Growth Presentation November, 2013 E 1 Disclaimer This - - PowerPoint PPT Presentation

1

Investor Presentation

November, 2013

Going for

Growth

E

2

Disclaimer

This presentation is not an offer or invitation to subscribe to or purchase any securities. No warranty is given as to the accuracy or completeness of the information in this presentation. You must make your own independent investigation and appraisal of the business and financial condition of KIPCO Nothing in this presentation shall form the basis of any contract or commitment whatsoever. This presentation is furnished to you solely for your information. You may not reproduce it to redistribute to any other person. This presentation contains forward-looking statements. These statements may be identified by such words as "may", "plans", "expects", "believes" and similar expressions, or by their context. These statements are made on the basis of current knowledge and assumptions. Various factors could cause future results, performance or events to differ materially from those described in these statements. No

• bligation is assumed to update any forward-looking statements

By participating in this presentation or by accepting any copy of the slides presented, you agree to be bound by the forgoing limitations.

3

Index

Executive Summary

Bloomberg Ticker: KPROJ KK Reuters Ticker: KPRO.KW

4

21 years of continuous profitability, 11 years of continuous dividends P/BV of 1.5x. Attractive NAV Primarily financial services and media Middle East and North Africa Operating holding company with an AuM of US$31 bn

A diversified company with deep regional expertise and roots

Majority owned by ruling family of Kuwait A transparent company with an experienced management team Listed on Kuwait Stock Exchange with a market cap

• f US$3.0 bn*

Credit ratings: S&P: BBB- Moody’s:Baa3

* As on November 14, 2013

Gateway to MENA with superior access to opportunities

5

Our presence by geographies & sectors

• 1. Based on total reported segmental revenues and assuming consolidation of GIG as a subsidiary
• 2. Based on segmental reporting revenues of US$ 2,260 mn (Before inter group eliminations) & consolidating 100% revenue of GI G & OSN
• 3. Based on segmental reporting assets of US$ 33.2 bn (Before inter group eliminations) and consolidating 100% assets of GIG & OSN

Geography Major Sectors

Commercial banking Asset management & investment banking Insurance Media Real Estate Industrial Others Revenues1 (2012)

• Kuwait

KSA UAE Bahrain Lebanon Egypt Tunisia Algeria Jordan

• 6%

49% 5% 4% 6% 13% 7%

Revenues2 (9M’13)

15% 6% 18% 11% 42% 1% 7%

Assets3 (9M’13)

3% 6% 5% 3% 74% 1%

• Others
• 4%

Iraq

• 2%
• 6%

4% 1%

Note: Exchange rate of KD/ USD of 0.2828 has been used in the presentation for financial numbers

Attractive presence in high growth economies and promising sectors

6

69 139 35 139 96 91 1997 2012 2002 2012 Adjusted Share Price (US cents) Cumulative Dividend (US cents)

Last 15 years

Total Shareholders’ Return (Share Price Return and Dividend Yield) Growth Book Value Per Share Growth (in US cents)

Track record of generating attractive returns

Last 10 years

235 230

Last 15 years Last 10 years

36 249 39 244 1997 2012 2002 2012

Note: Data adjusted for stock dividend

Note: Assuming no dividend was paid

7

NAV Computation (US$ per Share)

Net asset value

0.9 0.7 0.3 0.1 0.1 0.1 0.0 (0.6) 1.6 2.2 1.4 0.5 0.1 0.1 0.1 0.1 0.8 Burgan Bank OSN United Gulf Bank Gulf Insurance Company United Real Estate Company United Industries Company Net other Assets Net Debt NAV KIPCO Share Price in US$ BVPS (US$) Market Cap Share Control Premium (Note 1)

Note 2

12%

610 fils 405 fils 680 fils

Note 3

1.Control Premium has been assumed at 50% to the respective market prices to reflect the value of significant stakes in these entities. 2.OSN has been taken at fair value (~US$ 1.5 bn) used for Joint venture accounting in audited financials of KIPCO (notes 9 & 22 of annual financial statements for year ending 2009), further to merger of Orbit and Showtime in August 2009. Other components of the NAV are at book value as of Sep 30, 2013. 3.Operating expenses of US$0.03 per share adjusted with net other assets ; prices are as of November 14, 2013

8

Index

Strategy

9

Regional Outlook

Strategic roadmap

Building Businesses

Investing in engines of growth Diversified Revenue streams Strong managerial expertise

Investment in companies with sustainable and predictable cashflows

Being first in the region Thought leadership Team Approach Balanced Portfolio Target ROE: 20%

MENA

10

Solid & well managed portfolio of fast growing and attractive industries

KIPCO Effective Stakes1 60.3% 60.4% 96.7% 83.0%3 44.8% 65.8% Board Representation 6 of 9 2 of 75 6 of 6 6 of 6 4 of 104 4 of 7 Market Cap (US$ mn)2 3,151 Unlisted 469 125 363 495 Credit Ratings S&P: BBB+/A2 Moody’s: A3/ P2 Unrated CI*: BBB CI*: BBB- S&P: A- AM Best: A- CI*: BBB-

Controlling or majority stakes

Real Estate Main Entities Commercial Banking Media Asset Management & Investment Banking (AMIB) Insurance

Notes: 1.Effective Stakes given are as of Sept 30, 2013 2.Market Capitalisation as of November 14, 2013 (Source: KAMCO Research) 3.Stake in KAMCO is held through UGB 4.GIG has 10 board members – 4 from KIPCO , 3 from Fairfax and 3 independent directors 5.OSN has 7 board members – 2 each from KIPCO and Mawarid and 3 independent directors * Capital Intelligence

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Active Management – KIPCO Support & Action

