Coronation Fund Managers : REVIEWED ANNUAL RESULTS

Assets under management (AUM)

R574 billion

Diluted headline earnings per share

366.3 cents

Fund management earnings per share

387.0 cents

Final dividend per share

172.0 cents

ANNUAL RESULTS 2022

After a very strong recovery from the Covid lows in early 2020, global equity markets collapsed in 2022. Most asset classes declined precipitously as markets digested an unrelenting series of negative developments. Inflation, which soared to levels not seen in recent decades, and a dramatic increase in interest rates to curb it are likely to cause significant economic damage in the years to come.

Fund management companies are cyclical businesses that are heavily impacted by market movements. Our financial results for the period under review reflect the sharp declines seen across all asset classes globally.

In this challenging market environment, we experienced net outflows representing 6% of our average assets under management (AUM). This is in line with our expectations and it reflects the realities of a shrinking domestic savings pool. As a large domestic manager, we expect Coronation's flows to broadly reflect that of the South African savings pool and the economic reality within which it operates. Recent changes to Regulation 28 will further shrink the available pool of domestically managed assets.

Fortheperiodunderreview,averageAUMwasR621billion,whichismarginallyhigherthanthatoftheprevious year (September 2021: R617 billion). Closing AUM is 9% lower at R574 billion (September 2021: R634 billion). Reflecting the extreme volatility currently in markets, AUM as at 15 November 2022 has recovered to R610 billion.

Total expenses were down by 12% from the previous year, which is a significant decline considering the current inflationary environment. This is the result of our continued focus on managing fixed expenses, which were marginally up by 2%, and our variable expenditure model that has shielded shareholders from the extreme cost pressures that businesses around the world are currently experiencing. It is also worth noting that we continue to invest in the business to ensure that we are able to offer our clients world-class service in an ever-evolving landscape.

Fund management earnings per share (FMEPS) for the year ended 30 September 2022 decreased by 18% to 387.0 cents from 470.9 cents in the previous year. FMEPS is used by management to measure true operating financial performance. FMEPS excludes the net mark-to-market impact of fair value gains and losses and related foreign exchange movements on our investments held for seeding products. Diluted and basic headline earnings per share decreased by 25% to 366.3 cents (September 2021: 487.9 cents).

In 2023, the Company will celebrate its 30th anniversary. Our long-term investment track record over that period remains exemplary. Over the past three decades, 96% of our portfolios have outperformed their benchmarks.*

BUSINESS UPDATE AND CORPORATE CITIZENSHIP

We remain an active corporate citizen and are committed to contributing to an inclusive economy and a prosperous society. This year, we are proud to have been recognised for our continued efforts in the transformation and sustainability arenas, and we placed first for our gender reporting in Accenture's Gender Mainstreaming Awards and for our stewardship disclosure in the International Corporate Governance Network's Global Stewardship Disclosure Awards.

During the period under review, we continued to support education and training initiatives via our CSI and enterprise development programmes, and sharpened our focus on hunger relief initiatives in partnership with FoodForward SA and Ladles of Love.

Coronation is also an active participant in industry and government-related engagements to find solutions to reduce unemployment, improve the available skillset, kickstart growth and place South Africa on the road to economic recovery.

Stewardship

We have been active stewards of our clients' capital for almost 30 years and fully integrate environmental, social and governance considerations into our investment and business processes. Our 2021 Stewardship Report (available on www.coronation.com) details our stewardship activities for that calendar year, including our position on climate change and the carbon emissions of our key equity portfolios. We continue to encourage companies to adopt the Taskforce for Climate-Related Financial Disclosure (TCFD) when reporting on climate risks in their businesses. We fully support the move to a greener, more sustainable and equitable world and will continue in our endeavours to engage on these matters. We are a participating investor in Climate Action 100+.

Coronation itself has fully committed to applying the TCFD framework when reporting on our business operations. We will publish our third carbon footprint assessment later this year, along with our first Sustainability Report.

TRANSFORMATION AND EMPOWERMENT

Coronation is a Level 1 contributor to broad-based black economic empowerment, is 29% black owned and R269 billion, representing 47% of our total AUM, is managed by black investment professionals. Achieving a Level 1 rating is the result of years of dedication to meaningful and substantive broad- based transformation via our recruitment, enterprise development, procurement, and training and development initiatives.

* Company-wide, asset weighted since inception track record for funds with >10 year track record.

