EXCELLENCE TAKES A LIFETIME OF PREPARATION€¦ · In our institutional domain we offer the full...

integrated annual report 2013

EXCELLENCE TAKES A LIFETIME OF PREPARATION

1 integrated sustainability features2 introduction and report approval3 group profile4 business model and strategy5 five-year review of integrated

performance6 value-added statement7 chairman’s report8 board of directors10 executive committee12 chief executive’s report

contents

14 review of operations17 corporate governance report22 remuneration report24 social, ethics and sustainability

committee report26 audit and risk committee report28 risk management report32 summarised annual financial

statements42 notice of annual general meeting

form of proxy (attached)corporate information

About this reportThis report is printed on Sappi Triple Green – a paper grade manufactured according to three environmental pillars: a minimum of 60% of the pulp used in the production of this paper is sugar cane fibre, which is the material remaining after raw sugar has been extracted from sugar cane; the bleaching process is elemental chlorine-free; and the remaining pulp used in the production process comprises wood fibre which is obtained from sustainable and internally certified afforestation, using independently audited chains of custody.

NeVerwaiver in integrity and transparency financial gain over relationships fear failure negative, always positiveever quit

AlwAysstart and finish believe free to explore energetic and creativewith passion, respect and humility

the Cadiz ten commitments

The Cadiz Ten Commitments are the principles which guide relationships with stakeholders

integrated sustainability features

Diluted headline earnings per share up 175% to 2.2 cents

Operating costs down 20%

Dividend per share of 7 cents

Refocused business model

Share scheme implemented to align staff and shareholders

Maintained level 3 BBBEE status

Assets under management R34.6 billion

Received SA Multi-Strategy Hedge Fund Award 2012

175%

Diluted headline earnings per share up

20%

Operating costs down

7 cents

Dividend per share

1

CADIZ integrated annual report 2013

introduction and report approval

Scope of the reportCadiz Holdings has pleasure in presenting its integrated annual report to stakeholders for the 2013 financial year. The report has been prepared to enable stakeholders to make an informed assessment of the group’s ability to create and sustain value.

The integrated annual report covers the activities and financial and non-financial performance of Cadiz Holdings Limited and its subsidiaries (the group) for the period 1 April 2012 to 31 March 2013. There has been no change from last year in the scope and boundary of the report. The principle of materiality has been applied to the financial and non-financial content and disclosure contained in the report.

Reporting complies with International Financial Reporting Standards, the Companies Act and the recommendations of King lll. The group has again published summarised financial statements as part of the integrated annual report. The audited annual financial statements are available in the investor relations section of the website www.cadiz.co.za and by request from the company secretary.

AssuranceAssurance on the integrated annual report has been provided by the directors, management and the group’s

internal audit department. The group’s external auditors, PricewaterhouseCoopers Inc., audited the summarised financial statements. Further external assurance has been limited to the group’s broad-based black economic empowerment scorecard which has been verified by the empowerment rating agency, Empowerdex.

Approval of integrated annual reportThe board acknowledges its responsibility to ensure the integrity of the integrated annual report of which the group’s summarised financial statements form part. The directors confirm they have assessed the content and believe the integrated annual report addresses all material issues and is a fair representation of the integrated performance of the group. The board accordingly approved the 2013 integrated annual report for release to stakeholders.

peter-paul Ngwenya Fraser shawChairman Chief executive officer

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group profile

Cadiz Holdings is a Cape Town-based specialist financial services group which is listed in the

Financial Services: Investment Services sector of the JSE Limited.

Founded in 1993, the group specialises in institutional and personal asset management, and corporate advisory services.

In 1998 Cadiz acquired District Securities Bank from Investec Bank. This transaction was a defining moment in the group’s evolution and was the forerunner of the listing of Cadiz Holdings on the JSE in April 1999.

Another transaction to have a profound impact on the group was the acquisition of African Harvest Fund Managers in late 2006. The acquisition trebled the Cadiz asset base at the time and established the group as a sizeable competitor in the institutional and personal asset management markets.

In 2011 the company sold 60% of its securities businesses to BNP Paribas SA. Cadiz continues to hold a 40% interest in this business which currently has a research offering covering 51% of the local equities market. BNP Paribas Cadiz Securities focuses on selling South African equity

products to institutional investors locally and abroad and offers international research and market access to local institutional investors.

Cadiz Asset Management is one of the larger independent fund managers in the country. Assets under management totalled R34.6 billion at year-end, spread across institutional (75%) and personal (25%) investment clients.

Black equity ownership was introduced into the group in 2004 when empowerment group Makana Investment Corporation (Makana) acquired a strategic shareholding of 10% in Cadiz. Makana is owned and controlled by the Makana Trust, an organisation established at the behest of Nelson Mandela to cater for the needs of former political prisoners and their dependants. Makana increased its shareholding in Cadiz to 15% in 2010. Cadiz is currently a level three broad-based black economic empowerment contributor.

iNVestmeNts ANd AdVisoryCADIz CORPORATE SOLuTIONS 100%CEO: Robbie Gonsalves

BNP PARIBAS CADIz SECuRITIES 40%CEO: Dan Ahern

MAKANA INvESTMENT CORPORATION (MIC) 24.8%*

CAdiz Asset mANAgemeNt

100%

CEO: Frank Cadiz

PERSONAL INvESTMENTS INSTITuTIONAL INvESTMENTS

* conversion right

Group executive committee (exco)Fraser Shaw | Frank Cadiz | Robbie Gonsalves | Shaheed Mohamed

group shAred serViCesHuMAN RESOuRCES | FINANCE | RISK

iNstitutioNAl ANd priVAte shAreholders

60%

mAkANA iNVestmeNt CorporAtioN

15%

direCtors, mANAgemeNt ANd stAFF

25%

CAdiz holdiNgs limitedCEO: Fraser Shaw

3


business model and strategy

Decentralised business modelCadiz operates a decentralised business model, with autonomous business units and a small centralised head office function which provides shared services. Business units are accountable for their performance which is closely aligned with remuneration and with the interests of shareholders.

The corporate head office function has been scaled down and central shared services reduced where there is no economic benefit to the business units.

The group’s main focus is on institutional and personal asset management through Cadiz Asset Management and also offers corporate advisory services through Cadiz Corporate Solutions. The group holds a 40% interest in and provides support services to BNP Paribas Cadiz Securities.

Asset managementCadiz Asset Management is an independent asset manager focused on enriching the lives of investors through the delivery of sustainable investment excellence. The business aims to deliver strong long-term investment performance relative to its peers and benchmarks. We follow an integrated strategy in investments, distribution and operations with one investment team and process across all investment strategies, and a single operations and distribution team providing client service to both institutional and retail

investors. We are committed to meeting the needs of our investors by building a focused and credible product offering, delivering best in class service, and focusing on sustainability through the implementation of best practice governance and compliance processes.

Institutional investmentsIn our institutional domain we offer the full spectrum of domestic focused investment solutions across equities, fixed income, multi-asset class portfolios, protected investments, hedge funds and structured products. Our investors include pension and provident funds, corporates, multi-managers and medical schemes which invest into either our segregated or pooled fund portfolios.

Retail investmentsIn our retail domain we offer a credible range of seven funds through our unit trust management company, each designed to meet our investors’ differing needs and challenges. We are committed to remaining focused in those areas where we have a competitive advantage.

Capital managementThe group’s capital management strategy is to retain a prudent liquid capital base to meet regulatory capital adequacy and working capital requirements. Existing illiquid strategic investments will be retained. Cadiz does not aim to accumulate capital and will reduce the dividend cover ratio as a means of returning funds to shareholders.

4

five-year review of integrated performance

2013 2012 2011 2010 2009

group summary

Gross operating revenue1 (R’000) 156 130 180 547 326 063 390 722 334 616

Operating expenses1 (R’000) 170 078 251 840 277 004 298 058 276 055

Headline earnings (R’000) 5 059 1 911 53 553 99 473 73 021

Shareholders’ funds (R’000) 672 909 784 163 683 700 639 367 559 938

ordinary share performance

Headline earnings per share

Basic (cents) 2.2 0.8 24.1 45.6 33.2

Diluted (cents) 2.2 0.8 23.5 45.3 33.1

Dividend per share (cents) 7.0 50.03 20.0 20.0 11.5

Net asset value per share (cents) 289 337 304 294 257

Net tangible asset value per share (cents) 179 229 177 164 125

Financial ratios and other indicators

Return on average ordinary shareholders’ funds (%) 0.7 19.7 8.1 15.1 11.4

Cost-to-income ratio (%) 86.2 111.1 83.1 72.8 76.0

Effective tax rate (%) 18.8 7.5 21.1 22.8 28.0

Dividend cover (times) 0.3 –3 1.2 2.3 2.9

Number of permanent employees at end of year 115 123 183 177 158

BBBEE scorecard level 3 3 3 4 –

Assets under management (R billion) 34.6 41.6 42.0 52.2 45.6

ordinary shares

Shares in issue (’000) 253 276 253 070 245 339 245 138 245 138

Consolidated number of shares2 (’000) 232 957 232 751 225 205 217 794 218 126

Weighted average number of shares (’000) 232 878 230 927 222 262 218 155 220 195

Diluted weighted average number of shares (’000) 233 238 234 678 228 276 219 471 220 453

stock exchange performance

value of shares traded (R’000) 106 387 133 069 181 140 147 165 128 332

volume of shares traded (’000) 62 914 49 668 54 293 54 438 58 838

Closing price (cents) 146 254 280 300 180

Market capitalisation based on consolidated shares at year-end (R’000) 340 117 591 188 630 574 653 382 392 627

Price-to-earnings ratio (ratio) 66.4 317.5 11.6 6.6 5.4

1 From2012,excludesSecuritiesbusiness.Comparativefigureshavenotbeenrestated.2 Netofsharesheldbyshareincentivetrustsandtreasuryshares.3 Specialdividend.

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value-added statementfor the year ended 31 March 2013

value added is defined as the value created by the activities of a business and its employees and in the case of Cadiz wealth is created through the provision of financial services.

This statement shows the total wealth created by the group and how it was distributed, taking into account the amounts retained and reinvested in the group for the replacement of assets and the development of operations.

(R thousands) 2013 % 2012 %

Value added

Continuingoperations

Gross operating revenue 156 130 180 547

Net interest income 14 592 12 522

Net investment income 26 389 35 529

Less: operational costs (88 313) (146 944)

Share of loss of associate (11 345) (5 746)

97 453 75 908

Discontinuedoperation – 208 721

wealth created 97 453 284 629

Distribution of wealth

Employees (including employees’ tax) 81 765 84 121 550 43

Government 3 803 4 11 677 4

Shareholders 116 376 119 46 562 16

Third parties 6 776 7 6 827 2

(Withdrawn from)/Reinvested in the group (111 267) (114) 98 013 35

Wealth distribution 97 453 284 629

employee statistics

Average number of permanent employees for the year 119 153

wealth created per employee 819 1 860

6

chairman’s report

Dear fellow stakeholders

Last year Cadiz Holdings underwent fundamental change as we sold a majority stake in our securities business to BNP Paribas SA, restructured our asset management business and adopted a decentralised business model for the group as we scaled down the head office.

While progress in delivering growth in the current year has been slower than we would have wanted, we have consistently advised shareholders that the changes will not yield a rapid turnaround in performance. However, as a board we are confident of creating sustainable shareholder value over time.

Our core focus as a business is now primarily on asset management. We have positioned Cadiz Asset Management strategically as an autonomous, independent fund manager that aims to enrich the lives of our customers through the delivery of sustainable investment excellence. Along with this autonomy comes accountability.

Confirming this commitment to asset management, we have strengthened the board with the appointment of Greg Fury as an independent non-executive director. Greg is highly respected among the investment community and is a former chief operating officer of leading asset manager, Allan Gray. We are already benefiting from Greg’s wealth of experience gained in more than 16 years in asset management and investment banking.

Our board now comprises eight directors, with the majority being independent as recommended by King lll. The board is strong, stable and well balanced in terms of diversity and expertise. We engage in robust debate and value the contribution of each director.

The relationship between Cadiz and its strategic empowerment partner, Makana Investment Corporation, is now in its tenth year. Many empowerment partnerships have been formed in corporate South Africa but few have endured and delivered tangible, mutually beneficial results as our relationship has done.

Importantly, empowerment extends beyond the group’s shareholding structure and is one element of the sustainable transformation which is taking place across the group. Cadiz has maintained its level three BBBEE status despite the more onerous targets set for employment equity and preferential procurement in the past year.

As an executive of Makana which holds a significant interest in Cadiz, I am not classified as an independent director in terms of current governance and regulatory codes. In line with best practice the board has a lead independent director to conduct meetings where the chairman may be conflicted and to act as the principal liaison between the independent directors and the chairman. This position is elected each year by the board and is currently held by Gando Matyumza.

