MASSMART HOLDINGS LIMITED - TRADING UPDATE

MASSMART HOLDINGS LIMITED - TRADING UPDATE                                      
MASSMART HOLDINGS LIMITED                                                       
Registration no. 1940/014066/05                                                 
("Massmart" or "the Group")                                                     
JSE Code : MSM       ISIN Code:  ZAE000029534                                   
TRADING UPDATE                                                                  
MASSMART SUSTAINS GROWTH DESPITE RAND STRENGTH                                  
Background                                                                      
This comprehensive trading update is issued in response to queries from         
shareholders and analysts regarding the impact of the exchange rate on          
Massmart"s performance.                                                         
Year to June 2003                                                               
In the 43 weeks to 27 April 2003, Massmart"s total sales grew 26%, sales before 
acquisitions grew 22% and comparable store sales grew 22%.                      
Based on the performance to date, Massmart will achieve improved earnings in the
second half, and, once again, record sales and profits, with improved operating 
profit and headline earnings margins, in the full year to June 2003.            
Second Half to June 2003                                                        
Since August 2002 we have advised shareholders of various external factors that 
were likely to affect the extent of Massmart"s earnings growth in the six months
to June 2003.                                                                   
In the release of the Group"s interim results to December 2002, four factors    
were specifically identified:                                                   
* Softening consumer demand resulting from higher interest rates;               
* Reduced sales and profits resulting from declining inflation;                 
* Increased competition arising from competitors clearing imported inventory    
bought at a higher exchange rate; and                                           
* Rand translated foreign earnings lower than the previous year.                
While our assessment of the potential impact on performance arising from the    
first three factors has been accurate and trading decisions were modified       
accordingly, the strengthening of the Rand has exceeded our projections.        
Foreign stores in the Massdiscounters Division                                  
The impact of the stronger Rand has been manifest predominantly in the          
Massdiscounters division, comprising Dion and Game, the latter being the chain  
that generates most of Massmart"s foreign earnings.                             
Although Game"s foreign stores are trading well in their local currencies, the  
substantial strengthening of the Rand continues to reduce their reported Rand   
sales and margins, as well as increasing the unrealised losses arising on       
translation of their foreign net assets into Rand values.                       
In the six months to June 2003, notwithstanding a strong performance from its   
South African stores, Massdiscounters will consequently produce significantly   
lower profits before tax than in the comparable 6 months to June 2002.          
Massdiscounters is, nevertheless, anticipated to achieve record sales, profits  
and profit before tax margins for the full year to June 2003.                   
Outlook for Massmart                                                            
Despite the currency effect on the Massdiscounters division referred to above,  
Massmart is expected to experience profit growth in excess of sales growth in   
both the second half and the full year to June 2003.                            
Based on an average exchange rate of R8.00/$, Massmart"s recently concluded     
budgets for the year to June 2004 reflect further strong progress towards our   
earnings growth and margin objectives which, excluding further currency         
appreciation and its potentially dampening effect on performance, are expected  
to continue to show growth in real terms at the forefront of the sector.        
Johannesburg                                                                    
5 May 2003