Ann: Response to ASX Query, page-35

1. Think you mean 9.8kg per tree, anyway they refute the low ball estimate in the para's below. What they appear to be saying is that 9.7kg is the new benchmark and they believe they will exceed that.

On yield, Glaucus asserts heartwood yields of 4.0 to 6.8 kg per tree should form the basis of Quintis’s yield estimates. This is a self-serving conclusion as it ignores both (a) the result of 9.7 kg per tree from Quintis’s (most recent) third annual harvest in 2016, which was one of Quintis’s pioneering plantations, and (b) the significant improvements in yield and mortality over time which are evident to any visitor to the plantations.
Quintis achieved approximately a three-fold improvement in yield from its first to its third harvest. Quintis expects a doubling in yield from its third to its fifteenth harvest due to multiple improvements in silvicultural practices. This is readily apparent with the size and consistency of five-year-old trees in Quintis plantations today exceeds the size and consistency of many of the 15-year-old trees which were harvested by Quintis from its pioneering plantations planted in 1999 and 2000.

2. Agree, QIN appear conservative.

3. The Chinese buyer took 150T of raw wood. Whilst they appear to be the major customer of wood it appears that it is only $2.2M of sales (cash receipts) . If it wasn't wood, would they convert it into oil? Not sure but they will find other buyers and not too concerned as customers will come and go and the really important ones are the oil customers.....i.e. Lush etc

I think that it is a good response and highlights the future upside, irrespective of what happens in the short term.