[PPT] - 2019 GROUP ANNUAL RESULTS FOR THE 52 WEEKS ENDED 30 JUNE 2019 1 PowerPoint Presentation

SLIDE 1 1 FOR THE 52 WEEKS ENDED 30 JUNE 2019

2019

GROUP ANNUAL RESULTS

SLIDE 2 2

AGENDA

1. REVIEW OF THE PERIOD
2. FINANCIAL REVIEW
3. TRUWORTHS ACCOUNTS
4. STRATEGIC FOCUS AREAS
5. OUTLOOK
6. QUESTIONS

SLIDE 3

REVIEW OF THE PERIOD

SLIDE 4 4

SOUTH AFRICA TRADING ENVIRONMENT

Difficult trading environment. GDP growth h remained subdued throughout 2018/2019 – South African economy contracted by 3.2% in Q1 of calendar 2019, the biggest quarterly fall since Q1 2009. Higher r fuel and energy prices and volatile Rand. Unemploymen loyment increased in Q2 of calendar 2019 to 29.0 29.0%, a 15-year high. Consumer umer spen endin ding g remains constrained. Consumer umer confi fiden dence e improved marginally in Q2 of calendar 2019, but remains lower than 12 months ago. Business ness confid idence ence at lowest level in two years. Loadshed dsheddin ding g in November/December 2018 and February/March 2019 impacted negatively on trading.

SLIDE 5 5

UNITED KINGDOM TRADING ENVIRONMENT

Consumer umer confi fiden dence has been negative since announcement of Brexit in 2016. Extremely tough retail environment. March 2019 Brexi exit deadli line ne postpon

ned

ed to end October 2019, uncert ertaint ainty y continu inues es. High street et under r pressure ure as growth in sales mainly contributed by online; textile, clothing and footwear online sales grew 16.8% year-on-year for June 2019. Continuing decline ine in retail il footfall. Nearly 1 000 stores affected by 27 retai ail l failures res for calendar 2019 to July, many more impacted by risin ing g number er of CVAs. UK GDP c contrac racted ted by 0.2% in Q2 of calendar 2019 after 0.5% growth previous quarter and the lowest since last quarter 2012. UK unemplo ploym yment ent rate lowes est since Q4 of calendar 1974.

SLIDE 6

FINANCIAL REVIEW – GROUP

SLIDE 7 7

GROUP TRADING OVERVIEW

Non-cash impairm rment ent of O Office intangibles – £97 million (R1.7 billion). Improved

ved retail

il sales es growth (3.7%), second half momentum is encouraging. Gross margin down to 51.6%, led by Office full price versus markdown mix; Truworths unchanged at 55.5%. Trading expenses remain well controlled. Robust ust balance nce sheet et, 6%* growth in net asset value per share. Continued stron

ng

g cash h generat ration ion – net debt to equity at 7.2% (R663 million). Healthy cash realisation rate of 93%. Negotiations with Office lenders ongoing, expected to be concluded satisfactorily. Bough ght t back 3.75 5 million

n shares

res at total cost of R266 million. Headline earnings per share down 7%*. Dividend cover maintained at 1.5 times.

* On a comparable basis, i.e. excluding the Office impairment.

SLIDE 8 8

GROUP INTEGRATED REPORTING

The Group continues to strive for excell ellence ence in integrat rated ed report

rting

ng. South African companies are renowned for their high quality of integrated reporting.

In a study by Oxford University Business School in March 2019, South Africa was ranked first (scoring 2.85 out of 3) for quality of integrated reporting. Five integrated reports from each of the following countries were assessed: Brazil, France, Germany, Italy, Japan, The Netherlands, South Africa, South Korea, United Kingdom, and the United States.

Truworths International’s 2018 integrated report won the JSE Top 40 catego egory ry in the JSE/CSSA Integrated Reporting Awards 2018. The 2018 integrated report was also rated d 10th

th overal

rall l (of the JSE top 100 companies) in the EY Excellence in Integrated Reporting Awards. Truworths International has been rated d in the top 10 for 12 consec ecuti tive ve years rs, the

nly company besides Sasol to be rated in the top 10 for more than ten years.

SLIDE 9 9 Jun 2019 019 Including impai airmen ent Jun 2019 019 Compar arable* Jun 2019 Targets Gross margin (%) 51. 1.6 51. 1.6 51 – 55 Operating margin (%) 9.1 19.4 9.4 19 – 24 Return on equity (%) 9 23 23 23 – 28 Return on assets (%) 12 12 23 23 20 – 25 Inventory turn (times) 4.2 4.2 3.5 – 4.5 Asset turnover (times) 1.4 1.2 0.9 – 1.3

GROUP PERFORMANCE AGAINST TARGETS

* On a comparable basis, i.e. excluding the Office impairment and reclassification of interest in terms of IFRS 9 in the current period, as well as foreign exchange gains and losses in both periods.

SLIDE 10 10 Jun 2019 019 Including impai airmen ent Jun 2019 019 Compar arable* Jun 2018 Change on prior period % Chan ange e on compar arable prior period* % Sale of merchandise (Rm) 18 094 4 18 094 17 547 3 3 Gross margin (%) 51. 51.6 51. 1.6 52.4 Trading profit (Rm) 492 92 2 245 2 518 (80) (10) 0) Trading margin (%) 2.7 2.7 12.4 2.4 14.4 Operating profit (Rm) 1 1 653 653 3 512 3 946 (58) (10) 0) Operating margin (%) 9. 9.1 1 19. 9.4 22.5 Diluted HEPS (cents) 560. 0.7 567. 7.2 612.7 (8) (7) Dividend per share (DPS) (cents) 384 384 384 384 420 (9) (9) Cash generated from operations (Rm) 2 664 2 664 3 137 (15) (15) 5) Net asset value per share (cents) 2 2 156 156 2 569 2 421 (11) 6

GROUP FINANCIAL PERFORMANCE

* On a comparable basis, i.e. excluding the Office impairment and reclassification of interest in terms of IFRS 9 in the current period, as well as foreign exchange gains and losses in both periods.

