KAMCO Investment Company K.S.C.P. and Subsidiaries INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) PERIOD ENDED 30 SEPTEMBER 2019_—_ Eins Young Tet: 496522955000, A Aba, Al Osan & Panes Faces 22456019 PO.Box 78 wateieycom Building a better 1620 Foor, Batak Tower feycomimena working world Ahmed Alber Steet Safa Square 3001 Kuwale REPORT ON REVIEW OF INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION TO BOARD OF DIRECTORS OF KAMCO INVESTEMENT COMPANY K.S.C.P. Introduction We have reviewed the accompanying interim condensed consolidated statement of financial position of KAMCO Investment Company K.S.C.P. (the “Company”) and subsidiaries (collectively the “Group”) as at 30 September 2019, and the related interim condensed consolidated income statement and interim condensed consolidated statement of comprehensive income for the three-month and nine-month periods then ended, and the related interim condensed consolidated statement of changes in equity and interim condensed consolidated statement of cash flows for the nine-month period then ended. The management of the Company is responsible for the preparation and presentation of this interim condensed consolidated financial information in accordance with the basis of presentation set out in Note 2. Our responsibility is to express a conclusion on this interim condensed consolidated financial information based on our review. Scope of Review We conducted our review in accordance with International Standard on Review Engagements 2410, “Review of Interim Financial Information Performed by the Independent Auditor of the Entity”. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obt assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion, Conclusion Based on our review, nothing has come to our attention that causes us to believe thet the accompanying interim ‘condensed consolidated financial information is not prepared, in all material respects, in accordance with the basis of presentation set out in Note 2. Report on Other Legal and Regulatory Requirements Furthermore, based on our review, the interim condensed consolidated financial information is in agreement with the books of accounts of the Company. We further report that, to the best of our knowledge and belief, we have not become aware of any violations of the Companies Law No. 1 of 2016, as amended, and its executive regulations, as amended, or of the Company's Articles of Association and Memorandum of Incorporation, during the nine-month period ended 30 September 2019 that might have had a material effect on the business of the ‘Company or on its financial position. We further report that, during the course of our review, to the best of our knowledge and belief, we have not become aware of any violations of the provisions of Law No. 32 of 1968, as amended, concerning currency, the Central Bank of Kuwait and the organisation of investment business, and its related regulations, of of the provisions of Law No. 7 of 2010 concerning the Capital Markets Authority and its related regulations during the nine-month period ended 30 September 2019 that might have had a material effect on the business of the Company or on its financial position. i BADER A. AL-ABDULIADER LICENCE NO, 207 A EY AL AIBAN AL OSAIMI & PARTNERS. 31 October 2019 KuwaitKAMCO Investment Company K.S.C.P. and Subsidiaries INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED) Asat 30 September 2019 30 September 2019 Notes KD ASSETS Cash and cash equivalents 3 47,867,192 Loans and advances 6,065,393 Financial assets at fair value through profit or oss 23,630,713 Financial assets a far value through other comprehensive income 4 10,889,046 Financial assets at amortized cost 36,000 Investment in associates 22,503,037 Other assets 5 15129367 Investment properties 659,000 Property and equipment 11,526,721 Intangible assets 4,153,067 TOTAL ASSETS 142,509,536 LIABILITIES AND EQUITY LIABILITIES Loans| 23,922,855 Bonds 40,000,000 Other liabilities 20,270,497 ‘TOTAL LIABILITIES 84,193,352 EQUITY Share capital 26,330,175 Share premium 9,089,045 ‘Treasury shares 6 42,795,688) Statutory reserve 12,450,271 Voluntary reserve 1,008,953, ‘Treasury shares reserve 1,383,134 ‘Cumulative changes in far