Half Yearly Report

31 March 2014

SOUTH AFRICAN PROPERTY OPPORTUNITIES PLC

('SAPRO' or the 'Group')

Interim results for the six months ended 31 December 2013

South African Property Opportunities plc (AIM: SAPO), an investment company established to invest in real estate opportunities in South Africa, announces its unaudited interim results for the six months ended 31 December 2013.

For further information please contact

Paul Fincham +44 (0) 20 7886 2713

Robert Naylor +44 (0) 20 7886 2714

Panmure Gordon

Ian Dungate/Suzanne Jones + 44 (0) 1624 692600

Galileo Fund Services Limited

A copy of the results announcement will be available on the Company's website at www.saprofund.com

Chairman's Statement

On behalf of the Board, I am pleased to present the interim results for South African Property Opportunities plc ("SAPRO" or "the Company") for the six months ended 31st December 2013.

The Company's strategy is to sell assets in an orderly fashion and to return the proceeds of such sales to shareholders. We have today announced a capital distribution of 9 pence per share following receipt of the proceeds of the sales of the Sandton assets.

Performance

As at 31st December 2013, the unaudited EPRA net asset value per share "NAV" (taking into account property revaluations, estimated sales and distribution costs) was 49 pence compared with 69 pence (as at 30 June 2013). The fall in NAV primarily relates to the capital payment of 10 pence per share made in August 2013, valuation falls totalling £957,000, or 1.5 pence per share, and foreign exchange losses of £6,207,000 or 9.9 pence per share. Between 30th June 2013 and 31st December 2013 the exchange rate moved from 15 ZAR/£ to 17.3 ZAR/£ and since 31st December the rate has moved to around 17.8 ZAR/£. The Company does not hedge its South African Rand exposure.

Bank borrowings have fallen from £1.41mn at 30th June 2013 to £25,000 and cash balances at the reporting date totalled £1.63mn.

South African Economy and Property Market

The Investment Manager reports on the South African economy in detail.

The South African economy continues to suffer from high interest rates, a weak currency and high inflation. In addition the South African market for development land has continued to suffer from a lack of demand and from chronic difficulties in provision of adequate infrastructure. Certain of the Company's assets are dependent on infrastructure improvements and in the absence of progress the Board is concerned that the market value of these assets is under threat. The general decline in investor appetite for emerging markets since the start of 2014 has further impacted on South Africa and the decline in the exchange rate reflects this.

Valuations

The portfolio was not revalued externally at 31st December, and the majority of figures adopted are the Broll (CBRE) numbers from June 2013. However the Board has elected to revise the valuation of certain properties to reflect specific sale discussions. In each case the Board believes that the expected price is the best achievable under current market conditions. The consequence of these changes is a fall of ZAR 16.6mn, or £957,000, in the portfolio value.

Sales

Despite the difficult market, a number of sales were contracted during the period, including at Kindlewood where 10 units were sold, at Imbonini including Acacia Park units, and at Kyalami (previously reported post balance sheet in June).

Final transfer and receipt of cash occurred at Imbonini, Acacia Park and Kindlewood. As announced on 17th March 2014 the sale of the Sandton assets has now completed with ZAR 134 mn received by the Company. Sales at Kyalami, Kindlewood and Acacia Park remain contracted, and are only subject to formal transfer.

Asset Management

Group Five's efforts continue to focus on improving the liquidity of the underlying assets through planning and infrastructure improvements. Where these cannot be achieved within an acceptable timescale, the Company may decide to sell in unimproved condition.

David Hunter

Chairman

31 March 2014

Report of the Investment Manager

South African Economy

The South African economy remains under pressure and has endured a period of instability. Rising interest rates are anticipated over the next 12 to 18 months which will place an added burden on the property sector. A 50 basis point jump from 8.5% to 9.0% occurred in January 2014 with expectations of a further 150 basis points forecast over the indicated period. The South African Rand (ZAR) continues to weaken and remains volatile to interest and inflation indices. Inflation remains in the upper extremities of the target range set by Government of between 3% and 6% with a level of 5.3% being recorded for December 2013. This has subsequently increased to 5.9% in February 2014.

Over the past 6 months to 31 December 2013, the rand weakened by 15.3% to Sterling (15.00ZAR to 1GBP to 17.29ZAR to 1GBP) and 6.6% to the US Dollar (9.86ZAR to 1USD to 10.51 ZAR to 1USD). The forecast to June 2014 suggests further weakening to 18.32ZAR to 1GBP and 10.95ZAR to 1USD.

