SUMMARISED AUDITED RESULTS FOR THE YEAR ENDED 31 AUGUST 2014

The directors of Fountainhead Property Trust Management Limited, manager of Fountainhead Property Trust (“Trust or Fountainhead”), submit the summarised audited results of the Trust for the year ended 31 August 2014. These financial statements have been summarised from the audited financial statements on which KPMG Inc. has issued an unqualified audit opinion and which are available for inspection at the manager’s registered office.

+7.2%+6.9%Annualised distribution Net asset value

+6.0%Active portfolio net property income

www.fountainheadproperty.co.za

(A collective investment scheme in property registered in termsof the Collective Investment Schemes Control Act No 45 of 2002

and managed by Fountainhead Property Trust Management Limited)(Registration number 1983/03324/06)

JSE code: FPT ISIN: ZAE000097416(Approved as a REIT by the JSE)

Statement of financial position31 August

2014R’000

31 August 2013

R’000

ASSETSNon-current assets 11 214 867 11 183 361 Investment properties 11 191 357 11 105 125 Fair value of investment properties for accounting purposes 10 776 919 10 739 966 Unamortised letting commission and tenant installation 15 520 13 046 Straight-line rental income accrual 398 918 352 113 Interest rate swaps 23 510 78 236 Current assets 1 386 585 415 279 Trade and other receivables 152 271 96 739 Cash and cash equivalents 257 590 318 540 Assets held-for-sale 976 724 – Total assets 12 601 452 11 598 640 UNITHOLDERS’ FUNDS AND LIABILITIESUnitholders’ funds 8 841 591 8 249 107 Capital of the Trust 2 874 030 2 874 030 Retained income 398 976 359 357 Available-for-sale reserve 5 568 585 5 015 720 Other non-current liabilities 2 992 679 2 131 319 Interest-bearing liabilities 2 992 679 2 131 319 Deferred taxation – – Current liabilities 767 182 1 218 214 Trade and other payables 176 745 190 443 Interest-bearing liabilities 250 000 750 000 Unitholders for distribution 340 437 277 771

Total unitholders’ funds and liabilities 12 601 452 11 598 640

Statement of comprehensive income

31 August 2014

R’000

11 monthsended

31 August 2013

R’000

RevenueProperty portfolio 1 282 033 1 089 259 – Contractual rental income 1 242 414 1 047 754 – Straight-line rental income accrual 39 619 41 505 Direct property operating expenses (272 630) (216 538)Net property income 1 009 403 872 721 Changes in fair values of properties and financial instruments 552 865 144 621 Profit on disposal of investment property – 49 Administrative expenses (73 448) (74 149)Income from operations 1 488 820 943 242 Net finance costs (218 714) (175 712)– Interest income 25 882 20 283 – Interest expense (244 596) (195 995)

Profit before taxation 1 270 106 767 530 Taxation – –Profit after taxation 1 270 106 767 530 Headline earnings per unit (cents) 56.98 60.30Basic earnings per unit (cents) 109.24 66.01 Diluted earnings per unit (cents) 109.24 66.01

Statement of cash flows

31 August 2014

R’000

11 monthsended

31 August 2013

R’000

CASH FLOWS FROM OPERATING ACTIVITIESCash generated from operations 831 213 815 829 Interest income 25 882 20 283 Interest expense (244 596) (195 995)Income distributions (614 956) (627 166)Net cash (utilised)/generated from operating activites (2 457) 12 951CASH FLOWS FROM INVESTING ACTIVITIESAcquisition and development of investment properties (419 853) (233 733)Proceeds on disposal of investment properties – 30 249Net cash utilised from investing activities (419 853) (203 484)CASH FLOWS FROM FINANCING ACTIVITIESRepayment of interest borrowings (2 881 319) _Proceeds from interest-bearing borrowings 3 242 679 148 114Net cash generated from financing activities 361 360 148 114Net decrease in cash and cash equivalents (60 950) (42 419) Cash and cash equivalents at beginning of period 318 540 360 959 Cash and cash equivalents at end of period 257 590 318 540