SLIDE 11 11

GROUP DPS AND DILUTED HEPS

Compound growth rates: DPS: 5-year 0% 3-year -5% Compound growth rates: Dilut uted d HEPS: 5-year 0% 3-year -6% 405 452 452 420 384 384 592 666 621 613 561 561

100

200 300 400 500 600 700 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 DPS Diluted HEPS (cents) Office UK acquired Dec 2015

SLIDE 12 12

GROUP RETURN ON EQUITY (ROE) AND RETURN ON CAPITAL (ROC)

Average: ROE: : 5-year 30%* 3-year 27%* Average: ROC: : 5-year 44%* 3-year 40%* (%) 35 35 31 27 23 23* 49 51 46 40 33 33*

10

20 30 40 50 60 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 ROE ROC * On a comparable basis, i.e. excluding the Office impairment and reclassification of interest in terms of IFRS 9 in the current period, as well as foreign exchange gains and losses in both periods. Office UK acquired Dec 2015

SLIDE 13 13

GROUP RETURN ON ASSETS AND ASSET TURNOVER

Average: Return on assets: : 5-year 27%* 3-year 25%* Average: Asset turno nover: : 5-year 1.1 times* 3-year 1.1 times* Return on assets (%) Asset turnover (times) 38 24 26 25 23 23* 1.2 1.0 1.1 1.1 1.2* 0.5 0.8 1.1 1.4 1.7

5

10 15 20 25 30 35 40 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Return on assets Asset turnover * On a comparable basis, i.e. excluding the Office impairment and reclassification of interest in terms of IFRS 9 in the current period, as well as foreign exchange gains and losses in both periods. Office UK acquired Dec 2015

SLIDE 14 14

GROUP STATEMENTS OF FINANCIAL POSITION

Jun Jun 2019 2019 Including ing impairme rment nt Rm Rm Jun 2019 Compara rabl ble* Rm Rm Jun 2018 Rm Change on prior period % Change on comparab able le prior period* % Property plant and equipment 1 1 780 780 1 7 780 1 726 3 3 Goodwill 346 346 1 6 611 1 629 (79) (1) Intangible assets 2 2 616 616 3 1 171 3 227 (19) (2) Other non-current assets 443 443 443 443 322 38 38 38 Cash and cash equivalents 777 777 777 777 982 (21) (21) Trade and other receivables 4 4 934 934 4 9 934 5 110 (3) (3) Inventories 2 2 108 108 2 1 108 2 072 2 2 Other current assets 352 352 352 352 423 (17) (17) Total assets ts 13 356 15 176 15 491 (14) (2) Total equity 9 1 175 10 929 10 369 (12) 6 Non-current liabilities 1 7 763 1 8 857 2 363 (25) (21) Current liabilities 2 4 418 2 3 390 2 759 (12) (13) Total equity y and liabil ilitie ities s 13 356 15 176 15 491 (14) (2) * On a comparable basis, i.e. excluding the Office impairment and reclassification of interest in terms of IFRS 9 in the current period, as well as foreign exchange gains and losses in both periods.

SLIDE 15 15 * Increase in Office’s net debt to equity ratio mainly due to the impairment of intangible assets. Net t debt Jun 2019 019 Net t debt t to equity ty Jun 2019 019 % Net debt Jun 2018 Net debt to equity Jun 2018 % Group Rm 663 663 7.2 968 9.3 Truworths Rm 245 245 2.8 605 5.9 Office £m 23. 3.5 19. 9.5* 20.1 10.2

GROUP CAPITAL MANAGEMENT

After share buy backs of R266 million

SLIDE 16 16

Dividend ends Final dividend of 135 135 cents ts per share re (Jun 2018: 159 cents per share). Total dividend per share of 384 384 cents ts per share re (Jun 2018: 420 cents per share). Financial ncial positi tion

n

Financial position remains strong with net asset et value e per share re up 6%* to to 2 5 569 cents. Spent R266 6 million n on repurc rchas hasing ng 3.75 5 million

n shares

res during the period. Since the inception of the general share buy-back programme in 2002, 99.5 million shares have been repurchased at a total cost of R3.2 billion at an average price of R33 per share.

* On a comparable basis, i.e. excluding the Office impairment and reclassification of interest in terms of IFRS 9 in the current period, as well as foreign exchange gains and losses in both periods.

GROUP CAPITAL MANAGEMENT (CONTINUED)

SLIDE 17 17

GROUP TRADING SPACE

Jun 2019 019 ‘000 m2 Jun 2018 ‘000 m2 Change on prior period % Truworths 388 388 381 2 Office 15 15 16 (5) Total tal 403 403 397 2

SLIDE 18 18

GROUP ONLINE PRESENCE

Strong year-on-year growth in followers on Facebook (>20%) and Instagram (>50%). Truwort uworths hs has nea earl rly y 4 million n Faceb eboo

ok

k follow

wers

ers. Majority of Truworths’ Facebook and Instagram followers are under er the age of 34. Identity’s Facebook followers increased creased nearl rly y 20% over the last year. Office London’s following on Facebook and Instagram incr creas ased ed by nearl rly y 80% % and 120% 0%. The truw ruwort

rths.

hs.co. co.za za e-commerce website continues to register strong growth

truworths.co.za is generating the turnover of a medium to

large-size ized Truworths store.

Website profit

itable le from day 1.

Brands available online include:

c 10% of

Group retai tail sal ales Office online sales grew 10% 10%. Online sales comprising 34% % of retai ail sales es.

ffspring.co.uk website has grown significantly with the

expansion of product availability and growth in awareness, driven by effective use of social media and digital marketing. “Click & & collect” service expanded, comprising nearly 20% of orders, giving online customers access to stock already in store rather than just warehouse stock. User journey enhanced including a more seaml amless ess checkou ckout process cess. New payment gateway offers new w ways ys to pay including Apple Pay and Google Pay and a number of additional international currencies. Customer database has over r six x million

n cust

stomers

mers.
fficelondon.co.za link to Office UK site launching this

quarter, reinforcing stron rong g bran and d associ

ciat

ation

n between

OFFICE London in SA and Office in the UK.