Growth rates have slowed significantly to 0.7% in the 4th quarter 2013 and at 2.0% for calendar year 2013 and are predicted to remain below 2.0% over the next 24 months. Unemployment figures remained fairly flat for the reporting period at 24.5%.

Continued labour unrest, particularly in the mining sector, has a deteriorating effect on direct foreign investment. Significant issues around essential services such as power and water supply and distribution place the country at risk with planned power resources only set to come on line in 2015. This effects productivity levels and has a direct and adverse impact onto the property sector when trying to secure access to services.

Political elections will be held during May 2014. This has further impacted on the planned economic turn-around as alluded to in previous reports with very little progress to be shown to date on the governments infrastructure roll out plan.

Property Market

Difficulty of doing business, lengthy delays in the ability to secure rights and zoning approvals, the inherent lack of access to electricity and water are having a direct effect on the market.

The retail sector has seen focus starting to shift away from the South African Market to the African opportunities in both West and East Africa. Retailers, funds and developers have strategically established presence on the African continent in an attempt to combat the volatility in South Africa.

The demand for office space remains sluggish and continues to weigh down on rental growth. As always there are location specific exceptions to the above albeit limited.

Disappointing performances in both the manufacturing and retail markets imply continue weak growth for the industrial sector. In Q4 2013, market industrial rentals were only able to show growth of approximately 2% in the Johannesburg area with a weaker performance in Kwazulu Natal.

The residential sector has been able to show some marginal growth despite the adverse economic indicators. This is not expected to last however given that the consumer is under pressure and affordability is the main driver here. Disposable income has slowed to around 5%. Comparative values a year ago indicate a comparative level of around 11%.

Sale transactions for the six month period

Sales of ZAR 35.8m have been entered into in the six months to 31 December 2013 and proceeds have been received. The post balance sheet sales are also shown below and are anticipated to complete over the next six months or so as transfer takes effect. These consolidated sales are summarised as follows:

*Sales values above are either actual receipt values or are anticipated receipt values. Values in this table are shown before VAT but after sales costs. The Kindlewood value represents 100% of the receipts. SAPRO owns 89% of this asset.

Other sale assets worthy of mention - update

Valuation

Valuations are conducted by Broll (an affiliate of CBRE) on an annual basis at the end of June each year. The interim valuation is independently assessed by the Investment Manager and any proposed variations are then approved by the SAPRO Board. Overall the portfolio valuation declined by ZAR99.6m from ZAR492.7m to ZAR393.1m (20.2%) due to both sales / property transfers that had taken place in the period and due to a market assessment of the prevailing trading conditions. Of this value ZAR83.0m is attributable to sales and ZAR16.6m (3.4%) is attributable to negative market movements.

It should be noted that the Sandton and Longland assets were adjusted for valuation purposes in our report at the date which binding and unconditional offers were concluded. Proceeds for Longland were received in the period under review with proceeds for Sandton being received post balance sheet date.

Asset Management progress

Significant asset management initiatives are detailed below.

Portfolio Gearing

We are pleased to report that the portfolio has no debt on a post balance sheet basis. Debt at 31 December 2013 totalled ZAR 0.4m of which the SAPRO share approximated ZAR 0.35m.

Outlook

Harsh economic conditions, severe electricity restrictions and inefficient approval processes at local council level suggest a tougher outlook ahead which will in-turn place further pressure on market valuations. Despite this, a number of potential purchasers are busy with due diligence on some of the assets in the portfolio.

Our focus is to conclude on existing deals, to convert negotiations and discussions into meaningful and binding offers and to continue the zoning and approval processes where applicable.

Jon Hillary

Investment Manager

31 March 2014

Consolidated Income Statement

Consolidated Statement of Comprehensive Income

Consolidated Balance Sheet

Consolidated Statement of Changes in Equity

Consolidated Cash Flow Statement

Notes to the Financial Statements

1 General Information

South African Property Opportunities plc (the "Company") was incorporated and registered in the Isle of Man under the Isle of Man Companies Acts 1931 to 2004 on 27 June 2006 as a public limited company with registered number 117001C. On 7 January 2011 with the approval of Shareholders in general meeting, the Company was re-registered as a company under the Isle of Man Companies Act 2006 with registered number 006491v. South African Property Opportunities plc and its subsidiaries' (the "Group") investment objective is to achieve capital growth from a portfolio of real estate assets in South Africa.

