Operating profit before foreign exchange movements. 2009: R2,029.0m PER SHARE PERFORMANCE. down. Headline earnings. 2009: cents.

Transcription

1 FINANCIAL HIGHLIGHTS down up by 10.0% R47,451.0m Total sales 2009: R43,128.7m up by 0.1% R2,031.0m Operating profit before foreign exchange movements 2009: R2,029.0m 34.9% Return on equity 2009: 41.7% PER SHARE PERFORMANCE FINANCIAL STATISTICS down by 5.7% down by 6.2% down R1,138.6m Headline earnings 2009: R1,207.1m 567.2c Headline earnings 2009: cents 4.4% Trading profit before interest and taxation margin 4.9% in 2009 down up by 7.2% R2,639.4m Cash generated from operations 2009: R2,462.0m 386.0c Dividends 2009: cents 51.8% Return on capital employed 62.2% in 2009 Read more More detail on definitions and explanatory notes can be found on page 47 Ten-year Review More detail on headline earnings per share can be found in note 12 on page 181 Group Financial Statements up by 13.5% 1,722.0c Net asset value 2009: 1,517.5 cents up 11.1% Debt: equity 4.9% in 2009 Massmart Annual Report

2 OUR BUSINESS MODEL SELL BUY SELL BUY High-volume Low-margin Massdiscounters General merchandise discounter Masswarehouse Warehouse club Massmart Holdings Overall Group strategy and performance management Channel and Shared Services Food wholesaler, retailer and buying association Masscash SELL BUY Home improvement retailer and building materials supplier Massbuild High-volume Low-margin BUY SELL Massmart is a managed portfolio of four divisions, each focused on high-volume, low-margin, low-cost distribution of mainly branded consumer goods for cash, through 288 stores in 14 countries in sub-saharan Africa. 2 Massmart Annual Report 2010

3 MASSMART GROUP Massmart has evolved a business model that empowers its Divisions to take trading decisions suited to their individual operating needs but within a strategic operating and financial framework set by the Group. This has several advantages. The framework guarantees consistent compliance with the best governance standards and national legislative requirements. It commits each Division to implementing Massmart s core strategy of being a high-volume, low-margin distributor of quality branded consumer goods for cash, and ensures expansion plans add net value to the Group rather than cannibalising existing operations. At the same time, Divisions can extract maximum value from being part of a larger Group with greater access to goods and services or negotiating better terms and rebates with suppliers and service providers. The Divisions are differentiated as retail or wholesale formats that address different customer and market profiles. The model operates through four entities: Massmart Holdings, the shareholder of the operating Divisions that consolidates the Group s financial, treasury, tax and company secretarial functions and is headed by the Group CFO; Channel, where Divisions can share best practice and develop mutually beneficial collaborative efforts; Shared Services, which handles those activities identified by Channel that are more cost effective to share across Divisions; and the four operating Divisions themselves. Decentralised decision-making is given effect through a Group Executive Committee reporting to the Group CEO. The Committee s members comprise the CEOs of Massmart s four operating Divisions and a Group Executive from each of Massmart Holdings, Channel and Shared Services. Massmart Holdings Executives are also represented on each of the four Divisional Boards as non-executive Directors. MASSMART HOLDINGS Massmart Holdings performs the Group management and advisory role and defines the strategic and broad operating principles that guide the Group s activities. Its functions include budget approval and capital allocation, store site location, executive appointments, development and retention, corporate affairs, human capital and internal audit. A business intelligence unit collates and analyses divisional data to inform Group strategy and decision-making. MASSMART CHANNEL Massmart Channel consists of formal trading and functional forums where ideas on collaboration across Divisions are shared. Trading forums cover Food and Liquor, General Merchandise, and Cellular. Functional forums include Technology, Information and Process (TIP), Operations and Human Resources. Trading forums are headed by Divisional CEOs and functional forums are headed by Group Executives. Directors and Executives from the Divisions attend forums in their specific areas of competence. Once consensus is reached on a collaborative proposal, the Executive Committee approves whether it should be rolled out across the Group. MASSMART SHARED SERVICES Massmart Shared Services implements collaborative agreements reached by Channel. The most important are Group supplier negotiations for all products sold across the Group. Shared Services also handles the Group s Payroll functions, the Shipping and associated treasury functions for direct imports, and managing private or exclusive brands shared across Massmart s trading Divisions. MASSMART DIVISIONS Massmart s Divisions comprise Massdiscounters, Masswarehouse, Massbuild and Masscash. Each has a dedicated management team focusing on a particular retail or wholesale format, merchandise proposition and customer base, and is empowered to take trading decisions within a strategic framework and governance structure defined by the Group. Massmart Annual Report

