Ann: Appendix 4D and Financial Report 31 December 2015, page-5

Questions and answers from this mornings results pres ...


Q1 - Sale of UK businesses and Carboodle means you have cash ... why no buyback?
A1 - Holding cash to pursue growth opportunities. For example buying franchise stores and MACC capital.

Q2 - What may or may not be happening with the US affiliation? Will you pull back from Europe or will UK model of master franchiser be the model internationally?
A2 - We will be focused in Au and to a lesser extent NZ hence the change of strategy in the UK. ROE is more easily achieved in Au than in the UK and the rest of the world

Q3 - Does closure of UK business mean that good people will come back to Au?
A3 - Yes, Martin Jenkins is coming back end of June who has been heading up the UK turnaround. Looking forward to his return

Q4 - What was the reason CCV moved into the UK and what was the mistakes?
A4 - Decision made about 20 years ago, decided to be a franchisor and looked to grow corporate stores in the UK. Slightly diff business model to Au (cashing Giro cheques). Regulatory changes in the marketplace and competitive nature meant scale was never there.

Q5 - Do you anticipate any further class actions for issues post 2013?
A5 - Didnt anticipate any of the previous ones! QLD and NSW were the only rate cap states pre 2013. Post 2013 compliance with rate rate caps and no one has been charged in excess of 100% COC.

Q6 - Bad debt rising?
A6 - Although % up, collections and recoveries are also up. [This is a more complex answer so I missed some of this.] There were some write offs as a result of audit too. Overall happy with the loan book.

Q7 - 24 million WO for claim to be paid off over time. Expected write-back in future?
A7 - 20 mill in fund and balance to Maurice B. 15 million has been returned to customers. Short answer is no.

Q8 - Corp costs up? Corp store revenue down?
A8 - Corp costs include strategy review of 800k. Corp store revenue affected by the UK additional writedown of 2.2 mill. Au stores up 18%

Q9 - Govt review, will you announce impact of Govt review even if it has no material affect?
A9 - not if no material

Q10 - MACC contracs .. .will you sell to current customer base or looking for a new market? Will you move in same direction as Money3?
A10 - New market and not just M3 but other industry players are in this space as well. Online expected to be the significant source of customers.

This is my interpretation of the questions and answers and should be taken as such.