THE INVESTMENT COMPANY LIMITED

INTERIM ACCOUNTS 30 JUNE 2013 (UNAUDITED) THE EGYPT INVESTMENT COMPANY LIMITED

Interim Report For the period ended 30 June 2013

Directors 1

Management and Administration 2

Report of the Investment Manager 3 - 6

Investment Portfolio 7 - 8

Financial Statements: Statement of Total Return 9

Balance Sheet 10

Notes to the Financial Statements 11 - 14 THE EGYPT INVESTMENT COMPANY LIMITED DIRECTORS

Pierre C.A de Blonay (Chairman) Mr. de Blonay started his professional career in 1960 with Swiss Bank Corporation in London. In 1972, he joined Kidder, Peabody in Switzerland as an equity salesman. In 1980, he was elected Managing Director in charge of sales and asset management operations. He resigned in 1994 as Kidder, Peabody was taken over by PaineWebber and established himself as an independent financial consultant and money manager. Today, Mr. de Blonay is a member of the Board of a number of financial companies including: - Banque Audi (Suisse) S.A. Geneva - Banque Baring Brothers Sturdza S.A. Geneva - Banque , Bertrand, Sturdza S.A. Geneva - The Concord Group International Funds - The Nile Growth Company - Castle Property Company - IREF Global Holdings (Bermuda) Ltd. - IREF Australia Holdings (Bermuda) Ltd.

Mahmoud Abdel Aziz Mr. Abdel Aziz retired as Chairman & Managing Director of Commercial International Bank (Egypt) (CIB) in August 2002. Mr. Abdel Aziz’s achievements in the Arab world have qualified him for many prizes. He was awarded the prize of the Banker of the year in 1994, according to a poll by World Today (Al Alam Al Youm) Newspaper; awarded the Banker’s lifetime Achievement Award for 1997 granted by the Arab Bankers’ Association of North America, Member of the International Who’s Who of Professional Organisations in 1998 and Foreign Manager of the Year 1999, awarded by Mannheim University (unternehmer Forum, Management Berater and VWD). He was declared the Arab Banker of the year in 2000 by the Union of Arab Banks. During Mr. Abdel Aziz’s tenure as Chairman & Managing Director of CIB, the bank was awarded the prize of the Best Bank in Egypt for the Region & Africa for 6 consecutive years to the year 2000 by “Global Finance” and was awarded Best Bank in Egypt by EUROMONEY for 8 years. The Financial Times nominated the bank for the award of the year in September 2001.

Nigel Melville Nigel Melville was Executive Chairman of Emtelle Holdings, a leading supplier of fibre optic cabling systems to the telecommunications sector, between 1996 and 2008. He is a director of a number of other public and private companies. Between 1972 and 1995, he was an investment banker with Barings, latterly as director responsible for international corporate finance. In 1995 he established Melville Partners to provide strategic consultancy to a range of international companies.

Mohamed Saleh Younes Mohamed S. Younes is the Chairman of Concord International Investments Group, LP. From July 1977 to December 1979 Mr. Younes was President of Industrial Holdings Limited in New York. Prior to that he was Head of International Corporate Finance and a member of the Board of Directors of Kidder, Peabody & Co. Incorporated. From December 1979 to February 1987 he was Chairman and Chief Executive of Kidder, Peabody International Limited. He has served on a number of advisory committees on securities-related issues, including the Advisory Committee on International Capital Markets to the Board of the New York Stock Exchange and the International Capital Committee of the Securities Industry Association, New York. He also served on the board of Euroclear Clearance Systems (Zurich), Baring Brothers (London) and UBAF Arab Bank (New York). Mr. Younes was a member of the board of Directors of the Central Bank of Egypt and of Al Borg Laboratory Limited. He was Vice Chairman of Pioneers Holding Company. He is also a member of the boards of Directors of Coral Growth Investments Limited, The Egyptian Growth Investment Company Limited, Egyptian Direct Investment Fund Limited, Al Borg Laboratory Limited, Lecico Egypt, Bisco Misr and Coral Growth Investments (Parallel) Limited. Mr. Younes was Chairman of the US-Egypt Business Council.

