. The venture is now targeting developments in excess of Euro1 billion across the Central and Eastern
European region of which Euro665 million thereof has been secured. MAS has increased its commitment to the venture from
Euro200 million to up to Euro350 million in order to fund this pipeline. 

MAS has proposed paying a dividend of 3.19 Euro cents per share in respect of the six months to 30 June 2017. This would result
in a total distribution of 5.9 Euro cents per share in relation to the 2017 financial year, representing a 30.0% increase on the prior
year distribution. MAS remains on target to achieve its guidance of 30.0% annual growth in distributions through to 2019.

Waterfall development portfolio

Overview
Waterfall's location and ease of access create an attractive value proposition for continued development of a new city in the
centre of Gauteng. Attacq has approximately 1.0 million m2 (2016: 1.3 million m2) of remaining developable bulk in Waterfall. This
bulk is ungeared and 608 000 m2 is already serviced and immediately available for the value accretive roll out of commercial,
residential and industrial developments. 

The Waterfall development portfolio value increased to R3.6 billion (2016: R3.4 billion), comprising 13.0% (2016: 12.2%) of total
gross assets. The values below include non-current assets held for sale.

                                                                                                     30 June        30 June
                                                                                                       2017           2016
                                                                                                      R'000          R'000
Developments under construction                                                                    1 598 966      1 185 084
Development rights                                                                                 1 081 968      1 059 298
Infrastructure and services                                                                          737 172      1 111 772
Investment in Land Parcels 3 and 24                                                                  140 999              –
Vacant land                                                                                            5 000          5 000
Total                                                                                              3 564 105      3 361 154

Developments under construction  
The secured development pipeline, in various stages of progress, includes new regional headquarters for PwC, Deloitte as well as
the new BMW Group South Africa Regional Distribution Centre. 

As at 30 June 2017 the following properties were under development:

                                                                                         Anticipated       PGLA
Property                                                                   Sector    completion date      (m2)*   % Pre-let
Waterfall City                                                                                                          
PwC Tower and Annex~                                                       Office      February 2018     45 223         100
Gateway West                                                               Office        August 2017     13 405           –
Corporate Campus Phase 1+                                                  Office      November 2017      5 840         >50
Waterfall Logistics Hub                                                                                                 
BMW Group South Africa Regional Distribution Centre                    Industrial      November 2017     32 000         100
K101 warehouse                                                         Industrial     September 2017      8 523           –
Massbuild Extension                                                    Industrial      November 2017      9 770         100
Total                                                                                                   114 761         >78
*  Estimated PGLA for 100% of development. Subject to change upon final re-measurement post completion. 
~ Attacq has a 75% undivided share in the property.
+  Attacq has a 50% undivided share in the property.

Attacq's attributable share of the total of 114 761 m2 PGLA is 100 535 m2.

Development rights
Development rights relate to the contractual rights held by Attacq Waterfall Investment Company Proprietary Limited ("AWIC")
to develop certain Waterfall land parcels. These rights form a material element of the overall land valuation. In addition to the
1 million m2 of developable bulk referred to above, Attacq shares in the development rights relating to the two joint ventures
with Sanlam Properties, a division of Sanlam Life Insurance Limited ("Sanlam Properties"). As at 30 June 2017 the value of
Attacq's interest in these joint ventures was R141.0 million.

A maximum roll-out development period of 12 years was incorporated in the development rights valuation process.

Infrastructure and services
The reduced value of infrastructure and services is attributable to an allocation of related service costs incurred by developments
under construction. Whilst this asset currently generates no cash return, it creates the platform for future economic benefits from
top structure developments.

Development pipeline
Waterfall Corporate Campus Office Park – Land Parcel 10B
Attacq and Zenprop Property Holdings Proprietary Limited have established a 50/50 joint venture to develop the Corporate
Campus Office Park, with an approximate total development expense of R875.9 million. The Waterfall development comprises six
multi-tenanted office buildings with an estimated total PGLA of 34 000 m2. The first tenant has been secured and development of
phase I (5 840 m2 of PGLA) has commenced.