SLIDE 19 19

GROUP CASH FLOW ANALYSIS

(Rm) 2 930 (266) 1 152 8 (77) (968) (92) 2 687 (1 766) (373) (266) 24 306 (422) (116) ( 500)

500

1 000 1 500 2 000 2 500 3 000 3 500 4 000 4 500 Cash EBITDA Working capital movements Interest received Dividends received Finance costs Tax paid Capex maintenance Free cash flow Dividends paid Capex expansion Shares repurchased Other Net cash increase before borrowings repaid Borrowings repaid Net cash decrease for the period

SLIDE 20 20 80 89 91 109 93 93

20

40 60 80 100 120 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Group cash realisation rate (%)

GROUP CASH REALISATION RATE

Average: Cash realis isation ion rate: 5-year 92% 3-year 98%*

SLIDE 21 21

GROUP NEW ACCOUNTING STANDARDS

IFRS 9 and IFRS 15 adopted with effect from the start of the period. IFRS 9 Financial Instruments

Significant impact on doubtful debt allowance, increasing from 12.3% to 19.0% on transition date (through retained earnings). Doubtful debt allowance now based on expected credit loss model taking into account forward- looking information. Interest in respect of stage 3 debtors is recognised against trade receivable costs.

IFRS 15 Revenue from Contracts with Customers

Impact limited to accounting for sales returns (net impact on income statement is nil).

IFRS 16 Leases

New standard effective from 2020 financial year. In process of finalising system changes and reviewing affected agreements and policies.

SLIDE 22

FINANCIAL REVIEW – TRUWORTHS

SLIDE 23 23

TRUWORTHS TRADING OVERVIEW

Retai tail sal ales increas eased ed 3% 3%, gaining momentum in H2 (growing at 4%). Gross profi fit margin unchan anged at 55.5%. Trading expen enses es remai ain well contr trolled ed, growing at 3%. Profit before tax decreased 3%. Continued strong cash generation – net t debt t R245 45 million after fter shar are buy backs of R266 million. Cash realisation rate of 97%. Inventory turn unchanged at 4.8 times. Acti tive e account growth th of 3% – book remains healthy and performing in line with management expectations. Lay-bys and e-commerce sales contributing positively.

SLIDE 24 24

TRUWORTHS FINANCIAL PERFORMANCE

Jun 2019 19 Jun 2018 Change on prior period % Sale of merchandise (Rm) 12 2 863 3 12 617 2 Gross margin (%) 55. 5.5 55.5 Trading profit (Rm) 2 2 235 5 2 240

Trading margin

(%) 17.4 7.4 17.8 Operating profit* (Rm) 3 3 392 2 3 667 (7) Operating margin (%) 26. 6.4 29.1 Profit before tax (Rm) 3 338 3 445 (3) * Impacted by restructuring of funding arrangements in June 2018, as a result of which both investment interest received and finance costs decreased. Exclud luding ing fore reign gn exchan change ge losse ses s in 2019 and gains ns in 2018, , profit it before

re tax decre

crease sed d 1%

SLIDE 25 25 25

TRUWORTHS RETAIL SALES GROWTH ANALYSIS

Retail sales Rm Retail sales growth % LFL store growth % Product Inflation % Unit growth: Comp stores % Unit growth: Non-comp stores % Jun 2019 019 13 517 7 3 1 1 2 Jun 2018* 13 115 1 (3) (1) (2) 4 Jun 2017# 13 061 (2) (5) 12 (17) 3 Jun 2016 13 264 14 7 9 (2) 7 Jun 2015 11 644 8 1 6 (5) 7 * Compared to weeks 2 to 53 of the 2017 financial period. # Jun 2017 retail sales weeks 1 to 52.

SLIDE 26 26

TRUWORTHS MERCHANDISE INFLATION TREND

(4.0) (2.0)

2.0

4.0 6.0 8.0 10.0 12.0 14.0 16.0 2012 Summer 2013 Winter 2013 Summer 2014 Winter 2014 Summer 2015 Winter 2015 Summer 2016 Winter 2016 Summer 2017 Winter 2017 Summer 2018 Winter 2018 Summer 2019 Winter 2019 Summer Infla lation ion (%)

SLIDE 27 27

TRUWORTHS DIVISIONAL RETAIL SALES

Jun 2019 019 Rm Rm Jun 2018 Rm Change on prior period % Truworths ladieswear 3 757 7 3 753

Truworths designer emporium*

1 396 6 1 383 1 Truworths ladieswear emporium 5 153 3 5 136

Truworths menswear#

3 675 5 3 663

Truworths kids emporium~

1 097 7 925 19 Other† 1 443 3 1 309 10 Truworths emporium 11 368 68 11 033 3 Identity 2 149 9 2 082 3 Truworths retail sales 13 517 17 13 115 3 YDE agency sales 248 8 254 (2) * Daniel Hechter Ladies, Ginger Mary, Glamour, LTD Ladies and Earthaddict. # Truworths Man, Uzzi, Daniel Hechter Mens and LTD Mens. ~ LTD Kids, Earthchild and Naartjie. † Cellular, Truworths Jewellery, Cosmetics, Office London (South Africa) and Loads of Living divisions.

SLIDE 28 28 Jun 2019 019 ‘000 m2 Jun 2018 ‘000 m2 Truworths 294 4 290 Identity 72 2 70 Other* 15 15 14 Total excluding YDE 381 1 374 YDE 7 7 7 Total 388 8 381 % change on prior period 1.6

TRUWORTHS TRADING SPACE

* Other comprises Uzzi, Loads of Living, Earthchild/Earthaddict, Naartjie, Office London, Naartjie/Earthchild and Kids Emporium.

SLIDE 29 29

TRUWORTHS TRADING SPACE (CONTINUED)

Continued focus on optimis ising ing space e utilisation, consolidating space where possible. Leases are typically 5 years with option to extend for a further one or two 5-year periods, providing flexib ibil ilit ity in a changing retail landscape. Successful essful rental l negotiat

tiation
ns during the period – occupancy costs up 2%.

Rental reversions, lower escalations or combination of both. Lower average rental escalations. Some stores on turnover-only rental.