Corporate governance is an evolving discipline and we continue to change and adopt practices which are relevant for the business and for our stakeholders. Processes were enhanced over the past year as we streamlined our board committee structure and introduced service agreements for directors to formalise their relationship with the company. Shareholders also approved our memorandum of incorporation and our remuneration policy.

At Cadiz our remuneration policies are designed to motivate and retain high-calibre people and to reward individual contribution to the group’s performance. Following the restructuring and the change in the business model, the board felt it appropriate to review the remuneration structure for executives and senior management to ensure that our reward systems incentivise staff to deliver on the new strategy, that we retain key staff and that rewards are aligned with those of our shareholders.

Shareholders have approved two long-term incentive schemes which will reward key employees for achieving predetermined performance targets and allow Cadiz to remunerate executives with shares rather than paying substantial cash bonuses.

We look forward to the 2014 financial year with renewed confidence and believe we will start to realise the benefits of our refocused business model in the years ahead. Thank you to all our stakeholders for your support during this time of transition in the life of Cadiz. I also extend my gratitude to my fellow directors for their guidance and counsel, and in particular thank our chief executive officer, Fraser Shaw, who has led the group with distinction in his first year in office.

peter-paul NgwenyaNon-executive chairman

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board of directors

Peter-Paul Ngwenya (59)Non-executive chairman BCom (Hons)

Appointed to the board in 2004 when Makana Investment Corporation acquired an equity stake in Cadiz Holdings and appointed chairman of the board in March 2011. Peter-Paul is chairman of Makana, founding trustee of Makana Trust and treasurer of the Ex-Political Prisoners Committee. He is also chairman of South African Airlink, iGagasi 99.5FM, Heart 104.9FM, Sebenza Forwarding and Shipping Consultancy, and deputy chairman of ATE. Peter-Paul is a non-executive director of Hulamin.

Ray Cadiz (50)Non-executive directorBSc (Hons) (Econ) (Summa Cum Laude) (Natal), MSc (Econ) (Oxon), CFA, FIFM, Harvard OPM 28

Appointed to the board in 1997, Ray founded Cadiz Holdings in 1993 and served as chief executive for 12 years. Appointed non-executive chairman in November 2006 to March 2011 and continues to serve as a non-executive director. Previous chairman of South African Futures Exchange (SAFEX) and former non-executive director of Denel and JSE Limited.

Greg Fury (43)independent non-executive directorBA, LLB (uCT), MA (Cantab), CFA

Appointed to the board in 2012. Greg is a principal of private equity firm, Targe Capital. He was previously chief operating officer of Allan Gray Limited (2003 – 2009). Before that he was an executive in the corporate finance division of Investec. Greg also served as deputy chairman of the Association of Savings and Investment South Africa.

Bryan Kent (68)independent non-executive directorBCom, FCMA, CA (SA), HDip (Tax), HDip (Company Law)

Appointed to the board in 1998, Bryan is the owner of a financial consulting business and previously partner in charge of tax practice at Price Waterhouse. Chairman of Country Bird Holdings and director of Emira Property Holdings, Set Point Holdings, Anchor Yeast and Raubex.

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Totsie Memela-Khambula (54)independent non-executive directorBA, M Public Admin, MDP (Wits), SEP (Wits and Harvard)

Appointed to the board in 2010, Totsie is currently CEO at Eduloan, director of Memela Pratt and Associates, Ithala, Melanani Investments and Imvuno Investments. She has extensive experience in the financial services industry, including serving as regional manager of Peoples Bank, general manager and acting managing director of the Land Bank and chief executive of customer services and retention at First National Bank home loans.

Steven Saunders (54)independent non-executive directorBA (Econ) (uCT), MA (Agri Sc) (Oxon), MBA (uCT)

Appointed to the board in 1998, Steven served as executive director of Tongaat Hulett Group from 1991 to 2007 and is former chairman of Tongaat Hulett Sugar (1995), Tongaat Textiles (1997) and Moreland Estates (2000).

Fraser Shaw (53)chief executive officer and financial directorBCom, CA (SA)

Appointed to the board in 2009, Fraser joined Cadiz as chief financial officer in 2002. He was appointed head of operations in 2005 and chief operating officer in 2008. In February 2012 Fraser was appointed chief executive officer. Prior to Cadiz, Fraser worked for Deloitte locally and in London before joining FTSE 100 company BET plc as group financial officer. Over the next eight years he served in senior financial management roles at The Laser Group, Oasis Asset Management and Prodigy Asset Management.

Gando Matyumza (50)lead independent non-executive directorBCom, BCompt (Hons), LLB, CA (SA)

Appointed to the board in 2010, and as lead independent director in 2012. Gando is a non-executive director of WBHO, Hulamin and KZN Growth Fund Managers. Gando has held senior financial management and executive positions for various organisations including South African Breweries and Transnet, and was a regional general manager of Eskom Distribution in the eastern region. Gando is an ordained minister of the African Methodist Episcopal Church and pastor of umlazi in the Natal Conference.

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executive committee

Fraser Shaw (53)chief executive officer and financial directorBCom, CA (SA)

Refer to biography under board of directors.

Frank Cadiz (45)chief executive officer of Cadiz Asset managementBSc (Hons) (Econ) (Summa Cum Laude) (Natal), M Sc (Econ) (Oxon), FIFM, CFA

Frank was a co-founder of Cadiz Holdings in 1993. While head of the equity derivatives team he was rated as the top derivatives analyst in South Africa. Frank was appointed chief executive officer of Cadiz Securities in 2002 and to his current position as chief executive officer of Cadiz Asset Management in 2004.

Robbie Gonsalves (50)chief executive officer of cadiz corporate SolutionsBCom, BCom (Hons) (Financial Management) (uCT), CA (SA), CIA

Robbie completed his articles at PricewaterhouseCoopers in Cape Town prior to being transferred to their Boston office where he gained exposure to the firm’s M&A activities and the private equity industry. He was admitted as a PwC partner in 1995. He joined Cadiz in 1998 to lead the group’s move into corporate structuring and was appointed managing director of Cadiz Corporate Solutions in 1999. He sits on a number of companies’ boards where Cadiz has an investment.

Shaheed Mohamed (40)head of group riskBCom, CA (SA), CFA

Shaheed started his career in 1995 at Deloitte in Cape Town, including a secondment to their New York office. He subsequently spent 18 months in London, during which time he worked for two large insurers. Since his return to South Africa, he has held risk management roles at PSG Investment Bank and Sanlam. He joined Cadiz in 2005 to head the risk management initiatives within the group. Shaheed was appointed to the executive committee in 2012.

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11


chief executive’s report

IntroductionOur main focus during the past year was on implementing the new strategy and decentralised business model, and ensuring the independent business units are positioned for renewed growth. The cost benefits of the new business model are becoming increasingly evident and we are confident that we have created a solid platform for growth in the business units.

Cadiz Asset Management continues to focus on delivering excellence in investment performance and client service, and this strategy is beginning to bear fruit. The restructuring of the business has been completed and an employee incentive scheme with medium- to long-term profit performance targets has been introduced to align management’s interests with shareholders.

BNP Paribas Cadiz Securities, where Cadiz holds a 40% stake, has made significant progress in the integration and launch of the new business. The research offering has been expanded to cover 51% of the domestic equities market. Although the benefits of the increased research offering on the local market and access to international investors has been slower than expected, the business is gaining traction.

Cadiz Corporate Solutions retained its focus on resources and infrastructure, however, the reduction in foreign direct investment and the labour instability in the mining industry made the M&A market more challenging and deals are taking longer to close.

Financial performanceThe performance for the period was impacted by the start-up losses in BNP Paribas Cadiz Securities, lower revenue from Cadiz Corporate Solutions in tough market conditions and fee income remaining static in the asset management business. The impact of the lower revenue has been partially off-set by cost reductions across the group.

Gross operating revenue from continuing operations was 13.5% lower at R156.1 million. Revenue from the group’s investments and capital decreased by 15.8% to R41.1 million off a lower capital base and as foreign exchange gains in the prior year were not repeated.

The focus on tight cost disciplines has resulted in a 20.2% reduction in operating costs, excluding the impact of the goodwill impairment in the prior year. Staff head count was down 6.5% to 115 (2012: 123) following the significant reduction in the prior year.

The share of associate loss of R11.3 million is higher than expected and reflects the costs of integrating the securities business into BNP Paribas, the revenue impact of changing from an agency broker to a price maker and the time delay in generating revenue following the launch of the new business.

Operating profit from continuing operations of R20.4 million (2012: R29.2 million loss) is 115% higher than the comparable prior year excluding the goodwill impairment.

Total comprehensive income from continuing operations for the period increased from a loss of R36.4 million to income of R5.1 million.

Diluted earnings per share from continuing operations is 96.4% lower at 2.2 cents per share.

Headline earnings totalled R5.1 million, with diluted headline earnings per share 175% higher at 2.2 cents per share.

Cadiz declared a dividend for the 2013 financial year of 7 cents per share.

Board and governanceThe board committees were restructured at the end of the last financial year and this has contributed to a more streamlined governance process.

Greg Fury, who has an in-depth knowledge of the asset management industry, joined the board as an independent non-executive director in December 2012 and we look forward to his contribution. Abigail Brooks, who served as an alternate director to Peter-Paul Ngwenya for two years, resigned as a director in January 2013.

TransformationTransformation is a core strategy and the group maintained its broad-based black economic empowerment level three contributor status with a score of 75.53 (2012: 81.14) despite the tougher targets. The detailed scorecard is included in the report of the social, ethics and sustainability committee.

ProspectsManagement plans to substantially complete the implementation of the decentralised business model by the end of June 2013. While cost control will remain a priority the focus will now shift to medium- to longer-term revenue growth.

The successful implementation of the senior management share scheme in March 2013 is a significant strategic step forward in ensuring that our people are aligned with our stakeholders and are partners in Cadiz, a principle upon which Cadiz will build in the years ahead. Assisted by this strategic progress, Cadiz Asset Management will continue to focus on delivering excellence in investment performance and client service across its product range, which will benefit all stakeholders and attract assets in the medium to long term.

The integration of BNP Paribas Cadiz Securities should be completed during the 2013 calendar year, which will include providing the South African equity market access to international institutional investors. The research team

12

expects to expand its coverage to 70% of the South African equities market by year-end.

Cadiz Corporate Solutions will continue to focus on the resources and infrastructure sectors and is well positioned to capitalise on the growing interest from Chinese and Indian investors through its strategic partnerships. Cadiz plans to introduce an equity participation scheme for the team.

Following the payment of a special dividend to shareholders in May 2012 the group continues to focus on retaining a prudent capital base and intends to distribute annual profits, excluding the non-cash impact of the associates, to shareholders.

AppreciationThank you to all the people at Cadiz for their contribution and commitment. The changes have been far-reaching and could not have been achieved without your support. We are confident that we have laid the foundation on which to build a successful and sustainable business. I would also like to thank my fellow board members and the executive committee for their guidance and commitment.

Fraser shawChief executive officer

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review of operations

summarised consolidated segment report (R thousands)

Asset management

Securities and structuring

Investments and advisory Total

2013

Segment revenue 140 219 – 38 054 178 273

Segment costs 134 823 – 14 586 149 409

Segment profit 5 396 – 23 468 28 864

Corporate costs (8 607)

Share of loss of associate (11 345)

2012 (restated)

Segment revenue 140 764 45 463 51 543 237 770

Segment costs 139 896 47 716 14 421 202 033

Segment profit 868 (2 253) 37 122 35 737



Year-on-year percentage movement

Segment revenue (%) – – (26) (25)

Segment costs (%) (4) – (1) (26)

Segment profit (%) 522 – (37) (19)

Asset managementCadiz has continued to focus on building an independent asset management company which aims to enrich lives through investment excellence and is therefore committed to delivering strong investment performance relative to its peers and benchmarks.

Revenue of R140.2 million was consistent with the previous year while expenses were R5 million lower. The business generated a profit of R5.4 million compared to R0.9 million in 2012.

In challenging conditions, total assets under management declined by R7.0 billion from March 2012 to R34.6 billion (September 2012: R34.8 billion). The net change in asset base represents a gain from market movement of R2.7 billion off-set by net outflows of R9.7 billion. As previously advised to shareholders, the asset base was adversely affected by a single client drawdown of R4.7 billion in 2012. Assets were further impacted by the termination of a R2.2 billion mandate in March 2013 due to legislative changes. While net cash flows have been negative, Cadiz Asset Management has benefited from improving margins resulting from the acquisition of higher-yielding mandates during the period. While assets under management have declined by 16.8%, revenue has remained flat. At year-end assets under management within Cadiz Collective Investments were R8.9 billion (25% of total assets under management) and Cadiz Life were R4.8 billion (up 45% at 14% of total assets under management).

Investment performance remains competitive across most funds with particularly strong performance in unit trust funds. Highlights include:

• The Cadiz money market Fund is either best or second best fund over all measurement periods.

• The Cadiz Absolute yield Fund is in the top quartile of all South African Multi Asset Income funds over all periods.