Mixed-use development with the Barrow Group – Land Parcel 10
Attacq and the Barrow Group have established a 50/50 joint venture to develop The Atria, a mixed-use precinct adjacent to the
Mall comprising three office buildings, one residential tower with approximately 120 rental apartments and a hotel. The hotel
development will be sold prior to the commencement of construction. The total development expense, for this 37 000 m2 GLA
precinct, is estimated at R981.5 million.

River Creek – Deloitte corporate consolidation
Attacq and Atterbury Property Holdings Proprietary Limited ("Atterbury") have established a 50/50 joint venture to develop
River Creek, a corporate consolidation for Deloitte in Waterfall City. The development on completion will comprise of a PGLA
of approximately 42 500 m2 allowing for occupation of 3 700 staff. The completion date is the first quarter of 2020 and the
estimated development expense is R1.3 billion.

Waterfall Point Office Park – Land Parcel 15
Waterfall Point is a P-grade sectional title office park which will be situated opposite Waterfall Corner along the R55 in
Waterfall. The office park will consist of four similar office buildings with a total PGLA of 9 584 m2. Conditional sale agreements
have been entered into for all four buildings. As this office park will be developed for disposal, the cost of R25.3 million assigned
to the development has been classified as inventory. 

Disposals
Waterfall Junction (Land Parcel 3 and 24) – two joint ventures with Sanlam Properties
Attacq disposed of, with an effective date of 1 July 2016, 15 000 m2 of its retail development rights on Land Parcel 3 to a separate
joint venture company with Sanlam Properties titled Waterfall JVCO 15 Proprietary Limited ("JV15"). JV15 also acquired the
remaining retail development rights on the same land parcel from a Mia affiliate company. JV15 is funded by the two shareholders
with Attacq's 30 June 2017 investment therein at R34.0 million. Attacq and Sanlam Properties each hold 50.0% in JV15.

Attacq, in addition, has disposed of its development rights in respect of Land Parcel 24, Waterfall, to a new joint venture
company, Waterfall JVCO 115 Proprietary Limited ("JV115"). The shareholding in JV115 is 20.0% held by Attacq and 80.0% by
Sanlam Properties. Attacq has an option to increase its shareholding in JV115 to 50.0%. As part of the transaction, JV115 acquired
additional light industrial development rights from a Mia affiliate company for R371.6 million. JV115 is funded by shareholders loans
with Attacq's 30 June 2017 investment at R103.7 million. After conclusion of the transaction, the total development rights in JV115
amount to 656 054 m2. The effective date of the transaction was 1 July 2016.

Attacq has been appointed development manager and asset manager for both of these joint ventures.

Rest of Africa retail investments

Overview
The value of Attacq's Rest of Africa retail investments was R1.2 billion (2016: R1.4 billion), comprising 4.5% (2016: 4.9%) of total
gross assets. The net reduction over the year was mainly due to Rand appreciation and further impairments.

Attacq's African investments are held via its:
- 25.0% shareholding in Gruppo Investment Nigeria Limited ("Gruppo"), the owner of Ikeja City Mall, located in Lagos, Nigeria;
- 31.8% shareholding in AttAfrica Limited ("AttAfrica"), which is invested in five retail properties in Ghana and Zambia; and
- 25.0% interest in Grove Mall of Namibia Proprietary Limited ("Grove Mall"), owner of The Grove Mall of Namibia.

As at 30 June 2017, the Group's investment into Gruppo totalled R286.5 million (2016: R326.7 million) and its investment in
AttAfrica, through its shareholder loan, amounted to R776.2 million (2016: R877.4 million). As a result of the unfavourable
trading and economic conditions, impairments totalling R103.5 million (2016: R80.3 million) have been recognised in the current
year. Currently Attacq is not receiving distributions from AttAfrica, in light of the unfavourable trading and macro-economic
conditions as well as the structure of Attacq's investment in AttAfrica.

