Interim Management Statement

MEIKLES LIMITED INTERIM MANAGEMENT REPORT This Interim Management Statement is issued by Meikles Limited in accordancewith the UK Listing Authority's Disclosure and Transparency Rules. Unlessstated otherwise, key trends and figures highlighted below refer to the threemonths ended 30 June 2013 and the corresponding period in the previousfinancial year. Operating environment Zimbabwe approved a new constitution in March 2013 followed by harmonizedelections on 31 July 2013. The period leading up to and after these legislativeprocesses was largely peaceful and did not disrupt our businesses as was thecase in previous harmonized elections. However, business across the boardslowed down, while these processes were underway. The markets became moreilliquid; turnover on the stock market reduced, bank deposits decreased and itwas reported by Confederation of Zimbabwe Industries that capacity utilisationdropped to 45% from 55% in 2012. The period post the elections is yet tounravel as the country awaits the inauguration of the President and theformation of a new government and cabinet. Operations update Tanganda Tea Company Tanganda had a good first quarter aided by friendly weather patterns whichcontinued from the end of the last financial year. As a result, tea productionwas 33% higher than same period in 2012. The company also implementedpreventative measures to safeguard the crops from a severe winter and thesemeasures yielded the desired results. The global average bulk tea prices were 15% up when compared with thecorresponding quarter in 2012. The beverage tea sales in the local marketslowed down in the first quarter whilst the regional sales in Namibia andZambia increased. New markets for packeted tea in South Africa, Mozambique andBotswana are being developed. A new state of the art tea packing plant has beenordered to cater for the expanded regional markets and expected increase inlocal packeted tea volumes. The young plantations of coffee, macadamia and avocadoes planted in previousperiods are doing well. Land preparation continued in the first quarter andfurther plantings are expected to commence before the end of the secondquarter. Purified spring water production has vastly improved and volumes forthe quarter were 59% higher than those of the comparative period. TM Supermarkets Trading in TM Supermarkets was within expectations for the quarter ended 30June 2013. Turnover grew by 5% compared to the corresponding period in 2012.Year on year inflation was at 1.87% as at 30 June 2013. The gross margins aresimilar to those achieved in prior periods. The branch refurbishment is continuing with work currently underway at theMasvingo, Gweru and Harare CBD branches. The Supermarkets division added twonew trading operations in July 2013 bringing its stores portfolio to 51. Apartfrom the refurbishment of existing branches, at least two new branches will beadded to the portfolio by the end of the current financial year. Thomas Meikle Stores In TM Stores, the trading remains subdued as reported in previous statements.In spite of the improvement in our stocking and merchandise, the turnoverlevels are still below sustainable levels due to the challenges in the economicenvironment characterized by low disposable incomes and absence of creditfunding. The company continues to make progress on cost management and achieveda 10% reduction in operating costs during the quarter and, more efforts toreduce costs and stream line the business are currently in progress. Meikles Hospitality The Hospitality operations registered a 3% decrease in turnover compared toprior period. The legislative processes mentioned earlier affected occupancylevels as the international business travelers and tourists adopted a "wait andsee" attitude given experiences of past elections. The UNWTO General Assemblywill be taking place from 24 to 29 August 2013 and the country will take thisopportunity to showcase its tourist attractions in an environment of peace andtranquility. We therefore expect the occupancy levels to improve in futureperiods following this conference which is being co-hosted with Zambia. The refurbishment of the North Wing at the Meikles Hotel will be completed by31 August 2013. The first phase of the refurbishment at the Victoria FallsHotel is also nearing completion. At both hotels, the outcome of theserefurbishments has surpassed our expectations and created a truly magnificentproduct which we hope our guests will enjoy. Funds held on deposit with the Reserve Bank of Zimbabwe (RBZ) Progress has been made in getting better terms on the funds held on depositwith the RBZ. The discussions are nearing conclusion and will result in ahigher interest being accrued on the deposit, with a retrospective implication. Resources The shareholder agreements pertaining to mining in partnership with Centar wereconcluded in June 2013 resulting in the formation of a new company, MeiklesCentar Mining (Private) Limited. The company has since been licensed by theZimbabwe Investment Authority and is awaiting other regulatory approvalsfollowing which various mining projects will be pursued. Funding The Group has secured long term funding for all its projects being therefurbishment of the Hotels, the plantation development in Tanganda and therefurbishment and outfitting of new stores in TM Supermarkets. This funding isin line with the Group's financing policies, previously disclosed toshareholders. Outlook The Group is working on various initiatives to safeguard and improve itsperformance for the betterment of all stakeholders. We expect the newgovernment to play its part by putting in place policies that promote aconducive economic environment to attract both local and foreign investors. END Issued on 15 August 2013 Notes: 1. The financial information on which this statement is based has not beenreviewed and reported on by the Group's auditors. 2. Please note that matters highlighted above may contain forward lookingstatements which are subject to various risks and uncertainties and otherfactors, including, but not limited to: - business conditions. -political environment -market related risks. • A number of these factors are beyond the Group's control. • These factors may cause the group's actual future results, performance orachievements to differ from those expressed or implied. • Any forward looking statements made are based on the knowledge of the Groupas at 15 August 2013.