Ann: ADH 1H FY2022 Results Presentation, page-17

Thanks WarrenCharlie for the update. And yes the H1 numbers met the Market Update from Adairs provided to the market a month or so before formal results were released.

The one thing the market has not well understood is the complexity and therefore risk in the National DC Consolidation project. In the case of Adairs the project was implemented through 18 months of Covid-19 which had having a massive impact in H1 with major covid-19 issues cruelling available manning in the new DC and a significant impact on e-commerce order distribution. Despite some damage to Adairs customer loyalty it is essentially a one year hit (some lingering issues in H2 with respect to logistics costs) and in my view we will see a normal FY'23 which should include about half of the planned $3.5m of savings from the DC consolidation. FY'24 should see a full $3.5m of savings.

The good news is that immigration is slowly restarting and sometime in FY'23 the normal boost to population growth and household formation will return and this will bolster Adairs sales across its three brands.