▪ Transformed from a local player to regional player ▪ Hired new management in 2010/11 to execute on regional strategy ▪ Focused on growth with prudent loan underwriting ▪ Incubated pan-MENA commercial banking network ▪ Equipped to assess / develop opportunities identified by KIPCO ▪ Refining strategy to add more value to financial services sector ▪ Transformed from a local player to regional player ▪ Gained market leadership in 3 key geographies ▪ Partnered with Fairfax to strengthen operations and enhance growth ▪ Acquired Pehla in Aug’13 ▪ Merged with Orbit in 2009 to create leading pay TV

• perator in MENA

▪ Gained access to premium content and rolled out anti- piracy initiatives ▪ Focused on subscriber acquisition ▪ Spun-off AM/IB division to separate client funds from KIPCO funds ▪ Full range of asset management & investment advisory services in Kuwait ▪ Streamlined operation in 2012 to focus on core business

Then Now

1995 9M’13 1996 9M’13 1998 H1’13 1995 9M’13 2000 H1’13

Net Interest Margin Sub. Base Book Value Rank# (by GPW ) AUM

Active management

1.3% 2.8% 1.3%

858K^ _

• f 5

#3

3

• f 32

#1

1

. 7

Bn

US$

1 . 2 Bn

459 Mn 193 Mn US$

Number of success stories demonstrating consistent track record of value creation

Businesses

Key businesses – progress indicators

Parameters

^ Represents subscriber base post merger of Showtime & Orbit # Represents rank in Kuwait

12

Index

Performance Update

13

35% 21% 5% 161%

growth in

• perating

income growth in

• perating

profits NPA reduced to Aggregate provision coverage increased to

24% 22%

growth in revenues

25%

growth in subscriber base EBITDA margin

Net profit US$10 mn

Cost base rationalization continues

13% 5%

growth in revenues

15%

growth in net profit growth in net premium earned

21%

growth in investment income

7%

2012

117%

2012

23%

Total expenses reduced by

9M 2013: Operating performance continues to be strong

14

17 180 198 164 62 255 120 143 88 230 272 299 340 252 292 2010 2011 2012 9M'12 9M'13 Provisions charge to P&L 7.6 8.0 12.0 9.8 12.6 2010 2011 2012 9M'12 9M'13 Loan

Burgan Bank

US$ billion

Loan Growth Deposit Growth Asset Quality

US$ billion US$ million

Operating Income Net Profit & Provisions Total Provision

US$ million US$ million 7.3% 10.5% 7.0% 4.7% 2010 2011 2012 9M'13 NPA to Gross Credit Facilities 327 298 349 254 307 260 283 327 237 355 2.8% 2.6% 2.6% 2.6% 2.8% 2010 2011 2012 9M'12 9M'13 Kuwait Regional NIM% 587 581 676 350 310 226 271 263 317 465 571 613 627 691 843 2010 2011 2012 9M'13 Specific General 6% 9.1 9.9 13.8 11.8 15.2 2010 2011 2012 9M'12 9M'13 Deposit 16% Growth Ex BBT^ Growth Ex BBT^ 27% 21%

Solid Performance with strict focus on asset quality

111% 108% 117% 161% 72% 49% 58% 101% NPA Coverage with collateral NPA Coverage without collateral ^ BBT represents Burgan Bank Turkey (Eurobank Tekfen acquired by Burgan bank and renamed) 662 491

15

Burgan Bank: Regional operations

US$ billion

Loan Growth Deposit Growth Net Profit

US$ billion Percentage

Net Interest Margin Cost to Income Returns*

Percentage Percentage US$ million 29% 33% 46% 60% 42% 30% 34% 39% 33% 34% 83% AGB JKB BoB TIB Average BBT^ 9M'12 9M'13 4.3% 3.9% 2.7% 1.1% 3.0% 4.0% 4.1% 2.5% 0.7% 2.8% 3.7% AGB JKB BoB TIB Average BBT^ 9M'12 9M'13 34 19 7 59 48 53 21 5 126 6 AGB JKB BoB TIB Total BBT^ 9M'12 9M'13 4.2% 2.0% 2.3% 1.25% 2.5% 0.3% 30.8% 13.5% 14.8% 6.9% 16.5% 2.3% AGB JKB BoB TIB Average BBT^ ROAA ROAE 0.7 1.8 0.1 0.0 2.7 0.9 1.8 0.2 3.0 2.1 AGB JKB BOB TIB Total BBT^ 9M'12 9M'13 26% Growth in loan 0.9 2.1 0.7 0.2 4.0 1.1 2.3 1.1 0.3 4.9 1.5 AGB JKB BOB TIB Total BBT^ 9M'12 9M'13 33% 11% 24% Growth in Deposit * Annualized return (9M’ 2013)

Regional operations contributing towards improved growth profile

10% ^ BBT represents Burgan Bank Turkey (Eurobank Tekfen acquired by Burgan bank and renamed) BB = Burgan Kuwait, AGB = Algeria Gulf Bank, JKB = Jordan Kuwait Bank, BOB = Bank of Baghdad, BBT = Burgan Bank Turkey

16

Burgan Bank: NPA- cyclical & not structural

208 256 173 193 171 121 122 90 110

11.0% 11.8% 6.3% 6.0% 6.1% 4.1% 3.5% 1.7% 1.4% 9.5% 7.3% 10.5% 7.0% 4.7%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 9M'13 NPA NPA Ratio 112 129 139 168 139 140 146 148 354 637 613 627 691 843 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 9M'13 Provisions

 As on Sep’13, the combined coverage of non performing assets (NPA) is 161%  NPA Ratio declined from 7.0% in 2012 to 4.7% as on Sep’13  ~68% provisions in general category as on Sep’13  Prudent approach to credit cycle − Loan Loss Reserves (against Loans and Advances to Customers) created during 2008-09 higher than those created during 2000-01 cycle

1,116 850 1,287 1,193 836

NPA Trend

NPA (US$ million) NPA Ratio (Percentage)

Provisions Trend

54% 50% 80% 87% 116% 119% 165% 321% 90% 111% 108% 117% 161% 54% 50% 80% 87% 116% 119% 165% 321% 57% 72% 49% 58% 101% NPA Coverage with collateral NPA Coverage without collateral Note: Figures are based on re-stated financials as per Annual Report

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30 32 48 36 40 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 17% 16% 17% 17% 17% Q3'12 Q4'12 Q1'13 Q2'13 Q3'13

Thousand

Net Adds

Thousand

Subscribers

702 734 782 818 858 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13

Subscribers by country (September 2013) Churn

KSA 25% UAE 28% Kuwait 9% Bahrain 3% Egypt 10% Qatar 15% Others 10%

OSN

Quarterly Revenue run rate in excess of US$114 mn

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OSN (Cont’d)

MENA TV Overview

MENA Region1 Latin America UK India US Population (Mn)

258

2

586 64 1,243 317

Pay TV (Mn; Est.)