Frederick H.S. Allen Mr. Allen is an independent consultant focused on international affairs and on international cultural projects for both cultural organisations and corporations. He also advises corporations and financial institutions on the creation or restructuring of advisory boards. Mr. Allen was first employed by Morgan Guaranty Trust Company in 1960, joined that bank on a full-time basis in 1963, and retired from J.P. Morgan Chase & Co. In 1999; he remained a consultant to that firm until 2009 as Executive Secretary of its International Council, a position prevously held at JPMorgan since 1982. Other responsibilities at JPMorgan included Assistant to the Chairman (1976-81); cultural sponsorships, corporate communications, public affairs and press relations, and Middle East representative in . He was based in Paris, and was a director of J.P Morgan (Suisse) in Geneva. Mr. Allen has served on the boards of various cultural and academic institutions and is currently on the Metropolitan Museum of Arts' Business Committee, the Morgan Library and Museum's Music Visiting Committee, and a board member of the American Foundation for the Paris School of Economics.

All the Directors are non-executive.

1 THE EGYPT INVESTMENT COMPANY LIMITED MANAGEMENT AND ADMINISTRATION

Investment Manager Independent Auditors Concord National (Cayman) Limited Ernst & Young LLP C/o Wardour Management Services Limited Royal Chambers Alamander Way St Julians Avenue Grand Pavilion St Peter Port PO Box 10147 Guernsey Grand Cayman Channel Islands GY1 4AF KY1-1002 Cayman Islands

Administration, Secretary, Registrar and Channel Islands Stock Exchange Sponsor Legal Advisers Fulcrum Group (Guernsey) Limited Mourant Ozannes Regency Court 1 Le Marchant Street Glategny Esplanade St. Peter Port St. Peter Port Guernsey Guernsey GY1 1WW GY1 4HP

Custodian Butterfield Bank (Guernsey) Limited Regency Court Glategny Esplanade St. Peter Port Guernsey GY1 3AP

Registered Office Regency Court Glategny Esplanade St. Peter Port Guernsey GY1 1WW

