47 th Annual General Meeting At Two Rivers, Limuru Road AUGUST 29, 2014

47th Annual General MeetingAt Two Rivers, Limuru Road

AUGUST 29, 2014

Welcome , Prayer & General Information

Introduction of Directors

Notice of the Meeting

Confirmation of minutes

Ordinary Business

Special Business

AOB

2

3

4

AGM Program

5

1

General Information

1. Fire escape

2. First Aid

3. Washrooms

4. Water points

5. Help desk - Shareholder queries – CDSC and C&R

6. Security

7. Lunch

Details

3

Welcome , Prayer & General Information

Introduction of Directors



Ordinary Business

Special Business

AOB

1

2

3

4

AGM Program

5

Board of Directors

James MuguiyiChairman

(Non-Executive)

James MworiaCEO

(Executive)

Peter Kimurwa(Non-Executive

Director)

● Managing Director of UAP Holdings● Has over 40 years business experience in senior management positions● Has vast industry and board experience encompassing Financial Services,

Bottling and Real Estate Sector

● Has over 10 years investment management experience● Has led and closed multiple transactions across Sub-Saharan Africa● Specialist in deal Sourcing and Structuring

● Executive Director of ICDC● Specialist in strategy and financial management ● Has extensive and varied business experience spanning over 15 years

2

Laila Macharia(Non-Executive

Director)(Real Estate Subsidiaries)

● Founder and Principal of Scion Real Estate● Has over 15 years experience in corporate law and finance, property

development and investment and training● Specialist in property, urban development, telecommunications, transport

and financial services

Dr. James McFieDeputy Chairman(Non-Executive)

● Director, School of Accountancy of Strathmore University● Specialist in governance and financial management ● Has extensive and experience spanning over 40 years

Board of Directors... Cont’d

3

● Chief Finance Officer in the Ministry of Trade● Has over 20 years experience in Public Service● Specialist in Public Finance management

● Founder and Director of Cassia Capital● Has over 15 years business experience in Financial Services● Specialist in Corporate Finance, Private Equity and Real Estate

● Chief Executive Officer of Xtranet Communication● Has over 20 years business experience● Entrepreneur and specialist in the ICT industry

● Renown Industrialist● Has over 40 years business experience● Has vast industry and board experience in Financial Services, Industrials,

Media and Real Estate

Margaret Byama(Non-Executive

Director)

Imtiaz Khan(Non-Executive

Director)

Henry Njoroge(Non-Executive

Director)

Christopher Kirubi(Non-Executive

Director)



Ordinary Business

Special Business

AOB

1

3

4

AGM Program

5

2

AGM Notice – Page 14 & 15 of Annual Report

1. Confirmation of Quorum and Secretary to Read the Notice

2. Confirmation of Minutes of the 46th Annual General Meeting held on Friday, 18 October 2013

3. Ordinary Business: (i) Report of Auditors, Directors and Approval of Financial Statements (ii) Remuneration of Directors (iii) Re-election of Directors(iv) Appointment and Remuneration of Auditors

4. Special BusinessRatification of Subsidiaries and Related Companies

5. Any Other Business

8



Ordinary Business

Special Business

AOB

1

2

3

4

AGM Program

5

2. To confirm minutes of the 46th AGM



Ordinary Business

Special Business

AOB

1

2

3

4

AGM Program

5

3. Ordinary Business

12

• Report of the Directors & Auditors

• Remuneration of Directors

• Election of Directors

• Appointment and remuneration of Auditors

i

ii

iii

iv

3 (i) a. To receive the Chairman's report

Executive Summary

14

OUR 2009/14 STRATEGY – We delivered on the strategy

(i) We delivered a return market beating returns across the strategic period

(ii) We grew the value of Centum’s portfolio by Kshs 23.4 Billion from Kshs 5.9 Billion to 29.3 Billion and third party funds by Kshs 117 Billion from Kshs 6 Billion in 2009

(iii) We have progressively increased our exposure outside of Kenya from less than 1% to 19% at the close of the strategy period. The 19% represents assets of Kshs 5.3 Billion

(iv) Our understanding of a strong brand is one that consistently delivers to promise through people

(v) Maintained our portfolio costs at below 2.3% of assets under management over the period well below the strategic ceiling of 2.5%.

Executive Summary

15

WHAT HAVE WE ACHIEVED IN 2013/2014?

