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CORONATION FUND MANAGERS LIMITED - Interim Results For The Six Months Ended 31 March 2019

Release Date: 21/05/2019 07:05
Code(s): CML     PDF:  
Wrap Text
Interim Results For The Six Months  Ended 31 March 2019

CORONATION FUND MANAGERS
(Incorporated in the Republic of South Africa)
Registration number: 1973/009318/06
JSE share code: CML
ISIN: ZAE000047353
("Coronation" or "the company")

INTERIM RESULTS for the six months ended 31 March 2019
- Assets under management (AUM) R586bn
- Diluted headline earnings per share 165.1c
- Interim dividend per share 165.0c

RESULTS

Coronation's results for the six months to end March 2019 reflect the extremely challenging financial market conditions experienced worldwide up until December 2018,
somewhat ameliorated by the strong recovery in the first quarter of calendar year 2019 (Q1-19). Despite the FTSE/JSE All Share Index's 8.0% gain in Q1-19, it 
produced a mediocre return of 2.7% over the reporting period. Emerging markets were up 9.9% in Q1-19, but only gained 1.7% in the reporting period, as measured by 
the MSCI Emerging Markets Index in US dollar terms; while developed markets, as measured by the MSCI All Country World Index in US dollars, lost 2.1% for the 
reporting period, despite adding 12.2% in Q1-19.

At the period end, Coronation's total assets under management (AUM) remained flat compared to the figure reported as at end-September 2018 (R587 billion). However,
average AUM for the six months to end-March 2019 decreased by 8% from average AUM reported for the comparable period to end-March 2018, contributing to a 22% decrease
in revenue to R1.6 billion (March 2018: R2.1 billion). Conversely, operating expenses decreased by 10%, as a result of variable costs decreasing by 18%. The combined
effect was a decrease of 26% in diluted and basic headline earnings per share for the period to 165.1 cents (March 2018: 223.4 cents).

BUSINESS UPDATE

We are an independent active manager, with a long-term valuation-driven investment philosophy. The period under review saw a meaningful improvement in short-term 
performance across most of our strategies. The long-term performance across our entire fund range remains excellent.

From an operational perspective, following the implementation of a new fund administration model and the insourcing of retail reporting and communications in FY 2018,
we successfully migrated our unit trust client administration to Intembeko Investment Administrators. These back-office transitions were achieved on time, within
budget and without interruption to our clients.

INSTITUTIONAL BUSINESS

Our institutional business manages R346 billion (September 2018: R346 billion) on behalf of South African institutions and a growing number of global clients.

South African clients

We continue to manage a meaningful share of assets in the local pension fund industry, representing a total AUM of R278 billion (September 2018: R285 billion), making
us one of the largest independent managers of pension assets in the country. Net outflows over the reporting period represented 4.3% of our opening balance for local
institutional assets and were similar to the level of net outflows experienced in the prior comparable reporting period. While we continue to operate in a net-outflow
local institutional market, driven by years of low economic growth and poor savings discipline among South Africans, we believe the introduction of in-fund
preservation could be positive for renewed growth in the pension fund market in the next five to ten years.

Within our South African specialist equity strategies:
- Coronation Houseview Equity has produced a return of 16.4% p.a. since its inception in October 1993, delivering an active return (alpha) of 2.1% p.a.
 
Within our market-leading multi-asset strategies:
- Coronation Global Houseview has delivered 15.7% p.a. since its launch in October 1993, thereby achieving a real return of 9.7% p.a., while Coronation Managed has
  produced 15.8% p.a. since its launch in May 1996, representing a real return of 10.0% p.a.

Our South African fixed-income franchise continued to perform very well:
- Coronation Strategic Bond has produced a return of 10.0% p.a. since its inception in January 2008, thereby outperforming the All Bond Index by 1.3% p.a., while
  Coronation Active Bond has produced a return of 11.5% p.a. since its launch in July 2000, representing alpha of 0.9% p.a.

Global clients

We manage a total of R68 billion (September 2018: R61 billion) in our global strategies on behalf of several leading international retirement funds, endowments and
family offices. Net outflows represented 2.4% of our opening AUM; a reasonable outcome, given the ongoing material shift from active to passive strategies.