4 37 14 133 102

TV Households / Households (%)

85% NA 94% 61% 88%

Pay TV/ TV Households (%)

9% 30% 53% 86% 88%

Low Pay TV penetration in MENA region indicates huge market potential

TV Households (Mn)

53

2

NA 26 155 116

Notes: 1.MENA Region represents data of 13 countries: Saudi Arabia, UAE, Bahrain, Egypt, Kuwait, Jordan, Qatar, Lebanon, Libya, Algeria, Morocco, Oman and Tunisia (OSN’s core and target markets) 2.Population and TV HHs data includes Iraq, however, Pay TV subscriber in Iraq is not available Source: IMF WEO Database Oct’13, KIPCO research in 2013, OSN research in 2013

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2009

+

2011

OSN: Acquisition of Pehla

2013

Continued consolidation of MENA Pay TV

Deeper and bigger base: Total South Asian households in MENA estimated at ~800,000 Enhanced Sports content: Exclusive TV and media rights of major sports events such as International Cricket Council (ICC), Indian Premier League (Cricket), etc. Dynamics of South Asian content not related to Western content OSN revenue growth rate expected to accelerate by ~10% in the first full year of acquisition First year of acquisition is EBITDA accretive; EBITDA profile consistent with OSN Greater flexibility to test the digital platform and monetize Stronger distribution platform

Pehla acquisition presents a huge opportunity

Orbit & Showtime merged to form OSN OSN acquired exclusive rights from ART for select General Entertainment channels OSN acquired Pehla

20

US$ million

Fees & commission Income

US$ million

Revenue AUM & Capitalisation Net Profit & Provisions

United Gulf Bank

US$ billion US$ million

30 17 21 12 9 2010 2011 2012 H1'12 H1'13 39 1 11 16 10 29 24 13 9 68 26 25 26 2010 2011 2012 H1'12 H1'13

Provisions Charge to P&L

163 109 93 60 38 2010 2011 2012 H1'12 H1'13 8.0 7.5 8.0 9.1 2010 2011 2012 H1'13

24.9% 19.5% 18.2% 23.2%

CAR

21

US$ million

Net Investment Income

US$ million

Gross & Net Premium Written Net Profit Combined Ratio

Gulf Insurance Group

US$ million

211 239 262 202 236 426 476 517 400 435 2010 2011 2012 9M'12 9M'13 Net Premium Written Gross Premium Written 70% 67% 75% 74% 77% 19% 21% 17% 18% 17% 2010 2011 2012 9M'12 9M'13 Loss Ratio Expense Ratio Combined Ratio

89% 89% 94% 92%

27 25 33 26 28 2010 2011 2012 9M'12 9M'13 Net profit

13.6% 10.9% 10.7% 12.7%

Return on Equity

92% 13.8%

14 10 23 19 23 2010 2011 2012 9M'12 9M'13

22

US$ million

Operating Profit

US$ million

Total Revenue Total Assets & Return on Equity Net Profit

United Real Estate Company (URC)

US$ million US$ million

85 124 197 104 109 2010 2011 2012 9M'12 9M'13 20 36 80 (13) 11 2010 2011 2012 9M'12 9M'13 35 70 114 12 37 2010 2011 2012 9M'12 9M'13 1,294 1,855 1,959 1,608 2010 2011 2012 9M'13 Total Assets

2.9% 5.1% 10.7% 7.5%

Return on Equity

179 75

87 75

62 75 29 40 29 65 138 29 Represents non recurring income on sale of land held for development & revaluation gain resulting in gain of US$29 mn in 9M’13 (sale of Verdun resulting in gain of US$75 mn in 2012)

23

43% 26% 16% 6% 4% 3% 2%

Marina World - Kuwait Salalah Mall - Oman Salalah Residences - Oman Marina Plaza - Kuwait United Gulf Realty Co- USA Saleh Shehab Resort Others

58% 15% 12% 11% 4%

Egypt (Sharem Al-Shaikh land, Egypt land, & Uroba Land) Jordan (Areej & Abdali mall land) Dubai (Meydan land) Qatar (Entertaintment & Energy City) Syria (Sahnayia Land & Darkhabiya)

31% 16% 18% 14% 13% 1% 7%

Investment properties Land for development Projects under construction* Fixed assets (PPE) Investments in associated companies Cash Others

Total : US$ 486 million Total Assets US$ 1,608 million

URC: Balance Sheet (Break-up) as of September 30 2013

Total: US$ 292 million Total : US$ 259 million

41% 29% 23% 6% 1%

Abdali Mall - Jordan Raouche* - Lebanon Aswar - Egypt Shuwaimiya Project - Oman Ahmed Arabi Areej land

1 1 3 2 2 3

Total Assets Investment Properties Project Under Construction Land for Development

* Includes Raouche which is reported under inventory in the financials

24

US$ million

Revenues Net Income Consolidated Assets

US$ million US$ billion

KIPCO Consolidated: Financial performance

1,451 1,249 1,576 1,326 1,620 2010 2011 2012 9M'12 9M'13 160 107 111 84 92 2010 2011 2012 9M'12 9M'13 20.1 20.8 25.6 28.6 2010 2011 2012 Sep'13

25

KIPCO Parent debt profile: As at 30 September 2013

Proactive liability management ensuring longer maturity profile Term Loan

10%

20%

Local Bonds

70%

International Bonds

55%

2-4 Years

45%

>4 Years <2 Years

0%

Average debt maturity is 4.3 years

Total Debt: US$ 1.4 billion

Debt Maturity

Total Debt: US$ 1.4 billion

Debt Type Liquidity KIPCO has cash & bank balance of US$533 mn with no debt maturities till Jan’16 − The current cash balance covers all debt obligations due till Sep’ 2016 (1.9x coverage) Placements are with investment grade rated domestic institutions Placements are of short duration and are typically rolled over on a monthly basis

26

Index

Why KIPCO

27

Why KIPCO?