2 THE EGYPT INVESTMENT COMPANY LIMITED

REPORT OF THE INVESTMENT MANAGER

Economic Overview and Recent Developments

On 3rd July 2013, following three days of widespread protests, General Abdel Fattah El Sisi, Commander in Chief of the Armed Forces and Minister of Defence, announced via televised address that President Mohamed Morsi had been deposed and detained. The draft constitution was suspended and Chief Justice of the Supreme Constitutional Court, Adly Mansour was named Interim President. In subsequent days, Interim President Mansour appointed Mohammed El Baradei as Interim Vice President (Baradei subsequently resigned), Hazem El Beblawi as Interim Prime Minister and Dr. Ziad Bahaa El-Din as the Interim Deputy Prime Minister for Economic Affairs. The interim government transitional plan includes selecting a panel of 10 jurists (6 judges and 4 law professors) to redraft the suspended constitution which will be followed by a 2 month review by 50 government representatives from various institutions. Once approved, the draft constitution will be voted on in a national referendum one month following the review. One month after the constitution is voted on, parliamentary elections will take place to be followed by presidential elections. The panel tasked with amending the constitution convened on 8th September 2013 and selected Mr. Amr Moussa to head the group. The panel has two months to finalise the constitutional amendments and appears to be adhering to this roadmap. In the meantime, the funds recently pledged to Egypt by its allies in the Region (approximately USD 12 billion so far) far exceed the US aid (and long discussed IMF loan) and provide a much needed lifeline during this very turbulent time. GDP grew at 2.3 per cent. for the first nine months of 2012/2013 (nine months 2011/2012: 1.8 per cent.). In a recent statement, the Minister of Planning announced that GDP growth is expected to be 2.3 per cent. for the full fiscal year 2012/2013. The current account balance deficit decreased to USD 5.6 billion in fiscal year 2012/2013 from USD 10.1 billion at the end of the previous fiscal year. The balance of payments ran an overall surplus of USD 237 million in fiscal year 2012/2013, a significant improvement from the USD 11.3 billion deficit in fiscal year 2011/2012. This improvement can be attributed to an improvement in the current account thanks to a 7.6 per cent. drop in the trade deficit, reaching USD 31.5 billion from USD 34.1 billion and a 19.8 per cent. rise in the services surplus and 5 per cent. increase in net transfers. The budget deficit reached 10.1 per cent. of GDP in the first nine months of 2012/2013 compared to 10.8 per cent. for the full fiscal 2011/2012 year. Foreign debt increased to 14.7 per cent. of GDP in the first nine months of fiscal year 2012/2013 as compared with 13.1 per cent. of GDP during the first nine months of 2011/2012. Domestic debt increased to 82.2 per cent. of GDP in the first nine months of fiscal year 2012/2013 from 76.7 per cent. during the same period a year prior. The official annual headline inflation rate which has fluctuated greatly over the past two years stood at 10.15 per cent. in September 2013. During fiscal year 2012/2013 tourism revenues increased by 3.5 per cent., reaching USD 9.7 billion compared to USD 9.4 billion during fiscal year 2011/2012. Egyptian exports increased 3.5 per cent. to USD 26 billion in fiscal year 2012/2013, of which 53.8 per cent. were not oil- related. Imports decreased by 2.9 per cent. to reach USD 57.5 billion in fiscal year 2012/2013 from their USD 59.2 billion level in the previous fiscal year. Remittances increased in fiscal year 2012/2013 compared to the previous fiscal year, registering USD 19.3 billion versus USD 18.4 billion respectively. Suez Canal revenues decreased slightly to USD 5.0 billion for fiscal year 2012/2013 compared to USD 5.2 billion in fiscal year 2010/2011. The Egyptian pound depreciated by 8 per cent. year-to-date (10th October 2013) against the USD. The Central Bank of Egypt continues to support the Egyptian Pound through foreign exchange auctions and uses the aid received from Gulf Arab neighbours to support its Net International Reserves (NIR). As of July 2013, import cover was 3.9 months however this number should increase to above 4 months of import coverage due to the pledges of nearly USD 12 billion from , and the United Arab Emirates. NIR stood at USD 18.7 billion at the end of September 2013. Standard and Poor’s rate both foreign currency and local currency long-term sovereign debt with a CCC+ rating. S&P also rates short-term foreign and local currency debt with a C rating. Fitch Ratings’ outlook on Egypt is negative with a B- rating on long-term foreign currency debt and a B- rating on long-term domestic debt. Moody’s rates both foreign and local currency long-term debt Caa1.

3 THE EGYPT INVESTMENT COMPANY LIMITED

REPORT OF THE INVESTMENT MANAGER

Investment Strategy and Performance

Originally launched as a closed-ended investment company, the Egypt Investment Company changed its status to open- ended on the 27th of December 2012. On that date shareholders also approved the creation of a Side-Pocket Class to hold the Company’s illiquid securities. The Side-Pocket Class is closed-ended.

USD Share Class

As at 27th June 2013, the Net Asset Value per Egypt Investment Company Limited USD (Main Fund) share was USD 24.82. The Net Asset Value per Egypt Investment Company Limited USD (Side-Pocket Class) share was USD 1.27. This represents a decrease of 11.70 per cent. year-to-date (Main Fund only), and an increase of 210.40 per cent. since inception (Main Fund and Side-Pocket Class Fund combined).

Concord National (Cayman) Limited The Egypt Investment Company Limited USD Share Class Change in Net Asset Value + Distributions Since Inception

350.0%

300.0%

250.0%

200.0%

27-Jun-13 210.40% 150.0%

100.0%

50.0%

0.0%

-50.0% Jun-96 Feb-98 Nov-99 Jul-01 Apr-03 Dec-04 Aug-06 May-08 Jan-10 Oct-11 Jun-13

4 THE EGYPT INVESTMENT COMPANY LIMITED

REPORT OF THE INVESTMENT MANAGER

Investment Strategy and Performance (continued)

EGP Share Class

As at 27th June 2013, the Net Asset Value per Egypt Investment Company Limited EGP (Main Fund) share was EGP 174.50. The Net Asset Value per Egypt Investment Company Limited EGP (Side-Pocket Class) share was EGP 8.90. This represents a decrease of 2.25 per cent. year-to-date (Main Fund only), and an increase of 524.95 per cent. since inception (Main Fund and Side-Pocket Class Fund combined).