Statement of changes in unitholders’ funds

Capital of the fund

R’000

Non-distributable

reserveR’000

Retained earnings

R’000Total

R’000

Balance at 1 October 2012 2 874 030 4 871 050 317 852 8 062 932 Total comprehensive income for the periodProfit and total comprehensive income for the period – – 767 530 767 530 Transactions with unitholders, recorded directly in equityProfit and fair value reserve realised on sale of property transferred to non-distributable reserve – 49 (49) –Fair value adjustment on investment properties transferred to non-distributable reserve – 107 890 (107 890) –Straight-line lease adjustment (41 505) 41 505 –Fair value adjustment on interest rate swaps – 78 236 (78 236) –Income distributions – – (581 355) (581 355)Total transactions with unitholders – 144 670 (726 025) (581 355)Balance at 31 August 2013 2 874 030 5 015 720 359 357 8 249 107 Total comprehensive income for the yearProfit and total comprehensive income for the year – – 1 270 106 1 270 106 Transactions with unitholders, recorded directly in equityFair value adjustment on investment properties transferred to non-distributable reserve – 647 210 (647 210) –Straight-line lease adjustment – (39 619) 39 619 –Fair value adjustment on interest rate swaps – (54 726) 54 726 –Income distributions – – (677 622) (677 622)Total transactions with unitholders – 552 865 (1 230 487) (677 622)

Balance at 31 August 2014 2 874 030 5 568 585 398 976 8 841 591

Transfer secretaries: Computershare Investor Services Proprietary Limited, 70 Marshall Street, Johannesburg, 2001 (PO Box 61051, Marshalltown, 2107) Secretary: Java Capital Trustees and Sponsors Proprietary Limited, Redefine Place 2 Arnold Road Rosebank, Johannesburg Registered office: Redefine Place, 2 Arnold Road, Rosebank, Johannesburg (PO Box 1731, Parklands, 2121) Directors: WM Kirchmann (Chairman), VA Christian, T Wixley, AJ Konig, HY Laher, M Barkhuysen, B Nackan, DH Rice, DS Savage, LB van Niekerk (CEO), M Wainer Sponsor: Java Capital

IntroductionFountainhead is a property unit trust listed on the Johannesburg Stock Exchange (JSE). The Trust has R12.1 billion of investment properties with a focus on retail assets located in South Africa’s major metropolitan areas. Included in the portfolio are Centurion Mall, Boulders Shopping Centre, Benmore Gardens Shopping Centre, Bryanston Shopping Centre, Blue Route Mall, Kenilworth Centre and a majority share in N1 City.

1. BASIS OF PREPARATION AND ACCOUNTING POLICIES The summarised financial statements are prepared in accordance with the requirements of the

JSE Listings Requirements for provisional reports and the requirements of the Collective Investment Schemes Control Act of South Africa. 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) and the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the Financial Reporting Standards Council and also, as a minimum, to contain the information required by IAS 34 Interim Financial Reporting. Except for the new standards adopted as set out below, the accounting policies applied in the preparation of the financial statements, from which the summary financial statements were derived, are in terms of IFRS and are consistent with the accounting policies applied in the preparation of the previous annual financial statements. The Trust adopted the following new standards:

• IFRS 10 Consolidated Financial Statements • IFRS 11 Joint Arrangements • IFRS 12 Disclosure of Interests in Other Entities • IFRS 13 Fair Value Measurement.

These summarised audited financial results for the 12 months ended 31 August 2014 have been extracted from the audited annual financial statements but is not itself audited. The audit report does not necessarily cover all the information included in the announcement. The directors of the manager take full responsibility for the preparation of these summarised annual results and confirm that the financial information has been correctly extracted from the underlying audited results for the year ended 31 August 2014.

The results have been prepared under the supervision of Rafael Zabow CA(SA) Senior Financial Manager.

2. RESULTS FOR THE 12 MONTHS Fountainhead has declared a distribution of 29.28 cents per unit (cpu) for the final six months

to 31 August 2014, taking the total distribution for the 12 months to 58.28 cents per unit. This is an increase of 16.6% compared with the 11 months to 31 August 2013 and reflects growth of 6.9% on an annualised basis.

The distribution for the second half of the financial year includes legal and advisory costs of R5.3 million incurred as a result of the unsuccessful offer by Redefine Properties Limited to acquire the assets of the Trust.

The active portfolio, excluding properties acquired, sold and under development, achieved rental growth of 5.4% and net property income growth of 6.0% for the financial year.

