SUMMARY

To meet the many requirements of regulatory authorities, annual reports have become lengthy, complex and very technical. To provide a convenient overview of the 2006 annual report of Trencor, this insert contains highlights from that report. It is not in substitution of the report, nor does it form part thereof. For a full appreciation of the company’s activities and results, you are advised to read the annual report.

GROUP CHART

HIGHLIGHTS

GROUP

• Headline earnings per share (including net unrealised foreign exchange gains and losses) were 232,8 cents (2005: 255,4 cents). In US dollar terms, these were 27,7 US cents per share (2005: 32,1 US cents per share).
  
• Adjusted headline earnings per share were 253,5 cents (2005: 274,5 cents), which, consistent with prior years, include gains and losses arising on the disposal of containers from Textainer's leasing fleet.
  
• Trading profit after net finance costs was R493 million (2005: R499 million).
  
• Net realised and unrealised exchange gains arising on translation of net dollar receivables and the related provisions were R135 million (2005: R187 million).
  
• Fair value adjustment against long-term receivables reduced by a net R60 million (2005: R67 million) in recognition of the continuing improved outlook for collectability and timing of receipts.
  
• Consolidated gearing ratio was 174% (2005: 170%).
  
• Final dividend of 37 cents per share declared, making a total of 57 cents per share for the year (2005: total 40 cents per share).

TEXTAINER

• Net profit for the year was US$54,2 million (2005: US$59,3 million).
  
• Average utilisation of the container fleet under management for the year was 91,1% (2005: 91,9%). Currently, utilisation is 90,9%.
  
• Textainer purchased the right to manage the Gateway fleet with effect from 1 July 2006, thereby increasing the fleet under management by 317 000 TEU (twenty-foot equivalent unit) to a total of 1 528 000 TEU.
  
• 63,6% of the 1 528 000 TEU were on finance lease or long-term lease.
  
• Gearing at 31 December 2006 was 181% (2005: 203%).
  
• Equipment purchases during the year amounted to 94 900 TEU.

TRENSTAR SA

• Operating in South Africa as a 100% subsidiary of Trencor, growth at TrenStar SA during 2006 was satisfactory with revenue increasing to R72 million (2005: R57 million).
  
• Profit before interest and tax improved to R9,8 million (2005: R3,5 million).
  
• The company has no external debt.

TRENSTAR INC

• Revenue for the year was US$65,6 million (2005: US$56,0 million).
  
• Net loss, including substantial restructuring costs and keg impairment losses, came to US$20,0 million (2005: loss US$9,9 million).
  
• Certain operations in the US continue to show promise. However, in the UK, higher beer keg losses due to theft, coupled with declining draught beer sales (on which TrenStar’s revenue is based) on the part of two of TrenStar’s larger UK brewer customers, have made the contracts between these customers and the TrenStar subsidiaries involved, uneconomic. Subsequent to the year-end and in order to facilitate a solution, the special purpose company that contracted with one of these customers was placed into administration and the contract has been terminated. It is likely that the contract with the other customer may be discontinued. With the loss of these contracts TrenStar’s goal of pooling and managing kegs for multiple brewers in the UK is no longer viable and it is possible that it will exit the beer keg business in the UK and Europe.
  
• These developments have negatively impacted TrenStar’s performance and hampered efforts to raise significant new equity to de-gear its balance sheet and improve profitability. Once the basis for exiting the beer keg business in the UK is firm, strategic alternatives for the future of TrenStar will be explored further.
  

POSSIBLE TERMINATION OF CONTRACTS AND GOING CONCERN CONSIDERATIONS

Please refer to note 40 of the annual report.

PROSPECTS

Current indications are a satisfactory increase in earnings in 2007.

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CONDENSED FINANCIAL STATEMENTS

As virtually all of the group’s revenue and assets and much of its expenditure are denominated in currencies other than rand (principally US dollars and UK pounds), condensed income statements and balance sheets are also presented in US dollars in order to provide a fuller appreciation of the group’s results and financial position. The rand values have been extracted from the audited financial statements. The dollar statements have not been audited.

CONVERSION OF CONVERTIBLE DEBENTURES

The total dividends declared in respect of 2006 (Trencor 57,0 cents per share and Mobile 4,55 cents per share) exceed the thresholds in terms of the debenture trust deeds. Accordingly, each Trencor debenture will be converted into one Trencor ordinary share and each Mobile debenture into three Mobile ordinary shares effective 25 May 2007.

VALUE ENHANCEMENT INITIATIVES

The two classes of ordinary shares in Mobile were effectively consolidated into one class on 12 March 2007. This, together with the conversion of the debentures referred to above, will reduce the current five investor entry points into Trencor to only two – one class of ordinary shares in each of Trencor and Mobile.

Investigations into value enhancement initiatives at the operational level indicate that an appropriate opportunity may be the listing of Textainer on an international stock exchange. This is being explored further and shareholders will be advised of developments.

SHARE INFORMATION
Share code: TRE
ISIN: ZAE000007506
Industry Classification Benchmark (ICB): Industrial/Industrial Goods & Services/Industrial Transportation/Transportation Services

ANNUAL GENERAL MEETING

The annual general meeting will be held on Wednesday, 23 May 2007 at 15:00 at 1313 Main Tower, Standard Bank Centre, Heerengracht, Cape Town.

DIRECTORS

ON BEHALF OF THE BOARD