BUSINESS AND STRATEGY BRIEFING

20th SEPTEMBER 2010

DR MATHEWS CHIKAONDAGroup Chief Executive MR PIUS MULIPA- Group Operations Executive MR ANDREW SESANI- Group Financial Controller MRS AGNES VARELA- Group Projects Executive

MISS NINA KAPEZI Legal Officer

This presentation might contain forward looking statements. These statements, which reflect PCLs assessment and future expectations with regard to the development of the business, the timings and the benefits, maybe influenced by a number of risks and uncertainties that could cause actual results to differ materially from expectations. Press Corporation Limited is under no obligation to update or amend forward looking statements based on new information, future events or for any other reason.

GCEs statement
Performance Over Five Years Divestures and Acquisitions 2010 Highlights

Corporate Governance Financial Highlights State of Operations Going Forward Question and Answers

Turnover tripled from 15.7billion in 05 to 47.6billion in 09 representing 202% growth Profitability increased by 154% from 3.391 in 05 to 8.611 in 09 Basic EPS grew by 80.8% from 15.06 to 27.23 Ordinary shareholder funds improved by an enormous 194% from 8.366billion to 24.611billion

 Divestures & acquisitions are strategic to position PCL as a dominant company in the private sector Invest only in businesses that have a leading position or have the potential to become a leader in their industry

DIVESTURES
Malawi Pharmacies 2005 Sold 30% interest in FDH - 2006 Chombe Tea - 2007 PGI - 2009

ACQUISITIONS Presscane 2003/2006 Maldeco Aquaculture 2004 MTL - 2006 TNM - 2007 Increased stake in BBGL 2009/2010

The Fish Eagle arrives in the country Fibre optic network cable connects Mzuzu Mac steel increases sales of roofing products due to introduction of Harvey Tiles National Bank switches over to T24 system from Bank Master BBGL setting up new plant in Lilongwe

THE BOARD
Responsible to shareholders for setting the direction through establishment of strategic objectives and key policies

STRUCTURE AND COMPOSITION

Consists of six (6) Non Executive Directors and two (2) Executive Directors Chairperson is Non Executive Director Meets quarterly

COMMITTEES
Audit Two Non Executive Directors, One Non Board Member Meets at least bi-annually Group Chief Executive, Group Financial Controller, Group Internal Audit Manager attend by invitation Appointments & Remuneration Three Non Executive Directors Meets three to four times a year

POLICIES

Share Trading Policy - to prevent insider trading violations by

Directors Managers Employees Other related individuals

Corporate Fraud Policy HIV/AIDS policy on non discrimination Sexual Harassment

CODES

All Governed by King III

Code of Ethics Business Code of Conduct (BAAC) Malawi Code of Best Practice for Corporate Governance Code II

REGULATIONS MSE -Listing Rules and Continuing obligations LSE- Listing Rules and continuing obligations Statutory - Companies Act -Taxation Act -etc

PCL Clinic Open to

- PCL - Subsidiaries - Public -Communication On Progress

United Nations Global Compact

PCL going green campaign

- tree planting - recycling

2006/2007 took in huge losses from Limbe Leaf Sold loss making/insignificant investments to stabilize the Groups earnings 2007/2008 saw a complete turnaround in Presscane 2008 full year impact of the acquisition of TNM

2009
Dividend paid

2008 473 4.17 27.67 12%

2007 353 3.21 15.53 11%

2006 400 3.64 14.62 11%

2005 223 2.03 15.06 18%

295 2.45 27.23 13%

Dividend per share

Earnings per share

Return on investment

Issued share capital

120.2
163

113.5
205

110
205

110
96.5

110
50

Share price

Segmental results
14,000 12,000 10,000 8,000 6,000 4,000 2,000 (2,000)

Fin. services 4,074 2,148

Retail and consumer 12,729 423

Telecom 7,005 140

Food & beverages 397 (20)

Real Property 88 (368)

Discontinued

Turnover PAT

Segmental results
The Financial Services consists of NBM. The Retail & Consumer Goods consists of Bp Malawi, PTC, Ethanol, Presscane. Telecommunications consists of TNM and MTL. Food and beverages consists of Maldeco fisheries and Aquaculture. Real Property & Investments consists of Press Properties and Corporate Office

Results were driven by the strong performance of the bank, BP Malawi. PTC, BBGL Limbe Leaf made a loss as a result tax provision made relating to prior years MTL made a loss because could not generate planned revenues. Most projects still at development stage Aquaculture made a loss due to growth problems carried forward from prior year. Problem has since been resolved Ethanol manufacturing companies has just come from seasonal shut down

105 outlets nationwide, and 4 Kwikfoods canteens 45 retail outlets, contributing 28% turnover; 30 wholesale, 49% turnover; 30 combination outlets, 23% turnover. 80% of stock-holding is sourced locally, which assists in preserving jobs in the supplier companies. Competition is rapidly emerging largely from singleoperator shops A big capital expenditure budget in place to refurbish stores, replace aging equipment, re-arrange physical outlook, in order to meet competition and maintain market position. The business has grown too big to be managed with manual systems and a store/warehouse computerisation program has been embarked upon, the end result of which will be to link all stores real-time.

PET plant installed two years ago helped to significantly reduce stock-out problems but the market is still not adequately supplied with the key brands. New products (Fanta Passion, Fanta Exotic, Malawi Rum) have been introduced to enhance the product portfolio. A new brewery and combi-bottling line is to be installed in Lilongwe, which will double current production volumes and truly satisfy the market fro some time to come. It is also planned to export some products as this will be facilitated by the increased volumes. Mzuzu plant is also being revamped. There has been a major truck replacement program in the last 4 years such that the fleet is fairly young

Inadequate raw material (Molasses) supplies a critical problem; production is consequently at around 50% of installed capacity. Serious efforts underway to find addition raw materials from other sources. Further development of export market necessary and on-going, because local uptake is frequently inadequate to exhaust stock holding Consideration to revert to a fuel blending ratio of 20% is at an advanced stage.