Outstanding track record Compelling strategy Experienced management team Transparent Supportive primary shareholder

Pan MENA Player

Strong liquidity

Pan MENA Player

Well positioned to deliver 20% return in medium term

29

Index

Annexure 1: Portfolio Companies

30

Burgan Bank (BB): Overview

 Net Interest Income grew by 35% to US$ 425 mn in 9M’13  Operating profit grew by 22% to US$ 386 mn in 9M’13  CAR of 17.6%, amongst the highest in the industry

A regional player with presence in growth markets

Overview

Overview

Kuwait based commercial bank with regional presence in nine countries 2nd largest conventional bank in Kuwait in terms of assets (total assets of US$23.0 bn as of Sep 30, 2013) Offers a wide range of corporate, retail & treasury products through a network

• f 217

branches & 277 ATMs Listed on the Kuwait Stock Exchange with a market cap of US$3,151 mn as of November 14, 2013 BBB+ rating from S&P and A3 from Moody’s KIPCO Group Holds 60.3% stake, while KIPCO directly holds 43.0% stake (as on September 30, 2013) First and only ISO certified Bank in GCC to achieve certification for all its banking operations

31

OSN: Overview

 Acquired 100% stake in Pehla ( the region’s largest provider of South Asian pay TV content)  22% annualized growth in subscriber base to reach 858k in Sep’13 − Churn reduced to 17% as of Sep’13 after platform closure from 54% in Dec’10 − Continuous positive EBITDA since Apr’11  Post Pehla acquisition, OSN now carries 137 channels including 36 HD channels (highest in the region)  Exclusive Western & Arabic Content  Exclusive contracts with all 8 major Hollywood studios  Recently launched 5 new Arabic channels and exclusive Filipino content  Technology leadership continues with OSN play and internet enabled OSN Plus HD

OSN is the flagship media company of KIPCO Group

Overview

Overview

Largest digital satellite premium Pay TV operator in MENA region Market leading technology includes integrated DVR & subscription VOD Showtime and Orbit merged w.e.f . Aug 1, 2009 to form Panther Media Group Limited (PMGL) Licensed to operate in 24 countries in MENA (Focused on KSA, UAE, Kuwait, Egypt, Bahrain, Qatar & Jordan) KIPCO Group holds 60.4% stake in the merged entity (as on September 30, 2013)

32

United Gulf Bank (UGB): Overview

 Strong Basel II capital adequacy ratio of 24.9% as on June 30, 2013  Assets Under Management of US$ 9.1 bn as on June 30, 2013  Cost base rationalization in process to improve efficiency in operations; total expenses reduced by ~ 23% to US$12 mn in H1’13

Focused on growing the financial services network across the MENA region

Overview

Overview

Asset management and investment banking (AMIB) business Offers asset management, investment banking, brokerage and advisory services Listed on the Bahrain Stock Exchanges with a market cap of US$452 mn as of November 14, 2013 Credit rating of BBB from Capital Intelligence KIPCO Group Holds 96.7% Stake, while KIPCO directly holds 87.6% stake (as on June 30, 2013)

33

Gulf Insurance Group (GIG): Overview

 Net profit grew by 5% to US$28 mn in 9M’13 − 15% growth in net premium earned − 21% growth in net investment income  Composition of GPW − Line of business: 51% Life & Medical; 49% Non-Life (5% Marine, 12% Property, 20% Motor, 5% Engineering and 7% General)

Gulf Insurance Group is ranked 8th among the Private sector players in the MENA (by GPW)

Overview

Overview

Multi-line insurance provider with presence across 9 MENA countries through subsidiaries Provides marine, aviation, property, engineering, casualty, life & health insurance, & micro finance insurance Operates through a network

• f 50 branches across

the region Market leader in Kuwait (by GPW and Direct premiums) for eleven consecutive years Market leader in Bahrain and Jordan (by GPW) & Egypt (by Technical profit) among the private sector Listed on the Kuwait Stock Exchange with a market cap of US$363 mn as of November 14, 2013 A- Rating from S&P KIPCO Group Holds 44.8% Stake, while KIPCO directly holds 39.6% stake (as on September 30, 2013)

34

United Real Estate Company (URC): Overview

 Sold 10 plots in Mubarakiya area and 2 plots in Entertainment city for US$ 39 mn, resulting in a gain of US$ 10 mn in 9M’2013  Over the next few years, targets to develop projects spread over Oman, Jordan, Lebanon and Egypt in various segments including residential, office hospitality and commercial

URC is devoted to excellence in securing and managing the best prospect developments, providing the best quality services and allegiance to entrusted clients

Overview

Overview

Leading integrated real estate company with presence in Kuwait & MENA Sizeable portfolio of good quality properties; Large unencumbered asset base Stable rental income; growth to be supported by newly completed KIPCO Tower and Salalah Mall Listed on the Kuwait Stock Exchange with a market cap of US$495 mn as of November 14, 2013 Major real estate player in Kuwait, ranked second in real estate sector

• n KSE (total asset basis)

KIPCO Group holds 65.8% consolidated stake, while KIPCO directly holds 36.8% stake (as on Sep 30, 2013)