• The Cadiz managed Flexible Fund is in the top quartile of all South African Multi Asset Class High Equity funds for all periods of three years and longer.

• The cadiz inflation plus Fund is comfortably ahead of its rolling three-year CPI+5% benchmark.

Cadiz Asset Management was once again recognised for its investment excellence at the HedgeNews Africa awards where the Cadiz ZAR Opportunities Fund received the SA Multi-Strategy Hedge Fund Award for the best risk-adjusted returns in 2012.

Investments and advisoryAt year-end the group’s investment portfolio totalled R354.2 million. Revenue from the investment and advisory business declined by 26% to R38.1 million as a result of lower advisory fees and non-recurring foreign exchange gains. The revenue on investments was down from the previous year on a lower capital base following the payment of the R116 million special dividend. Costs were flat at R14.6 million.

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At the end of the period the capital was invested as follows:

• R53.7 million invested in liquid assets for regulatory capital adequacy;

• R49.5 million invested in liquid assets for short-term commitments;

• R50 million committed as seed capital and set aside for working capital requirements for the asset management business;

• R86.1 million invested in Makana, our strategic empowerment partner;

• R17.6 million invested in strategic unlisted investments; and

• R97.3 million held as a prudent operational buffer.

Cadiz Corporate Solutions (CCS), the group’s advisory business, continues to focus on the resources and infrastructure sectors. Through its strategic partnerships with leading international business advisory firms, The Beijing Axis (China) and Eternus Capital (India), CCS is well positioned to capitalise on the growing interest from Chinese and Indian investors in mining, resources and infrastructure in southern Africa.

The reduction in foreign direct investment and the labour instability in the mining industry has made the M&A market more challenging. The business has a healthy transaction pipeline but deals are taking longer to close in the current market environment.

Corporate costsCorporate costs have been reduced by 68% to R8.6 million as a result of reduced personnel costs, reduced IFRS 2 charges on the staff equity scheme and non-recurrence of prior year restructuring costs.

BNP Paribas Cadiz SecuritiesThe integration of the BNP Paribas Cadiz Securities business is nearing completion and the implementation of the business plan is well advanced. The cash equities and structured products offerings are gaining market traction along with the expanded research capability. The research team comprises 18 analysts, including 12 fundamental analysts covering 51% of the JSE. The non-fundamental analysts provide economic, political and quantitative research. The business has also been nominated as the Transition Manager of the Year by the Principal Officers’ Association.

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16

corporate governance report

IntroductionThe Cadiz Holdings governance framework extends beyond legislative and regulatory compliance and is aimed at creating a culture of good governance across the business to protect the interests of stakeholders.

The group subscribes to the principles of the Code of Corporate Practices and Conduct of the King Report on Corporate Governance 2009 (King lll) and any subsequent amendments to the code. Since the introduction of King lll several enhancements have been made to governance processes, including aligning the membership and charters of the board and committees to the recommendations in the code, shareholder approval of the memorandum of incorporation and a non-binding advisory vote passed on the remuneration policy. In addition, directors now have service agreements formalising their relationship with the company. The first integrated report was published in 2012 and through a process of stakeholder engagement the company continually seeks ways to enhance the report to provide meaningful information to key stakeholders.

A schedule detailing the group’s application of the King lll principles is available on the website (www.cadiz.co.za).

The board is satisfied that the group has applied the principles as set out in King III and where these have not been applied explanations have been provided for the alternative governance processes followed.

Explanation of non-adherence to King lll• The chairman of the board, Peter-Paul Ngwenya, is not

classified as independent as he represents Makana Investment Corporation, which holds a 15% interest in the company. As the chairman is not deemed to be independent, the lead independent non-executive director chairs meetings of the board when the chairman is conflicted.

• King lll recommends that non-executive remuneration should comprise a base fee and an attendance fee for each meeting. Directors currently only receive a base fee which the nomination and remuneration committee considers appropriate as many directors add value outside the regular formal meetings.

• The roles of the chief executive officer and the financial director are currently fulfilled by one executive director. The board and audit and risk committee consider this appropriate, given the size of the organisation, and are satisfied that there are sufficient resources within the group that both functions are adequately fulfilled.

• There is no formal dispute resolution process, however, the board believes that the existing processes within the group operate satisfactorily and do not require a more formal and separate mechanism.

Board of directorsBoard compositionIn line with the recommendations of King lll, Cadiz Holdings has a unitary board structure which consists of one salaried executive and seven non-executive directors. Greg Fury was appointed to the board as an independent non-executive director in December 2012 and Abigail Brooks resigned as an alternate director in January 2013.

At year-end the composition of the board was as follows (alphabetical by surname):

Independentnon-executivedirectorsGreg FuryBryan KentGando MatyumzaTotsie Memela-KhambulaSteven Saunders

Non-executivedirectorsRay CadizPeter-Paul Ngwenya (chairman)

ExecutivedirectorFraser Shaw (chief executive officer and financial director)

Background information on the directors appears on pages 8 and 9 and on the Cadiz website.

The non-executive directors have extensive business experience across a range of sectors which enables them to provide balanced and independent advice and judgement in the decision-making process. Non-executive directors have direct access to management and may meet independently of the executive directors.

Director independenceFive (71%) of the seven non-executive directors are independent. Chairman Peter-Paul Ngwenya is not classified as independent as he represents a shareholder owing a significant interest in the company while Ray Cadiz is not considered independent as he is a former executive of the company and a material shareholder.

The nomination and remuneration committee assessed the independence of the non-executive directors as required by King lll. This included a rigorous review of the two directors who have served on the board for more than nine years. The board is satisfied that these directors are independent.

Division of responsibilityA clear division of responsibility is embedded in the board charter. The board is led by the chairman, Peter-Paul Ngwenya, and the executive management of the group has been delegated to the chief executive officer, Fraser Shaw. This ensures a balance of authority and no one individual has unrestricted decision-making powers. The board and executive management work closely in determining the strategic objectives of the group.

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corporate governance report CONTINuED

Lead independent directorThe lead independent director is Gando Matyumza. She presides at meetings of the board where the chairman is conflicted, co-ordinates the activities of the other independent directors and serves as the principal liaison between the independent directors and the chairman.

Board appointmentsBoard appointments are conducted in a formal and transparent manner. Directors are appointed by the board based on the recommendations of the nomination and remuneration committee, subject to ratification by shareholders.

Non-executive directors retire annually and are eligible for re-election by shareholders at the annual general meeting. The executive director has a three-year service contract with key performance objectives. The retirement age for the executive director is 60 and there is no age limit for non-executive directors.

Succession planningThe nomination and remuneration, and the audit and risk committees are responsible for ensuring that formal succession plans are developed and implemented for the board, the chief executive officer and senior management.

Given the size of the organisation, a plan has been implemented to ensure that responsibilities related to vacancies in key positions are covered while the vacancy is being filled.

Board evaluationDue to the changes in the group structure and its renewed focus on asset management the board identified the need to appoint a director with experience in asset management. Consequently Greg Fury was appointed to the board on 1 December 2012. Taking into account the changes to the directors and their responsibilities with regard to their roles on the board and various committees, an internal evaluation was performed on the board, directors and committees. The evaluation concluded that the board and its committees were operating effectively and that the directors had the necessary skills and experience.

Company secretaryThe company secretary, Charl Schmahl, is responsible for ensuring that board procedures and the relevant regulations are observed. He also provides guidance to the directors on governance, compliance and their fiduciary responsibilities. The induction programme for newly appointed directors is co-ordinated by the company secretary.

All directors have unrestricted access to the advice and services of the company secretary. They are entitled to seek independent professional advice at the company’s expense

after consultation with the chairman of the board. Directors also have unrestricted access to all company information.

The board reviewed the skills, qualification and experience of the company secretary whose curriculum vitae is included below and was satisfied that they were appropriate.

Charl completed his BProc and LLB qualifications at the university of the Free State before being admitted as an attorney in 1997. He completed his articles concurrently at Markotter Attorneys and Walker Malherbe Godley and Field before joining Hofmeyr Herbstein Gihwala Cluver and Walker where he was made an associate in 1999. He then joined Walkers as a director where he served until 2005. He then moved into commercial business in 2006 with Oasis Group Holdings and joined Cadiz Holdings in 2007. He was appointed company secretary in June 2011.

Board charterA formal board charter confirms that the directors are accountable to shareholders and retain overall responsibility for:

• the focal point for corporate governance;

• developing and adopting strategic plans;

• cultivating and promoting an ethical corporate culture;

• monitoring operational performance and management;

• ensuring effective risk management and internal controls;

• ensuring that there is an effective risk-based internal audit;

• the selection, orientation and evaluation of directors;

• ensuring that there is an effective compliance framework;

• the approval of the integrated report and annual financial statements;

• timely and transparent reporting to shareholders; and

• sustainability of the business.

The charter also formalises policies relating to board membership and composition, board procedures, the conduct of directors, risk management, remuneration, board induction and evaluation.

Based on the results of the review of the company’s system of internal controls and risk management, including the review of the effectiveness of internal financial controls by internal audit and feedback from the external auditors on the results of the audit, assessed by the audit and risk committee, the board is of the opinion that the company’s system of internal controls and risk management is effective and that the internal financial controls form a sound basis for the preparation of reliable financial statements. The board’s opinion is supported by the audit and risk committee.

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Board committeesThe directors have delegated specific responsibilities to three committees to assist the board in the discharge of its responsibilities. The committees are all chaired by independent non-executive directors. The audit and risk committees and the remuneration and nomination committees were combined during the year to streamline the governance process.

Role of board committeesAudit and risk committeeThe committee is a statutory committee of Cadiz Holdings and its subsidiaries in terms of the Companies Act of 2008 and a committee of the board for all other duties assigned to it by the board.

The audit and risk committee seeks to ensure that management has created and maintained an effective internal control environment in the group. The committee is also responsible for ensuring that an effective policy and plan for risk management has been implemented that will enhance the group’s ability to achieve its strategic objectives, and that the disclosure regarding risk is comprehensive, timely and relevant.

Refer to the committee’s report on pages 26 and 27.

Nomination and remuneration committeeThe committee ensures that the group has implemented an effective and fair remuneration policy; employees, executives and directors are fairly and responsibly compensated according to the group’s remuneration goals and philosophy which are aligned with the shareholders’ interests; and that disclosure of director and executive remuneration is accurate, complete and transparent.

The committee further ensures that the board has the appropriate composition to execute its duties effectively; directors are appointed through a formal process; induction and ongoing training and development of directors takes place; and formal succession plans are developed for the board, chief executive officer and senior management.

Social, ethics and sustainability committeeThe committee ensures that the board provides effective leadership based on an ethical foundation; the group acts as a responsible corporate citizen and the group’s ethics are managed effectively.

Board and committee attendance

Board Audit and risk

Nomination and

remuneration

Social, ethics and

sustainability

Number of meetings 4 5 3 3

Peter-Paul Ngwenya 3+ 2

Ray Cadiz 4 3+

Bryan Kent 4 5+ 3

Gando Matyumza 4 3

Greg Fury* 1

Totsie Memela-Khambula 4 3

Steven Saunders 3 3 2+

Fraser Shaw 4 3

Frank Cadiz 2

% attendance at meetings 93 73 83 89

+ Chairman.* Appointedtotheboardwitheffectfrom1December2012.

The board is satisfied that the skills and experience of the audit and risk committee members are appropriate and in line with King III requirements.

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corporate governance report CONTINuED

Governance committeesThe following committees and forums support the governance framework within Cadiz:

committee role and responsibilities

Executive committee Develops strategy in conjunction with the board; determines objectives; goals and targets; manages the business within the authority’s framework; and ensures effective communication with all stakeholders.

Group risk forum Supports the audit and risk committee by ensuring that risks are actively monitored and managed and ensuring suitable compliance frameworks are in place and that the group complies with applicable governance.

IT steering committee Supports the audit and risk committee and the group risk forum by creating an effective IT governance framework, aligning IT with the group’s performance objectives, monitoring significant IT investment and expenditure.

Other governance structures

In addition to the group governance structures noted above, Cadiz Asset Management (CAM) has the following structures:

• CAM risk forum: Reviews risks facing the business, including compliance.

• CAM credit committee: Assesses and manages the credit exposure faced by client portfolios.

• CAM new business forum: Ensures that the business is able to manage new products and/or services.

Remuneration of directors and prescribed officersIn line with the recommendations in King III, remuneration of directors and prescribed officers has been disclosed in the remuneration report.

Accountability and complianceEffectiveness of compliance frameworkCadiz is committed to ensuring compliance with all relevant legislation, regulation, codes and standards. The board has delegated oversight of compliance to the audit and risk committee which has established the group risk forum. This forum operates within a board-approved compliance framework and includes representatives from all key areas in the business. Any material issues of non-compliance are escalated by the committee to senior management, the audit and risk committee and the board. The directors believe the compliance functions are suitably independent, adequately staffed and processes are sufficiently robust.