That said, we remain confident in the long-term outlook for our global strategies as well as their value proposition to clients through active management:
- Our Global Emerging Markets Equity Strategy saw a strong recovery in short-term performance in Q1-19, taking its annualised active return to 4.0% since its inception
  more than a decade ago in July 2008.

- Our Africa Frontiers Strategy has delivered a strong absolute return of 9.4% p.a. (in US dollars) since its launch more than 10 years ago in October 2008, resulting in
  an annualised active return of 8.6%.

- Launched in December 2014, we are encouraged by the investment track record of our Global Frontiers Strategy, which has delivered an absolute return of 3.8% p.a. (in
  US dollars) since inception.

All institutional performance returns are stated gross of fees.

Retail business

We remain one of the country's leading managers of long-term assets in the collective investment schemes industry, with retail assets totalling R240 billion (September
2018: R241 billion). Once again, net inflows at an industry level were subdued, driven by weak economic conditions impacting savings levels. Against this backdrop, we
experienced net outflows representing 2.9% of our opening balance.

Performance highlights across our domestic and international fund range are detailed below, reflecting consistent first-quartile rankings in their corresponding
Morningstar categories since their respective inception dates:
- Coronation Top 20, a top-performing general equity fund, has outperformed its benchmark (FTSE/JSE Capped All Share Index) by 3.8% p.a. since its inception 
  in October 2000.

- Coronation Balanced Plus, the no. 1 balanced fund in South Africa since its launch in April 1996, has outperformed its average competitor by 2.0% p.a. and inflation by
  8.0% p.a. over this same period.

- Coronation Capital Plus, the no. 1 multi-asset medium equity fund since its inception in July 2001, has delivered a real return of 6.0% p.a. over this same period.

- Coronation Balanced Defensive, a top-performing low equity fund, has produced a real return of 3.5% p.a. since its launch in February 2007.

- Coronation Strategic Income, the no. 1 multi-asset income fund since its launch in July 2001, has outperformed cash by, on average, 2.5% p.a. over this same period.

- Coronation Global Opportunities Equity [ZAR] Feeder, a top-performing global equity general fund since its launch in August 1997, has outperformed the global equity
  market by 0.8% p.a. over its more than 20-year history.

- Coronation Global Managed [ZAR] Feeder, the no. 1 global multi-asset high equity fund in South Africa since its launch in October 2009, has outperformed its average
  competitor by 1.7% p.a. over this same period. All performance returns are stated net of fees for the respective retail classes.

TRANSFORMATION

We are pleased with the tangible progress Coronation has made in transforming the business to reflect our country?s diversity. Of our board of directors, 67% of 
the non-executive directors are black and 50% are female. Our employees are 56% black ,of whom 57% are female.

In the period under review, we were rated a Level 2 contributor to broad-based black economic empowerment as per the revised Financial Sector Code released in December 2017.

INTERIM CASH DIVIDEND

We continue to reward shareholders through regular and significant distributions of free cash flow generated. We endeavour to distribute at least 75% of after-tax cash
profit. After assessing any projected future cash requirements, a gross dividend of 165.0 cents per share has been declared for the interim period ended 31 March 2019
from income reserves, resulting in a net dividend of 132.0 cents per share for shareholders subject to Dividends Tax (DT). In compliance with the Listings Requirements 
of the JSE Ltd, the following dates are applicable:

Last day to trade                              Tuesday, 4 June 2019
Shares trade ex dividend                     Wednesday, 5 June 2019
Record date                                     Friday, 7 June 2019
Payment date                                   Monday, 10 June 2019

Share certificates may not be dematerialised or rematerialised between Wednesday, 5 June 2019 and Friday, 7 June 2019, both dates inclusive. In terms of DT, the
following additional information is disclosed:

- The local DT rate is 20%.
- The number of ordinary shares in issue at the date of this declaration is 349 799 102.
- Coronation's tax reference number is 9 675 107 719.

PROSPECTS

We believe we are well placed to capitalise on the new systems and administration infrastructure, which allows us to continue improving on our levels of service 
to clients.

Should current market levels hold, we expect an improvement in our results for the second half of the current financial year.

Notwithstanding the uncertainties that abound, our objective remains to build diversified portfolios that can absorb unanticipated shocks. We will remain 
focused on valuation and will seek to take advantage of attractive opportunities that the market may present to us and in so doing generate long-term value for 
all our stakeholders.

