Ann: Business Update, page-6

Times are too uncertain for a dividend. Despite the fact that shareholders are long overdue for some kind of return, I'd rather the company conserve capital or even invest to strengthen the business during this period of uncertainty.

Glad to see this update - good to know we have transparent governance who are making smart decisions. As predicted, a lot of people have used COVID money to settle their debts. Moving into the post-COVID money phase, in which there is every possibility that unemployment will rise, it will be good for the company to be holding less loans on their books which could lead to significant bad debt. Combined with the company tightening their lending criteria moving into this period, in the short term we are looking at a decline in NPAT - it's likely the EOY financials will be quite average.

After this period, I'm looking back at the 2007-2011 era and how the GFC impacted CCV. CCV prospered due to a high demand in credit and second hand goods. Following the period, EZCorp who also prospered gained a large stake in CCV. EZCorp has not experienced any of the legislative pressures that CCV has had to deal with, and is in a strong position to increase its stake beyond the 35% it already owns. If the patterns of financial crises and our business model performs as it has performed all throughout history, then we are in a strong position.

CCV is currently great value, very much under the radar, and what I would classify as an "unsexy business". Pre-COVID, the share was moving into re-rate territory as it began to recover from the CA settlement. This has now been disrupted, leaving the share to remain on offer at a heavy discount to future value.