SLIDE 30 30

TRUWORTHS NUMBER OF STORES AND DEPARTMENTS

Jun 2019 Jun 2018 Stores Stores Departmen ments ts within stores Total Total Stores Departments within stores Total Truworths 350 350

350

350 346

346

Identity 258 258

258

258 255

255

Uzzi 44 44 247 247 291 291 48 233 281 Truworths Man 35 35 322 322 357 357 37 311 348 Earthchild/Earthaddict 34 34 135 135 169 169 41 90 131 Naartjie 21 21 60 60 81 26 49 75 YDE 20 20

20

20 21

21

Office London 15 15

15

15 13

13

Loads of Living 13 13 1 1 14 14 13

13

Naartjie/Earthchild 6

6

4

4

Kids emporium 4

4

2

2

Daniel Hechter 3 3 361 361 364 364 3 327 330 Ginger Mary 2 2 293 293 295 295 2 291 293 LTD 1 1 271 271 272 272 2 223 225 Total 806 806 813

SLIDE 31 31

TRUWORTHS CHANGE IN NUMBER OF STORES

Jun 2018 Stores New stores Closed stores Jun 2019 Stores Stores Truworths 346 7 (3) 350 350 Identity 255 6 (3) 258 258 Uzzi 48 2 (6) 44 44 Truworths Man 37 1 (3) 35 35 Earthchild and Earthaddict 41 1 (8) 34 34 Naartjie 26

(5)

21 21 YDE 21

(1)

20 20 Office London 13 2

15

15 Loads of Living 13

13

13 Naartjie and Earthchild 4 2

6

Kids Emporium (standalone) 2 2

4

4 Daniel Hechter 3

3

3 Ginger Mary 2

2

2 LTD 2

(1)

1 1 Total Total 813 23 (30) 806 806

SLIDE 32 32

TRUWORTHS REST OF AFRICA CORPORATE STORES

Retai tail sal ales Jun 2019 019 Rm Rm Retail sales Jun 2018 Rm Change on prior period % Retai tail sal ales Jun 2019 019 LC'm Retail sales Jun 2018 LC'm Change on prior period % Number of stores Jun 2019 019 Number of stores Jun 2018 Namibia 183 83 204 (10) 183 183 204 (10) 18 18 18 Botswana 106 06 100 6 79 79 78 1 8 8 8 Eswatini~ 100 00 94 6 100 100 94 6 5 5 5 Mauritius 23 23 21 10 55 55 55

2

2 2 Lesotho 23 23 23

23

23 23

2

2 2 Zambia^ 19 19 29 (34) 15 15 22 (32) 2 2 3 Kenya 9 9 9

66

66 73 (10) 2 2 2 Ghana#

8

(100)

3 (100)
Total

tal 463 3 488 (5) 39 39 40 ^ Closed 4 stores in May 2018 and a further 1 store in March 2019. # The Ghana stores ceased trading on 3 December 2017. ~ Formerly known as Swaziland.

SLIDE 33 33

TRUWORTHS SALES DENSITIES TREND

Compound growth rates: Sales densit ity: : 5-year 1% 3-year -2% R per m2 30 462 32 979 34 849 35 656 34 586 34 857 37 350 36 317 35 256 35 682 10 000 15 000 20 000 25 000 30 000 35 000 40 000 Jun 2010 Jun 2011 Jun 2012 Jun 2013 Jun 2014 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Sales density trend

SLIDE 34 34

TRUWORTHS GROSS PROFIT TREND

Compound growth rates: Gross profit it: : 5-year 4% 3-year 0% Average: Gross margin: n: 5-year 55.3% 3-year 55.4% 6.2 7.1 7.1 7.0 7.1 7.1 55.2 55.3 55.2 55.5 55.5 55.5

10

20 30 40 50 60 70

1.0

2.0 3.0 4.0 5.0 6.0 7.0 8.0 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Gross profit Gross margin Gross profit it (Rbn) Gross margin (%)

SLIDE 35 35

TRUWORTHS TRADING EXPENSES

Jun 2019 Rm Rm Jun 2018 Rm Change on prior period %

Depreciation and amortisation 322 22 289 11 Employment costs 1 1 569 69 1 474 6 Occupancy costs 1 491 91 1 462 2 Trade receivable costs 1 1 037 37 1 099 (6) Other operating costs 800 720 11 Trading expenses 5 5 219 9 5 044 3* * Trading expenses grew 2% on the prior period excluding foreign exchange loss of R39 million in 2019 and foreign exchange gain of R29 million in 2018.

SLIDE 36 36

TRUWORTHS ANALYSIS OF TRADING EXPENSES

Deprec eciat iation

n and amort

rtis isat ation ion Capital expenditure of R420 million (Jun 2018: R419 million) in the period. Excluding non-comparable stores, depreciation and amortisation increased 2%. Employment

yment costs

Excluding non-comparable store costs and incentives, employment costs increased 4%. Occupan pancy y costs ts A net 7 stores closed during the period. Trading space increased 1.6% on the prior period.

11% 11%

INCREASE

6% 6%

INCREASE

2% 2%

INCREASE

SLIDE 37 37

TRUWORTHS ANALYSIS OF TRADING EXPENSES (CONTINUED)

Trade de receivabl eivable e costs ts Excluding IFRS 9 stage 3 interest reclassification, trade receivable costs increased 4%. Gross bad debts decreased 4%, recoveries increased 6% and debt sold decreased 31%, resulting in net bad debts decreasing 6% relative to the prior period. The doubtful debt allowance increased from 19.0% (on an IFRS 9 basis, IAS 39: 12.3%) at Jun 2018 to 19.2% of gross trade receivables while the gross debtors book grew 4% since Jun 2018. Collection costs unchanged relative to the prior period and other trade receivable costs decreased 3%. Total cost of accounts of R1 211 million (Jun 2018: R1 278 million) exceeds total income from accounts (including notional interest) of R1 185 million (Jun 2018: R1 349 million), resulting in a deficit of R26 million (Jun 2018: surplus of R71 million). Other operat rating ng costs Excluding foreign exchange gains and losses from both periods (Jun 2019: R39 million loss, Jun 2018: R29 million gain) other operating costs increased 2%.

11% 11%

INCREASE

4% 4%*

INCREASE * Including the IFRS 9 stage 3 interest reclassification, trade receivable costs decreased 6%.