In the 2017 financial year, sub-Saharan Africa's economies were characterised by poor economic and operating conditions on
the back of weak commodity prices, volatile exchange rates and rising local interest rates. Nigeria in particular experienced
significant economic pressures due to continued low global oil prices, a lack of USD liquidity and high inflation. This environment
placed severe pressure on tenants and consumers. The second half of the year saw some improvement in macro-economic
conditions. Nigeria's USD liquidity improved during the third quarter of the financial year due to rising oil revenues and a more
accommodative foreign exchange policy. Zambia's economy benefited from rising copper prices and improved rainfall; whilst in
Ghana, improved conditions have allowed for interest rate cuts which will assist consumers going forward. 

During the year the construction of Kumasi City Mall located in Kumasi, Ghana, was completed. The mall opened on 20 April 2017.

Management continues to focus on asset management activities in order to optimise net income and value. It is noted that a
liquidity event in early 2020 is provided for in the AttAfrica shareholders' agreement giving Attacq an opportunity to realise its
investment and redeploy the proceeds.

The value of Attacq's 25.0% shareholding in Grove Mall has increased by 16.2% to R151.3 million (2016: R130.3 million).

At 30 June 2017, the retail properties in which Attacq has an interest together with the vacancy percentages were as follows:

                                                                                           Attacq's
                                                                                          effective
  Property                           Location       Owner      PGLA (m2)    Vacancy %    interest %
Manda Hill Mall                Lusaka, Zambia     AttAfrica       40 561          5.4          15.9
Accra Mall                       Accra, Ghana     AttAfrica      21 349            –          15.0
West Hills Mall                  Accra, Ghana     AttAfrica      27 560          5.3          14.3
Achimota Retail Centre           Accra, Ghana     AttAfrica       15 006          6.1          23.9
Kumasi City Mall                Kumasi, Ghana     AttAfrica       17 948         26.5          23.9
Ikea City Mall                 Lagos, Nigeria        Gruppo      22 223           –         25.0 
The Grove Mall of Namibia   Windhoek, Namibia    Grove Mall       52 809          0.5          25.0

Financial position
Investment properties

As per the table below, investment properties increased by 9.4% to R 19.7 billion representing 72.2% (2016:65.3%) of the total
gross assets of the Group. The information below excludes investment properties disclosed as non-current assets held for sale.
 
                                      30 June         30 June
                                        2017            2016
                                       R'000           R'000
Completed buildings                17 163 784      15 282 887
Developments under construction     1 598 966       1 185 084
Development rights                  1 058 236       1 059 298
Infrastructure and services           710 875       1 111 772
Vacant land                             5 000           5 000
Per valuation                      20 536 861      18 644 041
Straight-line lease debtor          (801 496)       (600 849)
Total                              19 735 365      18 043 192

Investments in and loans to associates

Atterbury Serbia B.V. ("Atterbury Serbia")
On 12 August 2016, Attacq invested a further R100.3 million into Atterbury Serbia to part fund Atterbury Serbia's increase in
shareholding in BreAtt B.V. ("BreAtt") from 33.0% to 50.0%. Attacq's effective shareholding in BreAtt increased from 8.3% to
12.5% at this time. On 27 January 2017, Attacq invested R23.8 million to fund its share of the purchase price of Borca Shopping
Centre, adding a seventh retail property to BreAtt's portfolio, including Serbia's largest mall Ušce Shopping Centre, located in
Belgrade.

