Slide 1: Donaghys Performance First
DONAGHYS PERFORMANCE FIRST
Slide 2: Manufacturing a unique range of advanced polymer fabrics
Manufacturing a unique range of advanced polymer fabrics and value added products in China 690 emp, Australia 122 and NZ 97 Products are both porous and waterproof and are sold into the Consumer market as well as Industrial and Agricultural markets Customers in the retail segment are mostly DIY Reta
Slide 3: Completion of Chinese Facility
Completion of Chinese Facility Management team in China in place Well planned plant closure (ongoing) from Braeside to China facility Acquisition of Donaghys with effective integration of commercial ranges under the “Synthesis” brand (industrial / agric) Gale Europe start up with 750 retail stores s
Slide 4: Low cost Chinese manufacturing base
Low cost Chinese manufacturing base with increased capacity and shorter lead times to service Northern Hemisphere clients The addition of Donaghys and the start up of Gale Europe progresses Gale’s planned global geographic expansion adding NZ & Europe Chairman providing experience and expertise to t
Slide 5: Rapidly rising raw material costs
* Rapidly rising raw ° material costs * Australian DIY ° slowdown and inventory tightening * International operations now well bedded down Prices increased to cover rises with a significant lag effect Reduced fixed operating expenses in Australian operations Reduced corporate overhead expenses trave
Slide 6: Sales by region: Asia/Pacific, Europe, Americas
¢ Asia/Pacific 103m 83m 24 ¢ Europe/ME/Africa 64m 30m _= 133 ¢« Americas 15m 16m_ (6)
Slide 7: Sales, EBIT, NPAT, EPS, Dividend
Sales 147m 105m 40 EBIT 10.8m 12.3m (12) NPAT 4.7m 7.0m (33) Shares on Issue 51.9 50.4 3 EPS (fully diluted) 9.14 15.05 (39) Dividend 5.0c 7.5c (33)
Slide 8: First half impact items
Jung 1% Time First Half impact Raw material increase impact Australian DIY volume loss Increased borrowing costs Europe start up costs
Slide 9: Balance sheet
Fixed Assets 58m Inventory 51m Intangibles 12m Other Assets/Liabilities 12m Net Operating Assets 54m Net Debt 79m Shareholder funds 54m Debt to Equity Ratio 1.45:1 ROE (%) 8.6% 32m 34m 10m 9m 53m 32m 53m 0.60:1 13.2%
Slide 10: Cash flow
Operating EBITDA Capital expenditure Tax Paid Operating Cash Flow Interest Paid Dividends Acquisition Net Cash 16.8m 25m 1.6m (5.6m) 4.9m 2.9m 11.7m (2.3m)
Slide 11: Australian DIY
Australian DIY inventory tightening softening sales Raw material price increases Aust/China/NZ Increase in China sales outside economic entity Higher inventories within Australia
Slide 12: Gale Europe start up
* Gale Europe start up expenses * Jung 15 half for the first time * Middle East rapid growth ¢ Higher inventories due to start up
Slide 13: Americas
Marginal revenue increase in local currency Late in year expansion in window furnishing ranging t Consolidation of warehousing Expansion into Central & South America
Slide 14: Increased R&D facility in China
Increased R&D facility in China, more for less Bioclip Nylon nets Mining ventilation Horizontal awnings Aluminium extrusion Powder coating
Slide 15: Management team
Chairman Harry Boon = *_ Joined 2005 Group MD Gary Gale * 1997 COO and MD USA Peter McDonald * 1988 CFO Andrew London * 2002 - Visy MD China Emma Xu * 2002 MD Aust Steve Carroll * 2002 MD NZ Craig McCallum + 2002 - Donaghys MD Europe (TBA) * 2005 MD MEast Zaf Fakroddin + 2002 Group Log. Greg Roberts
Slide 16: Risks and mitigation
* Raw material inputs ¢ Weather dependence * Foreign exchange * Pass on increases proactively * Diversity of distribution locations and addition of waterproof fabrics * Cautious and well advised coverage
Slide 17: Revenue mix outlook
¢ Our revenue mix will remain biased to the second half over the ensuing years as our Northern Hemisphere revenue accelerates. ¢ This year the second half will be biased further as the one off costs of equipment transfer to China will be absorbed in the first half.
Slide 18: Outlook
* With the establishment of our European and China operations nearly complete we will be free to reap the benefit of these investments while focusing on extending our ranging with existing accounts and expanding our customer base, while driving down costs in our Production Facilities. ¢ We will re-e
Slide 19: Organic agricultural products and cocooning
* Organic Agricultural Products — Passive barriers to birds, insects & severe weather * “Cocooning” — The backyard is a major area of home improvement spend
Slide 20: Global warming and water conservation
* Global Warming — UV damage to people & plants ¢« Water Conservation — Evaporation & water quality
Slide 21: ‘iin
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