Distributable income

12 months to 31 August

2014R’000

11 months to31 August

2013R’000

Rental income (excluding straight-line rental adjustment) 1 072 958 913 633

Net property expenses (122 691) (99 136)

Property expenses (501 464) (424 154)

Recovery of property expenses 378 773 325 018

Net property income 950 267 814 497 Sundry revenue 19 517 16 510

Net finance costs (218 714) (175 712)

Interest income 25 882 20 283

Interest expense (244 596) (195 995)

Trust expenses (73 448) (73 940)

Distributable income 677 622 581 355

Units in issue 1 162 709 1 162 709

Distribution (cents per unit) 58.28 50.00

Interim 29.00 26.11

Final 29.28 23.89

3. BORROWINGS The Trust beneficially restructured its debt during August 2014. The weighted average cost of debt

increased from 7.5% as at 31 August 2013 to 8.0% as at 31 August 2014 as a result of higher market interest rates and the increase in the portion of debt hedged against interest rate increases.

Including forward starting swaps, 76% of debt is hedged against interest rate risk.

Funding providerFacility

R’000

Loan balance

R’000Facility

maturityFixed/

floatingAll in

margin

Rand Merchant Bank 1 900 000 1 900 000 15 Aug 2019 Floating JIBAR + 1.57%Rand Merchant Bank 385 000 342 679 15 Aug 2019 Floating Prime - 1.73%Rand Merchant Bank 250 000 250 000 17 Sep 2014 Floating JIBAR + 1.30%Rand Merchant Bank 225 000 225 000 4 Feb 2019 Floating JIBAR + 1.61%Rand Merchant Bank 525 000 525 000 4 Feb 2019 Floating JIBAR + 1.61%

Total 3 285 000 3 242 679

Swaps provider Status

NominalvalueR’000 Maturity Rate

Rand Merchant Bank Current 500 000 31 May 2018 5.87%

Absa Capital Current 300 000 19 Sep 2016 6.58%

Absa Capital Current 300 000 17 Oct 2016 6.27%

Absa Capital Current 500 000 9 Apr 2019 7.79%

Rand Merchant Bank Forward start – 22 May 2015 350 000 31 May 2018 6.47%

Rand Merchant Bank Forward start – 22 May 2015 500 000 31 May 2020 7.06%

4. MAJOR CAPITAL PROJECTS Centurion Mall An upgrade and expansion in various phases of 6 500m2 at a cost of R318 million commenced in

August 2014 at an estimated incremental yield of 7.1%. The project includes a 2 260m2 expansion of Woolworths, additional gross lettable area (GLA) on the upper level, a new mall off the spine, as well as facilities and external upgrades. These interventions will address tenant mix and merchandising demands and facilitate shopper circulation. Furthermore, the R13 million acquisition of an adjacent property creates additional long-term value-added opportunities.

Kenilworth Centre

Parking deck rectification work to the value of R21.5 million was completed. R197 million will be spent on creating 4 500m2 of new GLA on the upper level, as well as additional parking that will significantly improve access and egress to and from the centre.

AMR This office property is undergoing a refurbishment and tenant installation to accommodate a CTI

education campus on a 10-year lease in two of the three buildings in a total of 8 100m2. The total capex will amount to R65 million and yielding 7.1% in the first year and 10.0% in the second year with the tenant taking staggered occupation commencing February 2015 and December 2015.

5. ACQUISITIONS AND DISPOSALS The Trust purchased and took transfer of the CIB office building in Bedfordview for R159 million in

February 2014 at an initial yield of 8.2%.

The Trust entered into a sale and leaseback agreement with Robor Proprietary Limited (Robor) in terms of which the Trust acquired the Robor industrial property situated in Elandsfontein for R570.5 million, which transferred on 3 September 2014. The acquisition was at an initial yield of 8.5% with an initial lease period of 10 years escalating at 8% per annum, commencing on transfer of the property.

Fountainhead also made two strategic acquisitions. The acquisition of the motor dealership adjacent to Kenilworth Centre for R34.7 million effective 1 April 2014 at an initial yield of 10%, which on lease renewal in 1 July 2014 increased to 12.8%. The other property acquired was a vacant fuel station adjacent to Centurion Mall for R13 million with 3 000m2 of available bulk for future opportunities. Transfer is expected after year-end.

Sales of the Trust’s undivided shares in Westgate Shopping Centre, Southgate Mall and Southgate Value Mart were concluded for an aggregate consideration of R944 million. Westgate Shopping Centre transferred in September 2014 at and escalated price of R720 million and the transfer of Southgate Mall and Southgate Value Mart is expected in October 2014 at an escalated price of R260 million. The aggregated estimated forward yield on these two disposals is 7.5%.

The Trust continues to follow its long-term strategy to focus on core retail, commercial and industrial properties and either has or is at an advanced stage of concluding sale agreements on 19 properties with an estimated value of R219 million at an average yield of 9.9%.