EXTERNAL AUDIT REVIEW

The external auditors, EY, reviewed the condensed consolidated statement of financial position of Coronation Fund Managers Ltd Group as at 31 March 2019, and the
related condensed consolidated statement of comprehensive income, changes in equity and cash flows for the period then ended, and other explanatory notes. The review
has been conducted in accordance with the International Standard on Review Engagements 2410. Copies of the unqualified report of EY are available for inspection 
at the registered office of the company. Any forward-looking information contained in this announcement has not been reviewed or reported on by the company's 
external auditors.

Shams Pather        Anton Pillay                  John Snalam
Chairman           Chief executive officer        Chief financial officer

Cape Town
21 May 2019

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                                                                                            SIX MONTHS  SIX MONTHS          FULL YEAR
                                                                                              REVIEWED    REVIEWED            AUDITED
                                                                                              31 MARCH    31 MARCH            30 SEPT
                                                                                                  2019        2018       %       2018
                                                                                             R MILLION   R MILLION  CHANGE  R MILLION
Fund management activities
Revenue                                                                                          1 632       2 079     (22)     3 848

Other income                                                                                        11           1                 18

Total operating expenses                                                                          (891)     (1 055)    (16)    (1 933)

Other expenses                                                                                      (2)        (68)                (3)
Operating expenses                                                                                (889)       (987)            (1 930)

Results from operating activities                                                                  752       1 025     (27)     1 933
Finance and dividend income                                                                         17          17                 38
Finance expense                                                                                    (14)        (13)               (24)

Share of profit of equity-accounted investee                                                         3           5                  8
Profit from fund management                                                                        758       1 034     (27)     1 955
Sundry gains*                                                                                       11           -                  -

Income attributable to policyholder linked assets and investment partnerships                        -           -                  5

Net fair value gains on policyholder and investment partnership financial instruments               12          13                 99
Administration expenses borne by policyholders  and investors in investment partnerships           (12)        (13)               (94)

Profit before income tax                                                                           769       1 034     (26)     1 960

Income tax expense                                                                                (191)       (252)              (489)

Taxation on shareholder profits                                                                   (191)       (252)              (484)
Taxation on policyholder investment contracts                                                        -           -                 (5)

Profit for the period                                                                              578         782     (26)     1 471

Other comprehensive income (to be reclassified to profit and loss in future periods)

Foreign currency translation differences for  foreign operations                                   (10)        (19)                22
Net change in fair value of available-for-sale financial assets*                                     -           4                 33

Other comprehensive income for the period                                                          (10)        (15)                55
Total comprehensive income for the period                                                          568         767              1 526

Profit attributable to:
- equity holders of the company                                                                    578         782     (26)     1 471
Profit for the period                                                                              578         782              1 471

Total comprehensive income attributable to:
- equity holders of the company                                                                    568         767     (26)     1 526
Total comprehensive income for the period                                                          568         767              1 526

Earnings per share (cents)
- basic                                                                                          165.1       223.4     (26)     420.7
- diluted                                                                                        165.1       223.4     (26)     420.7

Note to the statement of comprehensive income
Headline earnings per share (cents)
- basic                                                                                          165.1       223.4     (26)     420.7
- diluted                                                                                        165.1       223.4     (26)     420.7

Dividend per share (cents)
- interim                                                                                        165.0       223.0     (26)     223.0
- final                                                                                                                         197.0

*  The following changes have been made to the presentation of the statement of changes in comprehensive income:
   As a result of IFRS 9, sundry gains has been added in order to show the unrealised movement on investments whose gains and losses were previously recorded
   in equity through other comprehensive income.