The Company's investment activities are managed by Group Five Property Developments (Pty) Limited ("Group Five") ("the Investment Manager"). The Company's administration is delegated to Galileo Fund Services Limited (the "Administrator"). The registered office of the Company is Millennium House, 46 Athol Street, Douglas, Isle of Man, IM1 1JB.

Pursuant to a prospectus dated 20 October 2006 there was an authorisation to place up to 50 million shares. Following the close of the placing on 26 October 2006, 30 million shares were issued at a price of 100p per share.

The shares of the Company were admitted to trading on the AIM Market of the London Stock Exchange ("AIM") on 26 October 2006 when dealings also commenced. On the same date the shares of the Company were admitted to the Official List of the Channel Islands Stock Exchange (the "CISX").

As a result of a further fundraising in May 2007, 32,292,810 shares were issued at a price of 106p per share, which were admitted to trading on AIM on 22 May 2007.

The Company's agents and its Investment Manager perform all functions, other than those carried out by the Board's executive and non-executive directors. The Group has two employees.

Financial year end

The financial year end of the Company is 30 June in each year.

2 Summary of significant accounting policies

The accounting policies applied by the Group in the preparation of these condensed consolidated interim financial statements are the same as those applied by the Group in its consolidated financial statements for the year ended 30 June 2013.

2.1 Basis of preparation

These interim financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the European Union. They do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Group as at and for the year ended 30 June 2013 which have been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union.

The interim financial statements for the six months ended 31 December 2013 are unaudited. The comparative interim figures for the six months ended 31 December 2012 are also unaudited.

2.2 Critical accounting estimates and assumptions

Management makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year are addressed below:

(a) Going concern

These financial statements have been prepared on a going concern basis, which assumes that the Group will be able to meet its liabilities as and when they fall due for the foreseeable future.

The Directors have prepared forecasts that indicate that the Group will be able to meet its financial obligations from existing cash resources and the projected sales proceeds from sale of inventory.

(b) Estimated impairment of inventory, investment in associates and loans to associates

Valuations are conducted by Broll (an affiliate of CBRE) on an annual basis at the end of June each year. The interim valuation is independently assessed by the Investment Manager and any proposed variations are then approved by the SAPRO Board. These are used in conjunction with the strategic plan for each development in order to determine any impairment of inventory, investments in associates and loans to associates.

During the period there were no impairment charges in relation to loans due from associates (see note 10.2) and inventory (see note 12).

(c) Estimated impairment of goodwill

The Group tests annually for whether goodwill has suffered any impairment, in accordance with its accounting policy. The recoverable amount of the cash generating unit has been determined using fair value less cost to sell. This calculation requires the use of estimates, see note 11 for further details.

3 Segment Information

The entity is domiciled in the Isle of Man. All of the reported revenue, £1,470,328 (31 December 2012: £11,958,346), is from South Africa.

The total of non-current assets other than financial instruments is £1,005,798 (30 June 2013: £7,130,047) and all of these are located in South Africa.

For the six months ended 31 December 2013 revenues of £Nil (ZAR Nil) were derived from single external customers attributable to the Gosforth development (31 December 2012: £10,361,433 (ZAR 139,918,723)).

4 Operating leases

The Group leases out certain parts of its inventory under operating leases whilst it is in the process of seeking a buyer. The future minimum lease payments receivable by the Group under non-cancellable leases are as follows:

5 Cost of sales

6 Investment Manager's fees

Annual fees

The Investment Manager is entitled to a management fee of £290,000 per annum payable monthly in arrears. Management fees for the period ended 31 December 2013 paid to Group Five Property Developments (Pty) Limited amounted to £159,800 (ZAR 2,548,951) (31 December 2012: £250,423 (ZAR 3,381,664)).

During the period, pursuant to the investment management agreement, the Investment Manager was also entitled to recharge to the Group any costs and disbursements reasonably incurred by it in the performance of their duties, including costs of travel save to the extent that such costs are staff costs or other internal costs of the Investment Manager.

Sales fee

The Investment Manager was entitled to a sales fee of up to 3 per cent. of the gross proceeds on disposal of the Group's projects (such fee is net of external brokerage costs incurred). This fee has been eliminated under the new investment management agreement. These fees are payable on sale and have been considered when determining the net realisable value of the inventory (see note 12). Fees payable for the period ended 31 December 2013 payable to Group Five Property Developments (Pty) Limited and included in cost of sales amounted to £354,256 (ZAR 5,650,676) (31 December 2012: £220,397 (ZAR 2,976,202)).

