RIVCO AUSTRALIA LTD — Net Asset Value 2018

Apr 8, 2018

$1.23

Net Asset Value per Share

DUXTON WATER LIMITED Monthly Update – 31 March 2018

The primary investment objective of Duxton Water is to generate annual income through capitalising on the increasing demand for scarce water resources. Duxton Water derives its income from a diversified portfolio of Australian Water Allocations and Water Entitlements.

DUXTON WATER

ASX Code (Shares)	D2O
ASX Code (Options)	D2OO
Shares on Issue	73,013,132
Options Outstanding	62,142,906
Options Exercise Price	$1.10
Options Expiry	31 May 2018

NET ASSET VALUE PER SHARE

Duxton Water’s NAV as at 31 March 2018 was $1.23 per share.

The after tax NAV figure takes into account the provision for deferred tax on set-up costs and estimates of net tax provisions that may arise should the entire portfolio be disposed of on the above date. These figures are not adjusted for any dilution due to the outstanding options which are exercisable at $1.10. NAV is calculated based on independent monthly portfolio valuation performed by Aither Pty Ltd (“Aither”).

NET ASSET VALUE PER SHARE – SINCE INCEPTION

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ENTITLEMENT PORTFOLIO
VALUE BY REGION
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1.30 1.25 1.20 1.15 1.10 1.05 1.00 0.95

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1% 2%
7%
8%
4%
78%
Murray Goulburn
Murrumbidgee Lachlan
Mallee Loddon
Macquarie
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PERFORMANCE

GAIN/LOSS

	PERFORMANCE	GAIN/LOSS
	1 Month	1.83%
	3 Months	4.20%
	6 Months	9.77%
	12 Months	13.83%
	Inception	14.90%
	Inception (+ franked distribution)	17.53%

WATER PORTFOLIO DIVERSIFICATION

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43%
57%
Leased Unleased
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MARKET UPDATE

Market Summary

Storage levels of the major dams within the Murray Darling Basin (MDB) decreased by 7.3% through March in line with seasonal water expectations. Total MDB storage levels were 23.4% lower than at the end of March 2017.

As a result of lower conveyance losses, on the 15[th] of March a further allocation was made to NSW Murray and Murrumbidgee General Security Holders of 2% and 4% respectively. Duxton Water benefited from this increase. No increases were made to other entitlements and the likelihood of further allocations prior to the start of the 18/19 Water year (1/7/2018) is low. Duxton Water presently has approximately 8.5GL of unleased water allocations available.

WATER SECURITY BREAKDOWN

Southern Basin

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2%
21%
76%
HS GS BORE
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The Hume and Dartmouth reservoirs closed the month at 41% and 89% of capacity respectively. Entitlement demand remained strong. NSW Murray Zone 10 General Security and VIC Murray (both Zone 6 & 7) High Security Entitlements an increase of 3% over February pricing. These Entitlements represent 10.5%, 13.2% and 14.2% of portfolio respectively. NSW Murrumbidgee High Security Entitlements increased by 2% (8.12% of portfolio) and the market saw a 1% increase in the Entitlement value of South Australian High Security (4.8% of portfolio). Temporary water prices rose on the back of final watering and carry over requirements.

Northern Basin

A further 7% increase was seen in the Lachlan General Security Entitlement values, which currently represent 6.09% of the portfolio.

DUXTON CAPITAL (AUSTRALIA) PTY LTD // DUXTON HOUSE, 7 POMONA ROAD STIRLING SA AUSTRALIA 5152 // (+61) 8 8130 9500

$1.23

Net Asset Value per Share

DUXTON WATER LIMITED

Monthly Update – 31 March 2018

INVESTMENT UPDATE

Permanent Water Acquisitions and Divestments

At 31 March 2018, Duxton Water is invested in approximately $95.7 million of water entitlements with the remainder of the portfolio held in cash and net current assets. Duxton Water holds contracts over a further $4.1 million of water entitlements at the 31[st] March 2018.

Temporary Water Sales

5,173ML of allocation were sold throughout March. The Company's yield from its unleased Entitlement will increase through the financial year as we divest the remainder of current held allocation and derive returns from the next water years allocations from the 1st of July.

The allocation sales to date for 2018 amount to 17,011 ML.

Lease Yield

No new leases were entered into in March.