Disposal of investments in Atterbury Serbia and Atterbury Cyprus Limited ("Atterbury Cyprus")
Subsequent to the abovementioned transactions and following a strategic review, the Board resolved to reduce Attacq's exposure
to international assets by disposing of Atterbury Serbia and Atterbury Cyprus and in turn focus on MAS as Attacq's primary entry
point into Europe. As a result, Attacq disposed of its shareholdings and loan accounts in Atterbury Cyprus and Atterbury Serbia
to Atterbury Europe B.V. ("Atterbury Europe") for an aggregate consideration of Euro93.0 million, realising R1.4 billion in cash.

Artisan Development Partners Limited ("ADP")
During the financial year, Attacq invested a total of R118.4 million into ADP for investments into three UK-based development
opportunities located in Kent, England and Edinburgh and Glasgow in Scotland. ADP's investment focus is on acquiring
properties and land for re-zoning and development. The total investment value at year-end was R134.0 million (2016:
R40.6 million).

No further investments will be made into APD taking into account Attacq's strategic focus on MAS as its primary European
investment vehicle. 

Other financial assets
Other financial assets comprise mainly of loan accounts provided to Atterbury and the 25.0% partner in the new PwC Tower
development. 

The Atterbury loan relates to the acquisition of their 20.0% undivided share in the Mall. The amount due by Atterbury in respect
of 18.8% of the Mall was settled on completion of the Mall, with the balance of 1.2% to be settled based on the 30 June 2017 fair
market value of the Mall, as determined by an external independent valuer. This loan, with a 30 June 2017 outstanding balance of
R65.5 million (2016: R62.6 million), has been settled post year-end.

The loan of R243.1 million (2016: R86.1 million) provided to the PwC Tower development partner has similar terms and conditions
to the debt raised by AWIC in respect of the PwC Tower development.

Non-current assets held for sale
As at 30 June 2017 the following assets were classified as non-current assets held for sale:

The Atria development
The Group classified 50.0% of the development rights as well as infrastructure and service costs relating to the mixed-use Atria
development as held for sale. The 30 June 2017 value is R50.0 million.

Brooklyn Bridge Office Park
Management no longer considers the R553.0 million (2016: R637.0 million) Brooklyn Bridge Office Park to be a core asset, resulting
in the active intention to dispose of the asset. The value has decreased substantially, year on year, due to the impact of an
anticipated vacancy in May 2018.  

Stenham European Shopping Centre Fund Limited ("Stenham")
The 19.9% interest in Stenham, the owner of the Nova Eventis regional shopping centre in Leipzig, Germany is recognised at a
value of R197.7 million (2016: R380.8 million). This investment was included in other investment in the previous financial year.

Following a protracted disposal process, Stenham concluded a conditional agreement to dispose of the intermediary holding
company which owns Nova Eventis at net asset value determined with reference to a valuation of Euro208.5 million for the
shopping centre. Consequently, included in the results for this financial year, relating to Stenham, is a pre-tax negative fair value
adjustment of R116.6 million.

Subsequent to year end, merger clearance from the European Commission and shareholder approval has been obtained,
following which the disposal was implemented and more than 95.0% of the expected proceeds of R197.7 million have been
received with the balance to follow in October 2017 and July 2018.

Borrowings
Total interest-bearing borrowings net of cash decreased by 8.0%, compared to 30 June 2016 (2016: 30.2% increase compared
to 2015) mainly due to a portion of the proceeds (R582.6 million) from the sale of Atterbury Cyprus and Atterbury Serbia being
used to reduce debt. Subsequent to year end, the balance of the proceeds amounting to R737.4 million was applied against debt.

Gearing, calculated as total interest-bearing debt less cash on hand as a percentage of total assets, improved from 39.9% as at
30 June 2016 to 37.1% as at 30 June 2017. In order to mitigate interest rate risk, as at 30 June 2017, approximately R10.9 billion
(2016: R11.0 billion) or 90.8% (2016: 79.5%) of total committed facilities of R12.0 billion (2016: R13.8 billion) were hedged by way
of fixed interest rate loans and interest rate swaps. This is well in excess of the 70.0% minimum interest rate hedging policy set by
the Attacq Board. The weighted average cost of funding remained flat over the last 12 months at 9.2% (2016: 9.2%).

