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FALKLAND ISLANDS HOLDINGS

Results - Year ended 31 March 2015

Creating foundations for growth

FKL: Overview

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Pre-Tax profits £3.56m (2014: £3.65m)

•

Cash flow from operations £7.2m (2014 £3.6m)- Cash on hand £7.4m

•

FIC: Strong recovery, continued investment

•

Momart: Quieter trading year, growth with blue-chip clients

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PHFC: Stable trading – new ferry delivered

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FOGL: Disposal of 7.8m shares -£2.3m. and residual 5m shares sold post year-end.

•

Focus on organic and acquisition led earnings growth

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FKL: Year ended 31 March 2015 Trading Overview

• • • • • •

Group revenue +0.8% to £38.6m (2014: £38.3m)

—

FIC : Operating profits +£0.3m to £1.3m (2014: £1.0m)– Growth in Retail and Housebuilding & Construction

—

Momart: Quieter trading year – profits -32% to £1.2m

— — —

PHFC: Small decline in passenger numbers (-2.1%) – Revenue & profits stable at £0.8m

Operating profit -2.3% to £3.8m (2014: £3.9m) Underlying pre tax profits -2.4% to £3.56m (2014: £3.65m) EPS on underlying profits unchanged 22.0p (2014: 22.0p) Reported pre tax profits + £0.5m at £3.9m Cash +£1.7m to £7.4m (2014: £5.7m) Bank borrowings reduced to £0.7m (2014: £1.0m) £1.4m annual dividend suspended to facilitate investment and acquisition led growth

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FKL: Year ended 31 March 2015 Trading Overview

Year ended 31 March Turnover – continuing operations Underlying operating profit Interest (net) incl. pensions costs Underlying pre tax profit Non trading items Amortisation of Intangibles Reported Profit Before Tax Diluted EPS on taxed underlying PBT Weighted shares in issue 2015 £000 38,560 3,763 (204) 3,559 477 (142) 3,894 22.0p

12,446,097

2014 £000 38,263 3,852 (205) 3,647 64 (307) 3,404 22.0p

12,460,985 Change +/-

+0.8% -2.3% -0.5% -2.4% +645.3% -53.7% +14.4% -% -0.1%

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FKL: Cash & Liquidity

31 March 2015 £000

31 March 2014 £000

Bank Loans Hire Purchase & Other borrowings Total borrowings Cash Net Cash /(Borrowings) (735) (280) (1,015) 7,435 6,420

(1,019) (265) (1,284 5,715 4,431

Pontoon Finance Lease (4,858) Margin on bank loans: 2.8% + Bank of England base rate

(4,886)

Change £000 284 (15) 269 1,720 1,989 28

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FKL: Segmental Analysis

–

year ended 31 March 2015 Turnover FIC PHFC Momart Total Turnover Pre Tax Profit FIC PHFC Momart Underlying Pre-Tax Profit (PBTa) 2015 £000 18,506 4,301 15,753 38,560 1,556 796 1,207 3,559 2014 £000 Change +/ 15,881 4,124 18,258 38,263

+16.5% +4.3% -13.7% +0.8%

1,116 770 1,761 3,647

+39.4% +3.4% -31.5% -2.4% 6

FIC: Background to Oil – June 2015

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Premier Oil (PMO) progressing technical development of Sea Lion

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PMO “ Engaging with supply chain to capture lower costs ”– May 2015

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Lower cost engineering concept- Leased FPSO production facility

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Phased approach to develop 400mmbbls in total

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Pre first oil costs reduced to $1.8bn

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Further cost reductions being targeted for drilling, subsea and fabrication costs

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FEED being progressed for Board sanction- decision in Summer 2016

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Commitment depend on further recovery in oil price and positive news from drilling programme

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2015 drilling programme “ to determine ultimate resource potential of N. Falklands Basin”



Positive results from first two wells , Zebedee and Isobel Deep. Four more wells to be drilled