Concord National (Cayman) Limited The Egypt Investment Company Limited EGP Share Class Change in Net Asset Value + Distributions Since Inception 630.0% 27-Jun-13 580.0% 524.95%

530.0%

480.0%

430.0%

380.0%

330.0%

280.0%

230.0%

180.0%

130.0%

80.0%

30.0%

-20.0% Jun-96 Feb-98 Nov-99 Jul-01 Mar-03 Dec-04 Aug-06 Apr-08 Jan-10 Sep-11 Jun-13

5 THE EGYPT INVESTMENT COMPANY LIMITED

REPORT OF THE INVESTMENT MANAGER

Top Ten Holdings as at 27 June 2013

Investment Percent of Portfolio Telecom Egypt 5.56% Paints and Chemicals Industries 5.15% Eastern Tobacco 5.07% Egyptian International Pharmaceutical Industries Co. 4.88% Sidi Kerir Petrochemicals 4.58% Bisco Misr 4.46% Nasr City Housing 3.95% Commercial International Bank 3.83% Heliopolis Housing 3.81% Credit Agricole Egypt 3.70%

Outlook and Conclusion

As always, we are monitoring the developments in Egypt and their impact on your investments very carefully. The foreign currency received from Egypt’s regional allies has provided a much needed lifeline that will help support the country particularly during this challenging period. The interim government has thus far been sticking to their transition agenda and a draft constitution is expected in the coming weeks. While it is very difficult to predict what the full impact of the most recent events will be, we believe that Egypt is on the path to social and economic recovery and are cautiously optimistic.

Laura Osman October 2013

6 THE EGYPT INVESTMENT COMPANY LIMITED INVESTMENT PORTFOLIO as at 30 June 2013

Number of Percentage Value Shares/Securities Sector/Security of Net Assets EGP Banking and Finance (December 2012: 23.19%)

492,230 Commercial International Bank (CIB) 3.60 14,161,457 1,506,574 Credit Agricole Egypt 3.48 13,679,692 3,790,000 Pioneers Holding 2.73 10,725,700 9.81 38,566,849

Construction and Materials (December 2012: 13.77%)

18,850 El Ezz AlDekhela Iron & Steel 2.06 8,105,876 176,000 Lecico Egypt (GDRs) 0.36 1,408,000 1,173,196 Lecico Egypt 2.39 9,385,568 48,750 Orascom Construction Industries 2.99 11,765,325 155,415 Torah Portland Cement Company 0.87 3,419,130 429,263 Suez Cement Company 2.35 9,229,155 11.02 43,313,054

Chemicals and Fertilisers (December 2012: 8.91%)

1,348,130 Sidi Kerir Petrochemicals Company 4.30 16,919,031 475,275 Paints and Chemical Industries Company 4.84 19,020,506 9.14 35,939,537

Tobacco (December 2012: 4.81%)

195,203 Eastern Tobacco Company 4.76 18,737,536 4.76 18,737,536

Food/Food Related (December 2012: 3.16%)

343,124 Bisco Misr 4.19 16,473,383 4.19 16,473,383

Textiles (December 2012: 2.93%)

505,489 Oriental Weavers 2.57 10,109,780 2.57 10,109,780

Health Care (December 2012: 4.74%)

426,264 Egyptian International Pharmaceutical Industries Company 4.58 18,009,654 4.58 18,009,654

Hotels (December 2012: 5.23%)

14,440 Club Ras Soma Hotel Company * 0.72 2,813,056 131,532 Egyptian Investment Company * 3.34 13,153,200 47,170 MISR Hotels Co (Hilton) 0.34 1,341,327 32,510 Soma Bay Hotel Company * 1.02 4,010,759 5.42 21,318,342

7 THE EGYPT INVESTMENT COMPANY LIMITED INVESTMENT PORTFOLIO as at 30 June 2013

Number of Percentage Value Shares/Securities Sector/Security of Net Assets EGP

Housing & Real Estate (December 2012: 11.27%)