57% of the Company's portfolio is leased with a weighted average yield of

6.20% and a weighted average lease duration of 5.25 years.

Total Yield

Duxton Water’s yield is comprised of two streams of income: leased and unleased income.

Assuming a steady state basis, the forecast annual gross yield to the end of 2018 will be 6.10%

(This is a forecast and actual results may vary).

Dividends

In line with the Company's goals of paying a dividend to shareholders biannually, the Company announced on the 7[th] March 2018 that it will pay its second dividend to its shareholders of 2.4 cents per share payable in Australian dollars. The dividend will be franked to 60% for Australian taxation purposes. The company affirms this dividend which will be paid on the 18[th] of April 2018.

Valuation Methodology

Aither undertake a monthly valuation of the Duxton Water portfolio. Total assets of the Company are valued based on an assessment of fair market value. Aither has adopted the Australian Accounting Standards Board (AASB) 13 Fair Value Measurement definition of fair value. Further information can be found on www.duxtonwater.com.au.

MARKET OUTLOOK

DUXTON WATER PORTFOLIO – SMDB EXPOSURE

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INFLOWS TO THE MDB

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4,500 10 Year Average
4,000
3,500
2017/2018
3,000
2,500
2,000
2016/2017
1,500
1,000
500
-
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The latest Bureau of Meteorology outlooks are suggestive of a drier Autumn and early winter with a neutral chance of median rainfall over the next quarter ( see chart below ).

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Storage Levels
Total Murray Goulburn 12 Month
Hume Prior
Lake Eildon Volume
Dartmouth
Total Murrumbidgee Current
Storage
Burrinjuck
Volume
Murrumbidgee
0% 20% 40% 60% 80% 100%
DISCLAIMER
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The chance of above-median rainfall for April - June2018
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This factsheet is prepared by Duxton Capital (Australia) Pty Ltd [ACN: 164 225 647; AFSL no. 450218] ("Duxton Capital (Australia)"). Duxton Capital (Australia) is the Investment Manager of Duxton Water Limited [ACN 611 976 517] (“Duxton Water”). This factsheet has been prepared for the purposes of providing general information only and does not constitute an offer, invitation, solicitation or recommendation with respect to the purchase or sale of any securities in Duxton Water. Information from this factsheet must not be issued in any jurisdiction where prohibited by law and must not be used in any way that would be contrary to local law or regulation. The terms of Duxton Water are set out in the prospectus of Duxton Water (“Prospectus”), and should there be any conflict between the terms set out in this factsheet and the Prospectus, the terms in the Prospectus shall prevail. The forecasts provided are based upon our opinion of the market as at this date and are subject to change, dependent on future changes in the market. Any prediction, projection or forecast on the economy, stock market, bond market or the economic trends of the markets is not necessarily indicative of the future or likely performance. Investments are subject to risks, including possible loss of principal amount invested. The value of shares/ units and their derived income may fall as well as rise. Past performance or any prediction or forecast is not necessarily indicative of future performance. No assurance is given that the investment objective or the targets will be met. This document does not constitute investment, tax, legal or any other form of advice or recommendation and was prepared without regard to the specific objectives, financial situation or needs of any particular person who may receive it. Investors should study all relevant information and consider whether the investment is appropriate for them. If you require investment or financial advice please contact a regulated financial adviser. No representation or warranty, either expressed or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein, nor is it intended to be a complete statement or summary of the securities, markets or developments referred to in this presentation. The Duxton Group or its affiliates may hold positions in the securities referred. Where stocks are mentioned, it should not be construed that these are recommendations to buy or sell those stocks. You are not authorized to redistribute this document nor qualified to make any offer, representation or contract on behalf of Duxton Capital (Australia) or its affiliates. Although the information was compiled from sources believed to be reliable, no liability for any error or omission is accepted by Duxton Capital (Australia) or its affiliates or any of their directors or employees. The information and opinions contained may also change. Copyright protection exists in this presentation. To the extent permitted by applicable law, none of the Duxton Group, their affiliates, or any officer or employee of the Duxton Group accepts any liability whatsoever for any direct or consequential loss arising from any use of this factsheet or its contents, including for negligence.

DUXTON CAPITAL (AUSTRALIA) PTY LTD // DUXTON HOUSE, 7 POMONA ROAD STIRLING SA AUSTRALIA 5152 // (+61) 8 8130 9500