Ann: Appendix 4D and Half Year Report December 2016, page-4

Looks to be back on track after a couple of hectic years!

A sound strategy to open in Hamilton NZ bearing in mind Multispares is only in Auckland and Wellington on the North Island. Key competitor Truck Stops has 16 branches in NZ, is owned by Sime Darby Berhad (Malaysian Listed) and is the also the key importer of heavy commercial vehicles into NZ, somewhat giving them the early run on customer relationships on new vehicle owners. Nonetheless our company continues to perform well in NZ proven by the strong EBIT margins (FY16 12.2%, 1H17 13.1%). Possibly we have a cosy duopoly in a relatively small market!

It's here in Australia that we need the EBIT margin to lift, and as expected the new DC looks to be paying its way. Overall EBIT margin is now 9,2%, not far from the company target of 10%, despite the commentary of a highly competitive market. From there, let's hope the high watermark of 10.8% EBIT margin from FY2014 is within reach in the next couple of reports. Then we really will be flying.