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Noble Energy drilling large Humpback prospect in June / July 2015 in S&E Basin

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Timeline for Oil

Falklands: Timeline for Oil

Revised Sea Lion Timeline Temp dock in Stanley Harbour Jun-15 2015 2016 Complete Nov 2014 Exploration Drilling PMO Project Sanction / FDP Approval Field Development Revised view June 2015 Phase 1 using lower cost FPSO First Oil 2017 2018 2019 2020 1 rig 6 wells Eirik Raude Rig March - Nov 2015 Prepare "H1 2016 " Develop Develop Construct Construct FIRST OIL Now estimated 2020 ( 4 yrs following Project Sanction )

"Premier Oil " Engaging with supply chain to capture lower costs " May 2015 , Pre First Oil costs now reduced to $1.8bn

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FIC: Stanley

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–

FIC: Year ended 31 March 2015

Revenue Retail Falklands 4x4 Freight and port services Support services Property and construction Total Revenue 2015 £ million 9.54

3.07

1.24

1.66

3.00

18.51

Operating profit

Share of Joint Venture Net Interest

Pre Tax profit Operating profit margin 1.31

0.18

0.07

1.56

7.1%

2014 £ million 9.26

2.66

1.26

1.30

1.40

15.88

Change % 3.0% 15.6% -1.7% 28.1% 113.5%

16.5%

0.98

0.04

0.10

1.12

6.2%

34.3%

400.0% -37.9%

39.4% 15.2%

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FIC: Trading - Year ended 31 March 2015

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Revenue ahead + 16.5% at £18.51 million (2014: 15.88 million )

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Contribution +39.4% to £1.56m (2014: £1.1m )

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Retail revenues + 3% to £9.5m – better margins - further investment

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Good growth in Falklands 4x4 + 15.6% to £3.1m - 76 vehicles sold (2014: 79 )

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Falkland Building Services – Kit Homes growth – 16 properties sold 2014: 8)

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Stronger cruise ship visitors numbers +26% to 50,000 helped H2 sales.

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Good contribution from SAtCO at £0.18m (2014: 0.04m) - Installation of Noble Energy temporary dock from March – Nov 2014

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FIC: Expanding Home Builder DIY Store

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FIC: Further progress to First Oil

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FBS Kit Homes on Government plots

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FBS Kit Home

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FIC: Year ended 31 March 2015

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£2.6m capital investment during year.

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New chiller and warehouse / container facilities at Airport Road nearing completion

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Refurbishment complete of the Company’s Head Office at Crozier place, offering attractive office space for external rental and improved Head Office facilities for FIC ;

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Three new houses built in central Stanley, and one four bedroomed house purchased to add to rental portfolio

• •

Creation of new

“

Home Builder

”

Retail Warehouse and Garden Centre £0.4 million spent on the purchase and installation of 10 mobile homes for staff

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Strong contribution from SAtCO JV £180k (after tax) – Temp Dock project for Premier Oil & Noble Energy

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FIG plans for Deep Water Port on hold pending green light on Sea Lion

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FIC: New ambient and chilled warehousing

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FIC: Premier / Noble Temporary Dock Facility

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Momart: Return to more normal trading patterns

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Momart: Trading year ended 31 March 2015

Revenue Museums & Public Exhibitions Gallery Services Storage Total Revenue Operating Profit Interest Pre Tax Profit * * Before amortisation of intangibles Operating profit margin 2015 £ million 8.68

5.21

1.86

15.75

1.24

(0.03) 1.21

7.9%

2014 £ million 10.86

5.57

1.83

18.26

1.83

(0.07) 1.76

10.0% Change % -20.0% -6.5% 1.3% -13.7% -32.1% -50.8% -31.5%

-21.4%

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• • • • • • •

Momart: Trading year ended 31 March 2015

Quieter Trading – Absence of high added value contracts seen in prior year.