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
                                                                                                      REVIEWED    REVIEWED    AUDITED
                                                                                                      31 MARCH    31 MARCH    30 SEPT
                                                                                                          2019        2018       2018
                                                                                                     R MILLION   R MILLION  R MILLION
Assets
Intangible assets                                                                                        1 088       1 088      1 088
Equipment                                                                                                   24          17         20
Investment in equity-accounted investees                                                                    38          38         41
Deferred tax asset                                                                                         106         122        125
Investments backing policyholder funds and investments held through investment partnerships             51 532      54 504     51 424
Investment securities                                                                                    1 159         862      1 190
Taxation receivable                                                                                          -           -         15
Trade and other receivables                                                                                484         466        448
Cash and cash equivalents                                                                                  285         553        805
Total assets                                                                                            54 716      57 650     55 156

Liabilities
Long-term borrowings (note 3)                                                                              300         300        300
Deferred tax liabilities                                                                                    23          10         23
Policyholder investment contract liabilities and liabilities to holders of interests 
 in investment partnerships                                                                             51 529      54 503     51 421
External investors in consolidated funds                                                                   212           -        221
Taxation payable                                                                                            47           9          -
Trade and other payables                                                                                   466         560        935
Total liabilities                                                                                       52 577      55 382     52 900

Net assets                                                                                               2 139       2 268      2 256

Equity
Share capital and premium                                                                                  256         256        256
Retained earnings                                                                                        1 568       1 630      1 539
Reserves                                                                                                   152         229        301
Total equity attributable to equity holders of the company                                               1 976       2 115      2 096
Non-controlling interest in consolidated funds                                                             163         153        160
Total equity                                                                                             2 139       2 268      2 256


CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                                                                                    SIX MONTHS  SIX MONTHS  FULL YEAR
                                                                                                      REVIEWED    REVIEWED    AUDITED
                                                                                                      31 MARCH    31 MARCH    30 SEPT
                                                                                                          2019        2018       2018
                                                                                                     R MILLION   R MILLION  R MILLION
Cash flows from operating activities
Profit from fund management                                                                                758       1 034      1 955
Non-cash and other adjustments                                                                              16          74        (15)

Operating cash flows before changes in working capital                                                     774       1 108      1 940
Working capital changes                                                                                   (497)       (162)       314
Cash flows from policyholders and investment partnership activities                                        (17)       (993)    (2 427)

Cash generated from/(utilised by) operations                                                               260         (47)      (173)
Interest paid                                                                                              (14)        (13)       (24)
Income taxes paid                                                                                         (110)       (240)      (490)
Net cash from operating activities                                                                         136        (300)      (687)

Cash flows from investing activities
Finance and dividend income                                                                                 17          17         38
Acquisition of equipment                                                                                   (12)         (4)       (12)
Net sales of investment securities                                                                          21          61         (8)
Net cash from investing activities                                                                          26          74         18

Cash flows from financing activities
Dividends paid                                                                                            (689)       (759)    (1 539)
Net cash from financing activities                                                                        (689)       (759)    (1 539)

Decrease in cash and cash equivalents                                                                     (527)       (985)    (2 208)
Net (decrease)/increase in cash and cash equivalents - shareholders                                       (510)          8        219
Net decrease in cash and cash equivalents - policyholders  and investment partnerships                     (17)       (993)    (2 427)

Cash and cash equivalents at beginning of period                                                         6 073       8 259       8259
Cash and cash equivalents at beginning of period - shareholders                                            805         564        564
Cash and cash equivalents at beginning of period - policyholders  and investment partnerships            5 268       7 695      7 695

Effect of exchange rate fluctuations on cash held                                                          (10)        (19)        22

Cash and cash equivalents at end of period                                                               5 536       7 255      6 073
Cash and cash equivalents at end of period - shareholders                                                  285         553        805
Cash and cash equivalents at end of period - policyholders and investment partnerships                   5 251       6 702      5 268

The above cash flows include the policyholder and investment partnership activities. These cash flows represent net contributions and 
withdrawals by policyholders and investment partnerships and the related investing activities. Cash and cash equivalents of policyholders 
and investment partnerships are not available for use by the shareholders of the group.