There were no significant cases of legislative or regulatory non-compliance during the year and no penalties or sanctions were imposed on the group or any of its directors or management.

Companies Act compliance The Companies Act (71 of 2008, as amended) came into effect during the prior reporting period, with the necessary changes made, other than as noted below.

At the 2012 AGM the shareholders approved that the company’s memorandum and articles of association be

replaced by the (then) newly drafted memorandum of incorporation.

Competition law complianceCadiz subscribes to the principles of fair, equal and healthy competition as envisaged by the Competition Act. Products and services are based on the principles of being the most competitive within legislative parameters, offering competitive pricing and providing superior performance for clients.

As a member of various industry associations Cadiz ensures that the respective organisations or the company do not condone or participate in activities which could result in anti-competitive behaviour. Exclusivity arrangements are generally only entered into with the approval of the executive decision forum and this is done to ensure the quality of service delivery to clients and to protect proprietary information and processes.

The directors believe the group is compliant with the Competition Act and the group has not been sanctioned for anti-competitive practices or for non-compliance with the Competition Act.

Information technology governanceThe King III code of governance emphasises the importance of information technology (IT) and recommends that more formal approaches be taken to provide assurance to the board that suitable IT governance protocols are being employed.

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Cadiz has always viewed IT as an integral part of its business in several respects, providing opportunities for efficiency, innovation, and being an enabler to supporting income generation.

The IT steering committee acts on behalf of all Cadiz group companies, and operates within a documented and approved charter. To ensure that the committee is able to fulfil its role, its members comprise representatives of the business, IT and the executive.

The key functions of the committee are to:

• promote and ensure an ethical IT governance culture, common IT language and effective governance framework;

• align the group’s performance and sustainability objectives;

• monitor significant IT investment and expenditure, to ensure that the expected return on investments materialise;

• protect intellectual property;

• identify, monitor and action IT-related risks and/or opportunities;

• promote effective management of information “assets”, by means of information and security management policies, including protection thereof; and

• promoting business resilience by ensuring, inter alia, suitable business continuity and disaster recovery plans are in place.

Personal share dealingsDirectors and staff are restricted from trading in the shares of Cadiz Holdings during two defined closed periods ahead of the reporting of the interim and annual results. Directors and members of senior management are required to obtain written clearance prior to dealing in the company’s shares and to notify the company secretary of any dealings. This information is then disclosed on the Securities Exchange News Services (SENS) of the JSE.

21


remuneration report

Remuneration policy and philosophyRemuneration policies are designed to motivate and retain high-calibre people and to reward them for their individual contribution to the group’s performance.

The group aims to sustain a competitive business culture where employees subscribe to a set of core values while maintaining their own identity. Cadiz therefore offers a work experience based on the concept of total reward which includes remuneration, healthcare and retirement benefits, career growth, skills development opportunities, recognition of achievements and work-life balance.

Remuneration governanceThe nomination and remuneration committee performs an oversight function and ensures the group has a remuneration policy that promotes the achievement of strategic company objectives and encourages individual performance. The committee reviews and oversees the setting of remuneration levels across the mix of fixed and variable pay, the implementation of an agreed remuneration review process and the outcomes of the implementation of the remuneration policy against set objectives. The regular review of long-term incentives to ensure continued contribution to shareholder value, employee benefits, directors’ service agreements, as well as the content of the remuneration report also rests with the committee. In addition, it is the responsibility of the committee to perform annual reviews of the CEO’s performance and to recommend his annual salary increase and short-term incentive awards to the board for approval. The nomination and remuneration committee ensures good corporate governance and legislative compliance.

Remuneration structureCadiz aims to pay around the median of the market and uses salary survey data from its participation in the PricewaterhouseCoopers Remchannel remuneration survey to inform the annual remuneration review process.

Executive director, management and staffRemuneration packages comprise a guaranteed salary, together with short-term and long-term incentives. The relationship between these remuneration components is dependent on the employee’s role and responsibilities. All employees are subject to the same conditions of employment, except for key employees who are subject to a three-month notice period and a six-month restraint period.

The chief executive officer’s remuneration takes into account individual performance and the scope of his role relative to industry benchmarks. The CEO received a guaranteed annual pay of R2 100 000 and was awarded a short-term incentive of R525 000 based on the achievement of individual key performance indicators as set in his contract. The CEO participates in the group’s share appreciation rights and restricted share plans, as detailed below.

Guaranteed salaryEmployees receive a total guaranteed remuneration package which includes the cost of compulsory contributions to the provident fund, group life, group accident, income security and medical aid. Annual increases are determined with reference to expected inflation, role changes and

competence. The overall salary increase granted for 2013 was 7.1% effective from 1 June 2012.

Short-term incentivesPermanent employees are eligible for a discretionary annual incentive award which includes a cash element and, where applicable, restricted equity in the Cadiz Restricted Share Plan.

The annual group incentive award is determined based on an agreed 30% of each business unit’s operating profits. Individual incentive awards are closely linked to the business unit, team and individual performance to incentivise employees to contribute towards delivery against agreed business objectives.

In order to create the correct longer-term focus and staff retention certain key asset management employees were awarded a guaranteed minimum incentive during the current year subject to continued employment until 31 March 2016.

Long-term incentive schemesIn March 2013 shareholders approved the following long-term incentive plans which are aimed at incentivising staff in key positions to deliver on the group’s long-term strategy, align employee interests with all stakeholders and to encourage staff retention.

• Cadiz Share Appreciation Rights Plan (CSARP)This plan rewards key staff for achieving performance targets based on the profitability of Cadiz Asset Management. Key staff are awarded share appreciation rights (SARs) which gives them a conditional right to acquire shares in Cadiz, the number being determined by the appreciation in value of a specified number of shares over a fixed period. The SARs are subject to continued employment, with the majority of SARs having an additional performance condition. The SARs are primarily an incentive but also serve as a retention mechanism.

An initial grant of 29.6 million SARs was made to key Cadiz Asset Management employees at a grant price of 147.9 cents.

• Cadiz Restricted Share Plan (CRSP)This plan allows Cadiz to remunerate employees in restricted shares (RSs) as opposed to paying substantial cash bonuses. The RSs are subject to continued employment for a determined period and further sale restrictions thereafter. The CRSP is primarily a retention mechanism but also aligns participants’ interests with other stakeholders and to give them the opportunity of benefiting from the economic growth of the company. No restricted shares were awarded in the current year.

Cadiz Black Employee Share Ownership Scheme (CBESOS)Introduced in 2008, the CBESOS empowers black employees to take up ownership in Cadiz. Shares allocated under the scheme are subject to a lock-in period of seven years. No shares were awarded in the current year.

Discontinued share schemes Cadiz Executive Equity Scheme (CEES) has been discontinued following the introduction of the CRSP and will be wound

22

down once the sale restrictions are lifted on the remaining 3.0 million shares issued under the scheme.

The other previously discontinued share schemes have 5.8 million (2012: 13.4 million) options and equity share appreciation rights outstanding. These have no dilutionary impact based on the group’s closing share price at year-end.

Non-executive directorsNon-executive directors are remunerated to recognise their contribution and to encourage maximum participation at board and committee meetings. Directors are paid fixed fees for their services as directors and for serving on each board committee, with an additional fee paid to the chairperson of each committee. The fees are reviewed annually and

recommended by the nomination and remuneration committee based on market benchmarks, and are subject to approval by shareholders at the annual general meeting. Non-executive directors have service agreements and do not participate in incentive schemes.

The board has decided not to adjust the fee structure in line with the King lll recommendation that non-executive remuneration should comprise a base fee and an attendance fee for each meeting.

Please refer to the corporate governance report on page 17 for further explanation.

Refer to the directors’ report in the annual financial statements for directors’ and prescribed officers’ shareholding.

Directors’ and prescribed officers’ emoluments executive directors and prescribed officers

(R thousands) salary bonusretirement/medical aid

share-basedpaymentexpense1

other benefits total

2013Fraser Shaw 1 753 450 359 64 63 2 689 Frank Cadiz2, 3 2 036 49 394 130 44 2 653

3 789 499 753 194 107 5 342 2012Ram Barkai4 3 125 – 458 611 6 813 11 007 Fraser Shaw 1 179 440 253 253 51 2 176

4 304 440 711 864 6 864 13 183 1 Share-basedpaymentexpenseinrespectofoptionsgrantedinpreviousyearsandequityportionofMarch2010andMarch2011incentiveawards.2 On1April2012FrankCadizbecameaprescribedofficer.3 Share-basedpaymentexpenseincludesamountsexpensedunderthenewCSARPschemeasdisclosedinnote11.4 Resignedasdirector21February2012.Thesalaryincludessalarypaymentsdueuntil31July2012andotherbenefitsincludeanamountof

R6513200payableonretirement.

Non-executive directors (R thousands)

2013 2012directors’

feesother

fees totalDirectors’

feesOther

fees TotalRay Cadiz 240 – 240 133 – 133 Greg Fury5 46 – 46 – – – Colin Hall6 – – – 332 – 332 Bryan Kent 292 – 292 382 – 382 David Lawrence6, 8 – – – 183 – 183 Gando Matyumza 189 – 189 183 – 183 Totsie Memela-Khambula 189 – 189 183 – 183 Nonhlanhla Mjoli-Mncube7 – – – 133 – 133 Peter-Paul Ngwenya 311 – 311 352 1009 452 Steven Saunders 292 – 292 283 – 283

1 559 – 1 559 2 164 100 2 264 5 Appointedeffective1December2012.6 Resignedeffective26March2012.7 Resignedeffective4November2011.8 FeespaidtoInvestecLimited.9 Feespaidforadditionaltimecommitmentbeyondnormalexpectedrequirementofthechairmanoftheboard.

total directors’ and prescribed officers’ remuneration(R thousands) 2013 2012Executive directors and prescribed officers 5 342 13 183 Non-executive directors 1 559 2 264

6 901 15 447

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social, ethics and sustainability committee report

The board established a social, ethics and sustainability committee (the committee) during the 2013 financial year in compliance with the requirements of the Companies Act.

The role of the committee is to assist the board in monitoring the group’s activities in terms of legislation, regulation and best practice relating to:

• social and economic development;

• responsible corporate citizenship;

• ethics management;

• environmental impact;

• consumer relationships; and

• labour and employment relationships.

The committee is responsible for ensuring that an ethical culture is developed within the business and that the group acts as a responsible corporate citizen in terms of empowerment and transformation, human rights, socially and environmentally friendly trading principles, and health and safety regulations.

The strategic direction of Cadiz must focus on building a sustainable business which takes account of internal and external stakeholders and does not negatively impact the economy, society or the environment.

The committee comprises one non-executive director, Ray Cadiz, who chairs the committee, Fraser Shaw (chief executive officer) and Frank Cadiz (chief executive officer, Cadiz Asset Management). The committee is scheduled to meet twice annually. Biographical details of the committee members appear on pages 8 to 10.

The committee members believe that most of the issues required to be monitored in terms of the Companies Act are already being addressed.

Cadiz is committed to practices which promote sustainable development. The business is a signatory to the united Nations’ Principles of Responsible Investing (uNPRI), a framework for achieving better long-term investment returns and more sustainable markets, and supports the Code for Responsible Investing in South Africa, a voluntary code for institutional investors which provides guidelines on sustainable investing.

Empowerment and transformationCadiz maintained its level three BBBEE contributor status in terms of the Codes of Good Practice of the Department of Trade and Industry (DTI) in its assessment in January 2013. The rating was independently verified by accredited economic empowerment rating agency, Empowerdex.

BBBEE elementMaximum

points 2013 2012

Ownership 20 17.16 20.94

Management and control 10 6.56 6.72

Employment equity 15 5.04 5.73

Skills development 15 9.90 10.58

Preferential procurement 20 16.86 17.17

Enterprise development 15 15.00 15.00

Socio-economic development 5 5.00 5.00

Total 100 75.53 81.14

BBBEE level contributor 3 3

The 2013 rating reflects the more challenging targets set by the DTI for employment equity and preferential procurement.

Ownership, management and controlBroad-based empowerment group Makana Investment Corporation (Makana) holds a 15% strategic equity stake in Cadiz. Makana is controlled by the Makana Trust which was established to address the plight of former political prisoners in South Africa. Peter-Paul Ngwenya, the chairman of Makana, is the non-executive chairman of Cadiz.

Cadiz has also allocated 10% of its share capital to attract and retain black staff through equity ownership.

At year-end 43% of the non-executive directors were black and 29% female.

Employment equityCadiz aims to attract, develop and retain highly energised individuals who will contribute to the sustainability of the business. The group favours the appointment, empowerment and advancement of previously advantaged individuals to achieve a representative employee profile.

Black staff comprises 50% and females 51% of the total staff complement.

Skills developmentThe group invested 2.2% (2012: 3.1%) of its payroll in training and skills development. Owing to the restructuring and changes within the business over the past year, training has focused on systems and project implementation, as well as on regulatory and compliance training.