SLIDE 38 38

TRUWORTHS OPERATING PROFIT PERFORMANCE

Compound growth rates: Operating ing profit it: : 5-year 1%* 3-year -4%* Average: EBITD TDA A margin: n: 5-year 31%* 3-year 31%* Average: Operating ing margin: : 5-year 29%* 3-year 28%* 3.4 4.0 3.8 3.6 3.5 3.5* 32 33 31 31 30 30* 31 31 29 29 27 27*

5

10 15 20 25 30 35 40 45

0.5

1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019* Operating profit EBITDA margin Operating margin Operating ing profit it (Rbn) Margins (%) *Jun 2019 not comparable to prior years due to restructure of SA funding arrangements in Jun 2018. The numb umbers ers in the e grap aph below have ve been en adjust sted ed to exclude e the e impa pact of the e fun undi ding ng restru ruct cture. The reported numbers are operating profit R3.4bn, EBITDA margin 29%, and operating margin 26%.

SLIDE 39 39

TRUWORTHS CAPITAL EXPENDITURE

Actu tual al Jun 2019 019 Rm Rm Actual Jun 2018 Rm Change on prior period % Committed Jun 2020 Rm Store renovations and development 252 252 320 (21) 291 Computer infrastructure and software 48 48 59 (19) 88 Land, buildings and refurbishment 113 113 31 265 151 Motor vehicles 4 4

4

Distribution facilities 3 5 (40) 3 Total tal 420 420 419

537

SLIDE 40 40

TRUWORTHS CASH FLOW ANALYSIS

2 758 (157) 1 149 8 (54) (917) (80) 2 707 (1 766) (340) (266) 24 359 (302) 57

500

1 000 1 500 2 000 2 500 3 000 3 500 4 000 Cash EBITDA Working capital movements Interest received Dividends received Finance costs Tax paid Capex maintenance Free cash flow Dividends paid Capex expansion Shares repurchased Other Net cash increase before borrowings repaid Borrowings repaid Net cash increase for the period (Rm)

SLIDE 41 41

TRUWORTHS CASH REALISATION RATE

Average: Cash realis isation ion rate: 5-year 91% 3-year 97% 80 83 84 110 97 97

20

40 60 80 100 120 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Truworths cash realisation rate (%)

SLIDE 42

FINANCIAL REVIEW - OFFICE

SLIDE 43 43

“It’s worth bearing in mind that just about everything happening in Britain today seemed implausible just a few years ago. This situation is, as the pundits say, “fluid” and “dynamic”. About the only thing that can be predicted with confidence is that come November, Brexiteers will either be celebrating their victory, or mourning their destruction.”

John Rapley, Political Economist at University of Cambridge Sunday Times, 11 August 2019

OFFICE OVERVIEW

SLIDE 44 44 Retail sales decreased by 1% to £279 million. Second half retai tail sal ales es grew ew at 2% 2% compared to a decrease of 3% in the first half, due to increased markdown activity. Decrea ease in gross margin to 42.3% (Jun 2018: 44.4%) primarily due to a shift in the full price versus markdown mix. Online reta tail sales ales increas ased ed 10% 10% to £94 million (Jun 2018: £86 million), comprising 34% (Jun 2018: 31%) of retail sales. Store sales down 6%. Trading expen enses es remai ain well contr trolled ed, growing at 2% (excluding the impairment). Inve vento tory y turn unchan anged from prior year at 3.2 times. Net debt to equity increased to 20% (Jun 2018: 10%) following impairment of Office intangibles (11% before impact of impairment).

OFFICE TRADING OVERVIEW

SLIDE 45 45

OFFICE FINANCIAL PERFORMANCE

Jun 2019 19 Including Impai airmen ent Jun 2019 19 Compar arable* Jun 2018 Chan ange e on compar arable prior period* % Sale of merchandise (£m) 285. 5.5 285. 5.5 286.0

Gross margin

(%) 42. 2.3 42. 2.3 44.4 Trading expenses (£m) 215. 5.9 113. 3.9 111.2 2 2 EBITDA (£m) (89. 9.8) 8) 12. 2.2 21.8 (44) 44) Operating (loss)/profit (£m) (94. 4.7) 7) 7.3 16.1 (55) 55) Operating margin (%) (33. 3.2) 2) 2.6 5.6 * On a comparable basis, i.e. excluding the Office impairment in the current period.

SLIDE 46 46

OFFICE RETAIL SALES AND STORES BY COUNTRY

Retai tail sal ales Jun 2019 019 £m £m Retail sales Jun 2018 £m Change on prior period % Number of stores Jun 2019 19 Number of stores Jun 2018 United Kingdom 254. 4.3 256.7 (1) 124 124 138 Germany 12. 2.7 13.5 (6) 8 8 Republic of Ireland 11. 1.3 10.3 10 7 7 United States of America 0.3 0.5 (39)

3

Total 278. 8.6 281.0 (1) 139 139* 156* * Including 24 concession stores (Jun 2018: 40 concession stores)

SLIDE 47 47

OFFICE TRADING EXPENSES

Jun 2019 019 £m £m Jun 2018 £m Change on prior period % Depreciation and amortisation 4.8 5.6 (14) Employment costs 35. 5.3 37.0 (5) Occupancy costs 48.4 8.4 45.1 7 Trade receivable costs 0.6

*

Other operating costs 24. 4.8 23.5 6 Trading expenses, before impairment 113. 3.9 111.2 2 Impairment of intangibles 102. 2.0

Total trading expenses

215. 5.9 111.2 94 * Zero due to rounding

SLIDE 48 48

Deprec eciat iation

n and amort

rtis isat ation ion Capital expenditure of £2.5 million (Jun 2018: £3.6 million) in the period. Decrease due to assets becoming fully depreciated and lower capex spend during the period. Employment

yment costs

Store wages and salaries decreased £1 million due to lower headcount and hours paid, and lower commission due to lower sales. Excluding once-off costs, employment costs decreased 4%.

OFFICE ANALYSIS OF TRADING EXPENSES

14% 14%

DECREASE

5% 5%

DECREASE

SLIDE 49 49

OFFICE ANALYSIS OF TRADING EXPENSES (CONTINUED)

Occupan pancy y costs ts Onerous lease provision increased £1.9 million. Excluding once-off costs, occupancy costs increased 2%. Trade de and other r recei eivabl vables es Trade receivable costs amounted to £0.6 million due to House of Fraser entering administration. Other operat rating ng costs Excluding once-off costs, other operating costs increased 5%. E-commerce costs increased £1.8 million as a result of increased marketing spend and increased distribution costs, which are directly linked to sales.

