Ann: Monthly Update - July 2019, page-6

@F01

I’ve had a preliminary look at the Company’s available information, and the first set of questions I have for you is about the investment return one can reasonably expect from this sort of business, in the medium/long term.

1) If water entitlements are typically leased out at yields of around 6% pa (historical average), and before factoring in any NAV revaluation due to water price movements, is it fair to say that the long-term IRR of the equity will also be around 6% pa, if the Company aims at being a) debt-free, and b) leased out on the vast majority of the entitlements held?

2) Looking at the historical series of RoA for the existing entitlements portfolio (from the CBRE report attached to the Prospectus), what sort of risk premium do you think is appropriate to account for the significant variance of returns exhibited in the past (especially in view of current water allocation prices not being historically low)?

3) What sort of additional risk premium do you think it is fair to require to factor in political/legislative risk?

Cheers