35

2001 2003 2003 2005 2012 1979 1994 1997 1999 1999

Acquired Fairmont Hotel, Egypt Developed Al Khour Resort, Kuwait as BOT Developed Saleh Shehab, Kuwait as BOT Developed Al Shaheed Tower, Kuwait Developed Marina Hotel, Kuwait as BOT Acquired City Tower, Kuwait Acquired Bhamdoun Hotel, Lebanon Acquired Marina Plaza, Kuwait Developed Marina World, Kuwait as BOT Developed KIPCO Tower, Kuwait

Major Real Estate Properties Developed & Operated by URC

36

United Industries Company (UIC): Overview

 Net profits grew 131% from US$10 mn in 9M’2012 to US$23 mn in 9M’2013 − Due to 76% growth in income from underlying entities (QPIC)

UIC aims to be a leading regional investment house with specialized activities in the Industrial sector

Overview

Overview

Established in 1979, UIC invests in the industrial sector in Kuwait and the region Major investments are SADAFCO & QPIC Listed on the Kuwait Stock Exchange in 1997, it has market cap of US$284 mn as of November 14, 2013 KIPCO Group holds 72.7% consolidated stake, while KIPCO directly holds 70.1% (as on Sep 30, 2013)

SADAFCO –Saudi Dairy & Foodstuff Company, QPIC = Qurain Petrochemicals Industries Co.

37

US$ million

Total Revenue^

US$ million

Income from Associates Total Asset Net Profit

United Industries Company: Financial performance

US$ million US$ million

34 29 32 289 312 2010 2011 2012 9M'12 9M'13 14 4 12 10 23 2010 2011 2012 9M'12 9M'13 18 26 29 10 17 2010 2011 2012 9M'12 9M'13 633 632 772 806 2010 2011 2012 Sep'13

^UIC has been consolidating SADAFCO from H1’2013 therefore total revenue of 9M’12 restated

38

Saudi Dairy & Foodstuff Company (SADAFCO): Overview

SADAFCO is focused to be the leading dairy & foodstuff company in GCC by providing quality products to its customers

Overview

Overview

Established in 1976 as a pioneering venture in dairy sector Leading dairy and foodstuff company having operations across the MENA region Highest market share in UHT milk, tomato paste, co-market leader in ice cream & growing presence in snacks Current product portfolio includes milk powder, flavored milk, snacks, juices, ketchup, butter, breakfast cream, cheese products and fries Operates through two manufacturing facilities located in Jeddah, with distribution network across GCC Listed on the Saudi Stock Exchange with a market cap of US$797 mn as of November 14, 2013 KIPCO Group through UIC is the largest shareholder of SADAFCO, with 40.1% stake (as on Sep 30, 2013)

39

286 292 294 275 2010/11 2011/12 2012/13 H1'13/14

US$ million

Net Profit

US$ million

Total Revenue Total Shareholder’s Equity Total Asset

Saudi Dairy & Foodstuff Company: Financial performance^

US$ million US$ million

34 40 44 21 21 2010/11 2011/12 2012/13 H1'12/13 H1'13/14 Net profit 302 356 413 213 215 2010/11 2011/12 2012/13 H1'12/13 H1'13/14 194 209 226 221 2010/11 2011/12 2012/13 H1'13/14 Equity 11% 11% 11% 10% 10% Net profit margin 18% 19% 19% 19% RoE

^SADAFCO follows March year ending

40

Qurain Petrochemicals Industries Co. (QPIC): Overview

QPIC aims to become a leading company in the energy and petrochemical sectors through direct investments/ JVs/ alliances as well as through the creation of new, innovative investment opportunities in the petrochemical and related sectors

Overview

Overview

Holding company focusing on investment opportunities in petrochemicals, oil, gas & energy related sectors Four petrochemical investments in Kuwait i.e. EQUATE, TKOC, KARO & TKSC Listed on the Kuwait Stock Exchange, with a market cap of US$870 mn as of November 14, 2013 KIPCO Group through UIC holds 19.1% stake as on September 30, 2013

TKOC = The Kuwait Olefins Company, KARO = The Kuwait Aromatics Company, TKSC = The Kuwait Styrene Company

41

(32) 6 19 1 28 2010 2011/12 2012/13 H1'12/13 H1'13/14

US$ million

Net Profit

US$ million

Share of Income from Associates Total Shareholder’s Equity Total Asset

Qurain Petrochemicals Industries Co: Financial performance

US$ million US$ million

(7) 117 80 1 29 2010 2011/12 2012/13 H1'12/13 H1'13/14 687 911 1,034 1,044 2010 2011/12 2012/13 H1/13/14 681 899 1,010 984 2010 2011/12 2012/13 H1'13/14

On June 27, 2012, The company has changed its financial year end from 31 December to 31 March.

42

Index

Annexure 2: Executive Management

43

 Joined KIPCO Board in 1990  Recipient of Arab Bankers Association of North America Achievement Award (2005)  Joined KIPCO in 1990; Board and committee member of American University of Kuwait, MIT  BSc from MIT and MBA from Harvard University

Faisal Hamad Al Ayyar Vice Chairman Samer Subhi Khanachet Group COO

 Joined KIPCO in 1988  Recipient of the MENA Private Sector CFO of the Year Award (2008)  Joined KIPCO Group in 1997; appointed as KIPCO’s Banking CEO in 2010  Graduate in Accounting from Kuwait University and Diploma in Banking Studies, Kuwait

Pinak Maitra Group CFO Masaud Hayat CEO - Banking

 Joined KIPCO in 1992 and became in charge of KIPCO’s Investment Division from 1996 to 1999  BSc in Accounting from Kuwait University  Joined KIPCO in 2012, previously Head

• f

Human Resources at the Kuwait Foreign Trading Contracting Investment Company (KFTCIC). He is on the Board of the American Management Association International in New York.

