Trading Statement Verimark Holdings Limited Incorporated in the Republic of South Africa Registration number: 1998/006957/06 JSE share code: VMK ISIN number: ZAE000068011 ("Verimark" or "the company") TRADING STATEMENT In terms of paragraph 3.4(b) of the Listings Requirements of the JSE Limited, an issuer is required to publish a trading statement as soon as they are satisfied that there is a reasonable degree of certainty that the financial results for the next reporting period will differ by at least 20% from those of the previous corresponding period. While Verimark’s business and operational efficiency improvement initiatives, together with the completed relocation into the company’s new warehouse and office complex are beginning to take effect, shareholders are advised that it is anticipated that the Group will record a loss before taxation of between R1 million and R1.5 million for the six months ended 31 August 2013. This compares to the loss before taxation of R4.4 million reported on in the previous corresponding period. Headline earnings per share and earnings per share for the six months ended 31 August 2013 are expected to be in the range of (1.0) and (1.4) cents per share compared to the headline earnings per share and earnings per share of (5.2)cents per share and (5.1) cents per share respectively, as reported on in the previous corresponding period. Verimark’s operating profit is expected to be in the range of R3 million to R3.6 million compared to an operating loss of R5.1 million in the previous corresponding period. Improvements in the Verimark’s operating profit were largely as a result of the operational efficiency and business improvement initiatives presented at the year-end announcement made in May 2013. The volatility and devaluation of the Rand / Dollar exchange rate has resulted in higher foreign exchange losses. This together with the increased funding required in the first part of the year, resulted in higher overall finance expenses. This has negated a large portion of the above-mentioned operating profit improvement, resulting therefore, in a smaller improvement in the loss before taxation. FUNDING In spite of the anticipated loss for the six months ended 31 August 2013, the operating profit improvements and the considerable inroads into the reduction of excess inventory levels that were experienced at the end of February 2013 have resulted in positive cash generation. The company remains favourably geared and adequately funded to continue on Verimark’s growth path. PROSPECTS Management has taken certain actions to mitigate the impact of the Rand devaluation and continue to strive towards improvement in the operating margins. The focus on the operating efficiency and business performance initiatives remain priority and are expected to continue to bear fruit in the future. The Board is confident that the medium- and long-term prospects of Verimark remain positive. The information on which this trading update has been based has not been reviewed or reported on by the company’s auditors. The Company`s financial results for the six months ended 31 August 2013 will be released on SENS on 10 October 2013. 2 October 2013 Sponsor Grindrod Bank Limited Date: 02/10/2013 11:35:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.