Proceeds from disposals will be used to fund acquisitions and development activity.

6. SEGMENTAL INFORMATION12 months August 2014 11 months August 2013

RevenueRm

Net incomeRm

% of total

RevenueRm

Net incomeRm

% of total

Retail 887 676 100 752 585 101 Office 229 185 27 182 152 26 Industrial 88 69 10 81 63 11 Specialised 39 39 6 33 32 5Trust and administration – (291) (43) – (251) (43)

Total 1 243 678 100 1 048 581 100

7. PORTFOLIO VALUATION

SectorValue

(Rm) Income

Cents/unit

2014

Cents/unit

2013

% of portfolio

2014 2013

Retail 9 128 676 785 725 75 76 Office 1 940 185 167 146 16 15 Industrial 705 69 61 56 6 6 Specialised 395 39 33 30 3 3

Total property 12 168 969 1 046 957 100 100Interest-bearing liability (3 242) (279) (249)Net current liabilities (517) (44) (40)Net current assets 433 37 41

8 842 760 709

Total property includes assets held-for-sale of R977 million, NAV 84cpu.

Retail

Of�ce

Industrial

Specialised

£

£

£

£

Contributionto distributionInvestment

property valueby sector

75%

16%

6% 3%

Contributionto distribution

by sector

70%

19%

7%4%

Sectoral spread

8. VACANCY LEVELS Vacancies increased 4.2% over the year, with 3% due to strategic vacancies as a result of development

activities.

Subsequent to 31 August 2014 a number of vacancies have been filled, more notably being 3 775m2 at Mifa Industrial Park, 1 987m2 at Supreme Industrial Park and 1 250m2 at Lakeside A. Vacancies, after taking into account strategic vacancies and letting activity after year-end, decreased to 7.5%.

SectorGLA (m2)

2014GLA (m2)

2013August

2014August

2013

Retail 22 509 16 906 5.1% 3.8%Office 45 966 27 230 26.1% 16.2%Industrial 23 129 13 036 13.8% 7.8%Specialised – – – –

Total 91 604 57 172 11.3% 7.1%

9. LEASE EXPIRY PROFILE Lease expiry pro�le

£Of�ces £ Industrial £Specialised£Retail

0

20 000

40 000

60 000

80 000

100 000

120 000

140 000

160 000

2015 2016 2017 2018 2019

SectorGLA (m2)

2014GLA (m2)

2013Esc %

2014Esc % 2013

Retail 165 164 8.2 8.2Office 129 138 8.5 8.1Industrial 47 50 9.0 8.9Specialised 124 107 9.5 8.7

Total 134 133 8.4 8.4

10. STRATEGY Fountainhead has continued to build a platform for sustainable long-term growth despite the uncertain

economic and tough trading conditions. The Trust has successfully implemented a strategy that will see it reduce its exposure to smaller riskier assets and significantly improve the quality of its portfolio through the development and refurbishment of core properties. The Trust’s strategy extends beyond quality retail investments to large properties in metropolitan areas in other sectors that offer low-risk growing income streams and value add opportunities as illustrated by the acquisition of Robor and CIB and the redevelopment of AMR.

11. PROSPECTS Fountainhead expects to produce growth in distribution of 5% to 6% from its current portfolio for the

12 months to 31 August 2015 reflecting the challenging environment and the strategy to improve the quality of the portfolio. The forecast is the responsibility of the directors of the manager and has not been reviewed or reported on by Fountainhead’s auditors.

12. DECLARATION OF DISTRIBUTION Notice is hereby given of distribution number 63 of 29.27956 cents per unit for the six months ended

31 August 2014.

Last date to trade cum distribution Friday, 31 October 2014 Commence trading ex distribution Monday, 3 November 2014 Record date Friday, 7 November 2014 Payment date Monday, 10 November 2014

Unit certificates may not be dematerialised or rematerialised between Monday, 3 November 2014 and Friday, 7 November 2014, both dates inclusive.

In respect of dematerialised unitholders, the distribution will be transferred to the CSDP account/broker accounts on Monday, 10 November 2014. Certificated unitholders’ distribution payments will be posted on or about Monday, 10 November 2014.

An announcement informing unitholders of the tax treatment of the distribution will be released separately on SENS.

BY ORDER OF THE BOARD Fountainhead Property Trust Management Limited Registration number 1983/003324/06

8 October 2014

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