Operating Environment

a) 2013 General Election

b) Stable operating environment and investor confidence

Awards Won

c) Financial Reporting Excellence (FiRe) Awards 2013 – Overall winner

d) Champions of Corporate Governance – 1st Runners up Finance & Investments

e) Wharton Club of Africa – CEO of the Year

f) Acquisition International Awards – East Africa Investment Business of the Year

Executive Summary

16

WHAT HAVE WE ACHIEVED IN 2013/2014?

Service Subsidiaries

a) Athena Properties Limited

b) Nabo Capital (formerly Centum Asset Managers)

c) Centum Business Solutions (formerly Centum Shared Services Limited)

d) Genesis Kenya Investment Management Ltd – Acquired in the year.

Executive Summary

17

WHAT NEXT FOR YEAR 2014/19?

(i) Launch new strategic plan for 2014-2019

(ii) Sector focus – FMCG, Financial Services, Real Estate, Energy, Health, Education, Agriculture and ICT

(iii) Our 2014/19 strategy:

a) Deliver market beating annualized returns of over 35% per year

b) Focus on the 8 sectors

c) Scale up total assets to Kshs 120 Billion and total Assets Under Management (AUMs) to Kshs 720 Billion

d) Build Centum brand through delivering through people and develop sector expertise

e) Maintain costs below 2.0%

Board Changes

18

(i) Appointment of Dr. James McFie

• Director, School of Accountancy of Strathmore University

• Specialist in governance and financial management

• Has extensive and experience spanning over 40 years

(ii) Resignation of Robert Bunyi

• Remains a director in Centum subsidiaries

Appreciation

• On behalf of the Board, we would like to record our sincere appreciation to:

−Shareholders for continued support;

−Board and Management teams of our investee companies for without whom we not have achieved the good performance; and

−Fellow Board Members and The Management team for their contribution towards execution of the strategy and urge all to redouble their efforts

• We look forward to even greater successes in the coming year

19

3 (i) b. To receive the CEO's report

Private Equity Executive Team

21

James Kaguchia, Ag. Director Private Equity (CPA)

Over 10 years operational experience, 4yrs CEO experience (Kewberg)

Specialization: Turnarounds, post acquisition change management, strategic planning & business expansion

Job Muriuki, Principal (CFA)

Over 5 years international investment experience

Deals: Acquisition of Platcorp Holdings, Bottler consolidation, Longhorn exit

Board Directorships: Rift valley Bottlers, AON, Longhorn, Platinum

Athena Properties Executive Team

22

Graeme Reid – Managing Director

A Lawyer by profession with over 20 years experience in project management delivery of commercial mixed use developments.

He was the first Chief Executive Officer of the Johannesburg Development Agency

He was the Executive Director of the consultancy Urban Places Africa providing services to the public and private sectors on a range of large scale, mixed use and mixed income developments

Chris Ochieng – Deputy Managing Director

Over 10 years experience in delivery of mixed use developments comprising of Infrastructure, Residential, Sports, Retail, Commercial and Hospitality developments from inception through to completion in the Middle East and Africa.

He is a specialist in project development planning. He holds a BSC. in Civil Engineering from Egerton

University, He is a Certified Project Management Professional

(PMP).

Nabo Capital Executive Team

23

Pius Muchiri, Managing Director (MBA)

• Over 10 years combined experience

in investment and accounting• Experience in Sub-Saharan Africa

Equities and Fixed Income markets

Teresia Muthoni, Investment Products Manager (MBA)

• Over 5 years experience in risk management with an emphasis on portfolio & operational risk

• Holds a BSC Actuarial Science and is a member of Professional Risk Managers

Genesis Kenya Executive

24

Charles Ogalo – Chief Executive Officer • Over 32 years combined experience in investment and

banking• He served in key senior positions at Kenya Commercial

Bank (KCB) with his last posting as Chief Manager, Correspondent Banking and International Trade Finance.

• Holds a Bachelor of Economics degree

Centum Business Solutions Executive Team

25

Risper Mukoto, Director Finance & Operations (FCCA, CPA)

• Responsible for the overall delivery of Centum Business Solutions (CBS), which provides non investment related business solutions to the Group.

• She is a member of Institute of Certified Public Accountants (ICPAK) and a Fellow of the Association of Certified Chartered Accountants (FCCA).