4 OUR VISION AND MISSION OUR VISION Our Vision Our Customers Our Community will regard Massmart s wholesale and retail formats as their first choice when buying those categories of merchandise offered by the formats. Our Suppliers will regard Massmart as a valued partner in accessing and understanding their end-consumers. Career Retailers will regard Massmart as the preferred employer in the distribution industry. Our Investors will regard Massmart as a portfolio rendering superior returns relative to the JSE Retail sector. including Government, will regard Massmart as a socially accountable corporation. OUR MISSION Massmart is a South African-based, globally competitive, regional management group, invested in a portfolio of differentiated, complementary, focused wholesale and retail formats, each reliant on high volumes and operational excellence as the foundation of price leadership, in the distribution of mainly branded consumer goods for cash. The Group actively seeks the continual improvement of performance in the portfolio and its parts, through strategic and structural clarity, high market shares, excellent management, principle-driven ethical leadership, cost-effective technology and the sharing or agglomeration of capabilities, knowledge, resources, influence and information. To this end, thought leadership, individual and collective performance, and collaboration throughout the Group are appropriately rewarded, with executive management incentivised predominantly on Group performance. 4 Massmart Annual Report 2010

5 CORPORATE ACCOUNTABILITY HIGHLIGHTS Value added (Rm) 10,130.6 Massdiscounters Masswarehouse Massbuild Masscash Other R3,434.5m R1,446.9m R2,055.3m R3,226.4m (R32.5m) Customer satisfaction (%) 88.6 Massdiscounters 85.5% Masswarehouse 90.2% Massbuild 89.2% Masscash 88.2% Tested HIV/Aids prevalence (%) 6.1 Massdiscounters No testing conducted Masswarehouse 2.8% Massbuild 3.5% Masscash 16.7% Black professionals as a % of management professionals 77.5 Massdiscounters 88.5% Masswarehouse 69.2% Massbuild 57.5% Masscash 67.4% Other 68.3% Our B-BBEE score (%) 66.1 Massdiscounters 68.8% Masswarehouse 65.6% Massbuild 50.7% Masscash 59.1% Our purchased electricity emissions intensity (C0 2 e(kg)/m²) Massdiscounters CO 2 e(kg)/m 2 Masswarehouse CO 2 e(kg)/m 2 Massbuild CO 2 e(kg)/m 2 Masscash CO 2 e(kg)/m 2 Corporate social investment (Rm) 20.6 Massdiscounters Masswarehouse Massbuild Masscash Other R7.0m R6.1m R1.6m R3.9m R2.0m Read more Additional detailed information about the indicators covered in this scorecard is available on page 100 Corporate Accountability Massmart Annual Report

6 OUR SHARES AND SHAREHOLDER INFORMATION KEY INFORMATION Ordinary shares Authorised 500,000,000 Issued 201,495,504 Number of shareholders 7,674 Year-end End of June Ordinary general meeting of shareholders Held annually in Johannesburg towards the end of November Administrators of shareholders register Computershare Investor Services (Pty) Ltd 70 Marshall Street Johannesburg 2001 Share code MSM Shareholder spread Shares % 1-1,000 shares 1,716,495 1,001-10,000 shares 5,209,631 10, ,000 shares 9,492, ,001-1,000,000 shares 26,878,657 1,000,001 shares and over 158,197, Shareholders split between public and non-public Shares % Non-public: Directors and Group Executives of the Company 3,709, Non-public: Share trust 68, Public shareholders 197,717, High, low and closing share price (cents per share) Distribution of shareholders Closing 4,387 8,800 6,149 8,000 12,200 High Low 6,408 9,997 9,724 9,029 12,580 4,185 4,185 5,910 5,650 7,275 Shares Unit Trusts/Mutual Fund 77,393,104 Pension Funds 58,891,368 Other Managed Funds 13,900,026 Foreign Government 11,902,359 10,477,480 8,356,461 5,342,888 2,166,028 Private Investors Custodians Insurance Companies Charity American Depositary Receipts Investment Trust Local Authority Hedge Fund Remainder 994, ,038 85,978 30,689 11,262,865 % Massmart Annual Report 2010