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
                                                                                                                              ISSUED 
                                                                                                                         CAPITAL AND
                                                                                                                            RESERVES      
                                                                                                                        ATTRIBUTABLE
                                                                        FOREIGN                     SHARE-                 TO EQUITY
                                                                       CURRENCY                      BASED                   HOLDERS         NON-  
                                                    SHARE CAPITAL   TRANSLATION      RETAINED      PAYMENT  REVALUATION       OF THE  CONTROLLING       TOTAL                                          
                                                      AND PREMIUM       RESERVE      EARNINGS      RESERVE      RESERVE      COMPANY     INTEREST      EQUITY                                                           
                                                        R MILLION     R MILLION     R MILLION    R MILLION    R MILLION    R MILLION    R MILLION   R MILLION
Balance at 30 September 2017 (audited)                        256           131         1 607            5          107        2 106          166       2 272

Total comprehensive income for the period
Profit for the period                                                                     782                                    782                      782
Other comprehensive income
Currency translation differences                                            (19)                                                 (19)                     (19)
Revaluation of available-for-sale financial assets                                                                    4            4                        4
Total other comprehensive income                                            (19)                                      4          (15)                     (15)
Total comprehensive income for the period                                   (19)          782                         4          767                      767

Transactions with owners recorded directly to equity
Share-based payments                                                                                     1                         1                        1
Dividends paid                                                                           (759)                                  (759)                    (759)
Change in non-controlling interest in consolidated funds                                                                                      (13)        (13)
Total transactions with owners                                                           (759)           1                      (758)         (13)       (771)
Balance at 31 March 2018 (reviewed)                           256           112         1 630            6          111        2 115          153       2 268


Total comprehensive income for the period
Profit for the period                                                                     689                                    689                      689
Other comprehensive income
Currency translation differences                                             41                                                   41                       41
Revaluation of available-for-sale financial assets                                                                   29           29                       29
Total other comprehensive income                                             41                                      29           70                       70
Total comprehensive income for the period                                    41           689                        29          759                      759

Transactions with owners recorded directly to equity
Share-based payments                                                                                     2                         2                        2
Dividends paid                                                                           (780)                                  (780)                    (780)
Change in non-controlling interest in consolidated funds                                                                                        7           7
Total transactions with owners                                                           (780)           2                      (778)           7        (771)
Balance at 30 September 2018 (audited)                        256           153         1 539            8          140        2 096          160       2 256

Transfer between reserves (1 October 2018) (note 1)                                       140                      (140)           -                        -
Total comprehensive income for the period
Profit for the period                                                                     578                                    578                      578
Other comprehensive income
Currency translation differences                                            (10)                                                 (10)                     (10)
Total other comprehensive income                                            (10)                                                 (10)                     (10)
Total comprehensive income for the period                                   (10)          578                                    568                      568

Transactions with owners recorded directly to equity
Share-based payments                                                                                     1                         1                        1
Dividends paid                                                                           (689)                                  (689)                    (689)
Change in non-controlling interest in consolidated funds                                                                                        3           3
Total transactions with owners                                                           (689)           1                      (688)           3        (685)
Balance at 31 March 2019 (reviewed)                           256           143         1 568            9            -        1 976          163       2 139


EARNINGS PER SHARE
                                                                                                    SIX MONTHS  SIX MONTHS  FULL YEAR
                                                                                                      REVIEWED    REVIEWED    AUDITED
                                                                                                      31 MARCH    31 MARCH    30 SEPT
                                                                                                          2019        2018       2018
                                                                                                     R MILLION   R MILLION  R MILLION
Earnings attributable to shareholders                                                                      578         782      1 471
Non-controlling interest                                                                                     -           -          -
Earnings attributable to ordinary shareholders                                                             578         782      1 471
Headline earnings attributable to ordinary shareholders                                                    578         782      1 471

Earnings per share (cents)
- basic                                                                                                  165.1       223.4      420.7
- diluted                                                                                                165.1       223.4      420.7

Headline earnings per share (cents)
- basic                                                                                                  165.1       223.4      420.7
- diluted                                                                                                165.1       223.4      420.7


CONDENSED CONSOLIDATED SEGMENT REPORT
                                                                   AFRICA                               INTERNATIONAL                        GROUP
                                                          SIX        SIX                         SIX        SIX                     SIX        SIX        
                                                       MONTHS     MONTHS  FULL YEAR           MONTHS     MONTHS  FULL YEAR       MONTHS     MONTHS  FULL YEAR  
                                                     REVIEWED   REVIEWED    AUDITED         REVIEWED   REVIEWED    AUDITED     REVIEWED   REVIEWED    AUDITED 
                                                     31 MARCH   31 MARCH    30 SEPT         31 MARCH   31 MARCH    30 SEPT     31 MARCH   31 MARCH    30 SEPT   
                                                         2019       2018       2018             2019       2018       2018         2019       2018       2018
                                                    R MILLION  R MILLION  R MILLION        R MILLION  R MILLION  R MILLION    R MILLION  R MILLION  R MILLION
Segment external revenue                                1 050      1 315      2 516              582        764      1 332        1 632      2 079      3 848