• She holds a Bachelor of Arts Degree in Business Management from Moi University and an MBA from the United States International University-Africa (USIU-A).

Fred Murimi, Director Corporate Affairs& Company Secretary (CPA, CPS)

• He has over 10 years experience in Legal and Compliance management in the capital markets industry

• Previously worked for Renaissance Capital and Tatu City as Vice President – Legal & Compliance as well as with the CMA as a Senior Compliance Officer.

• Holds a Bachelor of Laws degree from University of Nairobi and an MBA from United States International University - Africa (USIU).

Strategy: we delivered to promise

Diversify by geography and asset class

Constantly deliver market beating returns

KES 1,000 invested on 1st Apr 09’ was worth KES 4,340 as at 1st Apr 14’ and KES 5,664 as at 28th Aug 14

Grown market capitalization by KES 18.7 Billion representing 334% growth over the period.

Total NAV Return of 291% against NSE 20 Return of 75%

2009-2014 Strategic themes

2014 Position

19% of the portfolio is outside Kenya 49% in Private Equity, 17% in Quoted

Private Equity and 34% in Real Estate

Total Assets under Management at KES 147.2Bn

Centum Portfolio value at KES 29Billion

Grow AUM to KES 30Billion by 2014

Deliver through people

Maintain costs below 2.5% of AUM

• Centum has consistently delivered to promise through a highly qualified team.

• Centum has continued to attract and retain top talent within the organization.

Costs closed at 1.5% in 2014. Costs maintained below 2.3% of AUM

over the period

PERFORMANCE1

DIVERSIFICATION

2

GROWTH

3

BRAND4

COSTS5

26

WHAT DID WE DO IN YEAR 2013/14?PERFORMANCE

(i) In the year: Grew the book value of Shareholder wealth by KES.6.8 Billion, a NAV growth of 42%

(ii) Over the Strategy period: Grew the book value of shareholder wealth by KES 17Billion, a 291% growth

(iii) Cumulatively outperformed the NSE 20 share index by 216% over the 5yrs

(iv) The share price increased by 83% from KES 19.90 to KES 36.50; a growth in market capitalization of KES 12 Billion to KES 24.3 Billion

27

WHAT DID WE DO IN YEAR 2013/14?COMPANY FUNDING

(i) Increased our group overdraft facility with Co-operative Bank from Kes. 1 Billion to KES 2 Billion in addition to KES 5.25 Billion Project Financing for the Two Rivers Mall

(ii) Improvement in the Company’s Credit Rating from A1-(short term) A-(long term) to A1(short term) A(long term)

28

WHAT DID WE DO IN YEAR 2013/14?BRAND-GROW OUR PEOPLE

(i) GT 2014:

a. Out of 3,000 applicants we recruited 22 Management Trainees in 2014 up from 10 in 2013

b. Increased exposure for the trainees with a 6 months secondment to South Africa

29

WHAT DID WE DO IN YEAR 2013/14?BRAND-GROW OUR PEOPLE

(i) A shift in how we do business from cost to profit centres with ALL Heads of Departments in-charge of delivery of profit from respective businesses

30

Business Value proposition No. of staff

Athena Properties REI-Centum’s Development and Project managers in charge of delivering Two Rivers and Pearl Marina

27

Centum Asset Managers

QPE-Centum’s asset management business

13

Centum Capital PE-Centum’s private equity managers and in-charge of business incubation

14

King Beverage FMCG in charge of bringing to market an international premium beverage

Centum Business Solutions

Business Support-Supports the group on shared services in HR, Legal, Risk, Finance, Tax and Administration

28

WHAT DID WE DO IN YEAR 2013/14?Private Equity

(i) PE portfolio had a gross return of 45% amounting to KES.3.9 Billion

(ii) Value increased from Kes.4 Billion (2009) to Kes.14.1 Billion (2014)

(iii) Investment activity:

a) Increased our shareholding in Almasi

b) Ventured into new sectors- Power, FMCG, Agribusiness

31

WHAT DID WE DO IN YEAR 2013/14?Quoted Private Equity

(i) QPE portfolio had a gross return of 35% amounting to Kes.1,753 Million

(ii) Begun operations as a licensed Fund Manager also registered as a REIT Manager, and Pension fund manager