1,257,500 El Kahera Housing 1.59 6,262,350 660,468 Medinet Nasr Housing 3.71 14,589,738 245,000 United Housing and Development 0.56 2,200,100 680,591 Heliopolis Housing 3.58 14,081,428 9.44 37,133,616

Technology (December 2012: 0.54%)

54,500 IT Investments Company SAE * 0.54 2,134,765 7,286 E- Knowledge Venture Capital * 0.00 - 15,000 IT-Concord-Misr Tech Venture Capital Fund Limited * 0.00 - 0.54 2,134,765

Telecommunications (December 2012: 4.24%)

243,590 Telecom Egypt (GDRs) 5.22 20,548,817 5.22 20,548,817

Oil Processing (December 2012: 7.11%)

1,519,500 Maridive & Oil Service 2.44 9,613,671 93,293 Alexandria Mineral Oils Company 1.49 5,863,462 3.93 15,477,133

Treasury Bills (December 2012: 22.02%)

64,000,000 Egypt Treasury Bill 13.00% 07/30/13 16.07 63,256,521 16.07 63,256,521

Total Investments 86.69 341,018,987 Other Assets in Excess of Liabilities 13.31 52,359,841 Net Assets 100.00 393,378,828

* Unlisted investments held by side pocket shares

8 THE EGYPT INVESTMENT COMPANY LIMITED STATEMENT OF TOTAL RETURN For the period from 1 January 2013 to 30 June 2013

June 2013 June 2012 EGP EGP Income

Net realised gain on investments 33,749,069 11,238,265 Net unrealised (loss)/gain on investments (47,518,828) 34,782,663 Foreign exchange loss (140,556) (53,493)

Dividend income 9,573,334 12,099,490 Interest income 332,190 157,572 Bond Income 870,155 1,050,000 Expenses (4,723,121) (5,335,015)

Net revenue before taxation 6,052,558 7,972,047 Withholding tax (on Treasury Bill interest) (577,888) (1,282,971)

Net revenue after taxation 5,474,670 6,689,076

Change in net assets attributable to holders of participating redeemable preference shares (8,435,645) 52,656,511

Basic and Diluted earnings/(loss) per participating redeemable preference share - EGP Class (EGP4.02) EGP19.40

Basic and Diluted earnings/(loss) per participating redeemable preference share - USD Class (EGP4.02) EGP19.40

Basic and Diluted earnings per participating redeemable preference share - EGP side pocket Class EGP0.03 -

Basic and Diluted earnings per participating redeemable preference share - USD side pocket Class EGP0.03 -

All items in the above Statement are derived from continuing operations.

9 THE EGYPT INVESTMENT COMPANY LIMITED BALANCE SHEET as at 30 June 2013

Total Total

30 June 2013 31 December 2012 EGP EGP Non-Current Assets Investments at fair value through profit or loss 341,018,987 449,730,664

Current Assets Cash and cash equivalents 54,545,529 28,548,857 Accounts receivables and prepayments 49,618 31,736,014 54,595,147 60,284,871

Total Assets 395,614,134 510,015,535

Current Liabilities Accounts payable 2,235,306 2,542,584 Redemptions payable - 105,658,485 Liabilities excluding net assets attributable to participating and side-pocket shareholders 2,235,306 108,201,069

Net Assets attributable to Participating and Side-Pocket Shareholders 393,378,828 401,814,466

Total Liabilities 395,614,034 510,015,435

Equity Called up share capital 100 100 Total Equity 100 100

Total Liabilities and Equity 395,614,134 510,015,535

Net Asset Value Per Participating Redeemable Preference Share - EGP Class EGP 174.50 EGP 178.52 Net Asset Value Per Participating Redeemable Preference Share - USD Class USD 24.82 USD 28.11 Net Asset Value Per Participating Redeemable Preference Share - EGP side-pocket class EGP 8.90 EGP 8.87 Net Asset Value Per Participating Redeemable Preference Share - USD side-pocket class USD 1.27 USD 1.40

Net Asset Value Per Management Share 1.00 1.00 Net Asset Value Per Nominal Share - -