Segment operating expenses                               (675)      (787)    (1 457)            (216)      (268)      (476)        (891)    (1 055)    (1 933)

Segment profit                                            375        528      1 059              366        496        856          741      1 024      1 915
Share of income of equity-accounted investee                3          5          8                -          -          -            3          5          8
Net finance and other income/(expenses)                    19         62         10               (5)       (57)        22           14          5         32

Profit from fund management                               397        595      1 077              361        439        878          758      1 034      1 955
Sundry gains                                                                                                                         11          -          -
Income*                                                                                                                               -          -          5

Profit before income tax                                                                                                            769      1 034      1 960

Segment assets                                          1 269      1 070      1 557              683        828        921        1 952      1 898      2 478
Investments*                                                                                                                     52 764     55 752     52 678
Total assets                                                                                                                     54 716     57 650     55 156

*  Income and investments are attributable to and backing policyholder funds and investments held through investment partnerships, consolidated funds 
   and other assets.

NOTES TO THE CONDENSED FINANCIAL STATEMENTS 

1 Basis of preparation and accounting policies

The financial information has been prepared in accordance with and containing the information required by the International Financial Reporting Standards (IFRS); the
International Accounting Standard 34 Interim Financial Reporting; the Listings Requirements of the JSE Ltd; the SAICA Financial Reporting Guides as issued by the
Accounting Practices Committee and Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council, as well as the South African Companies
Act, No 71 of 2008. The condensed consolidated financial statements do not include all of the information required for a complete set of IFRS annual financial
statements.

These condensed consolidated financial statements have been prepared in accordance with the historical cost basis except for certain financial instruments which are
stated at fair value. The condensed consolidated financial statements are presented in rand, rounded to the nearest million. The accounting policies applied in the
presentation of the condensed consolidated financial statements are in terms of IFRS and are consistent with those presented in the previous annual financial
statements. 

The group applied IFRS 9 Financial Instruments and IFRS 15 Revenue from Contracts with Customers for the first time. IFRS 15 has no impact on the results
of the group. In its adoption of IFRS 9, the group has used the retrospective approach with adjustments made to balances at the date of initial application.
Investments previously held as available for sale under IAS 39 have been reclassified as fair value through profit and loss and the historical revaluation reserve has
been transferred to retained earnings resulting in a restated 1 October 2018 opening retained earnings. Additionally, fair value gains and losses on these investments,
previously recognised in other comprehensive income with related foreign exchange gains and losses previously recognised in other expenses, are now both included 
in sundry gains and losses in the statement of comprehensive income. Comparatives have not been restated.

These reviewed results have been prepared under the supervision of H Rawoot CA(SA).

2 Related party transactions

Related party transactions for the current period are similar to those disclosed in the group's annual financial statements for the year ended 30 September 2018. No
new significant related party transactions arose during the current period.

3 Long-term and short-term borrowings

Cumulative redeemable preference shares with dividends linked to prime are payable on a quarterly basis, with R150 million capital repayments due on 1 April 2020 
and 1 April 2021.

4 Fair value disclosure

The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:
Level 1         Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2         Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as closing prices) or
                indirectly (i.e. derived from closing prices). The majority of Level 2 investments are deposits held with financial institutions. The fair values 
                of these deposits are determined using a discounted cash flow valuation methodology based on market rates, reflecting the time value of money 
                and counter party credit risk. The fair value of policyholder and investment partnership liabilities that are included in Level 2 of the hierarchy 
                are measured with reference to the quoted prices in an active market of the investments underlying the liabilities. Cash and cash equivalent 
                balances along with their related liabilities of R1 823 million (R1 383 million: 30 September 2018 and R1 989 million: 31 March 2018) have been 
                excluded from the fair value table on page 11 in current and prior years respectively.
Level 3         Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