–

Revenue -14% to £15.8m (2014: £18.26m )

–

Profits down to £1.24m (2014: £1.83m ) Exhibitions revenues -£2.2m (-20% ) Overseas revenues -£0.8m Commercial Gallery Services revenues -6.5% to £5.21million Storage revenues +1.3% to £1.86m: 33% expansion of storage space arriving Q1 2016 . Strengthened management team – increased focus on sales and marketing

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New marketing director and full time manger appointed – March 2015

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Specialist PR Agency now advising March 2015

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New Business Development Manager appointed- Nov 2014 Notable exhibitions: Matisse Cut Outs at Tate Modern; Anselm Keifer and Rubens at the Royal Academy; Virginia Woolf at the National Portrait Gallery; and Ming at the British Museum.

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Momart: Working with Blue Chip clients

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Matisse: Cut Outs, Tate Modern

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New dedicated storage racks for Royal Academy

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Momart: Working with Blue Chip clients

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Landmark Trust: Installing works by Anthony Gormley

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Portsmouth Harbour Ferry Company (PHFC)

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Revenues Ferry fares Other revenue Total Revenue Operating Profit Pontoon lease finance interest Profit before tax 2015 £ million 4.13

0.17

4.30

1.03

(0.24) 0.79

2014 £ million

3.95

0.17

4.12

1.01

(0.24) 0.77

Change %

4.5% 0.6% 4.4% 1.9% -2.9% 3.4%

Net margin on revenue (%)

Passenger journeys (000s)

18.5%

2,923

18.7%

2,986

-0.9 %

-2.1%

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• • • •

Revenue +4.4% to £4.3million PBT + 3.4% to £0.79m (2014: £ 0.77m ) Passenger journeys -2.1% to c.2.92 m (2014: -1.6% to c.2.99m )

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BAE,1,000 local job losses summer 2014

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Subsidised Park & Ride in Portsmouth Fares increased 6% June 2014

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Adult Return fares £2.90 > £3.10, Child / OAP unchanged at £2.10

—

10 Trip Ticket £13.50 > £14.50

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New vessel arrived from Croatia Q1 2015 – cost £3.2million – 30 year life

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No further vessel investment for 15-20 years

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Medium term outlook for Portsmouth positive – QE2 carriers - 2017 onwards

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•

FKL: Outlook

FIC

– – –

Falklands economy buoyant in H1 with drilling programme and FI Govt capital spending Further positive news from drilling will lessen reliance on oil price recovery Significant longer term growth linked to Sea Lion development

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Momart

–

No immediate repetition of exceptional 2013-14 result

– –

Commercial art market expected to remain buoyant – importance of London growing New ERP system will boost efficiency in 2014-15

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Plans to expand storage business in 2015 to remove block to further growth

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PHFC

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Stable outlook – more active promotional offers to offset cheap petrol

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Increased costs for new vessel ( deprec. / finance ) will hold back 2015-16

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Cyclical recovery & Dockyard expansion gives positive medium term view

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Overall

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Further investment in growth businesses

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Strategic acquisitions using cash and bank borrowings

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FKL: Strategy

FKL: Strategy

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FIC: Leverage property assets and support services to maximise long term returns from oil

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Momart: Expand storage capacity and develop sales & marketing to capitalise on brand reputation.

• • • •

PHFC: Maintain fleet, steady profits & strong cash flow Group: No final dividend planned - cash reinvested to accelerate earnings growth Leverage cash flow to finance strategic acquisitions

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Appendices

Additional Information on Falkland Islands Holdings

Property, plant and equipment Investment properties Intangibles & goodwill Deferred tax assets & sundry other Investment in FOGL at market value (5m shares @ 30.0p (2014: 12.825m shares at 25.5p ) Total fixed assets and investments Working capital - Net Cash Net operating assets Income tax payable Bank loans, Finance Leases & HP Pension provisions & Deferred tax Net Assets / Shareholders funds Net assets per share 31 March 2015 £000 19,621 3,693 12,226 1,852 1,500 38,892 1,132 7,435 47,459 (27) (5,873) (4,871) 36,688 £2.95

