Ann: 1H20 Appendix 4D and Interim Financial Report, page-2

Ouch!

’Challenging conditions’. No kidding, Cairns is virtually empty. Haven’t seen any Chinese there for quite a while now. And rumour has it that Hainan Air is going to pull out as well.

This business model had high potential during the boom time but I don’t know how they will survive in the current climate. Go to the nqlocal website and you can see that they have heavily discounted every product just to get people in the door. (Still too expensive for locals).

I still think they screwed themselves by laying off experienced staff from the original companies they bought.

Not looking good EXP. The next quarter is focused on reducing overheads. That’s a start, but I don’t see this ending well.

All in my opinion, but I try to keep a close eye on these operations as I used to be a top 50 and a very strong supporter of this co. I’d buy back in at very low teens for a punt on value of assets. Although no one is buying assets in Cairns so even diluting the business might prove difficult.

If I had any input to operations I would completely slash prices on some products to get locals involved. Eg reef trip or raft trip for $50. Might not turn much profit this way, but it will get the community re-involved with these products which could pay off if the tourism market returns.