The installation of the FOC project is MTLs biggest and most expensive project; it will create a platform on which so many products will ride. The link from Blantyre-Lilongwe-Mzuzu is now complete and work is underway on the back-loop to Blantyre through the lakeshore. Currently there is one link to a sea-cable through Mwanza to Mozambique. However, insufficient capacity is being provided on that link. To counter the above problem, a new link is expected to be operational through Songwe and Dar es Salaam by the end of September. Looking further into the future, two more links will be established through Mulanje and Chipata and Zambia Vandalism and sabotage remain key threats to infrastructure, but nothing is being spared to deal with this challenge.

Network reach has been expanded significantly in the past two years, leading to greater new customer recruitment. In terms of network coverage, the gap with the leading competitor is very nearly being closed. In view of the fact that most of the equipment has been installed or upgraded recently, the network contains the most modern technologies in its systems. The subscriber base exceeded the 1 million mark in July and market-share has increased. There is indeed growing competition with the advent of a new entrant, but the entity is ready to hold its position...and more.

The company still hold the leadership position in tobacco processing, although this position has been eroded in the past two years by the advent of new competing processing facilities. The industry is facing threats from external sources, but the real effect of this will take time to settle.

Head office building is expected to be complete by yearend, which will significantly improve efficiencies, as all departments will be in the same building. We expect an impairment on the head office building, the magnitude of which we are yet to determine. A new banking system has just been installed (went live on 6th September 2010) and this will also bring increasing operational efficiencies. Refurbishment of branches is on-going in order to maintain the Banks image and leadership position. New geographical locations are being explored to expand the branch network in pursuit of better customer satisfaction. Similarly, more ATMs are being installed at non-bank premises for greater customer convenience.

An ethanol distillery plant with capacity to produce 60,000 litres of alcohol per day using molasses. The plant was revamped two years ago at a total cost of K1 billion. A lot of production efficiencies are now being achieved following this revamp. Production stands at 65% Extra Neutral Alcohol (ENA), 23% in Absolute Alcohol and 12% in Rectified Alcohol. ENA is all for export market. Company operating at 50% capacity due to raw material shortage (inadequate supply of molasses). Efforts are undergoing to find long lasting solutions to the problem

Joint venture between BP Africa and PCL. Company leads in petroleum fuels distribution in Malawi (market share 40%). Has 46 roadside service stations and supplies fuel to the key economic drivers in the agriculture, industrial, mining and construction sectors. BP sole supplier of aviation fuel in the country. Major challenge -fuel supply problems due to forex shortages New service stations under construction and upgrading. Kabula (construction), Chikhwawa (upgraded and commissioned) Ntchisi (being upgraded). BP Africa has indicated its desire to exit from Malawi and are seeking buyers for their 50% shareholding in BP Malawi.

Joint venture partnership with Macsteel Exports of South Africa. Largest and leading manufacture and distributor of steel, wire and roofing products in the country. Last year, introduced Harvey tiles to its range of products. So far sales have been encouraging Business heavily dependent on imported raw materials from South Africa hence performance affected by forex shortages and forex losses (when ZAR strengthens against the MK).

Property portfolio comprises of residential properties in an exclusive low density residential area in Blantyre and commercial and industrial properties for letting across the country. The company has just completed a major property development project (at a cost of K1.7 billion) on a 120 ha site at Chapima Heights 6 km from centre of Blantyre. The project involves sale to the public about 550 serviced freehold high, medium and low density plots and commercial plots. Provision has also been made for a recreation area and a school. Press Properties is to construct about 260 (30 already constructed) three bedroom medium density houses for sale. Chapima Heights project offers an excellent opportunity to individuals and corporate investors. The company is now taking bookings for houses and plots.

Largest commercial fishing and processing company in Malawi, fishes using three stern trawlers. Annual catch amounts to about 7% of the total Lake Malawi catch, which fluctuates between 26,000 tonnes and 47,000 tonnes annually. Major catches: Ndunduma (diplotaxodomspp) contributing 6070% of the total catch and Utaka (haplochromines). Tilapia (Chambo and Makumba) catches have been falling and are now at their lowest point ever. Population of Chambo (oreochromis karongae), fish in the lake has declined due to overfishing and is presently not targeted by Maldeco Fisheries. Main product is fresh fish representing over 90% of sales, 10% processed including smoked, frozen gutted and frozen fillets. So far, fishing program mostly in the Southern part of the Lake. A project (at an estimated cost of K500 million) to expand trawl fishing further up Lake Malawi, through the development of a fish-land site at Domira in Salima and construction of new fishing vessel is almost at completion stage. The new vessel will be launched in November 2010.

Established 2003 with sole objective of farming and selling Chambo (oreochromis karongae) using both pond and cage culture. Established due to decline in availability of the nations favourite fish, Chambo. PCL reasoned that any project increasing Chambo production would have significant socio-economic benefits. From a developmental point of view Press Corporation also considered that Maldeco Aquaculture would act more generally as a catalyst for aquacultural expansion in Malawi. Construction of all infrastructure completed in 2007 at a cost of about K500 million, including 2.5 km water pipeline, breeding ponds, fingerling production facilities, sinking of net cages in to the Lake, building a feed mill. Has 50 floating cages in the Lake with fish at various stages of growth. First commercial Chambo harvest and sales commenced in 2008. Fish harvest and sales over the last two years has averaged 450 tonnes per year. The target is 1,000 tonnes per annum.