Approximately 24.7% or R2.6 billion of the Group's interest-bearing debt is due for repayment over the next 12 months including
R330.5 million relating to non-current assets held for sale. An amount of R378.9 million of the R2.6 billion was settled after year
end. Funding of R1.6 billion, which is included in the short-term portion, relates to 50.0% of the total senior debt provided to the
Attacq Retail Fund Proprietary Limited and Lynnwood Bridge Office Park Proprietary Limited portfolios during May 2015. The
maturity date of this funding is May 2018 and in this regard attractive refinance proposals from existing lenders, as well as new
lenders looking to establish funding relationships with the Group, have been received. The funding team are finalising allocations
in this regard.  

Financial performance
Profit for the year reduced by R784.7 million or 56.7% mainly due to the strengthening of the Rand, reduction in other income and fair 
value adjustments as well as the once off realisation of the MAS agterskot of R479.8 million in the previous year.

Other income
Other income reduced from 2016's R448.6 million to R60.5 million due to a stronger Rand and once off  disposal profits which were included 
in 2016. The material decrease is due to the fact that the previous year included unrealised foreign exchange gains of R211.6 million, 
a R145.0 million profit on the disposal of the interest in Bagaprop Limited and Mall of Mauritius at Bagatelle Limited, a R44.0 million 
profit on the disposal of MAS shares and a R33.3m profit on the disposal of Attacq's 10.0% shareholding in Atterbury.

Operating and other expenses
Operating and other expenses consists of operating expenses of R159.6 million (2016: R139.5 million) and other expenses of R426.1 million 
(2016: R207.8 million).

The material increase in other expenses is primarily attributed to the Stenham impairment of R116.6 million, the AttAfrica impairment of 
R82.8 million (2016: R58.3 million), a R20.6 million (2016: R22.0 million) impairment on the Ikeja Mall investment and unrealised foreign 
exchange losses of R162.7 million.

Fair value adjustments
Total fair value adjustments for the financial year, which include fair value adjustments on investment properties and marked-to-market 
movements on the interest rate swaps, reduced by 49.3% to R527.6 million (2016: R1.1 billion).

Compared to the prior year, fair value adjustments on investment properties decreased by 38.1% to R664.5 million (2016: R1.1 billion) 
and are made up as follows:

                                                         30 June 2017     30 June 2016
                                                                R'000            R'000
Completed buildings                                           536 936          557 949
Developments under construction                               193 133          758 314
Development rights                                            (65 544)        (230 039)
Land                                                                -          (12 000)
Total fair value adjustments to investment properties         664 525        1 074 224
             
The main reason for the year-on-year reduction of fair value adjustment in developments under
construction relates to the Mall which was completed during the previous financial year.

Property valuations as at 30 June 2017 are based on external valuations performed by Jones Lang LaSalle
Proprietary Limited, Sterling Valuation Specialists and Mills Fitchet Magnus Penny & Wolffs. The Directors
have made adjustments for straight-lining and cost to complete.

The valuation in respect of Waterfall's development rights is based on an external valuation performed
on a freehold, fully serviced basis. The valuation is then adjusted downward to take into account, inter
alia, the costs required to complete the servicing of the development rights and the estimated future
rental obligations attached to the development rights.

For the current year a pre-tax loss of R136.9 million (2016: R32.5 million) was recorded on the marked-to-
market valuation of the interest rate swap.

Net income from associates
Net income from associates for the current year includes income of R190.0 million (2016: Loss of R81.6 million) 
from MAS, income of R20.7 million (2016: R126.1 million) from Atterbury Cyprus and income of
R10.9 million (2016: R3.4 million) from Atterbury Serbia.