7 Foreign shareholding Massmart foreign holding JSE General Retailers average foreign holding % UK, Europe and other 43 US 29 South Africa 28 Massmart s share price and trading volumes on the Johannesburg Stock Exchange (rebased to R12.95) Massmart trading volumes (000 s) 280, , , , ,000 80,000 40,000 0 SHV s 31% shareholding in Massmart sold to local and international investors in January Dec-00 Jun-01 Dec-01 Jun-02 Dec-02 Jun-03 Dec-03 Jun-04 Dec-04 Jun-05 Dec-05 Jun-06 Dec-06 Jun-07 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Massmart share price and JSE Gerneral Retailers Index Massmart share price JSE General Retail Index Biannual Massmart trading volumes Principal shareholders Number of shares Equity stake (%) Custodians and managers holding 5% or more The following custodians and managers held beneficially, directly or indirectly, more than 5% of the Company s shares: Aberdeen Asset Management Group 33,505, Public Investment Corporation 27,857, JP Morgan Asset Management 15,121, Lazard Asset Management LLC Group 13,907, Baillie Gifford & Co Ltd 10,900, Massmart Annual Report

8 GROUP PROFILE MASSMART GROUP MASSDISCOUNTERS General merchandise discounter Divisions Stores and outlets 288 stores 91 stores 11 stores Countries SA, Botswana, Ghana, Lesotho, Malawi, Mauritius, Mozambique, Namibia, Nigeria, Swaziland, Tanzania, Uganda, Zambia, Zimbabwe SA, Botswana, Ghana, Malawi, Mauritius, Mozambique, Namibia, Nigeria, Tanzania, Uganda, Zambia SA Product categories Food/liquor/general merchandise/home improvement supplies General merchandise and FMCG Electrical appliances Financial highlights and contribution to Group Sales R47,451.0 million Sales R12,164.9 million Sales 26% Trading profit before tax* R2,267.5 million Trading profit before tax* R690.3 million Trading profit 30% Highlights f Operating profit before foreign exchange movements grew 0.1% to R2,031.0 million f No consumer credit sales f 7.6% of sales from African stores f Strong performance by Game SA with profits up 20% f DionWired now a national brand with 11 stores f New 70,000m² Gauteng regional distribution centre operational f Level 4 B-BBEE contributor Key sales drivers f Consumer confidence and disposable income f New stores f Interest rates f Social grants f Product inflation f Product inflation f Price perception f Interest rates f Consumer confidence and disposable income f New stores * Trading profit definitions can be found on page 47 8 Massmart Annual Report 2010

9 MASSWAREHOUSE MASSBUILD MASSCASH Warehouse club Home improvement retailer and building materials supplier Food wholesaler, retailer and buying association 13 warehouse clubs 24 stores 21 stores 31 stores 91 stores 6 stores 517 outlets SA, Zimbabwe (2 Zimbabwe stores not consolidated and excluded from 13 above) SA SA SA SA, Botswana, Lesotho, Mozambique, Namibia, Swaziland SA SA, Botswana, Lesotho, Namibia, Swaziland Food/liquor/general merchandise Home improvement supplies/ tools/building materials Home improvement supplies/ tools/building materials Building materials/ tools Food/liquor/ groceries Food/ groceries/ ethnic cosmetics Food/groceries Sales R11,501.2 million Sales R6,366.9 million Sales R17,418.0 million Sales 24% Sales 13% Sales 37% Trading profit before tax* R758.6 million Trading profit before tax* R308.5 million Trading profit before tax* R510.1 million Trading profit 34% Trading profit 14% Trading profit 22% f General merchandise sales reached R4 billion for the first time f Improved B-BBEE rating to Level 4 contributor f Dropped stock levels and improved service levels f Four new stores to be opened in the next four financial years f Double digit sales growth achieved in a difficult market f Launched new store format f Acquired Kangela in Mozambique f Branding opportunities maximised f Retail offering expanded focused on three key regions and developing a single national brand f Wholesale division-wide full suite IT system rolled out f Acquired Kawena in Mozambique f Product inflation f Price perception f Interest rates f Consumer confidence and disposable income f New stores f Interest rates f Residential property prices and housing growth f Consumer confidence and disposable income f Price perception f New stores f Selected acquisitions of existing competitors sites f Food inflation, particularly commodities f Social grants f New stores f Retail cash and carry acquisitions Massmart Annual Report