31 March 2014 £000 16,609 3,396 12,238 1,602 3,270 37,115 3,255 5,715 46,085 (419) (6,170) (4,119) 35,377 £2.85

Change £000

3,012 297 (12) 250 (1,770) 1,777 (2,123) 1,720 1,374 392 297 (752) 1,311

£0.10

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Year ended 31 March Underlying operating profit Depreciation Tax paid Decrease / (Increase) in working capital Other Net cash flow from operating activities Capital expenditure Dividends paid Loan repayments & Interest FOGL shares sold Loan repaid by / (loan to) Joint Venture Bank & other loans drawn down Other Net Cash Inflow / (outflow) 2015 £000 3,763 1,426 (792) 2,145 (158) 6,384 (4,944) (1,424) (1,408) 2,287 151 833 (159) 1,720 2014 £000

3,852 1,233 (780) (1,676) 169 2,798 (4,974) (1,423) (1,435) (529) (138) (5,701) 29

FIC: Sites for development

FIC: Sites for development

1 2 Site Fitzroy Road Dairy Paddock 3 YPF site 4 East Jetty 5 6 7

“

Coastel

”

Road Airport Road/FIPASS Fairy Cove Location & size 2 acres , Central Stanley Western Stanley 36 acres Development Potential 26 x 2 bed apartments / Terraced Housing Planning for 350 houses / Work camp Central Stanley, 2.25 acres Offices , high quality residential Waterfront Stanley , 3.0 acres FIC warehousing – prime site for re development FIPASS area, 7.5 acres FIPASS ,11.0 acres Warehousing & lay down areas with planning Warehousing & lay down areas with planning North side of Stanley Harbour, 301 acres Adjoins site for proposed new deep water port at Navy Point

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Map of FIC Development Sites

Map of FIC Development Sites

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Map of FIC Development Sites

Map of FIC Development Sites

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FIC: Development sites in Stanley

FIC: Development sites in Stanley

Dairy Paddock 36 acre site in central Stanley YPF site on Stanley Harbour 2.25 acres Fairy Cove : 300 Prime central site for acre site next to Navy Point offices , hotel / leisure harbour site Site 2 Crozier Place and East Jetty, 3.0 acres Prestige site for high quality residential homes Coastel Rd site on Stanley Harbour 7.5 acres Prime central site for Offices, Hotel or Leisure. Site 4 Warehousing, lay down areas and storage Site 3 Site 5 33

Management Team

Management Team

Edmund Rowland, Chairman

Edmund was appointed to the Board on 16 April 2013, and became Chairman on 9 February 2015. He currently serves as a Director of Blackfish Capital Management, a specialist asset manager based in London and as Chief Executive Officer of Banque Havilland S.A (London Branch), previously having gained experience in London and Hong Kong, as an analyst and investment manager with BNP Paribas S.A and Blackfish. He has broad experience of principal investing in both equity and credit capital markets, with a focus on special situations. He sits on the board of Banque Havilland (Monaco) SAM and Certus Trust Limited.

John Foster, Managing Director

John joined the Board in 2005. He is a Chartered Accountant and previously served as Finance Director for software company Macro 4 plc and toy retailer, Hamleys plc. Prior to joining Hamleys, he spent three years in charge of acquisitions and disposals at FTSE 250 company Ascot plc and before that worked for nine years as a venture capitalist with a leading investment bank in the City.

Jeremy Brade, Non Executive

Jeremy joined the Board in 2009. He is a Director of Harwood Capital Management where he is the senior private equity partner. Jeremy has served on the boards of several private and publicly listed international companies. Formerly Jeremy was a diplomat in the Foreign and Commonwealth Office, and before that an Army officer.

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