Chairman's address - 24 November 2015 Annual Meeting of shareholders

Thank you, Paul.

The year to June 2015 proved to be another challenging year for Cavalier. It involved some major decision points for the Group as we continued to adapt to an ever changing environment.

During the year, we completed a comprehensive strategic review covering every aspect of our business, identifying and considering every option to improve company performance. To be sure we had covered all angles, we engaged Deloitte to assist us by reviewing our plan, understanding that whilst we were confident in our assessment, an independent set of eyes can be extremely useful. As a result of our strategic review we prioritised a number of initiatives, and you have heard today that some have already been completed.

A highlight of the review work was confirmation of the strength of the Cavalier Bremworth brand, and the quality, durability and longevity that it continues to be associated with. A hugely valuable competitive advantage and one that we intend to make the most of.

Board composition

Last year’s Annual Meeting demanded changes at board level. This was already high on the board’s agenda - however, appointing a new chair or new directors is difficult when the company is not performing well. It was important to me, and the rest of the board, to have absolute clarity in the way forward before change could be made. Getting our story straight was critical for the recruitment process to attract the candidates we wanted.

Once our strategy was signed off and the bank facility renewed, this paved the way for successful recruitment. A robust process was undertaken to determine the balance of skills and experience that was needed, and we are delighted to be introducing Steve, Dianne and John to you today. They joined the board in July this year and are already making a great contribution.

I have been very pleased to receive the support of the new board and major stakeholders to take over the role of chair.

There is no substitute for the wisdom that comes with long term experience as a director or through being involved in a specific industry over an extended period of time. As a relative newcomer to the board myself, the stability and continuity provided by Grant and Graeme cannot be underestimated as we make these major changes to your company.

I am extremely grateful that Graeme has agreed to stay on for a few more months to support getting the new team up to speed. Grant will be speaking to you shortly in respect of the resolution for his re-appointment.

What have we achieved

So what have we achieved – some very considerable steps forward from a year ago.

We have a more focused strategy and tactical plan that the whole board and management team buy into.

We have a renewed bank facility that enables us to move forward with confidence – I want to take this opportunity to thank our team at the BNZ for working through this with us so positively.

The first steps of our plan have been completed and you have seen the significant debt reduction that has been achieved.

We have also made changes in the senior leadership team. Paul who was appointed interim Chief Executive Officer in May 2015 in addition to his role of Chief Financial Officer – will be glad to pass on that CFO role to a new incumbent – because I am pleased to advise today that Paul has been confirmed as our Chief Executive – please join with me in congratulating Paul.

Future performance

And what about the future? Believe me there is still a lot to do!

As indicated to the market back in May this year, we expect to be delivering improved profits in the 15/16 year and acceptable profitability in the 16/17 year.

We currently expect normalised profit after tax to be in the range $3 to 5 million for the year ending 30 June 2016.

In addition, the sale of our Sydney facility has resulted in a one-off gain of $2 million after tax.

Most importantly, we now have the flexibility and vital headroom to invest in our core business initiatives and implement the next steps of our plan. These initiatives will lead to longer term increased revenues and productivity, a return to better levels of profitability and with a sustainable level of debt. The Directors will keep shareholders updated as these initiatives are implemented.

As soon as we are in a position to confirm an ongoing improvement in underlying performance and have our debt firmly under control, we will resume dividend payments. This should in turn lead to a welcome improvement in the share price.

I am pleased to report the first half performance is on track.

Thank you.

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