Approved by the Board of Directors on 28 October 2013

10 THE EGYPT INVESTMENT COMPANY LIMITED NOTES TO THE FINANCIAL STATEMENTS

1. Accounting policies

Basis of preparation The interim accounts have been prepared under the historical cost convention as modified by the revaluation of investments, in accordance with United Kingdom accounting standards and the Companies (Guernsey) Law, 2008.The presentation of the interim accounts has changed as compared with the prior year interim accounts to comply with the fact that the Company is now open-ended and therefore Statement of Recommended Practice, "Financial Statements of Authorised Funds" November 2008 has been adopted. The interim accounts are presented in Egyptian Pounds with effect from 1 January 2010 (previously United States Dollars). The presentation of the interim accounts is not consistent with the year end Financial Statements but, in the opinion of the directors, they provide sufficient information to enable investors to make an informed assessment of the results and activities of the Company for the period. In keeping with the Company's offering memorandum the Net Asset Value was struck on the 27th June 2013, these interim accounts are prepared as at 30th June 2013, any differences in relation to income, expenses or change in fair value between the 27th June and the 30th June 2013 are deemed immaterial.

Judgements and estimates The preparation of interim accounts requires management to make estimates and assumptions that effect the reported amounts of assets and liabilities at the balance sheet date and the reported amounts of income and expenses during the reporting period. Actual results could differ from these estimates. Details of major estimates are provided below under "Investments at Fair Value".

Going Concern A fundamental principle of the preparation of the interim accounts in accordance with United Kingdom Accounting Standards is the assumption that an entity will continue in existence as a going concern, which contemplates continuity of operations and the realisation of assets and settlement of liabilities in the ordinary course of business.The Directors have reviewed the Company’s forecast activities, budgets and cash flows. As a result the Directors consider the Company has adequate financial resources and believe that the Company is well placed to manage its business risks successfully to continue in operational existence for the foreseeable future and hence that it is appropriate to prepare the interim accounts on the going concern basis.

Company Restructure A resolution was passed at an EGM held on 27 June 2012 to reclassify the Company for Guernsey regulatory purposes as a registered open ended collective investment scheme under the Protection of Investors (Bailiwick of Guernsey), Law, 1987. The effective date of implementation of this resolution was 27 December 2012. The Amended Proposals include a change to dealing frequency from closed ended to quarterly and an amendment to the Side- Pocketing arrangements, in particular, to add the right of Shareholders to request redemption in specie of the Side- Pocket Shares. Side-Pocket shares were issued by the directors to existing shareholders on 1:1 basis, that is in direct proportion to the number of shares held on 27 December 2012. These illiquid assets have been transferred to a separate "Fund" in the books of the Company attributable to the Side-Pocket shares. These shares carry rights to those assets on a winding up or distribution in specie and to any income attributable to those assets. The assets within the Side-Pocket fund will not be included in the calculation of the Company's net asset value for the purpose of calculating subscriptions and redemption prices.

Investments at fair value The Company classifies all its investments at fair value through profit or loss. These financial assets are designated as investments at fair value through profit or loss at inception on the basis that they are part of a financial assets group which are managed and their performance evaluated on a fair value basis in accordance with the risk management and investment strategies of the Company as set out in the Company’s constitutive documents. The financial information about these financial assets is provided internally on a fair value basis to the Investment Manager and to the Board of Directors. All regular way purchases and sales of financial instruments are recognised on the trade date, which is the date that the Company commits to purchase or sell an asset. Regular way purchases or sales are purchases or sales of financial instruments that require delivery of assets within the period generally established by regulation or convention in the market place. The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the rights to receive cash flows from the financial asset and the transfer qualifies for derecognition in accordance with Financial Reporting Standard 26 (FRS 26) Financial Instruments: Recognition and measurement. Most of the Company’s investments are listed and regularly traded on the Egyptian Exchange. This market is order driven where only one official closing price is available. As such, the Company uses the official closing prices to value these investments. All other securities, which are actively traded, for which market quotations are available are valued at the last bid price quoted on the valuation point or, if there is no trade on that date, at the latest available quoted market price.