Tariq Abdulsalam CEO – Investment Khaled Al Sharrad Group Chief HR &

• Admin. Officer

 Joined KIPCO in 2006, previously worked at KPMG  Holds a CPA, CISA, CIA and B.Sc. in Accounting  Joined KIPCO in 2001, previously worked at Anderson & Co.  Graduate

• f

Lebanese American University, Holds CPA and CMA

Mohsen Ali Husain Group Chief Internal Auditor Mazen Hawwa Group Senior Vice President

 Joined KIPCO in 2007, previously Head Asset & Liability Management for HBoS Corporate in Edinburgh, Scotland  Fellow of ICA, CFA and member of ACT  Joined KIPCO in 2006, previously held leadership positions for Cable & Wireless and Bell Canada  B.LL from Laval, LL.M Osgoode, M.Litt. Oxford

Declan Sawey Group Treasurer Robert Drolet Senior Vice President

 Joined KIPCO Group in 2013, previously Senior Vice President in Pictet & Cie.  Over 30 years

• f experience

in global and regional banking  Joined KIPCO in 1995, previously with Burgan Bank Treasury  MBA in 1986 from USI University

Osama Al Ghoussein SVP - Banking Adel Al Waqayan Treasurer

 Joined KIPCO in 2007, previously a senior consultant at Hill & Knowlton  Over 25 years of experience in public relations  M.Sc. from Edinburgh University, Scotland  Joined KIPCO Group in 1993  Associate Member of the ICA in England and graduate of Hull University

Robert Hipkins Group Communication Director Iqbal Mohamed President

KIPCO: Executive management

KIPCO Board of Directors is actively involved in overseeing the management and strategy of the Company under the Chairmanship of Sheikh Hamad Sabah Al Ahmad Al Sabah

44

Index

Annexure 3: Key Companies

UGM

45

KIPCO Group companies

Burgan Bank is one of Kuwait’s leading commercial

• banks. Burgan has 23 branches in Kuwait and one of

the biggest ATM networks in the country. Burgan is one

• f the MENA region’s fastest growing banks and has

controlling stakes in Gulf Bank Algeria, Jordan Kuwait Bank and the Bank of Baghdad. Burgan is listed on the Kuwait Stock Exchange. www.burgan.com United Gulf Bank (UGB) is KIPCO’s investment banking

• peration

based in Bahrain. Offering a range

• f

commercial and investment banking and asset management services, the bank also manages a diversified portfolio of investments in private equity funds, private equities, structured products, trading portfolios and provides a range of treasury activities. UGB is listed

• n

the Bahrain and Kuwait Stock Exchanges. www.ugbbah.com

Rabih Soukarieh

Acting CEO UGB The Gulf Insurance Company (GIG) is the leading insurance company in Kuwait and has become one of the MENA region’s biggest insurance networks with

• perating companies in Saudi Arabia, Jordan, Lebanon,

Syria, Egypt and Bahrain. GIG offers a full range of products including life, motor, accident and medical

• insurance. The company is listed on the Kuwait Stock

Exchange. www.gulfins.com.kw

Khaled Al Hassan

MD & CEO GIG OSN is the leading pay-TV operator in the MENA region. The company is a result of the merger between Showtime and Orbit which was completed in 2009. The company

• ffers

85 channels providing the latest premium entertainment including the latest Hollywood movies and series, international sports and Arabic content. www.osnetwork.com

David Butorac

CEO OSN KAMCO is KIPCO’s asset management and fund management company. Its business includes brokerage services, tailored portfolio management, forward trading and local and international fund management. KAMCO also provides corporate finance advisory services, mergers and acquisition services, IPOs, private placements, debt issuance and investment research and evaluation. KAMCO is listed

• n

the Kuwait Stock Exchange. www.kamconline.com

Faisal Sarkhou

Acting CEO KAMCO The United Real Estate Company (URC) is KIPCO’s real estate development company. URC is currently developing properties in Kuwait, Oman, Egypt, Qatar, Jordan, Syria, the UAE and Lebanon. These properties include residential, commercial, leisure and retail

• projects. The company is listed on the Kuwait Stock

Exchange. www.urconline.com

Mohammad Al Saqqaf

CEO URC

Eduardo Eguren

CEO Burgan Bank

46

KIPCO Group companies (cont’d)

The United Industries Company (UIC) is KIPCO’s industrial holding company. UIC has holdings in a variety

• f

industrial sectors including stakes in SADAFCO – one of the leading food manufacturers in Saudi Arabia – and the Qurain Petrochemical Industries

• Company. UIC is listed on the Kuwait Stock Exchange.

www.uickw.com

Sheikh Sabah Mohammad Abdulaziz Al Sabah

Chairman UIC United Gulf Management is KIPCO’s subsidiary in the United States. The company – based in Boston - is responsible for identifying strategic resources to support KIPCO’s financial services, real estate and media

• perations.

www.kipco.com

Iqbal Mohamed

President UGM Pulsar Knowledge Centre is KIPCO’s consulting company based in India. PKC offers services and solutions in business advisory, financial research and analysis. It also provides KIPCO Group Companies and external clients with website design and management services www.pulsarkc.com

Narendra Baliga

Head, COO PKC

United Gulf Management, Boston, USA

The Kuwait Hotels Company (KHC) is KIPCO’s hotel and hospitality services company. KHC is the holding company for Safir International Hotels – one of the region’s premier hotel companies with a total of 15 hotels throughout the Middle East and North Africa.. KHC is listed on the Kuwait Stock Exchange. www.khc.com.kw

Fawzi Al Musallam

CEO KHC The Qurain Petrochemicals Industries Company (QPIC) is one of the leading private investors in petrochemical projects both inside and

• utside

Kuwait. QPIC has invested in the projects such as the expansion of Kuwait’s ethylene and benzene production plants. The company is listed on the Kuwait Stock Exchange. www.qpic-kw.com