The mentoring and training of junior black staff have continued, in line with the group’s commitment to develop black staff for the industry.

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Preferential procurementThe group’s procurement policy supports black-owned businesses, particularly black SMMEs and encourages suppliers to transform their businesses, where appropriate.

Enterprise developmentCadiz provided funding to Makana to enable the business to enter the financial services industry when it acquired a 10% equity stake in Cadiz in 2004 and also funded an additional 5% shareholding in 2010. Cadiz also provided funding to KayaGAS which supplies liquefied petroleum gas to families in informal settlements.

Socio-economic developmentCadiz is committed to investing a minimum of 1% of after-tax profits in community support annually. Donations are channelled through the Cadiz Foundation which focuses on education, environmental awareness and community upliftment in the Western Cape.

The main beneficiaries from Cadiz and the Foundation in the past year included GreaterGood South Africa, the Kommetjie Environmental Awareness Group, LEAP Science and Maths Schools, and the Steenberg Golf Club caddie fund.

Since 2006 Cadiz has donated over R7 million to social and community development programmes.

Stakeholder engagementCadiz strives to achieve a balance between meeting the needs of stakeholders and advancing the interests of the business in a sustainable manner. Through proactive and constructive engagement with stakeholders Cadiz takes account of the legitimate interests of stakeholders. The committee recognises that stakeholders’ perception of the business determines the corporate reputation.

Ethical conduct The group subscribes to the highest ethical standards of business practice. The Cadiz Ten Commitments encapsulate the group’s values and are the guiding principles by which staff conduct business and manage relationships with stakeholders. Should staff violate the spirit of the values or contravene the code of conduct or any other company policy, the matter is dealt with in accordance with the human resources disciplinary code. The committee is responsible for monitoring ethics practices and is satisfied that no material breaches of ethical behaviour occurred during the reporting period.

Guidelines have been formulated which govern the declaration of potential conflicts of interests, personal account trading and the acceptance of gifts from third parties. Please refer to the section on competition law compliance on page 20 of the corporate governance report.

ConclusionThe group is committed to enhancing its social, ethics and sustainability reporting incrementally in future years. This report of the committee will be presented to shareholders at the annual general meeting in September 2013.

ray CadizChairmanSocial, ethics and sustainability committee

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audit and risk committee report

IntroductionThe Cadiz Holdings audit and risk committee is a statutory committee in terms of the Companies Act and also has an independent role with accountability to both the board and to shareholders.

The committee operates within a documented charter which complies with all relevant legislation, regulation and governance codes. The committee subscribes to the King lll code of corporate governance.

The committee also acts on behalf of all other Cadiz group companies that have not established their own audit committees.

Role of the committeeThe audit and risk committee seeks to ensure that management has created and maintained an effective internal control environment in the group. In conducting its business the committee is authorised by the board to investigate any activity within its terms of reference, seek any information that it requires from any employee of the company and obtain external legal or professional advice where it considers this to be necessary.

The key functions of the committee are to ensure the effectiveness of the following:

• integrated reporting, including risks, disclosure and assurance (if appropriate);

• ensuring a combined assurance model is applied and monitoring the relationship with those providers;

• considering expertise, experience and adequacy of the finance function and/or financial director;

• overseeing the functioning of internal audit, including approving the internal audit plan, assessing the internal audit function and the chief audit executive;

• overseeing risk management, which includes those relating to financial reporting, internal financial controls, fraud and IT (refer to the risk management report on pages 28 to 31); and

• recommending the external auditor for appointment by shareholders, approving the terms of engagement, monitoring quality, effectiveness and independence of external auditors (including non-audit services and related policies and approval processes).

Composition of the committeeThe committee comprises at least three independent non-executive directors and the chairman of the company may not serve on the audit and risk committee. The board appoints the chairman of the audit and risk committee.

The following independent non-executive directors served on the committee during the year under review and to the date of this report:

• Bryan Kent (chairman);

• Steven Saunders; and

• Gando Matyumza.

Details on the committee members appear on pages 8 and 9 of this report. Fees paid to the committee members are outlined in the table of directors’ remuneration on page 23.

Management, internal audit and the external audit partners and staff attend meetings at the invitation of the committee. The audit and risk committee also meets separately with the external and internal auditors, without members of executive management being present.

The effectiveness of the committee is reviewed as part of the board and committee evaluation process each year.

External audit The audit and risk committee has assessed the independence, expertise and objectivity of PricewaterhouseCoopers (PwC) as the external auditor, as well as approving the terms of engagement and the fees paid to PwC (refer to note 18 in the annual financial statements).

The board has received confirmation from the external auditor that the partners and staff responsible for the audit comply with all legal and professional requirements with regard to rotation and independence, including the stipulation that they should not hold shares in Cadiz Holdings.

The committee is satisfied with the external auditor and recommends PwC for reappointment for the 2014 financial year.

Non-audit servicesThe group has a formal policy for the provision of non-audit services by the external auditors. The policy also requires PwC to satisfy the audit and risk committee that the delivery of non-audit services does not compromise their independence. During the period under review PwC received R538 613 for non-audit services relating to advisory services. This equates to 17.4% of the total fees paid to PwC from continuing and discontinued operations.

Internal audit Internal audit, which operates under an approved internal audit charter, provides an independent, objective appraisal and assurance function and forms a core element of the group’s corporate governance structures. Internal audit follows a risk-based approach. The internal audit function reports to the audit and risk committee and has the support of the board and management. The chief audit executive has direct access to the chairman of the audit and risk committee and meets with him monthly.

To ensure the internal audit function meets the specialist and resource requirements necessary to fulfil its role, a strategic

26

decision was taken to co-source with a suitably skilled and reputable partner. Deloitte is currently the co-source partner. This ensures that industry best practices are always applied and that the necessary specialist skills are readily accessible. The co-sourcing strategy is regularly reassessed to ensure it remains appropriate. The performance of the chief audit executive and internal audit function has been assessed by the audit and risk committee.

Internal controlSystems of internal control are designed to manage the risk of failure to achieve business objectives and to provide reasonable, but not absolute, assurance against misstatement or loss.

The audit and risk committee has overseen a process by which internal audit performed an assessment of the effectiveness of the company’s system of internal control and risk management, including internal financial controls. This report by internal audit formed the basis of the audit and risk committee’s recommendation to the board to report thereon. The committee supports the opinion of the board in this regard.

Going concernThe committee has reviewed the assumptions used by management in the going concern status of the company.

Activities of the audit and risk committeeThe committee is required to meet at least twice each year, with meetings coinciding with the key dates in the financial reporting and audit cycle. Members of the committee, the external auditors or the chief audit executive may approach the chairman of the audit and risk committee and request a non-scheduled meeting. The chairman will consider the request and convene a meeting if deemed necessary.

Minutes of the meetings of the committee are circulated to all directors and supplemented by an update from the audit and risk committee chairman at each board meeting. Matters requiring action or improvement are identified and appropriate recommendations made to the board.

The chairman of the committee is required to attend all statutory shareholder meetings to answer any questions on the committee’s activities.

Evaluation of the chief financial officer and finance functionThe audit and risk committee satisfied itself as to the appropriateness of the expertise and experience of the group’s financial director and the chief financial officer. The committee is also satisfied as to the expertise, resources and experience of the finance function.

Approval of the audit and risk committee reportThe committee confirms that it has functioned in accordance with its terms of reference for the 2013 financial year and that its report to shareholders has been approved by the board.

bryan kentChairmanAudit and risk committee

Cape Town27 May 2013

27


risk management report

IntroductionCadiz recognises that effective risk management is critical to the long-term sustainability of the business.

The audit and risk committee seeks to ensure that management has implemented an effective policy and plan for risk management, which will enhance the group’s ability to achieve its strategic objectives. In conducting its business, the committee is authorised by the board to investigate any activity within its terms of reference, seek any information that it requires from any employee of the company and obtain external legal or professional advice where it considers this to be necessary. The committee makes suitable recommendations to the board for changes to be implemented within the group.

The board has satisfied itself as to the effectiveness and appropriateness of the risk management systems and processes that were in place for the reporting period.

Risk management processIn line with acknowledging management’s responsibility for risk management, a group risk forum (GRF) is in place and meets on a monthly basis, providing regular interaction and a structured approach to identification, measurement and monitoring of risks at a group level. This includes the review and control of exposures through various financial, credit, operational and legal reporting systems. Minutes of GRF meetings are circulated to the audit and risk committee as well as included in the documentation sent to the board.

To further embed risk management within the business, a credit and risk forum (CRF) has been established within the asset management business unit. The focus of this forum is on asset management and any of its related business, and

includes monitoring of risks that face clients, even if those risks do not impact the group’s balance sheet.

The chairman of the audit and risk committee is kept abreast of developments within Cadiz through regular meetings with the chief risk officer.

The group operates within an approved risk appetite. The risk appetite is reviewed on an annual basis to ensure that it is appropriate given the long-term vision of the company. Strategies are formulated and approved in line with the risk appetite of the board.

The reporting structures are further supported by complementary committees and/or forums responsible for the general oversight and approval of risk exposures.

Key internal controls are regularly evaluated through a risk-focused internal audit programme. Deloitte is contracted to assist Cadiz with the internal audit, ensuring that current best practices are utilised.

A risk register, which sets out the significant risks facing the company, is regularly reviewed by the committee. Due to the recent structural changes in the group, and the increased focus on asset management as a significant business within the group, the risks have been amended accordingly. Given the importance of investor returns to the sustainability of the business, some risks faced by the clients have also been incorporated into the register. The significant risks have been identified and are proactively managed. The accompanying table provides insight into risks and controls relevant to the Cadiz group. Financial risks are discussed in further detail in the financial statements available on the Cadiz website www.cadiz.co.za

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risk Definition How managed/mitigated

Credit risk The risk of a financial loss as a result of a counterparty failing to meet its financial obligations or changes in its creditworthiness. This loss could either be suffered by the company, or its clients.

Client

• A credit committee comprising executive management, compliance, risk and credit representatives is in place.

• The committee reviews the credit exposure to counterparties on an aggregated basis to ensure that internal global prudential limits are applied, except where mandates specifically allow otherwise.

• Industry trends and any related impact on credit quality is brought to the committee’s attention and action is taken accordingly.

• All counterparties (including brokers) require preapproval by the committee.

Corporate

• Investment of cash is limited to top-rated local and international banks on a diversified basis.

• The group audit and risk committee is responsible for setting prudential credit limits and reviewing the associated credit exposures.

• Established credit policies are in place and are reviewed as the business requires.

liquidity risk The risk that the group will not be able to meet its funding commitments as and when they fall due, or that the group may be forced to liquidate its positions under adverse conditions to meet these obligations.

• Daily cash flow reporting is conducted according to preset parameters, while monthly scenario-based cash flow forecasting determines future liquidity requirements.

• The group’s working capital requirements are monitored and are managed separately from the rest of the group capital with the primary focus on liquidity.

• Should there be a liquidity requirement over and above normal operational requirements, a general banking facility is available to meet those needs.

market risk The risk of loss to the group as a result of potential changes in fair values of financial instruments in response to movements in price, rates, currency and other factors such as volatility.

• The group only assumes market risk through the investments of the group’s own capital base.

• Proprietary trading is not undertaken and all investments are made according to an approved investment mandate with set asset allocation parameters. These investments are continually measured with the use of mark-to-market valuations, sensitivity, concentration and scenario analyses.

• A significant proportion of the capital base is invested in relatively low-risk investments so as to meet minimum regulatory requirements.

• The group has negligible currency risk.

Solvency risk The risk that the group will not have sufficient capital to settle potential losses from investment and business activities.

• The asset management and structuring teams limit exposure by never acting as principal.

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Compliance and legal risk

The risk of incurring financial loss resulting from penalties in the event of non-adherence to regulations and legislation.

• The GRF and CRF have been tasked with ensuring compliance with all regulations and legislation relevant to the group. The forums meet monthly and report to the group’s audit and risk committee.

• Mandate compliance monitoring software is utilised in asset management, with a formalised escalation policy in place. The compliance function is suitably independent and has direct access to the audit and risk committee.

• The compliance function is appropriately skilled to fulfil its role.

• The compliance function remains abreast of impending legislative changes by means of membership of professional and industry bodies such as ASISA and CISA.

technology risk

The risk of loss due to deficiencies in the information technology infrastructure or disruption in operations caused by an unforeseen disaster.

• Operational efficiency and business continuity are ensured by means of employing up-to-date software and hardware across the group, and continual revision and testing of the disaster recovery plan.

• An IT steering committee monitors risks and opportunities relating to IT, as well as monitoring significant IT project spend and ensuring that the intended benefits are realised.

• A business continuity plan is in place and is regularly assessed for suitability.

human resources risk

The success of the organisation is dependent on the quality of the staff employed and retained.

• The group has a remuneration policy designed to attract and retain the appropriate skills and talent. The policy is regularly reviewed for appropriateness.