7% 7%

INCREASE

6% 6%

INCREASE

SLIDE 50 50

OFFICE CAPITAL EXPENDITURE

Actu tual al Jun 2019 019 £’000 Actual Jun 2018 £’000 Change on prior period % Committed Jun 2020 £’000 Store renovations and development 790 790 2 338 (66) 993 Computer infrastructure and software 1 666 1 197 39 1 383 Distribution facilities 26 26 84 (69) 60 Head office refurbishment 10 10 2 400 22 Total 2 492 3 621 (31) 2 458

SLIDE 51 51

OFFICE UPDATE ON DEBT RESTRUCTURING

Office entered into debt restructuring negotiations with lenders in June 2019. Office and lenders appointed advisors Alvarez & Marsal (A&M) and Deloitte respectively. An amount of c £42.5 million is owed to UK lenders, and Office has cash balances currently of c £28-32 million (net debt levels els are curren ently ly c £10-15 15 million

n).

Given current levels of profitability, cash generation, solvency and liquidity, no major business restructuring is appropriate. Management confident that lender negotiations will be concluded satisfactorily. Truworths International as ultimate shareholder remains committed to the business, and its board believes that Office’s fortunes will improve as the turnaround strategies are successfully executed.

SLIDE 52 52

OFFICE CEO UPDATE FOCUS & PRIORITIES – STRATEGIC OPPORTUNITIES PARTNERSHIPS OFFSPRING OXFORD STREET

Positioning
Strength of messaging – Win in

London and with Her

Activations –Physical, digital and
social. Online growth (10%)

%) will continue

New offerings and differentiated

ranges

Strong growth @+32%
Unique commu

munity position

Strengthening digital content
Increased brand positioning and

allocations

Selfridges partnership
New model trial store
Significant improveme

ment

Agile and flexible elevated

format

Brand positivity – the physical

window to the Office brand

Test and learn

SEE TURNAROUND WORKSTREAMS ‘OPERATIONAL’

SLIDE 53

TRUWORTHS ACCOUNTS

SLIDE 54 54

SOUTH AFRICAN CREDIT ENVIRONMENT TRANSUNION SA CONSUMER CREDIT INDEX

The e Tran ansUn Union SA Consumer er Cred edit t Index ex (CCI) increa eased marginal ally y to 49 in 2019 19 Q2 from 48 in 2019 19 Q1. The increase in the TU CCI signals the end to a declining trend for the past three consecutives quarters. Nevertheless, the index has now been below 50 since 2018 Q3, indicating consumer stress. This is corroborated by low consumer confidence and weak retail sales growth. Overall, TransUnion consumer credit behaviour data shows stabilising consumer stress. Accounts in early y defau fault t (3 months in arrears) increased by 1% year-on-year in 2019 Q2. This is an improvement

n the 6% in 2019 Q1.

Househ ehold cas ash flow fell marginally by 0.5% during 2019 Q2. Househ ehold debt t service e costs ts did not change materially during 2019 Q2. Househ ehold distr tressed ed borrowing (revolving credit utilisation) appears to be muted, falling 1% year-on-year. However, utilisation rates above 50% is the norm.

52 52

Q2 2018

48 48

Q1 2019

49 49

Q2 2019 19 Source: TransUnion The index measures consumer credit health where 50.0 is the break-even level between improvement and deterioration. TransUnion Defaults & Distressed Borrowing

50% 50%

Household Cashflow

35% 35%

Debt Servicing Costs

15% 15%

DATA WEIGHTING IN THE TRANSUNION CCI

SLIDE 55 55

TRUWORTHS ACCOUNTS OVERVIEW

Strong demand for Truworths merchandise evidenced by record new account application volumes of 2.8 million. Majority of applicants are under 30 years old. Strict credit granting criteria maintained. Sales growth from new accounts has been sustained with two years of double le digit it growth wth. Truworths credit book quali lity ty has improved year-on

n-year, widening the gap to the retail benchmarks (Principa Credit

Compass). Lay-bys are an attractive purchase option for customers who do not qualify for credit and a good incubator tor for future account t custom tomers. E-commerce is not only adding sales but enhances our credit t account t appeal to the online shopper. Loyalty programme continues to attr tract t and reta tain in custome tomers via tailored customer offers. Shoppable le accounts increased significantly on prior year. Performance improvements driven by a combination of advanced predictive analytics that leverage our single-view of the customer into omni-channel custome mer engageme ment.

SLIDE 56 56

TRUWORTHS ACCOUNTS TOTAL GOOD(0-1)/TOTAL BAD (2+) BALANCE RATIO

Source: Principa Excludes Edcon Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19

20%
15%
10%
5%

0% 5% 10% 15% 20% Year-on-Year Change Y-on-Y % Change Industry Excl. Truworths Y-on-Y % Change Truworths GROUP Total Good (0-1)/Total Bad (2+) balance ratio for Truworths has improved by 7% year-on-year , while industry deteriorated by 13% compared to the same period in the prior year Source: Principa Deteriorating Improving

SLIDE 57 57

10%
5%

0% 5% 10% 15% 20% Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 4+ Cycle Balances Quarter Y-on-Y % Change Industry Excl. Truworths Y-on-Y % Change Truworths GROUP

TRUWORTHS ACCOUNTS TOTAL 4+ CYCLE BALANCES

Truworths Total 4+ balances improved by 4% compared to prior year while industry deteriorated by 16% Source: Principa (Excludes Edcon) Improving Deteriorating

SLIDE 58 58

TRUWORTHS ACCOUNTS NEW APPLICATIONS VS RISK APPROVED VS OPENED

0.5

1.0 1.5 2.0 2.5 3.0 2008/2009 2009/2010 2010/2011 2011/2012 2012/2013 2013/2014 2014/2015 2015/2016 2016/2017 2017/2018 2018/2019 0% 10% 20% 30% 40% 50% 60% No of Applications Risk Approval % Opened % (%) High standard of credit granting criteria maintained and improved