Where there is a lack of readily ascertainable market values for the unlisted investments or listed investments with no active trading and there is an inherent uncertainty involved in valuing them, then valuation is according to the International Private Equity and Venture Capital (“IPEVC”) valuation guidelines, using price earning multiples, as deemed appropriate by the Directors. An average P/E of similar companies listed on the stock exchange is calculated and a discount is applied to that P/E. The average P/E multiple applied to the companies is determined and disclosed in the notes to the financial statements. Changes in the fair value of investments classified as at fair value through profit or loss are recorded in net (loss) / gain on investments in the statement of total return. Realised gains and losses on the disposal of investments classified as at fair value through profit or loss are recorded in net gain/(loss) on investments in the statement of total return.

11 THE EGYPT INVESTMENT COMPANY LIMITED NOTES TO THE FINANCIAL STATEMENTS (continued)

1. Accounting policies (continued)

Cash and cash equivalents Cash and cash equivalents comprise cash at banks and on hand and short term deposits with an original maturity of three months or less.

Income Investment income represents bank interest on bank and cash deposits, and bond and dividend income. Investment income represents dividend income which is generated from the equity portfolio and is accounted for when the right to receive it is established. Interest income generated on all interest bearing financial instruments is recognised using the effective interest method. Bank interest is accounted for on an accruals basis.

Expenses Operating expenses are accounted for on an accruals basis. The Company is responsible for all normal operating expenses including investment manager's fees, directors' fees and charges incurred on the acquisition and realisation of investments.

Foreign currencies Transactions during the period, including purchases and sales of securities, income and expenses, are translated at the rate of exchange prevailing on the date of the transaction. Assets and liabilities denominated in foreign currencies are retranslated at the functional currency rate of exchange ruling at the reporting date. Items included in the Company's interim accounts are measured and presented using the currency of the primary economic environment in which it operates ("the functional currency"). This is the Egyptian pound, which is the currency that best reflects the nature of the Company's operations.

Treatment of preference shares Following the change in structure to an open ended fund the preference shares are now classified as liabilities instead of equities, as it was deemed that the shares now met the requirements of FRS 26 to classify puttable financial instruments as liabilities.

Exemption of cashflow statement The presentation of the Accounts has changed to comply with the fact that the Company is now open-ended and therefore IMA Sorp has been adopted. The exemption is based on the SORP requirement.

2. Material Agreements a) Investment Management Agreement Investment management services are provided by Concord National (Cayman) Limited, a member of the Concord International Investments Group, LP. The Investment Manager's appointment is terminable on one year's notice. A fee of 1.5 per cent. per annum of the Net Asset Value of each Share Class is payable to the Investment Manager quarterly in arrears. For the period ended 30 June 2013, fees paid to the Investment Manager by the Company amounted to EGP2,925,735 (30 June 2012:EGP3,415,179) of which EGP1,496,349 (31 December 2012: EGP1,867,450) remained outstanding at the period end. b) Administration Agreement Administration, company secretarial and registrar services are provided by Mutsubishi UFJ Fund Services Limited. A fee of 0.15 per cent. per annum of the Net Asset Value of each Share class is payable quarterly in arrears. The annual fee payable is subject to a minimum of £45,000 per annum. For the period ended 30 June 2013, fees paid to the Administrator by the Company amounted to EGP351,917 (30 June 2012: EGP374,795) of which EGP69,272 (31 December 2012: EGP72,365) remained outstanding at the period end. From 24 December 2012 a new administration fee structure came into effect which is a fee of 0.15 per cent per annum subject to a minimum of £45,000 for the open ended classes and a set fee of £15,000 for the side pocket classes. c) Custodian Agreement Custodian services have been provided by HSBC Limited, . A sliding scale of fees is payable, based on the asset values of different types of assets held within the Company's investment portfolio, quarterly in arrears. For the period ended 30 June 2013, fees paid to the Custodian by the Company amounted to EGP586,225 (30 June 2012: EGP321,359) of which EGP95,283 (31 December 2012: EGP46,917) remained outstanding at the period end. d) Directors' fees The Chairman receives US$20,000 per annum and each of the other Directors receives US$15,000 per annum, payable yearly half in arrears and half in advance, with the exception of Mohamed Younes, who has waived his entitlement to receive emoluments. e) Commissions Up to 2 per cent of the subscription price will be payable on the issue of any shares to any distributor appointed by the Company and a charge of 1.5 per cent of the aggregate redemption price will be payable to the Company. There were no Commissions received on redemptions for the period ended 27 June 2013 by the company (30 June 2012: EGP nil).