• Self-development, training and studying are encouraged. The group is committed to employment equity and continually strives to exceed best practice.

• An appropriate succession planning policy has been established.

New business risk

The risk associated with new business ventures, products, and/or material changes to existing ones.

• The GRF and/or CRF would act as the screening body to assess proposals that involve new business ventures, products, and/or material changes to existing ones. It would assess these proposals for suitability, given the risk appetite and tolerance of the business. Depending on its limits of authority, and impact of the proposals, it may refer them for further approval to the relevant executive committee, audit and risk committee and/or board, as is appropriate.

• The forums consist of representatives from business, risk, legal, finance and internal audit.

reputational risk

The risk that an event or transaction may compromise the group’s reputation with resultant adverse financial implications.

• The group is committed to conducting all activities with the utmost integrity and in accordance with the highest standards of professionalism.

• The group has a zero tolerance policy on ethical misconduct.

risk management report CONTINuED

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investment performance risk

The risk that poor investment performance on client portfolios could result in loss of assets under management.

• Investment performance is a significant driver of success within the asset management business.

• Key performance metrics are in place for the investment team and these are aligned with the remuneration process.

• Investment performance is assessed against mandates, benchmarks and peer groups. This is monitored by management and reported to the board, with appropriate action being taken when necessary.

operational risk

The risk of a loss suffered by the group, or its clients, due to an oversight or lack of adherence to policies and procedures.

• The operations team is centralised from a physical and reporting perspective.

• The operations team meets regularly and members of the team are able to escalate issues to other governance bodies within the group.

• Controls and procedures are included in the review performed by internal and external audit.

• Operational risks are assessed as part of the risk management process with consideration given to the appropriateness of mitigating actions.

• Formal service level agreements are in place where significant operations are outsourced. Where appropriate, comfort on outsource partner controls are assessed by the global assurance standard, ISAE-3402.

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33 directors’ responsibilities for financial reporting33 preparation of summarised consolidated financial statements34 certificate by the company secretary35 report of the independent auditor36 summarised consolidated statement of financial position37 summarised consolidated statement of comprehensive income38 summarised consolidated statement of cash flows38 summarised consolidated statement of changes in equity39 summarised consolidated segment report40 notes to the summarised consolidated financial statements41 analysis of shareholders

summarised consolidated financial statements

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directors’ responsibilities for financial reporting

The directors are responsible for the preparation, integrity, and fair presentation of the financial statements of the company and of the group. The summarised consolidated financial statements presented on pages 36 to 41 have been prepared in accordance with International Financial Reporting Standards (IFRS) and comply with IAS 34 – Interim Financial Reporting, the Listings Requirements of the JSE Limited and the Companies Act, No. 71 of 2008 and include amounts based on judgements and estimates made by management.

The directors consider that in preparing the financial statements they have used the most appropriate accounting policies, consistently applied and supported by reasonable and prudent judgements and estimates, and that all statements of IFRS that they consider to be applicable have been followed.

The directors are satisfied that the information contained in the financial statements fairly presents the results of operations and cash flows for the year and the financial position of the group at year-end.

The directors have responsibility for ensuring that accounting records are kept. The accounting records should disclose with reasonable accuracy the financial position of the companies to enable the directors to ensure that the financial statements comply with the relevant legislation.

The company and its subsidiaries operated in a well-established control environment, which is well documented and regularly reviewed. This incorporates risk management and internal control procedures, which are designed to provide reasonable, but not absolute, assurance that assets are safeguarded and the risks facing the business are being controlled.

The going concern basis has been adopted in preparing the financial statements. The directors have no reason to believe that the group or any company within the group will not be going concerns in the foreseeable future, based on forecasts and available cash resources. These financial statements support the viability of the company and the group.

The group’s external auditors, PricewaterhouseCoopers Inc., audited the financial statements and their report is presented on page 35.

The financial statements have been approved by the board of directors on 27 May 2013 and are signed on its behalf by:

peter-paul Ngwenya Fraser shawChairman Chief executive officer

preparation of summarised financial statements

The summarised consolidated financial statements have been prepared under the supervision of the chief financial officer, Richard Jähnig CA (SA).

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certificate by the company secretary

In accordance with the provisions of section 88(2)(e) of the Companies Act, No. 71 of 2008 as amended, I hereby certify that to the best of my knowledge, the company has lodged with the Companies and Intellectual Properties Commission, for the financial period ended 31 March 2013, all such returns as are required of a public company in terms of the Act and that all such returns are true, correct and up to date.

Charl schmahlCompany secretary


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report of the independent auditoron the summarised consolidated financial statements to the shareholders of Cadiz Holdings Limited

The summarised consolidated financial statements, which comprise the summarised consolidated statement of financial position as at 31 March 2013, and the summarised consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, and related notes, as set out on pages 36 to 41, are derived from the audited consolidated financial statements of Cadiz Holdings Limited for the year ended 31 March 2013. We expressed an unmodified audit opinion on those consolidated financial statements in our report dated 27 May 2013. Our auditor’s report on the audited consolidated financial statements contained an Other Matter paragraph (refer below).

The summarised consolidated financial statements do not contain all the disclosures required by International Financial Reporting Standards and the requirements of the Companies Act of South Africa as applicable to annual financial statements. Reading the summarised consolidated financial statements, therefore, is not a substitute for reading the audited consolidated financial statements of Cadiz Holdings Limited.

Directors’ responsibility for the summarised consolidated financial statementsThe company’s directors are responsible for the preparation of a summary of the audited consolidated financial statements in accordance with the requirements of the JSE Limited Listings Requirements, set out in the basis of preparation note to the summarised consolidated financial statements, and the requirements of the Companies Act of South Africa as applicable to summary financial statements.

Auditor’s responsibilityOur responsibility is to express an opinion on the summarised consolidated financial statements based on our procedures, which were conducted in accordance with International Standard on Auditing (ISA) 810, “Engagements to Report on Summary Financial Statements.”

OpinionIn our opinion, the summarised consolidated financial statements derived from the audited consolidated financial statements of Cadiz Holdings Limited for the year ended 31 March 2013 are consistent, in all material respects, with those consolidated financial statements, in accordance with the requirements of the JSE Limited Listings Requirements, set out in the basis of preparation note to the summarised consolidated financial statements, and the requirements of the Companies Act of South Africa as applicable to summary financial statements.

The Other Matter paragraph in our audit report dated 27 May 2013 states that as part of our audit of the consolidated financial statements for the year ended 31 March 2013, we have read the directors’ report, the audit committee’s report and the company secretary’s certificate for the purpose of identifying whether there are material inconsistencies between these reports and the audited consolidated financial statements. These reports are the responsibility of the respective preparers. The Other Matter paragraph states that, based on reading these reports, we have not identified material inconsistencies between these reports and the audited consolidated financial statements. The paragraph furthermore states that we have not audited these reports and accordingly do not express an opinion on these reports. The Other Matter paragraph does not have an effect on the summarised consolidated financial statements or our opinion thereon.

pricewaterhouseCoopers inc.

director: d g malanRegistered Auditor


35


summarised consolidated statement of financial position

(R thousands) 31 march 2013Restated

31 March 2012Restated

1 April 2011

Assets

Intangible assets 238 423 236 011 269 334

Plant and equipment 5 161 4 476 6 906

Investment in associate 64 317 75 662 –

Deferred taxation 24 575 20 846 19 230

Investments backing linked funds 4 846 601 3 337 733 2 232 001

Financial assets – at amortised cost 87 752 83 097 86 432

Financial assets – at fair value 251 158 151 963 113 314

Receivables and prepayments 54 943 67 770 227 835

Taxation 1 888 8 333 2 406

Cash and cash equivalents 66 081 276 834 231 798

total assets 5 640 899 4 262 725 3 189 256

eQuity

Capital and reserves

Ordinary share capital and premium 25 644 25 277 3 619

Treasury shares (52 893) (52 869) (52 411)

Share-based payment reserve 36 173 36 430 59 888

Retained earnings 663 985 775 325 672 604

total equity 672 909 784 163 683 700

liAbilities

Deferred taxation 7 694 5 994 2 912

Linked investment contract liabilities 4 846 601 3 337 733 2 232 001

Third-party financial liabilities arising on consolidation of mutual funds 50 839 46 333 –

Financial liabilities – at fair value – – 28 290

Provisions 4 759 5 519 17 567

Trade and other payables 51 092 77 375 217 873

Taxation 7 005 5 608 6 913

total liabilities 4 967 990 3 478 562 2 505 556

total equity and liabilities 5 640 899 4 262 725 3 189 256

Net asset value (cents per share) 289 337 304

Net tangible asset value (cents per share) 179 229 177

36

summarised consolidated statement of comprehensive income

(R thousands) 31 march 2013 31 March 2012continuing operationsGross operating revenue 156 130 180 547Interest income 14 746 13 353Net investment income 26 389 35 529

Net income from investments 26 275 32 135Foreign exchange gains 114 3 394

Income attributable to linked assets – –Net fair value gains on linked financial instruments 506 234 252 369Linked liability adjustment (506 234) (252 369)

Fair value adjustment on third-party mutual fund interests (6 776) (6 827)Operating expenses (170 078) (251 840)Operating profit/(loss) 20 411 (29 238)Finance costs (154) (831)Share of loss of associate (11 345) (5 746)Profit/(Loss) before taxation 8 912 (35 815)Taxation (3 803) (571)total comprehensive income/(loss) from continuing operations 5 109 (36 386)Discontinued operationProfit from discontinued operation – 180 961total comprehensive income 5 109 144 575

earnings/(Loss) per share (cents)Basic – from continuing operations 2.2 (15.8)

– from discontinued operation – 78.42.2 62.6

Diluted – from continuing operations 2.2 (15.5) – from discontinued operation – 77.1

2.2 61.6

Notes to the summarised statement of comprehensive incomereconciliation of headline earnings:profit attributable to equity holders of the company 5 109 144 575

Surplus on disposal of subsidiary – (191 909)Taxation impact – 10 495Goodwill impairment – 38 742(Surplus)/Loss on disposal of plant and equipment (70) 11Taxation impact 20 (3)

headline earnings 5 059 1 911

headline earnings per share (cents)Basic 2.2 0.8Diluted 2.2 0.8

Share informationIssued number of shares (’000) 253 276 253 070Consolidated number of shares (’000) 232 957 232 751Weighted average number of shares (’000) 232 878 230 927Diluted weighted average number of shares (’000) 233 238 234 678

37


summarised consolidated statement of cash flows

(R thousands) 31 march 2013Restated

31 March 2012

cash flow from operating activities 491 654 62 828

Cash generated from operations 605 936 131 076

Taxation paid 2 094 (21 686)

Dividends paid (116 376) (46 562)

cash flow from investing activities (78 509) 87 112

cash flow from financing activities 164 2 450

Net change in cash and cash equivalents 413 309 152 390

Effect of exchange rate adjustment – 2

cash and cash equivalents at beginning of year 751 657 599 265

cash and cash equivalents at end of year 1 164 966 751 657

Attributable to group 66 081 276 834

Attributable to policyholders 1 098 885 474 823

2012 cash flow includes cash flow from the discontinued operations.

summarised consolidated statement of changes in equity

(R thousands) 31 march 2013 31 March 2012

share capital, share premium and treasury shares

Opening balance (27 592) (48 792)

Issue of shares 355 21 731

Repurchase of A ordinary shares (12) (19)

Repurchase of B preference shares – (50)

Purchase of treasury shares – (462)

(27 249) (27 592)

reserves

Opening balance 811 755 732 492

Net premium on (cancellation)/issue of equity-settled share appreciation rights (73) 2

Employee scheme – value of services provided (257) (18 752)

Total comprehensive income 5 109 144 575

Dividends paid (116 376) (46 562)

700 158 811 755

total equity 672 909 784 163

38

summarised consolidated segment report

(R thousands)Asset

managementSecurities and

structuring Investments and advisory Total

31 march 2013

Segment revenue 140 219 – 38 054 178 273

Segment costs 134 823 – 14 586 149 409

Segment profit 5 396 – 23 468 28 864



Profit before taxation 8 912

Gross operating revenue (external) 129 228 – 26 902 156 130

31 march 2012 (restated)

Segment revenue 140 764 45 463 51 543 237 770

Segment costs 139 896 47 716 14 421 202 033

Segment profit 868 (2 253) 37 122 35 737


Goodwill impairment1 (38 742)

Profit before tax on discontinued operation (158)


Loss before taxation (35 815)

Gross operating revenue (external) 139 096 44 492 29 278 212 866

Year-on-year movement percentage

Segment revenue (%) – – (26) (25)

Segment costs (%) (4) – (1) (26)

Segment profit (%) 522 – (37) (19)

1 Thegoodwillimpairmentwasnotallocatedtoareportablesegmentasitisnotincludedintheinformationusedbythechiefoperatingdecision-makers.

