1. Coronation Flagship Income and Growth Solution The Coronation Balanced Defensive Fund Charles de Kock 04 September 2010

2. Agenda  A very brief view of the macro economy and financial markets  Coronation Balanced Defensive Fund

3. Slow take-off for global economy

4. Currency turmoil  Weak global economic recovery  Particularly slow jobs growth in US  Has led to yet more stimulus in US and a weaker dollar  Chinese RMB pegged to US dollar therefore does not strengthen  Emerging currencies including the rand firms  Talk of currency wars and protectionism abound  Gold and other commodities rise  Stock markets too as zero interest rate regime looks likely to remain for longer  bond yields fall sharply as talk of exit strategies evaporate

5. Implications of zero interest rates  As money flows from developed (zero interest rate world)  Emerging currencies appreciate  Asset prices rise  Inflation and interest rates stay low  Great environment for consumers  Credit expansion will follow  Current accounts will deteriorate  When global interest rates normalize the whole process will reverse

6. US Bonds vs Equities past 100 years bonds have won only 3 times over a 10 year cycle 10 Year rolling total return – S&P 500 vs. 10 Year US Treasuries Source: J.P. Morgan and Shiller. S&P 500 total return includes dividend and the return for US Treasuries assumes bonds will be held until maturity. Note: Past performance is not indicative of future results

7. SA economy

8. South Africa: macro environment  Global environment has led to huge portfolio inflows chasing higher yields  Rand has been very strong as a result…..hurting manufacturing competitiveness  Inflation lower than anticipated leading to more rate cuts by SARB  Lots of talk of measures to weaken the rand…..but success not assured

9. Huge divergence on JSE Source: I-Net Bridge

10. General retailers Significant outperformance over 3 years  Favourable economic tailwinds  Rand appreciation  Big interest rate cuts  World-class management  Focused on value creation  Extremely shareholder friendly (buybacks, big dividends)  Foreigners aggressive buyers of domestic retailers  MSM = 72%, TRU = 62% foreign held  Wal-Mart offer for MSM implies 19.5x PE multiple 3-year compound annual total return: General retailers vs. All Share JALSH CLS TFG MSM MPC PIK SHP SPP TRU WHL 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% JALSHCLSTFGMSMMPCPIKSHPSPPTRUWHL

11. The Coronation Balanced Defensive Fund

12. Risk (Annualised Standard Deviation) Avg 15% Max 25% (0% normal shares) Reg 28 Avg 50% Max 60% Reg 28 Avg 70% Max 85% Reg 28 100% Exposure to Growth Assets Avg 35% Max 40% Reg 28 Long-term Growth (Equity Only) Investment Objective Long-term Growth (Multi-asset) Coro Balanced Defensive Coro Top 20 3 Years → Income & Growth (Multi-asset) Income (Multi-asset) Return (Annualised Return) Coro Strategic Income Coro Capital Plus Coro Balanced Plus ConservativeModerateAggressive Risk Profile Average exposure to growth assets through the cycle (5 years) The exposure will fluctuate as valuations change Growth Assets are defined as local and foreign equities, properties and commodities. Aim to outperform Cash+3% over the medium term Protect Capital over any 12 month period Coronation Balanced Defensive Fund Cautious investors requiring stable returns

13. Growth Assets are defined as local/foreign equities (excl. pref shares) and real estate. Max exposure to growth assets Coronation Balanced Defensive Max 40% exposure to growth assets 25% 40% 60% 85% 100%

14. Coronation Balanced Defensive The strategy has delivered... Performance quoted from Morningstar as at 30 September 2010 for a lump sum investment with income distributions reinvested R140 317 R126 908

15. Coronation Balanced Defensive Capital protection is key... Balanced Defensive has not suffered capital losses over any 12 month period Performance quoted from Morningstar as at 30 September 2010 for a lump sum investment with income distributions reinvested Since Inception – 01 February 2007

16. 3 months6 monthsYTD1 year2 years3 years Ranking12/532/533/525/523/481/40 Quartile1 st Returns6.2%6.5%9.8%13.1%12.1%10.1% Cat AVG4.7%3.8%6.7%9.6%9.2%6.1% Performance quoted from Morningstar as at 30 September 2010 for a lump sum investment with income distributions reinvested Coronation Balanced Defensive Consistent 1st quartile performance... Our objective is to deliver top quartile returns over all meaningful performance periods, for this fund being a 3 year period

17. Coronation Balanced Defensive Fund Asset allocation history since inception... 40% max exposure to growth assets Growth Assets are defined as local and foreign equities and real estate

18. Coronation Balanced Defensive Portfolio positioning – 30 September 2010 Reg. 28 Compliant Growth Assets are defined as local and foreign equities and real estate

19. Coronation Balanced Defensive Portfolio positioning – 30 September 2010 Growth Assets Growth Assets are defined as local and foreign equities and real estate

20. Coronation Balanced Defensive Portfolio positioning – 30 September 2010 Income Assets

21. 1.This fund has delivered on it’s mandate to provide investors with a stable income and to preserve capital in real terms 2.This is the top performing fund in the Prudential Low Equity category since the inception of the fund on 02 February 2007 3.Different to the average fund in the category, the fund has suffered no capital losses over any 12 month period 4.This fund will charge 0% fees if we deliver negative returns over any 12 month period 5.The fund is managed by Coronation’s most experienced portfolio managers, backed by the research of Coronation’s global investment team Coronation Balanced Defensive Fund Our value proposition

22. Questions?

23. Disclaimer Coronation Asset Management is an Authorised Financial Service Provider. The content of this presentation and any information provided may be of a general nature and may not be based on any analysis of the investment objectives, financial situation or particular needs of the client. (as defined in the Financial Advisory Intermediary Services Act) As a result, there may be limitations as to the appropriateness of any information given. It is therefore recommended that the client first obtain the appropriate legal, tax, investment or other professional advice and formulate an appropriate investment strategy that would suit the risk profile of the client prior to acting upon such information and to consider whether any recommendation is appropriate considering the client’s own objectives and particular needs. Any opinions, statements and any information made, whether written, oral or implied are expressed in good faith.

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