Sadoun Al Ali

CEO QPIC The Saudi Dairy and Foodstuff Company (SADAFCO) is

• ne of the most profitable companies in the United

Industries Company’s investment portfolio. SADAFCO was established in 1976 and is a leader in the region’s dairy and foodstuff industry producing almost 700 million items every year. The company is listed on the Saudi Stock Exchange www.sadafco.com

Waltherus Matthijs

CEO SADAFCO

47

Index

Annexure 4: Per Share Return

48

6.7% 8.0% 5.2% 5.7% 2009 2010 2011 2012 169 165 161 147 2009 2010 2011 2012 12 14 9 9 2008 2009 2010 2012

KIPCO: Per share return

9 7 7 7 5.2% 4.6% 6.6% 5.1% 2009^ 2010^ 2011^ 2012^ DPS Dividend Yield

Cents per share

EPS

Cents per share

Book Value

Cents per share

DPS ROE

^ An additional 5% stock dividend was paid in 2009, 2010, 2011 and 2012

49

Index

Annexure 5: Trends

50

KIPCO: Net asset value (NAV)

As at September 2013 end, KIPCO’s NAV was US$2.5 per share vis-à-vis the market price

• f US$2.0per share and the book value of US$1.4 per share

US$

NAV/Share Position*

* Control Premium has been assumed at 50% to the respective market prices to reflect the value of significant stakes in these entities. OSN (Panther) has been taken at fair value used for Joint venture accounting in audited financials of KIPCO (note 9 of Annual financial statements for year ending 2009), further to merger

• f Orbit and Showtime in August 2009. Other components of the NAV are at book value.

Note: At the CMP (as on November 14, 2013), KIPCO’s NAV is US$2.4 per share vis a vis the market price of US$2.2 per share (refer slide 7 for details) 68% 40% 135% 110% 126% 149% 128% 147% 128% 101% 78% 72% 79% 40% 42% 20% 6% (7%) 51% 3% 15% 27% 23% 46% 51% 36% 34% 13% 11% (10%) (18%) (30%) (100)% (50)% 0% 50% 100% 150% 200%

• 1

2 3 4 Q4-09 Q1-10 Q2-10 Q3-10 Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 NAV per share Market Price Book Value per share NAV (higher/ (lower) ) to Stock Price BV (higher/ (lower) ) to Stock Price

51

45.2% 5.8% 38.1% 2.6% 6.2% 2.1% Primary Shareholder (AFH) Investment Funds Investment Companies HNIs Retail Investors Treasury Shares

Ownership

Shareholding Profile: September 2013

Major shareholders of KIPCO are members of ruling family of Kuwait They hold their ownership interest in KIPCO through an investment vehicle Al Futtooh Holding Company K.S.C. (AFH)

Total Shares as of September 30, 2013: 1,403.4mn

52

KIPCO Group: Market data

Entity P/B P/E Market Cap (US$ mn)1

2012 Current2 2012 Current2 2012 Current2

0.9 1.5 17.3 26.5 1,841 3,023 1.7 1.8 14.7 17.1 2,892 3,151 0.9 1.0 NM 55.9 504 452 1.3 1.4 11.1 10.7 344 363 0.5 0.8 16.0 13.0 172 284 0.7 0.7 6.9 11.6 504 495

Notes: 1.Market Cap for 2012 and the current number converted at 0.28315 2.P/B, P/E and Market Cap as of November 14, 2013 Source: KAMCO Research

53

Index

Annexure 6: About the region

54

 Favourable demography − Young and growing population ▪ 4th largest population (after China, India and EU) − Relatively nascent markets − High purchasing power (GCC) and high volume (Non GCC) ▪ 49% of world’s oil reserves and 14% of world’s natural gas reserves  Favourable business climate − Competitive labour cost structure − Local labour force gaining expertise − Opportunity to build businesses − Limited impact of political crisis − Ranked ahead of Latin America & Caribbean, South Asia & Sub-Saharan Africa by IFC in terms of doing business  Low level of regulation − Low taxes and absence of anti-trust laws  Currently low level of competition − Supply side creates value − Under-penetration across the full financial services spectrum  Small but consistently growing non-oil economy

MENA Region: Poised for Strong Economic Growth

GCC Non GCC Lebanon Iraq Bahrain Qatar Morocco A lgeria Tunisia Lybia Egypt Israel Syria Kuwait UA E Oman Yemen Saudi A rabia Jordan

4th Largest Population in the World (2012E)

China 8.4% India 6.5% EU 1.3% US 3.0% UK 2.2% Japan 1.3% Brazil 3.9%

1st 2nd 3rd 4th 5th 7th 11th 12th 24th

Real GDP Growth (2012-17E)

7.7% 3.3% 1.6% 1.4% 1.3%

• 3.0%
• 3.1%
• 3.8%
• 4.3%

MENA China Japan Russia EU Brazil US UK India

Current Account Balance as a % of GDP (2012-17E)

Market Characteristics

MENA 4.1% Russia 3.6%

55

68

2009

….One of the highest per capita income,

growing non-oil sector activity … Accumulated current account surplus of over

• ne trillion US

Dollars since 2005 Accumulated current account surplus of over 1.5 trillion US Dollars since 2006

• f world’s proven

….All contribute to strong growth fundamentals in the GCC…. ….All contribute to strong growth fundamentals in the GCC….