10 GROUP PROFILE MASSMART GROUP MASSDISCOUNTERS General merchandise discounter Divisions 2010 trading space (m 2 ) 1,179, , net new stores target net new trading space target (m 2 ) 202, ,871 Medium-term target trading PBT return on sales 5.5% Target 5.7% International 8.0% Target 7.4% International 4.2% Current benchmark 5.7% Current benchmark Wal-Mart ex-food Medium-term objectives f Maintain trading aggression f Organic store growth f Explore greenfield opportunities f Sustainability f Explore acquisitions f New Game outlets in South Africa and Africa f Develop DionWired f Build a supply chain capability f Private label f Leverage financial services capability Performance against objectives f Despite difficult trading, gained market share in both Massdiscounters and Builders Warehouse f Food retail acquisitions and new stores in Masscash f Group B-BBEE score of 66.1% up from 55.7% f Seven new Game stores in South Africa f Five new DionWired stores f Johannesburg, Gauteng, RDC opened in June 2010 f Very successful July 2009 launch of Game credit card with third party financial services provider RCS Revised medium-term objectives f Maintain trading aggression f Organic store growth f Explore greenfield opportunities f Sustainability f Explore acquisitions f African expansion f New Game stores in South Africa and Africa f Private label f Finalise switch-over to Gauteng RDC and realise supply chain efficiencies. Focus on a new KwaZulu-Natal RDC f Leverage further benefits from RCS relationship f New DionWired stores in South Africa Major potential risk areas noted in the risk register f Poor business model or strategic execution f Insufficient progress with transformation at executive level f Economic volatility f Acquisition risk f Talent retention and succession f Customer safety f Financial health and confidence of consumers in South Africa and Africa f Supply chain execution f African economic volatility and recovery 10 Massmart Annual Report 2010

11 MASSWAREHOUSE MASSBUILD MASSCASH Warehouse club Home improvement retailer and building materials supplier Food wholesaler, retailer and buying association 118, , , ,000 5,154 30, % Target 5.0% International 7.0% to 9.0% Target 10.0% International 3.0% Target 3.0% International 6.6% Current benchmark Metro AG C&C 4.8% Current benchmark Home Depot/B&Q 2.9% Current benchmark Makro South America f New stores in South Africa f Leverage customer relationship management capabilities f Invest in supply chain capability f Private label f Extract benefits from IT and structural investments f Optimise joint buying and merchandising benefits f New Builders Warehouse stores in major centres f New Builders Express stores in suburbs f New Trade Depot stores through acquisitions f Invest in supply chain capability f Private label f Refine and grow new Retail Food format f Roll out point-of-sales IT system to all stores f Manage Wholesale for cash and returns f Private label f Opening a new store in Vanderbijlpark in October 2010 f SAP Forecasting & Replenishment applied to 70% of merchandise f Two new Builders Warehouse stores, one new Builders Express store and one new Builders Trade Depot store f Acquired Mozambique building materials business, Kangela, three ex-mica stores now branded Builders Express and one store in Builders Trade Depot f Improved profitability in Builders Warehouse and Builders Express, and gained market share f Conditional offer to acquire Namibian building merchant, Pupkewitz. Pending authorities approval f In-store and back-office IT system now implemented at 70 stores f Acquired and opened ten retail stores and eight wholesale stores f Annualised retail turnover R2.5 billion f Rebranding retail stores as Cambridge Food f Anticipate opening 4 to 5 stores in next four years f Leverage customer relationship management capabilities f Continue to invest in supply chain capability f Private label f African expansion, initially focused on Nigeria f Merger of Builders Warehouse and Builders Trade Depot management and administration f New stores in South Africa and Africa f Supply chain capability f Private label f Focus on building materials and subcontractors through Builders Warehouse and Builders Trade Depot f Aggressively grow new Retail Food format f Finalise roll out point-of-sales IT system in all stores f Manage Wholesale for cash and returns f Private label f Store destroyed by fire f Financial health and confidence of consumers f Supply chain execution f Customer safety f Sustained deflation in Food f Finding appropriate sites in right locations for Builders Warehouse stores f Bonded residential housing market f Supply chain f Store destroyed by fire f Customer safety f Government social welfare programme f Poor acquisition or poor integration f HIV/Aids f Customer safety f Sustained deflation in Food Massmart Annual Report