(iii) Acquisition of 73.35% in Genesis Kenya Investment Management which is the second largest Pension Fund Manager in Kenya with over KES 100 Billion in assets under management

32

WHAT DID WE DO IN YEAR 2013/14?Real Estate & Infrastructure

(i) RE&I portfolio had a gross return of 84% amounting to Kes.2,062 million

(ii) Portfolio valued at KES 10.3 Billion

(iii) Two Rivers Update

a) Secured KES 6.6 Billion investment for 42.8% equity in Two Rivers

b) Secured KES 5.25 Billion in debt financing from Co-operative Bank for the mall

c) Construction of Infrastructure for Phase 1 on schedule for commissioning in June 2015

d) Construction of Retail Mall on schedule for opening in October 2015

e) Carrefour – Two Rivers Mall’s anchor tenant 33

WHAT DID WE DO IN YEAR 2013/14?Real Estate & Infrastructure

(i) Pearl Marina - Acquired additional land to bring the total land to 361 acres and commencement of construction of Phase 1 Residential Villas to commence.

(ii) Investment in Broll East Africa in partnership with Broll who are South Africa´s leading multi-disciplinary property services company on commercial, retail, industrial and investment property.

34

Strategy 2014/19 Objectives

• To grow Total Assets of the company from KES 29 Billion to KES 120 Billion by 2019

• To grow Total Asset under Management from KES 147 Billion to KES 720 Billion by 2019

• Generate 35% annualized return on book value per share

• The projected NAV per share to grow from KES 34.47 to KES 155 by March 31, 2019

PERFORMANCE

1

GROWTH

2

35

Strategy 2014/19 Objectives-How shall we achieve this?

# Sector Progress to Date

1 Real Estate

Continued development of Two Rivers and inviting partners in Commercial, Residential and Hospitality to site

Seeking additional sites to roll out large mixed use developments across the region

2 Financial Services

Signed SPA agreement to acquire 63% of K-REP Bank Significant organic growth opportunities within our financial services

portfolio companies

3 Agriculture Actively seeking to acquire sizable agricultural land 10,000 acres+ to be the foundation of our agriculture business where we shall be integrated across the value chain from inputs to production, processing and finally distribution.

4 Energy A 37.5% investor in Akiira 1 project involved in the development of 140Mw Geothermal power plant in Longonot

Advanced stage of developing other power projects

Focus on 8 sectors, where we shall build capacity and develop investment grade opportunities

36

Strategy 2014/19 Objectives-How shall we achieve this?

# Sector Progress to Date

5 EducationWe are in discussions with the prospective partners to launch an offering in education and healthcare6 Healthcare

7 FMCG Have an active presence with Almasi & KWAL King Beverage-Have established a premium beverage distributing business

and shall be seeking to the processing plant by April 2015

8 ICT Actively engaged with prospective partners

Focus on 8 sectors, where we shall build capacity and develop investment grade opportunities

37

Appreciation

• We are grateful for your continued support and believe that you will continue to support your Company, Board and the Management team as you have done in the past

38

3 (i) (c). Report of the Auditors and to adopt and approve the accounts for the year ended 31 March 2014

Group Statement of Comprehensive income – Pg 92

40

23% increase in PBT, 22% increase in PAT

• 25% improvement in income due to improved Portfolio performance

• Increase in portfolio costs on account of growth strategy.

• Improvement in performance of Associate companies

• Improvement in performance & valuations of the investment portfolio

Kes. m FY2014 FY2013 Var

Dividend income 460 301 53%

Interest income 218 223 (2%)

Other income 279 89 213%

Realized gains 993 1,641 (39%)

Unrealized gains 2,932 1,653 77%

Income 4,883 3,906 25%

Portfolio costs (796) (520) 53%

Finance costs (469) (401) 17%

Share of Ass. Profit 393 263 49%

Profit before tax 4,011 3,248 23%

Tax (956) (739) 29%

Profit after tax 3,055 2,509 22%

Other comp income 3,576 1,092 227%

Total comp income 6,631 3,601 84%

Group Statement of Financial Position – Pg 94

41

56% growth in total assets as at 31 March 2014

Assets (Kes M.) FY2014

FY2013

Investment property 10,845 5,456

Equipment & Intangibles 1,049 49

Investment in associates 3,901 3,659

Unquoted investments 7,569 4,306

Quoted investments 3,036 2,733

Corporate bonds 1,071 995

Receivables 1,282 261

Cash & cash equivalents 844 1,502

29,597 18,962

Liabilities (Kes M.) FY2014 FY2013

Borrowings 5,492 4,150

Payables and accruals 1,840 289

Unclaimed dividends 29 33

Current income tax 210 18

Deferred tax liability 1,752 829

Liabilities 9,324 5,319

Shareholder funds 20,273 13,643

29,597 18,962

Cash flow Statement – Pg 100

42

Kes M 2014 2013

Internally generated funds: 3,550 2,167

Investing activities:

Equity & Investment Property (4,776) (3,753)

Equipment & intangibles (18) (27)

(4,794) (3,780)

Financing Activities:

Net Proceeds from borrowings - 3,150

Unclaimed dividends paid in the year (3) (2)

Dividends paid to non-controlling interest (42) -

Interest paid (660) (344)

(705) 2,804

Net Increase/(Decrease) (1,949) 1,191

Opening cash 1,502 322

Closing cash & cash equivalents (Net of Overdraft) (447) 1,502

*Dividend paid relates to unclaimed dividends paid in the year and dividends paid to non-controlling interest in subsidiaries

Q and A


44

• Report of the Directors & Auditors



• Election of Directors over the age of 70


i

ii

iii

iv

v

Remuneration

To To approve the remuneration of the directors for the year 2014/15

Refer to Note 32 (iii) on Page 148

45


46

• Report of the Auditors & Directors



• Election of Directors over the age of 70


i

ii

iii

iv

v

Election of directors

(a)To re-elect Mr. Henry Njoroge a director retiring by rotation, who being eligible, offers himself for re-election.

b)To re-elect Mr. Imtiaz Khan a director retiring by rotation, who being eligible, offers himself for re-election.

c) To elect Dr. James B. McFie a director appointed to fill a casual vacancy, who being eligible, offers himself for election.

47

Election of directorsRESUME OF DR. JAMES McFIE

48

Current designation

Director, School of Accountancy – Strathmore University

Track record • Dr. McFie has exemplary industry experience and has been a Training Manager, Ernst and Young and a member of Education and Training Committee, Institute of Certified Public Accountant of Kenya. He was also a member of the Board of Directors of the Kenya Capital Markets Authority and a Trustee in the Centre for Corporate Governance.

• Dr. McFie has written published documents including, Business Combinations and the Equity Method of Accounting, Accounting for Leasehold Land in Kenya.

Experience • Dr. McFie has a PHD in Accounting, University of Strathclyde and M.A. (Mathematics), Oxford University. He is a Fellow of the Association of Chartered Certified Accountants (FCCA) and a Fellow of the Institute of Certified Public Accountants of Kenya.


49

• Report of the Auditors & Directors




i

ii

iii

iv

Appointment and remuneration of Auditors

To re-appoint PricewaterhouseCoopers as the Company’s external auditors, and to authorize the directors to fix their remuneration

50

4. Special Business4. (i) Ratification of Incorporation of Subsidiaries and Related

Companies

51

Agenda 4 (i)

Purpose

(a)

(b)

(c)

(d)

(e)

(f)

(g)

THAT the incorporation of Two Rivers Property Owners Company Limited (incorporated in Kenya) as a wholly-owned subsidiary of the Company be ratified.

THAT the incorporation of Two Rivers Lifestyle Centre Limited (incorporated in Kenya) as a branch of Two Rivers Lifestyle Centre Limited in Mauritius be ratified.

THAT the incorporation of King Beverages Limited (incorporated in Kenya) as a wholly-owned subsidiary of the Company be ratified.

THAT the incorporation of Bakki Holdco Limited (incorporated in Kenya) as a wholly-owned subsidiary of the Company be ratified.

THAT the incorporation of Shefa Holdings Limited (incorporated in Mauritius) be ratified.

THAT the acquisition of 73.35% shareholding in Genesis Investment Management Kenya Limited be ratified.

THAT the acquisition of 30% shareholding in Broll Kenya Limited be ratified.



Ordinary Business

Special Business

AOB

1

2

3

4

5

AGM Program

AOB

i. Pollingii. Prayersiii. Lunch

53

Documents

47 th Annual General Meeting At Two Rivers, Limuru Road AUGUST 29, 2014