                                                                                       LEVEL 1      LEVEL 2      LEVEL 3        TOTAL
                                                                                     R MILLION    R MILLION    R MILLION    R MILLION
March 2019 (Reviewed)
Investments backing policyholder funds and investments held through 
 investment partnerships                                                                44 795        4 914            -       49 709
Investment securities                                                                    1 155            -            4        1 159
                                                                                        45 950        4 914            4       50 868
Policyholder, external investor and investment partnership liabilities                       -       49 918            -       49 918

March 2018 (Reviewed)
Investments backing policyholder funds and investments held through 
 investment partnerships                                                                46 171        6 344            -       52 515
Investment securities                                                                      861            -            1          862
                                                                                        47 032        6 344            1       53 377
Policyholder, external investor and investment partnership liabilities                       -       52 514            -       52 514

September 2018 (Audited)
Investments backing policyholder funds and investments held through 
 investment partnerships                                                                45 017        5 024            -       50 041
Investment securities                                                                    1 189            -            1        1 190
                                                                                        46 206        5 024            1       51 231
Policyholder, external investor and investment partnership liabilities                       -       50 259            -       50 259


Fair value for all other financial assets and liabilities have not been presented because they are not carried at fair value and their carrying amounts approximate
fair value.

During the current reporting period a net amount of R154 million in debentures were transferred from Level 2 to Level 1 as these are now considered to be held in an
active market.

5 Non-controlling interest and external investors in consolidated funds

The non-controlling interest in consolidated funds arises as a result of the continued consolidation of the Coronation Global Frontiers Fund. The prior year increase
in the group's interest in the Coronation Global Equity Sector Feeder Fund means that it also continues to be consolidated.

6 Contingent liabilities: South African Revenue Service (SARS) matters

From time to time, in common with other organisations, companies in the group are subject to review by SARS. One of our companies has been the subject of a review on
a matter of principle relating to international operations, and assessed on that basis for the 2012, 2013 and 2014 financial periods, to which management strongly 
disagrees and has objected. Management is confident, supported by external advisors, of the company's position and an outflow is not considered probable should 
the matter be interpreted by a court of law, the ultimate tax authority on these matters. Any amounts involved are currently not considered capable of reliable estimation.

Directors: S Pather (Chairman)*, A C Pillay (CEO), J A Snalam (CFO), A Watson*, H Nelson*, J D McKenzie*, J G February*, L Boyce* (* Independent non-executive)

Company secretary: L Parenzee (resigned with effect 30 June 2019)

Registered office: 7th Floor, MontClare Place, Cnr Campground and Main Roads, Claremont 7708, Cape Town

Postal address: PO Box 44684, Claremont 7735, Cape Town  

Registration number: 1973/009318/06 

Transfer secretaries: Computershare Investor Services Proprietary Limited, Rosebank Towers, 15 Biermann Avenue, Rosebank 2196, Gauteng

JSE share code:CML

ISIN: ZAE000047353

Website: www.coronation.com

Sponsor: PSG Capital (Pty) Ltd

CAPE TOWN
7th Floor, MontClare Place, Cnr Campground and Main Roads, Claremont 7708
PO Box 44684, Claremont 7735
Telephone: +27 (0)21 680 2000   
Fax: +27 (0)21 680 2100

JOHANNESBURG
3rd Floor, Building 2, Oxford and Glenhove, 114 Oxford Road, Houghton 2196
PO Box 652643, Benmore 2010
Telephone: +27 (0)11 328 8200   
Fax: +27 (0)11 684 2187

PRETORIA
1st Floor, Block 4, The Boardwalk Office Park, Eros Street, Faerie Glen 0043
Telephone: +27 (0)12 990 9040   
Fax: +27 (0)12 991 6079

DURBAN
Suite 6, 15 The Boulevard, Westway Office Park, Westville 3635
Telephone: +27 (0)87 354 0508

LONDON
7th Floor, St Albans House, 57-59 Haymarket, London, SW1Y 4QX United Kingdom
Telephone: +44 (0)207 389 8840   
Fax: +44 (0)207 389 8899

DUBLIN
Suite 1, 2 Grand Canal Square, Macken Street, Dublin D02 A342, Ireland
Telephone: +353 (0)1 674 5410   
Fax: +353 (0)1 674 5411

Date: 21/05/2019 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
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