Performance fees

The Group accrued a performance fee due to the Investment Manager based upon the market value of the portfolio which only became payable on the eventual sale of these assets so long as the sales values were better than certain agreed benchmarks. Under the new investment management agreement there is a performance fee to be calculated based on 1.5% on the net proceeds of the sale of each asset. The decrease in performance fees accrued for the period ended 31 December 2013 amounted to £93,055 (ZAR 1,618,153) (31 December 2012: decrease of £178,605 (ZAR 2,411,846)).

7 Other administration fees and expenses

Included within other administration fees and expenses are the following:

Directors' remuneration

The maximum amount of basic remuneration payable by the Company by way of fees to the Non-executive Directors permitted under the Articles of Association is £200,000 per annum. All Directors are each entitled to receive reimbursement of any expenses incurred in relation to their appointment. During the period of these accounts, the Non-executive Directors (excluding

the Chairman) were entitled to receive an annual fee of £40,000 each and the Chairman £75,000. From 1 July 2012 David Saville reduced his annual fee from £40,000 to £20,000. From 1 April 2013 the Chairman reduced his annual fee to £40,000, Stephen Coe reduced his annual fee to £35,000 and David Saville reduced his annual fee to £15,000.

Executive Directors' fees

The Executive Directors received annual basic salaries of £40,000. From 1 April 2013 John Chapman reduced his annual basic salary to £30,000. Pursuant to the terms of their service agreements, Craig McMurray and John Chapman are entitled to incentive payments of, respectively, 1.5 per cent. and 0.5 per cent. of all sums distributed to shareholders. Their service agreements also provide for payments of the same percentages, following termination of their employment, for distributions paid or payable from cash generated during their employment.

All directors' remuneration and fees

Total fees and basic remuneration (including VAT where applicable) paid to the Directors for the period ended 31 December 2013 amounted to £85,500 (31 December 2012: £117,000) and was split as below. Directors' insurance cover amounted to £15,870 (31 December 2012: £19,012).

8 Income tax expense

The tax on the Group's profit before tax is higher than the standard rate of income tax in the Isle of Man of zero per cent. The differences are explained below:

9 Basic and diluted loss per share

Basic loss per share is calculated by dividing the loss attributable to equity holders of the Group by the weighted average number of shares in issue during the period.

The Company has no dilutive potential ordinary shares; the diluted earnings per share is the same as the basic earnings per share.

10 Investments in and loans to associates

10.1 Investments in associates

The Group's stake in Longland Investments (Pty) Limited share of the results of its principal associates, all of which are unlisted, and its aggregate assets (including goodwill) and liabilities, is as follows:

10.2 Loans due from associates

11 Intangible assets

The above goodwill relates entirely to the Group's investment in the shares of Living 4 U Developments (Pty) Ltd, (the African Renaissance development). The recoverable amount of this cash generating unit has been determined using fair value less cost to sell. The recoverable amount has been assessed as £5,909,800 (ZAR 102,766,693). The key assumption used to determine the fair value less cost to sell is the third party valuation of the land held and is valued at £6,791,571 (ZAR 118,100,000) at 31 December 2013. Considering all factors within the calculation of the recoverable amount of this cash generating unit, the recoverable amount would have to fall by £618,765 (ZAR 10,759,844) before impairment would be required.

12 Inventories

Current assets

During the period, the Group capitalised costs of £88,204 (ZAR 1,406,934) (30 June 2013: £766,000 (ZAR 10,618,000)) in order to develop these assets for future re-sale, and accordingly they were classified as inventory.

At 31 December 2013 the net realisable values of Brakpan, Driefontein, Emberton, Gosforth, Kindlewood, Kyalami, Lenasia, Imbonini and Imbonini phase 2 were lower than cost, therefore their inventory values have been impaired to a value of £17,368,828 (ZAR 302,186,348) (30 June 2013: Brakpan, Driefontein, Emberton, Gosforth, Kindlewood, Kyalami, Lenasia, Imbonini and Imbonini phase 2 were lower than cost, therefore their inventory values were impaired to a value of £21,963,104 (ZAR 330,650,145)). Net realisable value has been assessed using valuations determined by Broll as at 30 June 2013 which have been updated by the directors to reflect current levels of interest and any potential offers from third parties less estimated selling expenses. Included within these selling expenses is a 3 per cent. sales fee due to the Investment Manager on disposal of inventory (see note 6).

The Directors consider all inventories to be current in nature. It is not possible to determine with accuracy when specific inventory will be realised, as this will be subject to a number of issues such as availability of finance and delays due to obtaining permits.