No. of
f account

applic ications ions (million lions)

SLIDE 59 59 100 200 300 400 500 600 700 800 2009/2010 2010/2011 2011/2012 2012/2013 2013/2014 2014/2015 2015/2016 2016/2017 2017/2018 2018/2019 Applic licati ation Date

TRUWORTHS ACCOUNTS NEW ACCOUNTS OPENED

No. of new

accou

unt

nts opened (‘000) Record number of new accounts opened

SLIDE 60 60

TRUWORTHS ACCOUNTS NEW ACCOUNT APPLICATIONS BY AGE GROUP

18 – 24 years 25% 25 – 29 years 24% 30 – 34 years 19% 35 – 39 years 13% 40 – 49 years 13% 50+ years 6% Almost half of all applicants are under 30

SLIDE 61 61

Account sales growth year-on-year Months

n book

Jun 2016 % Jun 2017 % Jun 2018 % Jun 2019 % 1 to 12 months 11 (24) 21 14 14 13 to 24 months 15 6 (24) 13 13 25 to 36 months (3) 9 3 (23) 23) 37 months + 14 4 1 3

TRUWORTHS ACCOUNTS ACCOUNT SALES GROWTHS

Affordability legislation impact on sales growth moving into the older account groups impacting the overall sales growth. Affordability legislation impact on sales growth. Positive future sales growth.

SLIDE 62 62

TRUWORTHS ACCOUNTS SHOPPABLE ACCOUNTS

Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun 2018 - Shoppable 2019 - Shoppable

No. of

accounts Shoppable accounts continued to improve in line with increase in active customer base

SLIDE 63 63

TRUWORTHS ACCOUNTS STATISTICS

Jun 2019 19 Jun 2018 Number of active accounts (000's) 2 658 2 591 Change in number of active accounts (%) 3 3 2 Gross trade receivables (before doubtful debt allowance) (Rm) 5 898 8 5 663 Change in gross trade receivables (before doubtful debt allowance) (%) 4 (3) Account sales as a % of retail sales (%) 70 70 69 Qualifying payment (%) 90 90 90 Accounts opened to applications ratio (%) 22 22 25

SLIDE 64 64

TRUWORTHS ACCOUNTS STATISTICS (CONTINUED)

Jun 2019 19 Jun 2018 Active account holders able to purchase at period-end (i.e. not in arrears) (%) 83 83 84 Overdue accounts as a % of gross trade receivables (%) 13 13 14 Net bad debt as a % of account sales (%) 8.3 9.2 Net bad debt as a % of gross trade receivables (%) 13. 3.3 14.7 Doubtful debt allowance as a % of gross trade receivables* (%) 19. 9.2 19.0* Trade receivable interest as a % of gross trade receivables# (%) 18. 8.8 22.7 * The June 2018 provision was 12.3% under IAS 39. The transition date increase in the provision was processed through retained earnings. # Impacted by the IFRS 9 stage 3 interest reclassification. Excluding the reclassification, 20.6%

SLIDE 65 65

TRUWORTHS ACCOUNTS REGULATORY UPDATE

Nati tional Credit it Amendme ment Act Debt relief legislation signed into law on 13 August, announced by Parliament yesterday. Regulations will need to be drafted and circulated. Stakeholders will have an opportunity to comment on regulations. Comes into effect on date to be set by the President on proclamation in the Government Gazette Eligible to customers earning less than R7 500 per month, have unsecured debt of less than R50 000 and have been found to be critically indebted by the National Credit Regulator. These accounts have in all likelihood already been written off or largely provided for. In addition the doubtful debt allowance under IFRS 9 includes a provision for debt relief based on forward-looking considerations. Studies will have to be undertaken about what the long term implications are for consumer behaviour. NCRF is considering the legislation with its advisors.

SLIDE 66

STRATEGIC FOCUS AREAS

SLIDE 67 67

GROUP STRATEGIC FOCUS AREAS

Grou

up

p focus cus areas

Truworths and Office continue to collaborate
Investigate strategic acquisitions
Board transformation

Truwo worth ths s focus cus areas

Leadership and succession
New store concepts
Merchandise and supply chain
Digital

Office fice focus us areas

Turnaround strategy
Marketing, customer

engagement and loyalty

Expansion and growth of e-

commerce

Supply chain

SLIDE 68 68

GROUP BOARD TRANSFORMATION

Commit itted ed to transform

rmat

atio ion of the Truworths International Ltd board.

Medium-term target of 30% female representation on the board.

Cindy dy Hess appointed as independent non-executive director with effect from 1 May 2019.

Cross-industry experience predominantly in the FMCG sector. Experience in the fields of risk management, restructuring and corporate finance.

Sarah ah Proudf dfoo

ot

t appointed as executive director with effect from 23 May 2019.

21 years experience with the Group. Appointed Director of Truworths Ltd Ladieswear Merchandise in 2016. Experience in merchandise design, merchandise buying, planning, store design and marketing; strengthening the board's capabilities in all fashion retail functions.

Following these appointments, femal ale e repres esent entat atio ion n on the board d now 31%, in line with the Group’s medium-term target.

SLIDE 69 69

TRUWORTHS STRATEGIC FOCUS AREAS LEADERSHIP AND SUCCESSION

Succession is an important area of focus. New divisional directors appointed with effect from 1 March 2019. Cathy hy Kirkman an appointed as Divisional Director: Merchandise Planning.

21 years experience with the Group.

Myles es Apsey ey appointed as Divisional Director: Merchandise Planning.

18 years experience with the Group.

Peter r Shac acklet leton

n appointed as Divisional Director: Marketing & Merchandise.

21 years experience with the Group.

Zamira ra Mowzer er appointed as Divisional Director: Internal Audit, Governance and Risk.

11 years experience with the Group.

SLIDE 70 70

TRUWORTHS STRATEGIC FOCUS AREAS NEW STORE CONCEPTS

Context ext One of a kind EXPERIENTIAL concept store by TRUWORTHS. Upmarket brand offering a collection of fashion, beauty and homeware. Modern retail experience for the discerning female customer. Aimed at capturing market share in the better-end segment by offering our higher LSM customer a range of products with unique appeal. Can be rolled out into better-end malls or more exclusive smaller retail environments. First store successfully opened in April 2019 in the V&A Waterfront, Cape Town. Fourways (Johannesburg) opening August 2019. Brooklyn (Pretoria), Loch Logan (Bloemfontein) and Sandton (Johannesburg) to follow.