values (6581,113) Foreign currency translation reserve (684,924 Retained earnings 4,721,873, Equity attributable to equity holders of the Company 33,261,274 Non-controlling interests 25,054,910 ‘TOTAL EQUISY 58,316,184 ‘TOTAL LIABILITIES AND EQUITY 142,509,536 ZEEE aa TTT cams (Audited) 31 December 2018 20,533,532 150,000 21,707,005 1357244 657,000 11,837,494 4409867 141,968,871 17,080,391 440,000,000 25,170,135 9,089,045 (12,795,688) 12,450,271 1,008,953 1,383,134 (3.127.134) ‘se2415 769,206 35,690,377 24,027,968, 59,718,345 141,968,871, ‘The attached notes 1 to 16 form part of this interim condensed consolidated financial information, 2 30 September 2018 KD 44,576,722 6,216,877 25,027,278 21,254,739 149,521 23,001,751 15,912,788 691,000 8,148,571 144,979,247 18,112,992 40,000,000 27,984,612 86,097,604 26,330,175 9,089,045 (12,795,688) 12,175,734 734416, 1,383,134 (2,954,163) 975,354 183,764 35,121,771 23,759,872 58,881,643, 144,979,247KAMCO Investment Company K.S.C.P. and Subsidiaries INTERIM CONDENSED CONSOLIDATED INCOME STATEMENT (UNAUDITED) For the period ended 30 September 2019 Notes Fee income Realised gain on sale of financial assets at fair value through profit or loss Unrealised (loss) gain on financial assets at fair value through profit or loss Gain on fair valuation of investment in associates on reclassification to financial assets at fair value through other comprehensive income [Net gain arising from non-current assets classified as held for sale/ gain on disposal of non-current assets exclusively acquired for sale 10 Share of results of associates Dividend income Interest income Foreign exchange gain Bargain purchase gain Other income Income General and administrative expenses Finance costs Reversal of provision on loans and advances Charge for provision for other financial assets Expenses PROFIT FOR THE PERIOD BEFORE "TAXATION Tax reversal (expense) 7 PROFIT FOR THE PERIOD Attributable to: Equity holders of the Company ‘Non-controlling interests Basic and diluted (loss) earnings per share attributable to equity holders of ‘the Company 8 Three months ended Nine months ended 30 September 30 September 2019 2018 2019 2018 KD KD KD KD 4,342,808 2,336,807 13,018,476 6,116,267 196,121 134,438 794,395, 402,143 272,962) (510,021) 394,186 (721,218) : : 9.345 : 22,123 114028 138,349 (257,842) 265,674 937,913, 655,866 222,361 33,958 1,073,545, 274,506 434,498 243,439 1,170,362, 363,083 ‘$5,191 71,493, 38,399 100,922 - 1,108,271 - 1,108,271 215,874 80,363, 687,054 94,322 4,936,049 (3,786,545 18,228,358 8,561,856 4,016,845 2,415,112 13,884,669 6,164,091 891,803 656,874 2,607,386 1,234,240 (7,000) : (290,000) . 29,000 : 108,000 : 4,930,648 3,071,986. 16,310,055 7,398,334 ‘5,401 714,559 1,918,303, 1,163,525 9,538 (76,271) (41,735) (110,377), 14929 638,288 1,876,568 1,053,148 (178,284) 635,360, 932,036 1,056,767 193,223 2,928 944,532 3,619) 14939 638288 1,876,568 1,053,148 (0.75) fils 2.68 fils 3.93 fils 4.45 fils ‘The attached notes 1 to 16 form part of this interim condensed consolidated financial information. 3KAMCO Investment Company K.S.C.P. and Subsidiaries INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) For the period ended 30 September 2019 Three months ended Nine months ended 30 September 30 September 2019 2018 2019 2018 KD KD KD KD Profit for the period 14,939 638,288 1,876,568 1,053,148 Other comprehensive income (loss): tems that are or may be reclassified in subsequent periods to the interim condensed consolidated income statement: Share of other comprehensive income (loss) of associates. 19,904 9,103 19377 (178,561) Foreign currency translation adjustments 66,694 (21,795) 72,509 138,734 86,598 (12,692) 92,086 (39,827) tems that will not be reclassified tothe interim condensed consolidated income statement: ‘Net loss on equity instruments at fair value through, other comprehensive income (1,185,159) (794,860) _@,789,974) (2,910,838) Total other comprehensive loss for the period (1,068,561) (807,552) (3,697,888) (2,950,665) Total comprehensive loss for the period (1,053,622) (169,264) (4,821,320) (1,897,517) Attributable to: Equity holders of the Company (1,269,085) (118,570) @,429,103) (1,764,120) Non-controlling interests 215,463 (50,694) 607,783 (133,397) (1,053,622) (169,264) (1,821,320) (1,897,517) ‘The attached notes | to 16 form part of this interim condensed consolidated financial information. 