Chairman's Statement

The results for 2008 have been very pleasing. Trading profit net of financing costs increased by 20% to R810 million. These excellent results are mostly due to the outstanding performance of Textainer, our container leasing business, operating worldwide with headquarters in Bermuda and administration carried out in San Francisco.

Adjusted headline earnings best reflects our sustainable performance. This measure includes, inter alia, net gains and losses arising from the ongoing disposals of containers from Textainer’s leasing fleet but excludes unrealised foreign exchange translation gains and losses. For the year these earnings amounted to 251,9 cents per share, an increase of 18% over last year.

Headline earnings per share, which includes net unrealised foreign exchange translation gains and losses and excludes gains on container sales, were 384,4 cents, an increase of 80% over 2007. These differing measures are better reflected in tabular form:

	2008	2007
	Cents per share	Cents per share
Headline earnings	384,4	212,9
Add/(Deduct):
Various TrenStar adjustments	–	(44,3)
Net gains on container sales	36,4	34,4
Foreign exchange translation (gains)/losses	(168,9)	11,0
Adjusted headline earnings	251,9	214,0

Textainer
In its first full year as a listed company on the New York Stock Exchange, Textainer delivered an outstanding performance, earning US$99,8 million (US$2,10 a Textainer share) before charging net unrealised gains and losses on interest rate swaps. This is a 38% improvement on earnings of US$72,2 million in the previous year. Highlights of the year were:

renewing and expanding debt facilities; available credit now totals US$680 million;
originating of long-term leases of containers amounting to 212 000 TEU (twenty-foot equivalent unit);
successfully entering the refrigerated container market; and
achieving an average fleet utilisation of almost 95% for the year.

Dividend
The satisfactory ongoing collection of Trencor’s long-term receivables together with Textainer’s excellent management of working capital provided a strong boost to the group cash flow. Cash balances at the ‘centre’ were enhanced by an increased dividend from Textainer. On the other hand, the world’s financial situation and tight credit markets, together with the stated policy of Textainer and Trencor to pursue acquisitions which we believe may arise this year make it advisable to conserve cash. Taking into account all these factors and also considering the low leverage in the group, the board declared a final dividend of 75 cents per share making a total of 110 cents in respect of 2008, an increase of 38% over last year.

Strategy
As noted in the last two annual reports, it has been and remains our strategy to invest in existing businesses involved in the movement of goods and to include in our activities similar businesses that have the potential to render acceptable returns. We have pursued this policy, and Trencor is now essentially an investment holding company. Its core focus is owning, leasing, managing and reselling marine cargo containers worldwide as well as finance related activities.

Group structure
Having listed Textainer, we reviewed the need for continuing the existing listed corporate structures and explored the possibility of Trencor unbundling its shares in Textainer. The conclusion, after canvassing our professional advisers as well as major shareholders is that the current structure holds significant advantage for Trencor, Textainer and Mobile Industries as well as for their respective shareholders and should accordingly be retained for the time being.

We considered, inter alia, tax, exchange control restrictions on holding foreign shares and the benefits of a stable and established corporate structure. Particular weight was given to avoiding negative effects that may result from unsolicited corporate activity, the more so in a business such as Textainer that is particularly management intensive and heavily reliant on its team for success.

Textainer is an excellent investment and the retention of Trencor as its holding company provides SA shareholders the unique opportunity to invest in a NYSE listed company using rand and without resorting to their offshore investment allowances.

Most of these factors relate to Trencor’s interest in Textainer but also, of course, directly affect Mobile’s shares. In particular, Mobile’s shareholding in Trencor is an integral part of the stability afforded by the structure and we believe is, at this stage, to the benefit of Trencor and Textainer and their shareholders.

Prospects
The worldwide liquidity crisis that began in 2008 has, of course, impacted on our container leasing customers. Freight volumes have declined as have freight rates leading to lower utilisation, increased costs and reduced margins. We anticipate that our seasoned management team will minimise the downside of these adverse trading conditions and take advantage of the opportunities these conditions may bring.

Appreciation
It is with regret that we announce the resignation of Harold Gorvy from our board. He has reached an age where he has decided to retire. His association with Trencor began before our listing on the JSE in 1956; first as our auditor and then as director when he retired from the audit profession. His understanding of finance was of the highest order and he always gave of his best with great integrity and a sure grasp of what was right and wrong in the often ambiguous world of business. We shall miss him greatly and wish him well.

To my colleagues on the board, I thank them for their guidance in overseeing the affairs of the group and to Trencor’s people, most of whom are located outside South Africa, I express my appreciation for the contribution they have made to our group.

N I Jowell
31 March 2009