The securities and structuring segment in the prior year represents the performance of the business up to the disposal of 60% of the business to BNP Paribas SA on 31 October 2011. The remaining 40% has been accounted for separately as an associate from 1 November 2011.

39


notes to the summarised consolidated financial statements

Basis of presentation These results have been prepared in terms of International Financial Reporting Standards (IFRS) and comply with IAS 34 – Interim Financial Reporting, the Listings Requirements of the JSE Limited and the Companies Act, No. 71 of 2008. The summarised financial statements do not include all of the information required for full annual financial statements.

The accounting policies applied are in terms of IFRS and are consistent with those applied in the annual financial statements for 31 March 2013.

Reclassification of comparative figuresThe prior year figures were reclassified as follows:

• Due to the nature of the investments backing linked funds and linked investment contract liabilities, the group has changed its order of presentation of its statement of financial position from current/non-current classification to a liquidity-based statement of financial position. This has had no financial impact.

• Cash flows related to the investments backing linked funds and the linked investment contract liabilities of R107.4 million which were previously excluded from the group’s statement of cash flows, have been included in net cash generated from operations.

• Provisions of R5.5 million previously included within trade and other payables have been separated and disclosed in the statement of financial position.

• Financial assets of R235.1 million were split out into “at amortised cost” (R83.1 million) and “at fair value” (R152.0 million) on the face of the statement of financial position.

• As indicated in the September 2012 interim results announcement, the March 2012 comparative investment and advisory segment revenue and costs have both been reduced by R11.3 million relating to the service level agreement with BNP Paribas Cadiz Securities in line with how the chief operating decision-makers review the group.

All of the above reclassifications had no financial impact and were only changes in presentation.

40

analysis of shareholdersas at 31 March 2013

Number of shareholders %

Number of shares %

residency SA residents 1 496 98.5 244 300 408 96.5 Non-SA residents 23 1.5 8 975 398 3.5

1 519 100.0 253 275 806 100.0

portfolio size 1 – 1 000 553 36.4 217 885 0.1 1 001 – 10 000 607 39.9 2 577 229 1.0 10 001 – 100 000 253 16.7 7 941 730 3.1 100 001 – 1 000 000 67 4.4 17 625 773 7.0 1 000 001 and over 39 2.6 224 913 189 88.8

1 519 100.0 253 275 806 100.0

Distribution of shareholdersBanks 7 0.5 8 409 467 3.3 Brokers 7 0.5 703 239 0.3 Close corporations 18 1.2 348 000 0.1 Empowerment 1 0.1 34 416 502 13.6 Endowment funds 2 0.1 16 500 – Individuals 1 289 84.8 24 462 262 9.7 Insurance companies 2 0.1 2 991 430 1.2 Investment companies 3 0.2 125 810 – Medical aid schemes 1 0.1 61 435 – Mutual funds 20 1.3 68 065 378 26.9 Nominees and trusts 93 6.1 57 314 874 22.6 Other corporations 17 1.1 97 580 – Pension funds 23 1.5 30 448 909 12.0 Private companies 32 2.1 5 460 612 2.2 Public companies 1 0.1 35 399 – Staff share scheme 2 0.1 8 244 420 3.3 Treasury shares 1 0.1 12 073 989 4.8

1 519 100.0 253 275 806 100.0

Category Non-publicDirectors of the company and subsidiaries 9 0.6 14 329 631 5.7 Associates of directors 12 0.8 49 753 778 19.6 Staff share scheme 2 0.1 8 244 420 3.3 Treasury shares 1 0.1 12 073 989 4.8 Persons over 10%

Makana Financial Services1 1 0.1 26 672 789 10.5 Employees with restrictions 17 1.1 766 804 0.3

42 2.8 111 841 411 44.2 public 1 477 97.2 141 434 395 55.8

1 519 100.0 253 275 806 100.0

1 MakanaFinancialServiceshastherighttoappointadirectorandholdsover10%aftertakingintoaccountdirectors’indirectbeneficialholdingsdescribedintheannualfinancialstatementsavailableontheCadizwebsite.

41


notice of annual general meeting

Notice of general meetingNotice is hereby given that the fourteenth annual general meeting of the company will be held at 14:30 on Thursday, 5 September 2013 in the boardroom on the 4th Floor, The Terraces, 25 Protea Road, Claremont, Cape Town for the following business to be transacted:

1 To receive and adopt the annual financial statements of the company and its subsidiaries, incorporating the auditors’, directors’ and audit committee reports for the period ended 31 March 2013.

2 To sanction the dividends paid by the company.

3 To reappoint PricewaterhouseCoopers Inc. (audit partner Dilshad Khalfey), as nominated by the company’s audit committee, to hold office until the next annual general meeting of the company, as the auditors of the group and to authorise the directors to determine the remuneration of the auditors.

4 To re-elect directors by way of separate resolutions in place of those retiring by rotation. The retiring directors are R F G Cadiz, B H Kent and G Fury all of whom, being eligible, offer themselves for re-election. The Cvs of the directors appear on pages 8 and 9 of the integrated annual report.

5 To appoint by way of separate resolutions B H Kent, A N Matyumza and S J Saunders as the company’s audit and risk committee members. The Cvs of the directors appear on pages 8 and 9 of the integrated annual report.

6 To receive and adopt, on a non-binding advisory basis, the company’s remuneration policy.

7 To consider and, if deemed fit, pass, with or without modification, the following special and ordinary resolutions in accordance with the requirements of the Companies Act, No. 71 of 2008, as amended, (the “Act”), and the JSE Limited (“JSE”) Listings Requirements (the “JSE Listings Requirements”):

Special Resolution 1“RESOLvED THAT the following remuneration of directors of the company for their services as directors of the company for the period from 1 September 2013 to 31 August 2014 be and is hereby approved in accordance with section 66(9) of the Act:

Currentr

proposedr

Chairman of the board 259 200 274 752

Members of the board 137 160 145 390

Chairman of board committees 102 600 108 756

Members of board committees 51 840 54 950”

Reasons and effect:In terms of section 66(9) of the Act, the company may, if so authorised in terms of a special resolution, pay remuneration to its directors. The effect of this resolution is to approve the remuneration of the directors of the company for their services as directors for the following year.

Special Resolution 2“RESOLvED THAT the board of directors of the company be and is hereby authorised in terms of the provisions of section 45(3)(a)(ii) of the Act, as a general approval, to authorise the company to provide any direct or indirect financial assistance (‘financial assistance’ will herein have the meaning attributed to it in section 45(1) of the Act) that the board of directors of the company may deem fit to any related or interrelated company or corporation of the company (‘related’ and ‘interrelated’ will herein have the meaning attributed to it in section 2 of the Act), on the terms and conditions and for amounts that the board of the directors of the company may determine; provided that:

• the recipient or recipients of such financial assistance, and the form, nature and extent of such financial assistance, and the terms and conditions under which such financial assistance is provided, are determined by the board of directors of the company from time to time; and

• the board of directors of the company may not authorise the company to provide any financial assistance pursuant to this special resolution unless the board meets all those requirements of section 45 of the Act which it is required to meet in order to authorise the company to provide such financial assistance; and

• such financial assistance to a recipient thereof is, in the opinion of the board of directors of the company, required for the purpose of (i) meeting all or any of such recipient’s operating expenses (including capital expenditure), and/or (ii) funding the growth, expansion, reorganisation or restructuring of the businesses or operations of such recipient, and/or (iii) funding such recipient for any other purpose which in the opinion of the board of directors of the company is directly or indirectly in the interests of the company.”

Reasons and effect:In terms of section 45(3)(a)(ii) of the Act the board of directors of a company may not authorise any financial assistance unless pursuant to a special resolution of the shareholders adopted within the previous two years, either as general or specific authority, the shareholders of the company have approved such financial assistance. The effect of this resolution is to grant the directors of the company the general authority to provide direct or indirect financial assistance to any company or corporation forming part of its group of companies, including in the form of loans or the guaranteeing of their debts. This authority will be in

42

place for a period of two years from the date of adoption of this resolution.

Special Resolution 3“RESOLvED THAT, in accordance with sections 46 and 48 of the Act and the JSE Listings Requirements, the company and any of its subsidiaries (each a ‘subsidiary’) be and is hereby authorised, by way of a general approval, to acquire up to 15 000 000 (fifteen million) ordinary shares in the issued share capital of the company (‘ordinary shares’) from time to time.”

Reasons and effect:In terms of paragraph 5.72 of the JSE Listings Requirements a company may only make a general repurchase of securities if approved by shareholders in terms of a special resolution. The effect of this resolution is to grant the company the general authority to repurchase securities of the company. This authority will be in place until the next annual general meeting of the company.

Note: The directors consider that a general authorityshould be put in place should it become necessary, in thebest interests of the company, to repurchase ordinaryshares before the next annual general meeting to giveeffecttotheCadizHoldingsRestrictedSharePlan(“CRSP”),Cadiz Holdings Share Appreciation Rights Plan (“CSARP”)andCadizBlackShareOwnershipSchemeTrust(“CBESOST”).

Special Resolution 4“RESOLvED THAT, in accordance with sections 46 and 48 of the Act and the JSE Listings Requirements, the company and any of its subsidiaries be and is hereby authorised by way of a general approval, to acquire A ordinary shares in the issued share capital of the company (‘A ordinary shares’) from CBESOST for a purchase consideration equal to the par value of each share, in order to give effect to the terms of the trust deed of CBESOST.”

Reasons and effect:In terms of paragraph 5.72 of the JSE Listings Requirements a company may only make a general repurchase of securities if approved by shareholders in terms of a special resolution. The effect of this resolution is to grant the company the general authority to repurchase A ordinary shares from CBESOST, from time to time in order to give effect to the provisions of the trust deed of CBESOST. This authority will be in place until the next annual general meeting of the company.

Ordinary Resolution 1“RESOLvED THAT, in accordance with the JSE Listings Requirements, 15 000 000 (fifteen million) authorised but unissued ordinary shares be and are hereby placed at the disposal and under the control of the directors of the company and that the directors be and are hereby authorised and empowered to allot, issue and otherwise

dispose of such shares to the participants under CRSP, CSARP and CBESOST (collectively, the ‘schemes’) on such terms and conditions and at such times as envisaged under the plan rules and deed of the schemes.”

Note:Thisauthorityisvaliduntilthecompany’snextannualgeneralmeeting provided that it shall not extend beyond15(fifteen)monthsfromthedatethatthisauthorityisgiven.

Ordinary Resolution 2“RESOLvED THAT, in accordance with the JSE Listings Requirements, all the authorised but unissued A ordinary shares be and are hereby placed at the disposal and under the control of the directors of the company and that the directors be and are hereby authorised and empowered to allot, issue and otherwise dispose of such shares to the participants under CBESOST on such terms and conditions and at such times as envisaged under the CBESOST deed.”

Note:Thisauthorityisvaliduntilthecompany’snextannualgeneralmeeting provided that it shall not extend beyond15(fifteen)monthsfromthedatethatthisauthorityisgiven.

Ordinary Resolution 3“RESOLvED THAT, subject to the JSE Listings Requirements, the directors of the company be and are hereby authorised by way of a general authority, to procure that any of the company’s subsidiaries transfer A ordinary shares, and/or ordinary shares to the participants of the schemes, the number of which shall be equal to such number of ordinary shares that have been allocated to or have vested in the participants of the schemes, in accordance with the terms of the plans and the deed of the schemes.”

Note:IntermsoftheJSEListingsRequirements,thepassingofOrdinaryResolution4requiresa75%majorityofthevotescastinfavourofsuchresolutionbyallshareholderspresentorrepresentedbyproxyatthegeneralmeeting.

This authority is valid until the company’s next annualgeneralmeeting, provided that it shall not extendbeyond15(fifteen)monthsfromthedatethatthisauthorityisgiven.

Ordinary Resolution 4“RESOLvED THAT, in accordance with section 46 of the Act and paragraph 5.85 of the JSE Listings Requirements, the board of directors of the company be and is hereby authorised, by way of general approval, to make payments to the shareholders of the company up to the amount which the board of directors of the company would have declared and paid out of the profits of the company as the dividend for the year ending 31 March 2014.”

Note:Thisauthorityisvaliduntilthecompany’snextannualgeneralmeeting, provided that it shall not extendbeyond15(fifteen)monthsfromthedateofpassingofthisauthorityisgiven.

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notice of annual general meeting CONTINuED

Ordinary Resolution 5“RESOLvED THAT any 2 (two) of the directors of the company, acting jointly, be and are hereby authorised and empowered to take all necessary steps and do all acts, matters and things and sign all such documents (including any affidavit) as may be necessary or desirable to give effect to the special and ordinary resolutions as passed at this meeting, and generally to do all things as may be necessary or expedient in order to give effect to these resolutions, and things done or to be done by both of the aforesaid directors on behalf of the company be and are hereby ratified and approved.”

