Interim Management Statement

17 February 2011

Interim Management Statement

GROUP PERFORMANCE REVIEW

The group has weathered the storm and the performance in 2010 was very
encouraging. The continuing operations of the group yielded a loss before tax
of $2.8 million (2009: $9.2 million). This performance was weighed down by an
interest payable bill of $5.5 million on borrowings which averaged
approximately $40 million in 2010. The focus has been to bring back
profitability across the group with emphasis on growth in turnover and
improvement in margins. The discontinued operations reported a profit before
tax of $7.3 million (2009: loss of $1.5 million) mainly from the financial
services.

Span of operations

                                                               31 December 2010
                                                                               
Turnover                                                           $276 million
                                                                               
Number of stores outlets                                                     24
                                                                               
Number of supermarket outlets                                                51
                                                                               
Number of hotels                                                              3
                                                                               
Area of land under cropping (60%                                 4,350 hectares
tea, 32% timber, 3% macadamia, 3%                                              
maize)                                                                         
                                                                               
Employees (permanent staff 71%)                                           7,331
                                                                               
Market capitalisation                                              $109 million

Store portfolios

                  31 December       Opened          Closed        31 December  
                                                                               
                     2009                                            2010      
                                                                               
Supermarkets          52               3              (4)             51       
                                                                               
Departmental           8               -               -               8       
stores                                                                         
                                                                               
Hardware               0               5               -               5       
departments                                                                    
                                                                               
Home and              14               -              (3)             11       
                                                                               
beauty stores                                                                  

TM SUPERMARKETS: Overall an excellent performance in sales for the year.
Productivity indicators were good as a result of buoyant sales. The turnover
was however, negatively affected by constant repairs of old refrigeration,
bakery and butchery equipment. In addition the ZESA power cuts affected the
production in bakery, butchery and other perishables. The company recorded a
profit before tax of $574,000 in 2010 (2009: loss of $3.8 million)

MEIKLES HOSPITALITY (Private) Limited (formerly Meikles Africa Hotels): Whilst
hotel occupancies have continued to recover, the average room rates are not
growing as quickly and to the required levels to achieve growth in profits. 
The discount policies have negated this growth in average room rate; however,
we could not have achieved the occupancies in the environment without the
discounts. The hotels registered a profit before tax of $769, 000 in 2010
(2009: loss of $157,000)

THOMAS MEIKLE STORES ("TMS"): 2010 has been characterized by TMS' drive to
bring the company into profitability by increasing turnover. The main
constraint has been the lack of capital and the high cost of borrowing. Despite
these challenges, significant quantities of good quality Asian stock were
ordered earlier in the year 2010 and the Stores were well stocked for the
Christmas season. This, coupled with the major promotion to significantly
increase credit account numbers, resulted in an increase of 247% in turnover in
2010 compared to 2009. The stores registered a loss before tax of $3.4 million
in 2010 (2009: loss of $2.8 million)

TANGANDA TEA COMPANY: The bulk tea production was 8117 tons in 2010 compared to
7082 tons in 2009. The production could have been more had it not been for the
reduced winter rains and also the delayed arrival of the summer rains. The
shortage of power impacted on the planned irrigation. The company is
diversifying its operations into other crops such as Avocados and macadamias.
This process has already started and will reduce the company's dependency on
tea in the future. The company recorded a loss before tax of $869,000 in 2010
(2009: profit of $649,000)

DEMERGER FROM KINGDOM FINANCIAL HOLDINGS LIMITED (KFHL)

The shareholders approved the terms of the demerger of KFHL from Meikles
Limited ("company") on 13 October 2010. The terms included conditions precedent
such as High Court approval of the reduction of KFHL's share capital by US$22.5
million and also approval of the demerger by the Minister of Youth Development
and Indigenisation. The High Court approval for the capital reduction was
secured on 14 December 2010 while the approval by the Minister of Youth
Development and Indigenisation was obtained on 11 February 2011. With these
approvals, the company is now working on finalising the demerger through the
distribution of KFHL's shares to the company's shareholders. This process will
be concluded on or before 28 February 2011.

Proposed investment by Pick N Pay into TM Supermarkets ("TM")

As shareholders will know, the company entered into negotiations with Pick N
Pay of South Africa for them to increase their shareholding in TM from 25% to
49%. These negotiations were successfully concluded in the third quarter of
2010 but with suspensive condition being the approval of the proposed
transaction by regulatory authorities including the Reserve Bank of South
Africa, Reserve Bank of Zimbabwe and the Minister of Youth Development and
Indigenisation. The approvals by the Reserve Bank of South Africa have been
secured while the approvals from the other mentioned regulatory authorities are
still awaited. Management is confident that these approvals will be secured in
the short term.

CHANGE IN FINANCIAL YEAR END

As previously announced, Meikles Limited changed its financial year end from 31
December to 31 March. Accordingly, the group will be publishing its 15 months
results for the period to 31 March 2011 in May 2011.

FUTURE PROSPECTS

The future prospects of the group look very promising. All the operational
bottlenecks are being smoothened out and a lot of progress was made in 2010.
This now forms the basis of the continued growth of the various operations
across the group. The capitalization and high cost of borrowings are a
challenge and management is confident that this challenge is not insurmountable
and will endeavour to grow the profitability of the group in the current
environment.