Investment income
Investment income for the current year reduced by 19.6% to R189.5 million (2016: R235.8 million) from the
previous year. Included in investment income is interest income of R189.0 million (2016: R182.9 million)
and dividend income of R0.5 million (2016: R52.8 million). Interest income from international investments,
via loan accounts, amounted to R134.3 million (2016: R146.5 million).

Excluded from investment income is the MAS dividend received of R105.3 million (2016: R101.2 million), as
this dividend is applied to reduce the value of the investment in associate.

Finance costs
The increase in finance costs of 17.6% to R987.4 million (2016: R840.0 million) compared with the prior year is attributable to the
completion of the four buildings (2016: eight buildings) in the financial year, as well as the fact that the Mall was completed in
April 2016. Once a property is completed, finance costs post-completion are expensed and no longer capitalised to the specific
development.

Change in directors
No changes to the Board have occurred during the financial year. However, effective 1 July 2017, LLS van der Watt resigned from
the Board as a Non-Executive Director.

Subsequent events
The Directors are unaware of any matters or circumstances arising subsequent to 30 June 2017 that require any additional
disclosure or adjustment to the annual financial statements.

Prospects
In South Africa, Attacq has strategically focused on Waterfall, with the objective of developing Waterfall City – an integrated city
that works, as well as the Waterfall Logistics Hub – Gauteng's logistic hub of choice. The node continues to grow, with four new
buildings completed during the year under review adding 70 914 m2 of PGLA.

Waterfall is the ideal location for corporate consolidation due to its central location and ease of access to the rest of Gauteng.
Tenants who have relocated to Waterfall include Premier Foods, Group Five, Novartis, Massmart, Cummins and Cell C. In addition,
PwC will be consolidating in Waterfall on completion of the PwC Tower in early 2018, with Deloitte due to relocate to Waterfall
City on completion of the River Creek building in the first quarter of 2020.

The location of Waterfall's Logistic Hub between Johannesburg and Pretoria, with its close proximity to major highways and
transport routes, makes it a natural location for distribution centres and other light industrial users. The joint venture with Sanlam
Properties has further increased the land available for industrial developments.

As Waterfall City and its surrounds continue to develop, the increasing density will benefit the Mall's trading densities,
increasing further value in the years to come.

Outside of Waterfall, Attacq will continue to optimise and extract further value from its South African portfolio of high quality
properties, including its portfolio of regional malls. On an international front, Attacq's strategic investment in MAS is expected to
provide continual benefit from MAS' revised strategy of focusing on distributable income growth underpinned by its attractive income-
generating investments and the development pipeline in Central and Eastern Europe. 

Attacq is currently not looking at increasing its investments in the rest of Africa.

Attacq is targeting a maiden dividend payment from its income-producing assets, namely the existing quality operational portfolio and MAS
investment, of 73 cents per share for the year ended 30 June 2018 with a 20.0% growth per annum in its distributions for the next three years. 
The guidance is based on assumptions which include forecast rental income based on contractual terms and anticipated market-related renewals, 
the expected roll-out of the current and budgeted development portfolio, MAS achieving its distribution targets, the required positioning to 
become a REIT and that no unforeseen circumstances such as major corporate tenant failures or macro-economic instability. The guidance has not 
been reviewed or reported on by Attacq's auditors.

Basis of preparation and accounting policies
The summarised provisional consolidated financial statements for the year ended 30 June 2017 have been prepared in
accordance with the requirements of the JSE Listings Requirements applicable to summarised provisional reports and the
requirements of the Companies Act, No. 71 of 2008 of South Africa applicable to summarised financial statements. The
JSE Listings Requirements require provisional reports to be prepared in accordance with the framework concepts and the
measurement and recognition requirements of International Financial Reporting Standards ("IFRS"), the SAICA Financial
Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the Financial
Reporting Standards Council, and to also, as a minimum, contain the information required by IAS 34: Interim Financial Reporting.

This report was compiled under the supervision of M Hamman CA (SA), Chief Financial Officer of Attacq.