12 STORE REGIONAL MAP INTERNATIONAL A total of 25 stores GHANA 1 1 NIGERIA UGANDA 1 TANZANIAA 1 1 ZAMBIA MALAWI MOZAMBIQUE 1 1 ZIMBABWE NAMIBIA BOTSWANA SWAZILAND LESOTHO SOUTH AFRICA MAURITIUS Chain Country Stores City Game Botswana 2 Francistown and Gaborone Ghana 1 Accra Malawi 1 Blantyre Mauritius 1 Quatre Bornes Mozambique 1 Maputo Namibia 2 Oshakati and Windhoek Nigeria 1 Lagos Tanzania 1 Dar es Salaam Uganda 1 Kampala Zambia 1 Lusaka Makro Zimbabwe* 2 Bulawayo and Harare CBW Botswana 9 Francistown, Gaborone x2, Mahalapye, Maun x3, Palapye and Selebi Phikwe Lesotho 2 Maseru x2 Namibia 1 Windhoek Swaziland 1 Manzini * Two Makro Zimbabwe stores were not included in the table of stores on page 13 as their results have not been consolidated. See note 8 in the annual financial statements on page 179 for further details. 12 Massmart Annual Report 2010

13 Massmart at a Glance SOUTH AFRICA MAKHADO A total of 263 stores POLOKWANE MOKOPANE TZANEEN LIMPOPO PRETORIA RUSTENBURG KRUGERSDORP MAFIKENG NORTH WEST HAZYVIEW WITBANK GA G AUT AU TE TEN ENG NG GAUTENG JOHANNESBURG POTCHEFSTROOM MIDRAND VANDERBIJLPARK SECUNDA VRYBURG NELSPRUIT GROBLERSDAL OLIFANTSFONTEIN MPUMALANGA SWAZILAND ERMELO KLERKSDORP MANGUZI PIET RETIEF VEREENIGING ZAMDELA MKUZE NONGOMA UPINGTON NEWCASTLE KIMBERLEY WELKOM MTUBATUBA QWA QWA FREE STATE DUNDEE PHUTHADITJHABA ESHOWE LADYSMITH FICKSBURG BLOEMFONTEIN ULUNDI RICHARDS BAY GINGINDLOVU KWAZULU-NATAL LESOTHO NORTHERN CAPE SPRINGBOK VRYHEID EMPANGENI PIETERMARITZBURG BALLITO UMHLANGA ISIPINGO LADYBRAND BOTSHABELO DURBAN THABA NCHU KOKSTAD PA P PARK RYNIE PORT SHEPSTONE P SHELLEY BEACH MARGATE WILLOWVALE UMTATA AMANZIMTOTI A QUEENSTOWN VREDENBURG KING WILLIAM S TOWN GONUBIE EASTERN CAPE 11 CAPE TOWN PAARL WORCESTER BUTTERWORTH UITENHAGE EAST LONDON WESTERN CAPE STELLENBOSCH SOMERSET WEST HERMANUS Chain Game DionWired Makro Builders Warehouse Builders Trade Depot Builders Express CBW Jumbo Total KNYSNA GEORGE MOSSEL BAY South Africa JEFFREYS BAY International PORT ELIZABETH Total Key to information Colour denotes the stores by chain Number denotes the number of stores in that specific region Denotes cities and towns Masssmart Annual Report 2010 Mas Massmart 13

14 OUR INVESTMENT PROPOSITION Massmart is a South African retail and wholesale distributor, with 263 stores in South Africa and 25 stores elsewhere in sub-saharan Africa. f Continuously improving the productivity of capital, space and labour f Strengthening supply chain activities f Upweighting Group private label efforts f Inter-divisional collaboration f Complementing store growth through targeted acquisitions and greenfield opportunities f Consistent merchandise innovation f Board composition two executive and 11 non-executive directors f Recognised record of good disclosure f Compliant with King III Report and the JSE SRI criteria f Member of the Ethics Institute of Southern Africa f Merchandise Massmart is the third largest distributor of consumer goods in Africa, and is the leading retailer of general merchandise, liquor, home improvement and building supplies, and the leading food wholesaler f Formats trading through a variety of formats f Customers serving all mass-market consumers f Geography operating in 14 sub-saharan African countries Diversification Growth Strategic and structural clarity Investment Proposition Good governance Management depth, quality and diversity Low risk f Earnings underpinned by high cash generation f Limited balance sheet financial leverage f Conservative throughthe-cycle store opening plans f Through four focused Divisions, each a leader in its target market and business model f Where additional value is created through inter-divisional collaboration f And behaviour is aligned through short- and long-term incentives f While adhering strictly to organic and acquisitive growth criteria f The 46 Group and Divisional Executives hold 98 qualifications of which 58 are degrees, are an average age of 45 years, and 13% are African, Coloured or Indian 14 Massmart Annual Report 2010