Solvency and liquidityBefore giving effect to the general repurchase of shares in accordance with Special Resolutions 3 and 4 and before giving effect to the general payment to shareholders in accordance with Ordinary Resolution 4, the directors will ensure that the company and the group will be able, in the ordinary course of business for a period of 12 (twelve)months following the repurchase/payment:

• to pay its debts;

• and the assets of the company and the group, fairly valued, will exceed the liabilities of the company and the group;

• share capital and reserves of the company and the group will be adequate for the group’s business;

• working capital of the company and the group will be adequate for the ordinary course of business; and

• in accordance with the solvency and liquidity test contained in section 4 of the Act.

The repurchase will take place through the open order book.

The repurchase will not be made at a market price greater than 10% above the weighted average of the market value of the securities for the 5 (five) business days immediately preceding the date of the repurchase.

The company will not repurchase shares during a prohibited period unless a repurchase programme where dates and quantities of securities to be traded have been announced on SENS, prior to the prohibited period.

Disclosure in terms of paragraph 11.26 of the JSE Listings Requirements The JSE Listings Requirements require the following disclosures, which are in the audited financial statements and integrated annual report as follows:

• Directors and management – pages 8 to 10 of the integrated annual report;

• Major beneficial shareholders – page 59 of the annual financial statements;

• Directors’ interests in ordinary shares – page 5 of the annual financial statements; and

• Share capital of the company – page 30 of the annual financial statements.

Litigation statementIn terms of paragraph 11.26 of the JSE Listings Requirements, the directors, whose names appear on pages 8 and 9 of the integrated annual report of which this notice forms part, are not aware of any legal or arbitration proceedings that are pending or threatened, that may have or have had in the recent past, being at least the previous 12 (twelve) months, a material effect on the group’s financial position.

Directors’ responsibility statementThe directors, whose names appear on pages 8 and 9 of the integrated annual report, collectively and individually accept responsibility for the accuracy of the information pertaining to these resolutions and certify that, to the best of their knowledge and belief, there are no facts that have been omitted which would make any statement false or misleading, and that all reasonable enquiries to ascertain such facts have been made and that the ordinary resolution contains all information.

Material changesOther than the facts and developments reported on in the annual report, there have been no material changes in the affairs or financial position of the company and its subsidiaries since the date of signature of the audit report and up to the date of this notice.

The directors have no specific intention, at present, for the company to make any payments by way of a pro rata reduction of share capital or share premium, but consider that such a general authority should be put in place to give the directors the option to pay by way of a pro rata reduction of share capital or share premium, in lieu of all or part of the dividend, which the directors of the company would have declared and paid out of profits in respect of the company’s dividends for the financial year ending 31 March 2013.

In terms of Ordinary Resolutions 3 and 4, the following criteria will be met:

• Securities will be issued to public shareholders.

• The aggregate number of securities issued will not exceed 15% of the shares in issue at the date of this meeting.

• The maximum discount the shares will be issued at is 10% of the weighted average traded price for the 30 business days prior to the issue.

44

Attendance, verification, voting and proxiesAttendance The record date in terms of section 59 of the Act for shareholders to be recorded on the shareholders’ register of the company in order to be able to attend, participate and vote at the annual general meeting, is Friday, 30 August 2013.

Electronic participationPlease note that the company intends to make provision for shareholders of the company, or their proxies, to participate in the annual general meeting by way of electronic communication. In this regard the company intends making a video-conferencing facility available at the following location:

The boardroom, Ground Floor, 31 West Street, Lower Houghton, Johannesburg 2198.

Should you wish to participate in the annual general meeting by way of electronic communication as aforesaid, you, or your proxy, will be required to attend this address on the date and at the time set for the commencement of the annual general meeting. The video-conferencing will enable all persons to participate electronically in the annual general meeting in this manner and to communicate concurrently with each other without an intermediary, and to participate reasonably effectively in the annual general meeting.

Please note that the cost of the video-conferencing facility described will be for the account of the company.

verificationPlease note that section 63(1) of the Act requires that a shareholder, or a proxy of a shareholder, wishing to participate in the annual general meeting provide satisfactory identification before they may so participate.

voting On a show of hands, every shareholder of the company who (being an individual) is present in person or by proxy at the annual general meeting or which (being a company or body corporate) is represented thereat by a representative appointed pursuant to section 57(5) of the Act shall have one vote, and on a poll, every shareholder of the company who (being an individual) is present in person or by proxy at the annual general meeting or which (being a company

or body corporate) is represented by proxy at the annual general meeting, shall have one vote for every ordinary share and A ordinary share of which it is the holder.

Dematerialised Cadiz shareholders (who are not “own name” dematerialised Cadiz shareholders) who wish to attend the annual general meeting or to vote by way of proxy, must contact their Central Securities Depository Participant (CSDP) or broker who will furnish them with the necessary authority to attend the annual general meeting or be represented thereat by proxy. This must be done in terms of the agreement entered into between the dematerialised Cadiz shareholder and the CSDP or broker.

ProxiesA Cadiz shareholder entitled to attend and vote at the annual general meeting may appoint one or more persons as its proxy to attend, speak and vote in its stead. A proxy need not be a shareholder of the company.

A form of proxy is attached for the convenience of certificated Cadiz shareholders and “own name” dematerialised Cadiz shareholders who are unable to attend the annual general meeting, but who wish to be represented thereat. In order to be valid, duly completed forms of proxy must be received by the transfer secretaries of the company, Computershare Investor Services (Proprietary) Limited, 70 Marshall Street, Johannesburg 2001 (PO Box 61051, Marshalltown 2107), so as to be received by no later than 17:00 on Tuesday, 3 September 2013.

By order of the board of directors.

CAdiz holdiNgs limited

C schmahlCompany secretary

Cape Town24 June 2013

45


notes

46

form of proxy

CADIZ HOLDINGS LIMITED(Incorporated in the Republic of South Africa)(Registration number 1997/007258/06)Share code: CDZ ISIN: ZAE000017661(“Cadiz” or “the company”)

FOR uSE BY SHAREHOLDERS WHO HAvE NOT DEMATERIALISED THEIR SHARES AND “OWN NAME” DEMATERIALISED SHAREHOLDERS AT THE ANNuAL GENERAL MEETING OF CADIZ TO BE HELD ON THE 4th FLOOR, THE TERRACES, 25 PROTEA ROAD, CLAREMONT, CAPE TOWN AT 14:30 ON THuRSDAY, 5 SEPTEMBER 2013 OR ANY POSTPONEMENT THEREOF.

Shareholders who have dematerialised their shares, other than “own name” dematerialised shareholders, with a Central Securities Depository Participant (CSDP) or broker should advise their CSDP or broker as to what action they wish to take. This must be done in terms of the agreement entered into between them and the CSDP or broker. Shareholders who have dematerialised their shares must not return the form of proxy to the transfer secretaries. Their instructions must be sent to their CSDP or broker for action.

I/We (please print names in full)

of (address)

being a shareholder of Cadiz, holding ordinary shares and/or A ordinary shares in Cadiz hereby appoint:

1 or failing him/her

2 or failing him/her

3 the chairman of the meeting as my/our proxy to attend, speak and vote on my/our behalf at the annual general meeting of the company to be held at 14:30 on Thursday, 5 September 2013 or at any adjournment thereof, and to vote or to abstain from voting on the ordinary resolutions to be proposed at the annual general meeting, as follows:

For Against Abstain1 To adopt the annual financial statements.2 To sanction the dividend paid.3 To reappoint PricewaterhouseCoopers Inc. (audit partner Dilshad Khalfey) as the company’s

auditors and to authorise the directors to approve the auditors’ remuneration.4 To re-elect the directors individually in terms of the company’s memorandum of incorporation: 4.1 R F G Cadiz 4.2 B H Kent 4.3 G Fury5 To appoint members to the company’s audit and risk committee: 5.1 B H Kent 5.2 A N Matyumza 5.3 S J Saunders6 To adopt on a non-binding advisory basis the company’s remuneration policy.7 Special resolution 1: Approval of directors’ remuneration.8 Special resolution 2: General authority to provide financial assistance to related and interrelated

companies.9 Special resolution 3: General authority to repurchase 15 000 000 ordinary shares.10 Special resolution 4: Authority to repurchase A ordinary shares.11 Ordinary resolution 1: Placing 15 000 000 ordinary shares under the control of the directors for

the purposes of the schemes.12 Ordinary resolution 2: Placing all A ordinary shares under the control of the directors for the

purposes of CBESOST.13 Ordinary resolution 3: Authority to transfer shares held by subsidiaries in respect of the schemes. 14 Ordinary resolution 4: Payment to shareholders by way of a pro rata reduction of share capital

and share premium.15 Ordinary resolution 5: Authority to two directors to give effect to the special and ordinary

resolutions passed.

Signed this day of 2013

Signature of member(s)

Assisted by me (where applicable)

Please read the notes and instructions on the reverse hereof.


notes

A member entitled to attend and vote at the annual general meeting is entitled to appoint a proxy to attend, speak and vote in his stead. A proxy need not be a member of Cadiz.

Every person present and entitled to vote at the general meeting as a member or as a proxy or as a representative of a body corporate shall, on a show of hands, have one vote only, irrespective of the number of Cadiz shares such person holds or represents, but in the event of a poll, a member holding shares will be entitled to only one vote per share held.

Please insert the relevant number of Cadiz shares and indicate with an “X” in the appropriate spaces on the face hereof, how you wish your votes to be cast at the general meeting. If you return this form duly signed without any specific instructions, the proxy will vote or abstain from voting at the proxy’s discretion.

Instructions on signing and lodging the form of proxy:1. A deletion of any printed matter and the completion of any blank spaces need not be signed or initialled. Any alteration or

correction must be initialled by the authorised signatory/ies.

2. The chairman of the general meeting shall be entitled to decline or accept the authority of a person signing the form of proxy:

a. under a power of attorney; or

b. on behalf of a company,

unless that person’s power of attorney or authority is deposited with the transfer secretaries by no later than 17:00 on Tuesday, 3 September 2013.

3. You may insert the name of any person(s) whom you wish to appoint as your proxy/ies in the blank space(s) provided for that purpose. If more than one person is so nominated, the person whose name stands first on the form of proxy and who is present at the annual general meeting will be entitled to act as proxy to the exclusion of those whose names follow.

4. A shareholder’s instructions to the proxy must be indicated by the insertion of the relevant number of shares exercisable by that shareholder in the appropriate box provided. Failure to comply with the above will be deemed to authorise the proxy to vote or to abstain from voting at the annual general meeting of shareholders as the proxy deems fit in respect of all of those shareholder’s votes exercisable thereat. The shareholder or the proxy is not obliged to use all the votes exercisable by the shareholder or by the proxy, but the total of the votes cast and in respect of which abstention is recorded may not exceed the total votes exercisable by the shareholder or by the proxy, as the case may be.

5. When there are joint holders of Cadiz shares, all joint shareholders must sign this form of proxy.

6. The completion and lodging of this form of proxy will not preclude the member who grants this proxy from attending the annual general meeting and speaking and voting in person thereat to the exclusion of any proxy appointed in terms hereof should such member wish to do so.

7. Completed forms of proxy MuST be returned to the transfer secretaries, Computershare Investor Services (Proprietary) Limited, 70 Marshall Street, Johannesburg 2001 (PO Box 61051, Marshalltown 2107) (Facsimile: 011 688 7721) to be received by NO LATER THAN 17:00 on Tuesday, 3 September 2013.

corporate information

Financial year-end 31 March

ReportingAnnouncement of year-end results 27 May 2013Annual report published 28 June 2013Annual general meeting 5 September 2013Interim results 18 November 2013

DividendsDeclaration of dividend Monday, 27 May 2013Last day to trade Friday, 21 June 2013Record date Friday, 28 June 2013Payment date Monday, 1 July 2013

Cadiz Holdings LimitedRegistration number 1997/007258/06JSE code: CDzISIN: zAE000017661

Company secretary C SchmahlE-mail: [email protected]

Registered office (from 1 June 2013) Johannesburg office4th Floor, The Terraces 31 West Street 25 Protea Road Lower HoughtonClaremont 7708 Johannesburg 2198

PO Box 44547 Postnet Suite 164Claremont 7735 Private Bag X2600

Houghton 2041

Telephone: +27 21 670 4600 Telephone: +27 11 483 0855Telefax: +27 21 670 4651 Telefax: +27 11 483 0867E-mail: [email protected] E-mail: [email protected]: www.cadiz.co.za Website: www.cadiz.co.za

Transfer secretaries SponsorComputershare Investor Services (Proprietary) Limited Investec Bank Limited70 Marshall Street 100 Grayston Drive Johannesburg 2001 Sandown, Sandton 2196

PO Box 61051 PO Box 785700 Marshalltown 2107 Sandton 2146

Independent auditorsPricewaterhouseCoopers Inc.No. 1 Waterhouse PlaceCentury City 7441

PO Box 2799Cape Town 8000

Groundpepper

www.cadiz.co.za

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