Distribution
The Sep 2003 distribution amounted to 3.1184 cents per unit, (Jun 2003: 3.2901) bringing the distribution for the last four quarters to 13.9249 cpu, the current distribution when annualized represents a yield of 11.53%.

Future Income
Interest rates declined during the last quarter (a 1% cut in August) and further interest rate cuts are expected during this quarter ending Dec 2003. This decline in interest rates, as well as the final unwinding of some very high yielding fixed deposits, will result in a decline in cents per unit to be distributed for the quarter ending Dec 2003.

Capital
At the current asset allocation, 75% of the portfolio is invested in money market and fixed deposits with no risk of capital diminution. The rest of the portfolio is exposed to listed property. With the continued decline in interest rates, there is little risk of material capital decline although it is the fund manager's opinion that property stocks are fully valued.

Distribution
The June 2003 distribution amounts to 3.2901 cents per unit, (March 2003: 3.1455) bringing the distribution for the past 12 months to 12.9249 cents per unit, representing a yield of 12.17%.

Future Income
Interest rates dropped by 1.5% during the quarter. This, combined with the fact that a number of the deposits fixed at high rates will unwind during the next quarter, will result in a decline in the next distribution. A continuous trend of fixing cash for appropriate periods and the exposure of the fund to high yielding securities will ensure, however, that investors will receive a higher income flow than that received from retail cash deposits.

Capital
The fund's exposure to listed property securities provided for capital gains in the previous quarter of the year as income yields started to decline (there is an inverse relationship between yields and capital values - when yields fall, capital values rise). If interest rates fall further, the fund may experience further capital appreciation from the listed property component of the portfolio, although the fund manager's feel that property is fully priced at current levels, as well as the fact this represents less than 30% of the market value. The rest of the portfolio is invested in money market instruments where there is no capital appreciation or depreciation.

Distribution
The March 2003 distribution amounts to 3.1455 cents per unit, bringing the distribution for the past 12 months to 12.5582 cents per unit, representing a yield of 12%.

Future Income
Money market yields have already fallen on the expectation of lower inflation as the rand retraced all of its 2001 losses during the course of last year. The fund will however continue to enjoy yields in excess of 13.5% on the majority of its money market investments which were fixed at these rates for periods of up to a year. By the end of the year, these investments will have matured and the proceeds will in all likelihood be invested in lower-yielding money market instruments. This means that investors should expect the distributions from the Marriott Income Fund to decline marginally during the course of 2003 as long as interest rates continue to drop.

Capital
The fund's exposure to listed property securities provided for capital gains in the fourth quarter as income yields started to decline (there is an inverse relationship between yields and capital values - when yields fall, capital values rise). If interest rates fall further, the fund will in all likelihood experience further capital appreciation from the listed property component of the portfolio, although this represents less than 30% of the market value. The rest of the portfolio is invested in money market instruments where there is no capital appreciation or depreciation.

Distribution
The December 2002 distribution amounts to 3.6111c per unit, bringing the distribution for the year to 12.4627c per unit, representing a yield of 12%. The distribution was significantly higher than the previous quarter's as money market yields peaked at over 14%.

Future Income
Money market yields have already fallen on the expectation of lower inflation as the rand retraced all of its 2001 losses during the course of last year. The fund will however continue to enjoy yields in excess of 13.5% on the majority of its money market investments which were fixed at these rates for periods of up to a year. By the end of the year, these investments will have matured and the proceeds will in all likelihood be invested in lower-yielding money market instruments. This means that investors should expect the distributions from the Marriott Income Fund to decline marginally during the course of 2003 as long as interest rates continue to drop.

Capital
The fund's exposure to listed property securities provided for capital gains in the fourth quarter as income yields started to decline (there is an inverse relationship between yields and capital values - when yields fall, capital values rise). If interest rates fall further, the fund will in all likelihood experience further capital appreciation from the listed property component of the portfolio, although this represents less than 30% of the market value. The rest of the portfolio is invested in money market instruments where there is no capital appreciation or depreciation.