15 EXECUTIVE DIRECTORS Grant Pattison (39) BSc (Eng) (Hons) (UCT) Chief Executive Officer, member of the Strategy and Investment Committee. Appointed 7 December Grant graduated from the University of Cape Town as an electrical engineer. After four years with the Anglo American group and two years consulting with The Monitor Group, Grant joined Massmart as Executive Assistant to the Executive Chairman in He has since held various positions within the Group, including Managing Director of Massdiscounters and Group Commercial Executive. He joined the Executive Committee in 2000 and the Board in 2004, becoming Deputy Chief Executive Officer in 2005, Chief Executive Officer Designate in 2006 and Chief Executive Officer on 1 July Guy Hayward (45) BCom, CTA (UCT), CA(SA) Chief Financial Officer, member of the Risk, and Strategy and Investment Committees. Appointed 15 May Guy graduated from the University of Cape Town in 1986 and, after serving articles with Deloitte Haskins & Sells, qualified as a Chartered Accountant in During the 1990s he held senior financial roles at Malbak and CNA Gallo in South Africa and at Goldman Sachs in London. He joined Massmart as Group Financial Executive in 2000 and was appointed Chief Financial Officer in Guy is also a Governor of Hilton College. Massmart Annual Report

16 NON-EXECUTIVE DIRECTORS Mark J Lamberti (60) BCom, MBA (Wits), PPL (Harvard) Chairman of the Board, member of the Remuneration and Nominations Committee and Chairman of the Strategy and Investment Committee. Appointed 1 August Following progress through a multi-functional retail career that began in 1975, Mark was appointed Managing Director of the ailing six-store Makro chain in After successful repositioning of the chain, he founded Massmart in 1990 to pursue an aggressive growth strategy in high-volume, low-gross margin, low-expense retailing and wholesaling. In 1996, he was appointed Executive Chairman of Massmart and from July 2003 CEO and Deputy Chairman of the Board. At the end of June 2007 he relinquished his executive role to become non-executive Chairman. His role as architect and leader of Massmart has been widely recognised with numerous awards including that of the Ernst & Young South African Entrepreneur of the Year in Mark currently serves as Chief Executive Officer of Transaction Capital (Pty) Limited, Chairman of Business Against Crime South Africa, and a director and executive committee member of Business Leadership South Africa. His commitment to education has led to his involvement as a benefactor, director or adviser to a number of educational institutions, including the Wits Business School where he is an Honorary Professor. Deputy Chairman of the Board and Lead Independent Director, and a member of the Remuneration and Nominations, Audit and Strategy and Investment Committees. Chris Seabrooke (57) BCom, BAcc, MBA, FCMA Appointed 1 February Chris has, over the years, been a director of over 20 stock exchange-listed companies. He is currently CEO of Sabvest Limited (JSE), Chairman of Metrofile Holdings Limited and Set Point Group Limited (JSE), and a director of Datatec Limited (JSE/AIM), Net1 UEPS Technologies Inc (Nasdaq/JSE) and Brait S.A. (Luxembourg/London/JSE). He is also Chairman of the Alternative Equity Partners Fund and a director of a number of unlisted companies locally and internationally. He is a former Chairman of the South African State Theatre and former Deputy Chairman of both the inaugural National Arts Council of South Africa and the founding board of Business & Arts South Africa. Member of the Risk, and Sustainability and Transformation Committees. Appointed 25 February Dods was a career retailer from 1963 until his retirement in 1998, at which time he was the Chief Executive of JSE-listed Moregro (Morkels Retail Group). He has, over the past 25 years, served on and chaired the boards of a number of international and local public companies and is currently a director of Avusa Limited and various private companies. Dods Brand (67) Kuseni Dlamini (42) BA (Hons)(KZN), MPhil (Oxon) Chairman of the Remuneration and Nominations Committee. Appointed 1 November Kuseni is the Chief Executive Officer of Old Mutual South Africa & Emerging Markets. He was head of Anglo American South Africa and member of the Executive Committee of Anglo American plc. He was Executive Chairman of Richards Bay Coal Terminal (RBCT) between 2005 and Kuseni previously worked for De Beers in South Africa and at its London office, and for AngloGold Ashanti s corporate office in Johannesburg. After graduating cum laude with a BA (Honours) degree from Natal University in Durban, he went to Oxford as a Rhodes scholar, where he read for his MPhil degree. In March 2008, Kuseni was named a Young Global Leader by the World Economic Forum (WEF). During the same month, Miningx selected him as one of the top 100 most influential people in South African mining. In May 2009, he was nominated to be part of the WEF s Global Agenda Council on the future of Mining and Metals. Kuseni is the Chairman of the Board of SANParks and a member of the National Advisory Council on Innovation which advises the Minister of Science and Technology. He is a former Non-Executive Director of Anglo Platinum and Chairman of Anglo Operations Limited. Kuseni was recently appointed Adjunct Professor at the Wits Business School where he is also a member of the Advisory Board. In May 2010, he was made co-chairman of the 20th WEF on Africa Summit in Dar es Salaam, Tanzania. Member of the Risk Committee. Appointed 1 November Lulu is Chief Operating Officer of Lereko Investments (Pty) Limited. She was Deputy Director General in the National Department of Public Works, responsible for establishing the national public works programme, and completed a five-year term as the CEO of the Independent Development Trust. She has served on various Government commissions, and is a non-executive director of FirstRand Limited, the Development Bank of Southern Africa and Sun International Limited. Dr Nolulamo ( Lulu ) Gwagwa (51) MSc (KZN), MSc (LSE), PhD (UCL) 16 Massmart Annual Report 2010