Security

At 31 December 2013, there is one first rank mortgage secured over the inventory held by Kindlewood, in respect of debt totalling £25,000, which totals £3,523,353 (ZAR 61,300,000) (30 June 2013: Kindlewood £4,071,791 (ZAR 61,300,000)) (see note 19).

13 Trade and other receivables

The fair value of trade and other receivables approximates their carrying value.

14 Cash at bank

Included within the bank deposit balances figure is an amount of £5,261 (ZAR 91,539) (30 June 2013: £55,621 (ZAR 837,370)) represented by bank guarantees retained by the bank under fixed deposit (detailed below). This is the only figure excluded from the above balances for analysing the movements of cash and cash equivalents in the cash flow statement.

Bank guarantees

The subsidiary SAPSPV Holdings RSA (Pty) Ltd has a contingent liability of £5,261 (ZAR 91,539) (30 June 2013: £55,575 (ZAR 836,671) in connection with senior debt obligations of its associate Imbonini Park (Pty) Ltd.

15 Share capital

The holders of Ordinary Shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company.

Business Venture Investments No 1269 (Pty) Limited (the Wedgewood development) has issued preference shares ZAR 100 to its minority holders. The holders of the preference shares are entitled to the first ZAR 22,000,000 (£1,603,475) in dividends declared by Business Venture Investments No 1269 (Pty) Limited.

16 Net asset value ("NAV") per share

The NAV per share is calculated by dividing the net assets attributable to equity holders of the Group by the number of ordinary shares in issue.

The Group publishes an adjusted NAV that is calculated in accordance with the guidelines of the European Public Real Estate Association ("EPRA"). The primary difference between EPRA and IFRS is that, in general, under IFRS the Group's development properties are classified as inventory and held at the lower of cost and net realizable value, while EPRA permits the incorporation of open market valuations. In order to produce the EPRA numbers the Group has retained Broll's Johannesburg office to conduct annual valuations, which are reviewed and adjusted by the directors for the interim accounts. The EPRA numbers incorporate the adjusted Broll valuations and are net of tax.

The below figures also take into consideration any profit share agreements with development partners, fees due on sale of properties (see note 6) and incentive fees due to the Executive Directors (see note 7).

17 Loans from third parties

The loans from third parties are as follows:

* in relation to its 50 per cent. interest in subsidiary company, Madison Park Properties 40 (Pty) Ltd, and the Brakpan development.

** in relation to its 25 per cent. interest in subsidiary company, Breeze Court 31 (Pty) Ltd, and the Starleith development.

All of the above loans are unsecured and carry no fixed terms of repayment.

The fair values of these loans approximate their carrying value.

18 Trade and other payables

The fair value of trade and other payables approximates their carrying value.

19 Borrowings

Current liabilities

Terms and debt repayment schedule:

* relates to the Kindlewood development, a mortgage bond has been registered over the Kindlewood property.

The fair value of the borrowings approximate their carrying value.

20 Contingent liabilities and commitments

As at 31 December 2013 the Group has contingent liabilities which have corresponding bank guarantees. See note 14 for further details.

21 Related party transactions

Parties are considered to be related if one party has the ability to control the other party or to exercise significant influence over the other party in making financial or operational decisions.

The Investment Manager, Group Five Property Developments (Pty) Limited, and the Directors of the Company are considered to be related parties by virtue of their ability to make operational decisions for the Group. Fees in relation to the Investment Manager are disclosed in note 6 and fees in relation to the Directors are disclosed in note 7.

Group Five Property Developments (Pty) Limited is a related party to Group Five Construction (Pty) Limited, which is a partner in the Wedgewood and Starleith developments. There is a loan in respect of the Starleith development which is disclosed in note 17.

Related party transactions with associates are disclosed in note 10.

The principal subsidiary undertakings within the Group as at 31 December 2013 are:-

* this also represents the percentage of ordinary share capital and voting rights held

** the Group controls the company by means of direct control of the board

22 Post balance sheet events

Proceeds of ZAR 18 million of the Starleith portion of the Sandton sale have been received.

Proceeds of ZAR 106 million of the Wedgewood portion of the Sandton sale have been received.

A return of capital of 9 pence per ordinary share will be paid, representing the cash proceeds available for distribution from the portfolio to date.

Shareholders should take note of the following dates in respect of this return of capital payment:

Ex-dividend date: 9 April 2014

Record date: 11 April 2014

Payment date: 23 April 2014