Reviewed Group results for the year ended 31 March 2008

The operating environment changed materially in the second half of the period under review, presenting Brait with both challenges, and opportunities.

Operating Environment
Market Conditions

The past year has been challenging for investment managers in the South African and global markets.

The turmoil in global financial markets, triggered by the US sub-prime credit crisis, has resulted in many investors seeking the security of high quality, low risk investments.

While the South African equity markets continued to provide reasonable returns, these have been concentrated in the large market cap resource stocks, with the industrial, commercial and mid-cap sectors – where Brait’s activities predominate – showing weaker performance and more volatility.

Slower Growth Rates and Higher Inflation

Global growth is showing signs of slowing down, particularly in the US and Europe, but also in South Africa, with the added challenges of a curbing of credit-led consumer growth, and the impact of load-shedding and expectations of electricity shortages in the medium term.

At the same time, inflation has risen, particularly in South Africa.

These factors, combined with an increase in perceived levels of crime and regional instability in Zimbabwe, have led to reduced business confidence in the region.

This should be seen, however, in the context of continuing global appetite for deploying capital in emerging markets.

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