17 Member of the Strategy and Investment Committee. Appointed 25 August During his long retail career, Jim was both Chairman and Chief Executive of B&Q plc, a subsidiary of Kingfisher plc. As Chief Executive of New Look plc, he transformed a family business to a public company with a multi-national footprint. Currently, he is Chairman of Ultimate Products Limited and non-executive director of Furniture Village and Rosehold Limited, all UK-based companies. James ( Jim ) Hodkinson (66) Chairperson of the Sustainability and Transformation Committee and member of the Audit Committee. Appointed 25 August Phumzile is the Executive Chairperson of Afropulse Group (Pty) Limited, a women-led investment, investor relations and corporate advisory house. She was previously the economic adviser to the Minister of Minerals and Energy, and an executive director of dual-listed junior platinum miner, Anooraq Resources. Phumzile is a non-executive chairperson of Astrapak Limited, a non-executive director of Imperial Holdings Limited, Peermont Global (Pty) Limited, the Mineworkers Investment Company (Pty) Limited, Transaction Capital (Pty) Limited and a member of the Port Regulator. Phumzile Langeni (36) BCom (Natal) Chairman of the Audit and Risk Committees, member of the Remuneration and Nominations Committee. Appointed 1 November During his career in the South African hotel and tourism industry, Nigel has served as Managing Director of Holiday Inn and Executive Director of Rennies. He founded his own business, Sentry Group, which was sold to an international group in He is a non-executive director of City Lodge Hotels Limited, Sun International Limited, Metrofile Holdings Limited and Indian Ocean Real Estate Company Limited. Nigel Matthews (65) MA (Oxon), MBA (UCT) Member of the Audit, Risk, and Strategy and Investment Committees. Appointed 25 February Peter is a private equity and corporate finance specialist and heads the private equity interests of the Oppenheimer family in South Africa. He was a founder of Primedia Limited and executive director from 1992 to 2003, responsible for all corporate finance activities. Peter remains a non-executive director and member of the Audit Committee of Primedia. Peter Maw (49) BCom (Hons), CA(SA), HDip Tax Law Member of the Sustainability and Transformation Committee, and Remuneration and Nominations Committee. Appointed 1 June Dawn is a director of several companies, including Engen Limited, Nozala Holdings (Pty) Limited and Sabvest Limited. She is also a director of the Financial Services Board Foundation Trust. She is chairperson of African International Advisors, Wesizwe Platinum, and is Deputy Executive Chairperson of Partnership Investments (Pty) Limited. Dawn Mokhobo (61) BA (Social Science) Member of the Sustainability and Transformation Committee. Appointed 30 August Michael worked as a specialised retail consultant in New York and Toronto for nine years and joined Massmart as Development Director in He left the Group in 1997 to pursue his interests in private equity management and property development. Michael Rubin (60) BSc, MBA (UCT), MBA (Columbia) Massmart Annual Report

