Conduit Capital Limited
                                    Incorporated in the Republic of South Africa
                                      (Registration number 1998/017351/06)
                                     Share code: CND ISIN: ZAE000073128
                               (“Conduit Capital” or “the Company” or “the Group”)


    QUARTERLY PROGRESS REPORT AND UPDATE ON FINANCIAL RESULTS – JUNE 2023 AND CHANGE
    IN ACCOUNTING POLICY AND ADOPTION OF FAIR VALUE THROUGH PROFIT OR LOSS AS MEASURE


Quarterly Progress Report

Shareholders are referred to the ‘Update on financial results and quarterly progress report – March 2023’
announcement released on SENS on 31 March 2023 (“March Quarterly Progress Report”) (and using the terms
defined therein unless otherwise stated) are hereby, in accordance with paragraph 1(11)(c) of the JSE Listings
Requirements and until the Suspension is lifted, provided with the quarterly update on the state of the affairs of the
Company.
In terms of the granting of the provisional liquidation order by the High Court pursuant to the Prudential Authority’s
application to place Constantia Insurance Company Limited (“CICL”) into liquidation (“CICL liquidation”), the
appointed liquidators continue to manage the winding-up of CICL. The unfortunate passing of Mr Cloete Murray,
one of the liquidators, in March 2023, as well as delays at the Master's office, however, creates uncertainty as to
when the first meeting of creditors will take place. Consequently, the status quo of the Suspension remains.
Furthermore, shareholders are referred to the following announcements released on SENS (and using the terms
defined therein unless otherwise stated), and relevant updates subsequent to the March Quarterly Progress Report:
o       on 28 December 2022 it was advised that Constantia Risk and Insurance Holdings (“CRIH”), an indirect
        wholly-owned subsidiary of Conduit Capital, had entered into a sale and purchase agreement with Affinity
        Financial Services (“Affinity”) to dispose of Constantia Life and Health Assurance Company Limited
        (“CLAH”) for a purchase consideration of R20 million. Shareholders were further advised, in the
        announcements released on SENS on 5 April 2023 and 22 May 2023, of the subsequent addendums
        entered in to by the parties to the sale and purchase agreement, namely CRIH, Affinity, CLAH and Conduit
        Capital, to extend the date of fulfilment of the suspensive conditions and the effective date of the disposal
        to 30 June 2023 and 3 July 2023, respectively. Shareholders are hereby advised that the parties are in the
        process of attending to the outstanding suspensive conditions and it is expected that the transfer of
        ownership of CLAH will be completed by 3 July 2023;
o       on 4 April 2023 it was advised that with effect from 3 April 2023, Mr Christian Solberg and Mr Geoff Hacking
        were appointed as Independent Non-executive Directors of the Company;
o       on 24 May 2023 it was advised that Conduit Capital and its wholly-owned subsidiary, Copper Sunset Trading
        186 Proprietary Limited, had entered into an agreement with TMM Holdings Proprietary Limited (“TMM”)
        (“Agreement”), an unrelated third party, to dispose of the “Sale Interest” (which includes CRIH and
        Constantia Life Limited), to TMM for an aggregate cash purchase price of R55 million (“Disposal”).
        Shareholders are hereby advised that the parties to the Agreement, have entered into an addendum to the
        Agreement to extend the date of fulfilment of the suspensive conditions from 1 July 2023 to 1 August 2023;
        and
o       on 21 June 2023, the Board confirmed the appointment of Mr Melvyn Lubega as the Lead Independent
        Director of the Company, with effect from 1 July 2023, and the composition of the various Board committees.
Publication of audited annual financial statements for the year ended 30 June 2022 (“2022 year-end”)

Further to the update on the publication of the annual financial statements for the 2022 year-end as set out in the
March Quarterly Progress Report, shareholders are advised that this matter remains a priority under the current
circumstances. As a result of the events at CICL, the auditors have been unable to complete the audit of CICL due
to a pervasive scope limitation. Historically, and as at the most recent reporting date, CICL was the Company’s main
operating subsidiary as evidenced by the fact that CICL represented approximately 94.4% of the revenue of the
consolidated Conduit Capital Group for the six months ended 31 December 2021.

