To meet the many requirements of regulatory authorities, annual reports have become lengthy, complex and very technical. To provide a convenient overview of the 2008 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

• Trading profit from continuing operations after net financing costs (but excluding unrealised losses on derivative instruments in Textainer) increased by 27% from R733 million in 2007 to R932 million. After accounting for these unrealised losses, the increase was 20% from R675 million in 2007 to R810 million in 2008. These gains or losses are non-cash, non-operating items and Textainer intends to hold its interest rate swaps until maturity. Over the life of an interest rate swap held to maturity the unrealised gains or losses will net to zero.
  
• Headline earnings per share which includes net unrealised foreign exchange gains and losses as well as the group’s attributable share of unrealised losses on interest rate swaps in Textainer were 384,4 cents (2007: 212,9 cents).
  
• Adjusted headline earnings per share, which excludes net unrealised foreign exchange gains and losses and includes net gains and losses arising from the ongoing disposals of containers from Textainer’s leasing fleet, were 251,9 cents (2007: 214,0 cents).
  
• Net realised and unrealised foreign exchange gains arising on translation of net dollar receivables and the related valuation adjustments, not included in adjusted headline earnings per share, were R439 million or 169 cents per share (2007: loss R29 million or 11 cents per share).
  
• Consolidated gearing ratio at 31 December 2008 was 101% (2007: 92%). All of the interest-bearing debt is in Textainer, with no recourse to Trencor.
  
• Final dividend of 75 cents per share declared, making a total of 110 cents per share for the year (2007: total 80 cents per share), an increase of 38% over the previous year.
  

Textainer

• Net profit for the year excluding net unrealised losses on interest rate swaps was US$99,8 million, a 38% increase over the US$72,2 million earned in 2007. Net profit for the year was US$87,7 million (2007: US$66,6 million). Unrealised gains and losses on these interest rate swaps net out to zero over a period of time, if held to maturity, and have no effect on cash flow.
  
• While the overall demand for containers started to decline in the fourth quarter, utilisation of the fleet under management averaged 94,8% for the year (average for 2007: 93,9%).
  
• The container resale division had the best year in its history. Full year resale profit before tax of US$14,3 million exceeded last year’s record results by US$4,0 million, or 38%.
  

Prospects

The worldwide recession 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 Textainer’s seasoned management team will minimise the downside of these adverse trading conditions and take advantage of the opportunities these conditions may bring.

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), 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.

Profit attributable to equity holders of the company from the various classes of business
for the year ended 31 December 2008

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 Thursday, 11 June 2009 at 15:00 at 1313 Main Tower, Standard Bank Centre, Heerengracht, Cape Town.

Directors

Executive: N I Jowell ^{1 3 4} (Chairman) H R van der Merwe ¹ (Managing)
J E McQueen ¹
Non-executive: C Jowell ^{1 4}
Independent non-executive: H A Gorvy ^{2 4} (resigned 31 March 2009)
J E Hoelter ² (USA) D M Nurek ^{2 3 4} E Oblowitz ^2
1 Executive committee
² Audit committee
³ Remuneration committee
⁴ Nomination committee

On behalf of the board