12 THE EGYPT INVESTMENT COMPANY LIMITED NOTES TO THE FINANCIAL STATEMENTS (continued)

3. Share Capital and Share Premium Number of Number of Share Capital Share Premium Shares Shares USD Class EGP Class EGP EGP a) Management Shares At 1 January 2013 and 30 June 2013 100 1 549 - b) Participating Redeemable Preference Shares at 1 January 2013 1,396,243 720,000 149,533 - Issued during the period - - - - At 30 June 2013 1,396,243 720,000 149,533 - c) Side Pocket Participating Redeemable Preference Shares at 1 January 2013 1,754,063 959,999 - - Issued during the period - - - - At 30 June 2013 1,754,063 959,999 - - d) Nominal Shares at 1 January 2013 - - - - Issued during the period - - - - At 30 June 2013 - - - -

The capital and assets of the Company shall on any winding up be applied first to repay capital paid up on participating redeemable preference shares, then to repay capital paid up on Management Shares and Nominal Shares. Participating Redeemable Preference Shares Shares may be redeemed on Dealing Days except where determination of the Net Asset Value has been temporarily suspended. Redemptions on the First Dealing Day will be restricted to 25 per cent of the Company's Net Asset Value.Thereafter, the Directors may at their discretion limit the value of shares to be redeemed on any one Dealing Day to 10 per cent of the Company's Net Asset Value. The limitation in each case will be pro rata to the number of Shares redeemed. Following the change in structure to an open ended fund the preference shares are now classified as liabilities instead of equity.

Side-Pocket Participating Redeemable Preference Shares Upon the restructuring of the Company as an Open- Ended Investment Company each existing shareholder as at 27 June 2012 received Side-Pocket Shares on a 1:1 basis in direct proportion to the number of shares held. These shares carry rights to the assets in the Side Pocket only on a winding up or distribution in specie and to any income attributable to those assets.

Nominal Shares On a winding-up, the Nominal Shares rank, for the purpose of the return of capital paid up, after the repayment of capital paid up on the Participating Preference Shares and are not entitled to participate in any surplus assets. Nominal Shares do not carry any right to receive dividends. No nominal shares have been issued.

Management Shares On a winding-up, the Management Shares rank, for the purpose of the return of capital paid up, after the return of capital paid up on the Participating Redeemable Preference Shares and the Nominal Shares but are not entitled to participate in any surplus assets. Management Shares do not carry any right to receive dividends.

4. Earnings Per Participating Preference Share 30 June 2013 30 June 2013 Open Ended Side- pocket

(Loss)/profit EGP (8,508,031) EGP 72,386

Average shares 2,116,243 2,714,062

Earnings/(loss) per share USD/EGP Class (4.02) 0.03

30 June 2012 30 June 2012 Open Ended Side- pocket

Profit EGP 52,656,511 -

Average shares 2,714,062 -

Earnings per share EGP Class 19.40 -

13 THE EGYPT INVESTMENT COMPANY LIMITED NOTES TO THE FINANCIAL STATEMENTS (continued)

5. Reconciliation of Net Asset Value per the Financial Statements to Published Net Asset Value

30 June 2013 30 June 2013 USD Class EGP Class

Published Net Asset Value at 27 June 2013 USD 24.82 EGP 174.50 Net asset value per Participating Redeemable Preference Share per period end accounts USD 24.82 EGP 174.50

30 June 2013 30 June 2013 USD Class EGP Class Side-pocket Side-pocket Published Net Asset Value USD 1.27 EGP 8.90

Net asset value per Participating Redeemable Preference Share per period end accounts USD 1.27 EGP 8.90

30 June 2012 30 June 2012 USD Class EGP Class

Published Net Asset Value at 25 June 2012 USD 27.98 EGP 169.44

Less: Adjustments (1.15) (6.88)

Net asset value per Participating Redeemable Preference Share at 30 June 2012 USD 26.83 EGP 162.56

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