SLIDE 71 71

TRUWORTHS STRATEGIC FOCUS AREAS NEW STORE CONCEPTS (CONTINUED)

ID K Kids Successfully piloted ID Kids range in 26 Identity stores in summer 2018, rolling out to a large number of stores for summer 2019. Range is focused on the 2-8 year old age group and covers both girls and boys collections. Utilise the extensive in-house kidswear experience. Look and feel aligned with the DNA of Identity and is “cool and fun”. New Office London

n concept

ept Larger format footwear, apparel and accessories store. Forward-thinking retail space, clean and clinical yet feels soothing and inviting for a new take on futuristic design. First store launching in Fourways Mall, Johannesburg.

SLIDE 72 72

TRUWORTHS STRATEGIC FOCUS AREAS NEW STORE CONCEPTS (CONTINUED)

New emporium rium concept ept Launched refreshed emporium store concept in a number of large stores. Examples include Gateway, Eastgate, Westville Pavilion, East Rand Mall and Westgate. New store e design gn element ents Introduced several new designs to ensure stores remain visually appealing and relevant, including Loads of Living, Identity, YDE and Uzzi.

SLIDE 73 73

TRUWORTHS STRATEGIC FOCUS AREAS MERCHANDISE AND SUPPLY CHAIN

Product uct life-cyc ycle le managemen agement t (PLM) system em Implementation of first phase successfully completed in April 2019. Consoli

lidat

datio ion n of f fabric ic purchasin hasing g across

ss departm

rtmen ents ts Drive improved margins and value offering through volume consolidation and bulk negotiations. Merchan handi dise e manag agem ement ent system em Suppl ply y strateg tegy y review ew New distri ribu bution

n center

ter

SLIDE 74 74

TRUWORTHS STRATEGIC FOCUS AREAS DIGITAL

Integrat rated ed brand d mark rket eting ng E-comm mmerc erce Data-driven riven decis isio ion n making ng

SLIDE 75 75

Office turnaroun round d strategy egy managed through three e workstream reams:

Trading alignment – focuses on merchandise performance and stock to reduce markdowns by managing stock position. Short-term essentials – aimed at prioritising Office’s operational and capital expenditure. Marketing and brand alignment – focuses on the marketing/communication strategies, branding and brand relationships.

Closure of poor performing stores remains a priority, while enhancing the e-commerce

ffering to grow sales in a consumer

er environmen ronment t trendi ding ng towards rds online ne shopp pping ing – footwear is highly conducive to online retailing.

OFFICE TURNAROUND STRATEGY

SLIDE 76 76

OFFICE STRATEGY – OUR VISION

We will focus on the basics to drive a more profitable business for all stakeholders: Look after our people, invest in

ur customers, harness our brand relationships and improve
ur product process

“ “

BACK K TO BASICS ICS TURNAROU RNAROUND GROW OW

Morale
Costs
Capex
Trade
Inventory
Brand
People
Customers
Product
Stores
Space
Service
Digital
Offspring
Assortments
Supply chain

Our strategic priorities:

SLIDE 77 77

OFFICE STRATEGIC FOCUS AREAS

Marketi eting ng, customer

mer engagemen

agement t and loyalt lty Customer research and analysis exercise in progress. E-receipts Expansi ansion

n and growth

h of e e-commerce erce Ongoing enhancement of customer experience and transactional touch points continues, supporting the popularity of this channel in the UK. New payment gateway. Same-day/nominated-day delivery and “click & collect” enhancements are progressing well. Suppl ply y chain In-depth review of current warehousing and distribution model expected to improve efficiency and reduce costs.

SLIDE 78

OUTLOOK

SLIDE 79 79

TRUWORTHS OUTLOOK

Consumer spending expected to remain under pressure in the short term – prolonged economic downturn and renewed demands on disposable income. Labour market continues to weaken with unemployment at a 15-year high level. Consumer confidence stabilised following the country’s national elections in May 2019 and the improvement in the power supply in recent months. Consumer inflation remains steady. Promulgation of debt relief act. Stronger retail sales growth trend in the second half of the financial period is promising. Sales momentum expected to be driven by: Health of the account portfolio Expanding e-commerce offering Lay-by payment option Customer response to new store concepts, including ID Kids and Context Medium-term prospects will be supported by the health of the account portfolio, continued investment for growth, robust cash flows and strong balance sheet. Retail sales for the first 6 weeks of the 2020 financial period increased relative to the corresponding period in 2019, with lower markdowns. New Early Summer product started well – improved on last year. 1%

1%

increase

SLIDE 80 80

OFFICE OUTLOOK

Trading conditions and consumer confidence remain under intense pressure ahead of the end-October 2019 Brexit deadline. Retail sector will remain constrained in the medium term. Turnaround initiatives implemented by management progressing according to plan. Ongoing focus on inventory management to arrest gross profit margin decline and release working capital. Real estate portfolio evaluation with a view to closing loss-making stores as leases come to an end. Based on in-depth assessment by advisers, a major financial restructuring of Office is not being considered given its current profitability, liquidity and cash balances.

Retail sales for the first 6 weeks of the of the 2020 financial period increased in Sterling relative to the corresponding period in 2019.

3% 3%

increase

SLIDE 81

QUESTIONS

SLIDE 82

DISCLAIMER

This announcement contains certain forward-looking statements with respect to the financial condition and results of

perations of Truworths International Limited and its group

companies which by their nature involve risk and uncertainty because they relate to events and depend on circumstances that may occur in the future. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: global and national economic conditions; growth in trading space; interest rates; credit and the associated risks of lending; merchandise clearance rates; inventory levels and stock turn; gross and

perating margins achieved; and competitive and regulatory
factors. The Group does not undertake to publicly update or

revise any of these forward-looking statements, whether to reflect new information or future events or otherwise.

SLIDE 83

APPENDICES

SLIDE 84 84

SLIDE 85 85