US$ billion 734 762 792 827 863 901 5.6% 3.8% 4.0% 4.4% 4.3% 4.5% 0% 2% 4% 6%

2012 2013 2014 2015 2016 2017 GCC Real GDP (US$ billion) GCC Real GDP growth (%)

204 179 258 154 331 355

• il reserves along with robust and

49,922 46,716 36,941 36,266 32,021 17,709 11,875 9,162 3,830 US GCC UK Japan EU Russia Brazil China India (In US$)

GDP / Capita, PPP (2012E)

US$ billion

Real GDP and GDP Growth

GCC Region: Well Positioned to Deliver Growth

56

Kuwait: Oil Wealth to Fuel Non Oil Growth

Source: WEO Database, IMF, April 2013

57

Kuwait development plan update

Key Projects under the plan

To renovate/expand existing and construct of 5 new; Cost~US$5bn Kuwait Hospital Development To increase capacity from 6mn to 13mn passengers p.a. by 2016; Cost US$6bn Airport Expansion Plan To develop residential city providing 10k houses and 22k apartments; Cost US$14 bn Technical and financial bids under evaluation; winner to be announced in Q4’13 Khairan City (PPP) KD31 bn (US$108 bn) 4 year plan starting FY 2010/11 The government recently announced that US$5.4 bn will be allocated for development spending under the Kuwait Development Plan 2013-14. The FY2013/14 allocation, which represents about 11.0% of GDP, will focus on infrastructure development in the power and water sectors as well as upgrading Kuwait’s land, maritime, air transport networks, energy, health and education service.

Development Plan (In US$ Bn) What has happened so far? Government Policy Initiatives

Kuwait Municipality collaborations with stakeholders PPPs model to finance large scale project Formation of Mini- Cabinet to monitor the plan Government pledged bank guarantee for funding Specification upgrade and expansion of 2 existing refineries; Cost US$18bn Clean Fuels Project New refinery by KNPC; Cost US$14 bn Al Zour New refinery: To build a network of 171 km with ~75 stations; Cost US$7bn Kuwait City Metro System Railroad system linking Kuwait to the rest of GCC; Cost US$7bn Kuwait National Rail Road

11.4 6.6

FY2010/11

10.8 8.2

FY2011/12

Actual Spent Unused

Allocated US$18bn Allocated US$19bn

9.3 9.2

FY2012/13

Allocated US$19bn

58

Kuwait development plan overview

 Purpose:

− Upgrade infrastructure − Diversify non oil revenue − Create employment − Develop private sector

Implement- ation Final Approval

• Prelim. &

Design Approval Not Started

Source: KDP Semi-annual report, Markaz

 Overview

− US$108 bn 4 year plan − FY 2010/11 – Approved US$18 bn comprising 884 projects − FY 2011/12 – Approved US$18.7 bn comprising 1,240* projects − FY 2012/13 – Approved US$18.7 bn comprising 1,234 projects

By Sectors By Industries By Sources of Funds

By Sectors-Total Projects: ~884

KIPCO group banking & insurance focus

2,800

6% 31% 29% 16% 18% Health & Education Infrastructure Oil Others Trade/Industries 36% 29% 35%

• Govt. Non Oil
• Govt. Oil

Private 35% 65% Private (Equity & debt) Govt.

Upgrade Boubyan Harbor Construction

• f Al-Subiya

power station Kuwait Health Assurance Company Mina Abdullah’s water reservoir Jahra Street project

2,650 1,200 925 415

Examples of some key projects underway

US$ million Port Electricity Water Healthcare Road INFRASTRUCTURE

The details of FY 2010/11 :

224 259 260 141

* Out of 1240, 270 are new projects while the remaining are continuation of existing projects. US$18.7bn represents cost of new projects and additional cost on rolled over projects from last year

59

Index

Annexure 7: Market opportunity

60

Burgan Bank: Banking Sector Opportunity

3.1% 3.9% 4.6% 4.1% 3.6% 8.7% 45,824 4,879 4,232 10,609 5,694 6,305 4 6 11 75 36 34 2.8% 2.3% 1.3% 1.2% 1.5% 3.1%

Real GDP Growth Rate Per Capita income Population CAGR (12-17) USD (2012) Size (mn) (2012) CAGR (12-17) Kuwait Jordan Tunisia Turkey Algeria Iraq

Countries

Source: Central Banks &IMF, World Economic Outlook Database, Oct 2012 475% 405% 326% 122%151%133% 360%66% 250% 96% 177% 96% 83% 60% 87%

140% 101% 126% 71% 68% 41% 41% 39% 90% 55% 69% 67% 48% 13% 11%

Banking Penetration: Loan/GD Banking Penetration: Assets/GD Low penetration & healthy expected growth rate creates significant

• pportunity for

banking sector in GCC region

Burgan Presence Burgan Presence

61

Source: PWC Entertainm ent Outlook, Ofcom European Report, Screen Digest, Litsearch, Bain Analysis)

OSN: Market Opportunity

Movement in Pay TV Penetration

 Pay TV market in the MENA region has witnessed a penetration increase of 0.4% p.a. since its launch, compared to other developed markets (US~ 1.7% p.a., Brazil~ 1.1% p.a.) which represents the potential for future growth. Considering that the Pay TV penetration increases by ~ 1.1 % p.a. (equivalent to Brazil), then overall equivalent market growth in OSN’s priority markets would be 18% p.a.  Pay TV penetration in OSN’s seven priority markets ~5% - showing that the sector is still in nascent stage as compared to other developed markets (32%-89%) and has room for significant growth

62

Gulf Insurance Group: Market Opportunity

337 22 450 103 302 190 1,724 3,996 656 1% 1% 2% 2% 3% 1% 7% 8% 7% Kuwait Egypt Bahrain Jordan Lebanon Saudi Arabia Europe North America World

Under-penetration and low insurance density coupled with growing population and favorable economic outlook signify strong growth prospects for the sector  MENA region is characterized by low insurance density and significant under penetration  Rapid insurance market growth in MENA with all countries witnessing double digit growth

• ver past few years

 Likely growth in takaful insurance to further boost the insurance sector  Fundamentals remain strong for life business driven by improving economic outlook and growing population  Non-life lines

• f

business to continue to grow primarily driven by compulsory health and motor insurance and growth in infrastructure projects

Insurance Density *(2012) (in US$) Insurance Penetration** (2012)

GIG Presence

Source: World Insurance 2012 Report by Swiss RE Sigma. *Insurance Premium per capita; ** Total Insurance Premium as a % of GDP