18 EXECUTIVE COMMITTEE Grant Pattison Chief Executive Officer Guy Hayward Chief Financial Officer Divisional Chief Executive of Massdiscounters and Chairman of the Cellular Forum. Jan s early career was spent in financial roles in various industries until becoming a business manager at Clover SA for three years. He then spent seven years at SA Breweries in senior financial roles, before joining the Massmart Group as Financial Director of Massdiscounters in In April 2007, he was appointed Chief Executive of Massdiscounters and a member of the Massmart Executive Committee. Jan Potgieter (41) BCompt (Hons), CTA (Free State), CA(SA) Divisional Chief Executive of Masswarehouse, member of the Risk Committee and Chairman of the General Merchandise Forum. After qualifying as a Chartered Accountant in 1989, Kevin consulted at both the Strategy Group (Deloitte) and Gemini Consulting. He joined UPD as Group Operations and Systems Director in 1995 and became Group Chief Executive Officer in Kevin joined Massmart as Divisional Chief Executive responsible for Makro and a member of the Massmart Executive Committee in Kevin Vyvyan-Day (45) BCom, BAcc (Wits), CA(SA) Divisional Chief Executive of Massbuild. Llewellyn spent thirteen years in the banking industry where he held senior positions in a number of specialist financial institutions before joining ABSA. In June 2003, Llewellyn joined Super Group, a JSE-listed supply chain and logistics company where his last position was Divisional MD responsible for the group s African operations. He joined Massmart in November 2008 as Divisional Chief Executive for Builders Warehouse and was appointed to the Massmart Executive Committee upon joining. Llewellyn Walters (46) BA, LLB (Wits) Divisional Chief Executive of Masscash and Chairman of the Food and Liquor Forum. After graduating from Natal University with a BCom degree and qualifying with his CA(SA) in 1978, Robin spent six years in retailing and wholesaling at WG Brown before founding CCW in In 1998, he sold a controlling interest in CCW to Massmart and was appointed to the Massmart Executive Committee. He led the acquisition and integration of Browns and Weirs, and has spearheaded the growth of the Division to become South Africa s leading food wholesaler. Robin Wright (54) BCom (Natal), CA(SA) 18 Massmart Annual Report 2010

19 Divisional Chief Executive of New Formats. Joe joined Makro in He worked for the Checkers Group from 1978 to 1988 after which he returned to Makro as Merchandise Director. He was appointed Managing Director of Makro in 1993, Divisional Chief Executive of Makro in 1999, Divisional Chief Executive of Massbuild in 2005 and Divisional Chief Executive of New Formats in February Joe has 39 years of mass merchant, general merchandise and FMCG experience. Gareth ( Joe ) Owens (61) Retail Director Masscash. Following a period managing Mala Mala Game Reserve and founding a small IT solutions provider, Jay joined Business Connexion as a Network Engineer before taking a position with Massdiscounters as IT Technical Manager in November He was appointed to the Massdiscounters Board in 2002 as IT Director. In addition to his IT responsibilities, he assumed responsibility for the supply chain of that company in 2003 and was appointed to the Massmart Executive Committee as Group Commercial Executive in Effective June 2009 Jay has been appointed as Retail Director Masscash. He remains a member of the Massmart Executive Committee. Jay Currie (36) BSc (Natal) Group Human Capital Executive, Chairperson of the HR Forum and member of the Sustainability and Transformation Committee. Prior to joining Massdiscounters Pearl worked for Telkom and Old Mutual and for Umgeni Water as General Manager: Corporate Services. Prior to assuming responsibility for Human Capital on the Massmart Executive Committee from August 2007, Pearl was Director of Human Resources at Massdiscounters. She brings broad experience in managing and developing human capital to the Group. Pearl Maphoshe (42) BA (Hons), HDipEd (Durban-Westville), MA (London) Group Corporate Affairs Executive and member of the Sustainability and Transformation Committee. Brian s work experience includes executive positions at Masstores (Pty) Limited, an associate partner at Andersen Consulting (now Accenture) and Marketing Director at CNA. He joined Massmart as Group Projects Executive in September 2004 and was appointed Group Corporate Affairs Executive in September Brian joined the Massmart Executive Committee in July Brian Leroni (46) BA (Wits), MPhil (Stellenbosch) Group Commercial Executive and Chairman of the TIP and Operations Forums. Llewellyn graduated from the University of the Witwatersrand in 1991 as a Physical Metallurgist. After seven years with Tongaat-Hulett group and three years with the Industrial Development Corporation, Llewellyn joined Massmart as Business Analyst in He has since held various positions within the Group, including Executive Assistant to the CEO and most recently, Managing Director of Builders Express. Llewellyn was appointed Group Commercial Executive and joined the Massmart Executive Committee in July Llewellyn Steeneveldt (41) BSc Eng (Phys Met), GDE (Industrial), MBA Massmart Annual Report