The Group audit work had resumed. The audits of the remaining insurance companies in the Group have been
finalised and the requisite statutory submissions to the Prudential Authority have been effected. Work on finalising
the audit of the remainder of the Group has progressed substantially and it is anticipated that the audited results for
the 2022 year-end, together with the Group’s Integrated Annual Report, will be published on or before 15 August
2023. Work on the interim results for the six months ended 31 December 2022 has also commenced, however final
timelines in respect of the publication thereof will only be finalised on completion of the 2022 year-end results.

Change in Accounting Policy and adoption of Fair Value Through Profit or Loss as measure

Change in Accounting Policy to that of an Investment Entity in terms of IFRS 10 Consolidated Financial
Statements

International Financial Reporting Standards (“IFRS”) requires that an entity reassess whether it is an investment
entity (“Investment Entity”) if facts and circumstances indicate changes to one or more of the elements making up
the definition of an Investment Entity or to the typical characteristics of an Investment Entity.

Change to an Investment Entity status
An Investment Entity is typically an entity that: i) obtains funds from one or more investor(s) for the purpose of
providing those investor(s) with investment management services; ii) commits to its investor(s) that its business
purpose is to invest funds solely for returns from capital appreciation, investment income, or both; and iii) measures
and evaluates the performance of substantially all of its investments on a fair value basis.
During the financial year ending June 2023, Conduit Capital experienced events which significantly impacted the
Group’s composition and strategy going forward:
o      On 14 September 2022, Constantia Insurance Company Limited (“CICL”), an indirect wholly-owned
       subsidiary of Conduit Capital which contributed more than 95% of the Group’s revenue, was placed under
       Provisional Liquidation.
o      On 28 December 2022, a Schedule 11 announcement was made in respect of the disposal of the entire
       issued share capital of an indirect wholly-owned subsidiary, Constantia Life and Health Assurance Company
       Limited (“CLAH”).
o      On 23 May 2023, Conduit Capital entered into an agreement to dispose of Constantia Risk and Insurance
       Holdings Proprietary Limited (“CRIH”) and Constantia Life Limited (“CLL”), both indirect wholly-owned
       subsidiaries of Conduit Capital.
Conduit Capital has, as a results of the occurrence of the above events, necessitated a reassessment of the
Company’s compliance with the financial reporting framework in accordance with IFRS 10. Specifically, whether the
Company should continue to consolidate its equity interest in subsidiaries or measure the equity interest at fair value
through profit or loss by applying the Investment Entity exemption, and whether these events constitute a change in
Conduit Capital’s business purpose and strategy from an owner operator to an investment manager.
Conduit Capital’s strategy is centred on effectively managing its portfolio of listed and unlisted companies, generating
returns through interest and dividends, as well as profitable disinvestments. With a distinct shift from adopting a
long-term-operator approach, the Company embraces the strategy of an Investment Entity.
Management and the Board have therefore considered the information available and concluded that with effect from
1 July 2023 Conduit Capital will apply the Investment Entity exemption in accordance with IFRS 10.
The characteristics outlined by IFRS 10 for an Investment Entity include having: i) more than one investment; ii)
more than one investor; iii) investors that are not related parties of the entity; and iv) ownership interests in the form
of equity or similar interests. Conduit Capital exhibits all these distinguishing characteristics of an Investment Entity.

Accounting treatment of Investment Entity
IFRS 10 contains special accounting requirements for Investment Entities. Where an entity meets the definition of
an Investment Entity, it does not consolidate its subsidiaries, but rather measures subsidiaries at fair value through
profit or loss (“FVTPL”). However, an Investment Entity is still required to consolidate a subsidiary where that
subsidiary provides services that relate to the Investment Entity’s investment activities (i.e. entities comprising
Conduit Capital’s head office operations).


Cape Town
30 June 2023
Sponsor
Merchantec Capital