The accounting policies applied in the preparation of the summarised provisional consolidated financial statements are in terms of
IFRS and are consistent with the accounting policies applied in the preparation of the previous consolidated financial statements,
with the exception of the adoption of new and revised standards which became effective during the year. These standards did
not have any impact on the financial statements.

Fair value disclosure
The Group's investment properties were externally valued by independent valuers. In terms of IAS 40: Investment Property
and IFRS 7: Financial Instruments: Disclosure, the Group's investment properties are measured at fair value and are categorised
as level 3 investments. The valuation of investment properties requires judgement in the determination of future cash flows
from leases and an appropriate capitalisation rate which varies between 6.3% and 9.8% (2016: 6.3% and 9.5%). Changes in
the capitalisation rate attributable to changes in market conditions can have a significant impact on property valuations. A
50-basis points weakening in the capitalisation rate will decrease the value of investment properties by R640.5 million (2016:
R603.3 million). A 50-basis points improvement in the capitalisation rate will increase the value of investment properties by
R746.2 million (2016: R690.6 million). Changes in the discount rate attributable to changes in the underlying risk profile associated
with the property portfolio can have a significant impact on property valuations. A 50-basis points weakening in the discount
rate will decrease the value of investment properties by R557.7 million (2016: R462.8 million). A 50-basis points improvement
in the discount rate will increase the value of investment properties by R592.1 million (2016: R480.9 million). In terms of IAS 39:
Financial Instruments: Recognition and measurement and IFRS 7, the Group's currency and interest rate derivatives as well as the
equity derivative are measured at fair value through profit or loss and are categorised as level 2 investments. Unlisted investments
are categorised as level 3. There were no transfers between levels 1, 2 and 3 during the year. The valuation methods applied are
consistent with those applied in preparing the previous consolidated financial statements. This announcement does not include
the information required pursuant to paragraph 16A(j) of IAS 34. The full set of Annual Financial Statements is available on the
issuer's website, at the issuer's registered offices and upon request.

Audit report
The auditor, Deloitte & Touche, has issued its opinion on Attacq's consolidated and separate financial statements for the year
ended 30 June 2017. The audit was conducted in accordance with International Standards on Auditing. Deloitte & Touche has
issued an unmodified opinion. A copy of the auditor's report together with a copy of the audited consolidated and separate
financial statements is available for inspection at the Company's registered office during normal business hours.

These summarised provisional consolidated financial statements have been derived from the Group's consolidated financial
statements and are consistent in all material respects with the Group's consolidated financial statements for the year ended
30 June 2017, but is not itself audited. The Directors take full responsibility for the preparation of these summarised provisional
consolidated financial results and confirm that the financial information has been correctly extracted from the underlying audited
consolidated financial statements. Any reference to future financial information included in this announcement has not been
reviewed or reported on by the auditor. Shareholders are advised that, in order to obtain a full understanding of the nature of the
auditor's engagement, they should obtain a copy of that report together with the audited consolidated financial statements as at
30 June 2017 from the Company's registered office during normal business hours.

On behalf of the Board

P Tredoux               MC Wilken
Chairman                CEO

11 September 2017

Directors 
P Tredoux#* (Chairman)
MC Wilken (CEO)
M Hamman (CFO)
MM du Toit#*
HR EI Haimer#*
KR Moloko#*
BT Nagle#*
S Shaw-Taylor#*
JHP van der Merwe#*

#Independent
*Non-executive 

Website address: www.attacq.co.za

Company Secretary
T Kodde

Registered office
ATT House, 2nd Floor
Maxwell Office Park
37 Magwa Crescent 
Waterfall City
2090

Postal address
PostNet Suit 016
Private Bag X81
Halfway House
1685

Transfer Secretaries
Computershare Investor Services Proprietary Limited
Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196
(P O Box 61051, Marshalltown, 2107)

Sponsor
Java Capital

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