4s "TOTEUIOFUYTeisu PSIUPITOSTOS POSTEPUON WATT Sp Fo WET UGG OT OF T SHOU payoeAE ATL swo'lew'es— cuvesc'ec wrest BSUS (Gor eSGT) per SUL RESET G'S6U'T)— SwroRTS — SLroceIe ‘102 quoniss o¢ 1 sv - 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Hast, om niod Burg “spud yons Sq poouonyr Ajpuwoytiis 10 In ued woued aqp wasaudar sopzed poy} SNOLLVSNVUL AVE CILV TA 1 6107 soquioidas og 1 SW (daLianvnn) NOLLWAYOANI TVIONVNIA GALVCITOSNOD GASNAGNOD WIALNI AHL OL SALON SOURIPISANG pur “g')'S"y AUedwioD yuouNseAu] OCOWVYKAMCO Investment Company K.S.C.P. and Subsidiaries NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at and for the period ended 30 September 2019 13 RELATED PARTY TRANSACTIONS (continued) ‘Key management personnel compensation: Nine months ended 30 September 2019 2018 KD KD Short-term employee benefits 1,223,506 654,707 ‘Termination benefits 141,024 130,774 1,364,530 785,481 14 SEGMENT INFORMATION ‘The Group is organised into four major business segments based on internal reporting provide to the chief operating decision maker. The Group does not have material inter-segment transactions. The principal activities and services under these segments are as follows Financial services Financial services provide a full ange of corporate finance services, including mergers and acquisitions, underriting, private placements, project and investment evaluation and consulting ‘Asset management ‘Asset management services cover both local and intemational markets and include securities trading, derivatives trading, discretionary and non-discretionary portfolio management, custody services, portfolio structuring, asset allocation advice, mutual funds and alternative instrument. Brokerage Quoted and umquoted equity and debt instruments brokerage activities and margin financing. Strategic investments and corporate overheads Strategic investments include investments which are long term in nature and are aligned with the Group’s long-term strategy. Corporate overheads include all support services Management monitors operating segments separately forthe purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on segmental return on investments 14KAMCO Investment Company K.S.C.P. and Subsidiaries NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at and for the period ended 30 September 2019 14 SEGMENT INFORMATION (continued) ‘The following table presents total revenue, profit (loss) for the period, total assets and total liabilities information regarding the Group's operating segments, Nine months ended 30 September 2019 Strategic investments Financial Asset ‘and corporate services management Brokerage overheads Total KD KD KD KD xD Total revenue 294302 4,980,554 1,195,000 14,758,502 18,228,358, (Loss) profit for the period (215,909) 2,206,697 207,000 G21.220) 1,876,568 Total assets a 41,321,352 18,448,000 82,740,184 142,509,536 ‘Total liabilities 13,496,436 686,000 184,193,382 Nine months ended 30 September 2018 Strategic investments Financial Asset ‘and corporate services management Brokerage overheads Total KD KD KD KD KD Total revenue 1,010,015 4,156,123 189,000 3,206,718 8,561,856 Profit (loss) for the period 437,006 1,710,316 116,000 (4,210,174) 1,053,148 Total assets 108,477 44,901,670 _ 19,757,378 80,211,722 144,979,247 ‘Total liabilities 15KAMCO Investment Company K.S.C.P. and Subsidiaries NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at and for the period ended 30 September 2019 15 FAIR VALUE OF FINANCIAL INSTRUMENTS. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in orderly transactions between market participants at the measurement date. Underlying the definition of fair value is the presumption that the Group is a going concern without any intention, or need, to liquidate, curtail materially the scale of its operations or undertake a transaction on adverse terms. Financial instruments comprise of financial assets and financial liabilities. For financial assets and financial lisbiltes that are liguid or having a short-term maturity, the carrying amount approximates their fair value Fair value hierarchy ‘The Group uses the following hierarchy for determining and disclosing the fair values of financial instruments by valuation technique: Level 1 - Quoted (1inadjusted) market prices in active markets for identical assets or liabilities; » Level 2- Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable. The following table shows an analysis of financial instruments recorded at fair value by level ofthe fair value hierarchy: Level I Level 2 Level 3 Total 30 September 2019 KD ‘AD KD xD Financial assets at fair value Financial assets at fair value through profit or loss: ‘Quoted equities 1,875,114 - : 1,875,114 Quoted debt securities 3,120,556 : : 3,120,556 ‘Unguoted equity : - 341,620 341,620 ‘Unquoted debt securities - - 250,000 250,000 “Managed funds 319314 4304,109 18,043,423, 5,314,984 95,729 23,630,713 Financial assets at fair value through other comprehensive income: Quoted equities 97,203 - - 97,203 Unquoted equities : : 10,486,981 10,486,981 Managed funds 7 : 304,862 304,862 97,203 - 10,791,843 10,889,046 16KAMCO Investment Company K.S.C.P. and Subsidiaries NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at and for the period ended 30 September 2019 35 FAIR VALUE OF FINANCIAL INSTRUMENTS (continued) Level 1 Level 2 Level 3 Total 30 September 2018 KD KD KD KD Financial assets at fair value Financial assets at fair value through profit or lass Quoted equities 1,182,959 - : 1,182,959 Quoted debt securities 2,030,746 - - 2,030,746 Unquoted equity - ~ 449,946 449,946 ‘Managed funds : 13,167,000 8,196,627 21,363,627 3,213,705 13,167,000 8,646,573. 25,027,278 Financial assets at fair value through other comprehensive income: Equities 4251,771 : 16,706,302 20,958,073 Managed funds : : 296,666 296,666 4,251,771 - 17,002,968 21,254,739 7,465,476 13,167,000 25,649,541 46,282,017 ‘The following table shows a reconciliation of the opening and closing amount of level 3 financial instruments which are recorded at fair value: Loss recorded in the Net Recognised in As at consolidated purchases, other As at J January income sales, transfers comprehensive 30 September 2019 Statement and settlements income 2019 KD KD KD KD KD Financial assets at fair value through profit or loss: ‘Unquoted equity 351,978 (10,358) = - ‘Unquoted debt - : 250,000 7 Managed funds 5,380,456 (585,664) (490,683) - 5732434 (696,022) (240,683) : Financial assets at fair value through other comprehensive income ‘Unquoted equities 15,842,829 Z (1,697,818) 3,658,030) 10,486,981 ‘Managed finds 306,666 : - (1804 304,862 16,149,495 . (1,697,818) 3,689,834) 10,791,843 ‘The impact on the interim condensed consolidated statement of financial position and the interim condensed consolidated statement of income would be immaterial ifthe relevant risk variables used to fair value the unquoted securities and unquoted funds managed by external fund managers were altered by 5%. 7KAMCO Investment Company K.S.C.P. and Subsidiaries NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) ‘As at and for the period ended 30 September 2019 16 PROPOSED MERGER On 4 July 2019, the Board of Directors of KAMCO Investment Company K.S.CP. (*KAMCO”) and Global Investment House K.S.C.C. (“GIH") have voted unanimously to recommend to shareholders a merger of the two entities, Subsequently, on 17 September 2019, the proposed merger (the “Merger”) of KAMCO and GIH was approved by the shareholders at the Extraordinary General Assembly Meeting to be effected by way of @ merger pursuant 10 the provisions of Module Nine ("Mergers and Acquisitions") of the Executive Bylaws of Law No. 7 of 2010 on the Esablishment of the Capital Markets Authority and Regulation of the Activity of Securities and their Amendments, and the provisions of Article 259 of the Companies Law No. 1 of 2010 and its executive regulations, through the issuance of 0.75522821 new KAMCO shares for every I share in GIH subject tothe terms and conditions of the Merger ‘and with effect from the Merger becoming effective ‘The share capital of the merged Company would increase from 263,301,750 shares to 342,332,633 shares. As at the date of approval of the interim condensed consolidated financial information, the legal formalities of the ‘merger are under process.