PROGRESS IN TRANSFORMING OUR BUSINESS

Level 1

B-BBEE contributor as measured by the Financial Sector Code

Our commitment to diversity is demonstrated by our diverse employee complement, with key senior leadership positions occupied by black individuals (three of whom are women). This includes our CEO, CFO, COO, Head of Institutional Business, Head of Fixed Interest, Head of Core Equity and Head of Absolute Return.

Of our South Africa-based employees:

• 51% are women;
• 63% are black, of whom 58% are black women;
• 86% of new appointees during the 2022 financial year are black; and
• 80% of our Board of Directors are black and 50% are women.

CASH DIVIDEND

We continue to reward shareholders through regular and significant distributions of free cash flow generated. We endeavour to distribute a minimum of 75% of after-tax cash profit. After assessing any projected future cash requirements, a final gross dividend of 172.0 cents per share has been declared for the financial year ended 30 September 2022 from income reserves, resulting in a net dividend of 137.6 cents per share for shareholders subject to Dividends Tax. In compliance with the Listings Requirements of the JSE Ltd, the following dates are applicable:

• Declaration date: Tuesday, 22 November 2022
• Last day to trade cum dividend: Tuesday, 6 December 2022
• Trading ex-dividend commences: Wednesday, 7 December 2022
• Record date: Friday, 9 December 2022
• Payment date: Monday, 12 December 2022

Share certificates may not be dematerialised or rematerialised between Wednesday, 7 December 2022 and Friday, 9 December 2022, both dates inclusive. In terms of Dividends Tax, the following additional information is disclosed: the local Dividends Tax 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 are deeply concerned by the plethora of challenges that economies and societies around the world will need to navigate in the years ahead and the consequent impact on people's ability to save. However, the steep, and often indiscriminate, sell-off in markets has created multiple opportunities for patient long-term investors.

We have taken full advantage of these opportunities and are very optimistic about the long-term prospects for our client portfolios. As an investment-led business, our primary focus remains growing the value of the client assets entrusted to us over the long term, rather than simply looking to grow the pool of assets under our management.

In the tough and competitive fund management industry, our ability to consistently deliver outperformance, at scale, and over multi-decade periods is a significant differentiator. Our highly experienced and well-resourced investment team continues to employ the same long-term investment approach that has driven outperformance across a significant portion of our fund range for nearly three decades.

We will continue to manage the business to deliver long-term value to our clients, shareholders and other stakeholders.

EXTERNAL AUDIT REVIEW

The external auditors, KPMG Inc., reviewed the condensed consolidated statement of financial position of Coronation Fund Managers Ltd as at 30 September 2022, and the related condensed consolidated statement of comprehensive income, condensed consolidated statement of changes in equity and condensed consolidated statement of cash flows, earnings per share and condensed consolidated segment report for the period then ended and explanatory notes. The review has been conducted in accordance with the International Standard on Review Engagements 2410 (ISRE 2410). Copies of the unmodified review report of KPMG Inc. are available for inspection at the registered office of the Company together with the condensed consolidated financial statements identified in the auditor's review report. The auditor's review report does not necessarily report on all of the information contained in this financial results announcement. Shareholders are therefore advised that in order to obtain a full understanding of the nature of the auditor's engagement, they should obtain a copy of the auditor's review report together with the accompanying financial information from the issuer's registered office. Any forward-looking information contained in this announcement has not been reviewed or reported on by the Company's external auditors.

Fund management activities

Revenue (note 2)

Other (losses)/income

Total operating expenses

Results from operating activities

Finance and dividend income

Finance expense

Profit from fund management

Share of profit of equity-accounted investee

Sundry (losses)/gains

(Losses)/income attributable to policyholder linked assets and investment partnerships

Net fair value gains on policyholder and investment partnership financial instruments

Administration expenses borne by policyholders and investors in investment partnerships

Profit before income tax

Income tax expense

Taxation on shareholder profits

Taxation on policyholder investment contracts

Profit for the period

Other comprehensive gains/(losses)

Foreign currency translation differences for foreign operations

Total comprehensive income for the period

Profit attributable to:

• equity holders of the company
  Profit for the period

Total comprehensive income attributable to:

- equity holders of the company

Total comprehensive income for the period

Earnings per share (cents)

• basic
• diluted

Headline earnings per share (cents)

• basic
• diluted

Dividend per share (cents)

• interim
• final

1. 50

1613

1. (39)

1. 106

1. 10

122118

1. (108)

1. (597)

1. (587)

3(10)

30(46)

30(46)