BEACON LIGHTING GROUP LIMITED — AGM Information 2016

Oct 10, 2016

Beacon Lighting Group Limited

Annual General Meeting

CEO PRESENTATION OCTOBER 11, 2016

DISCLAIMER

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The Presentation contains “forward-looking statements”. All statements other than those of historical facts included in the Presentation are forward-looking statements. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. The Company will not necessarily release publicly any revisions to any such forward-looking statement.

The Presentation contains general background information about the Company and its activities current as at the date of this presentation. The information in this Presentation is in summary form only and does not contain all the information necessary to fully evaluate whether or not to buy or sell shares in the Company. It should be read in conjunction with the Company’s other periodic and continuous disclosure announcements lodged with the ASX, which are available at www.asx.com.au.

This Presentation is not a prospectus, disclosure document or other offering document. It is for information purposes only and does not constitute an offer, invitation or recommendation to subscribe for or purchase any security and does not form the basis of any contract or commitment.

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CONTENTS

1 INTRODUCTION TO BEACON LIGHTING 2 FY2016 RESULTS OVERVIEW 3 GROWTH STRATEGIES 4 FY2017 OUTLOOK

5 QUESTIONS

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1 INTRODUCTION TO BEACON LIGHTING

1 BEACON LIGHTING TODAY

• Beacon Lighting is Australia’s leading specialist retailer

• of light fittings, ceiling fans and light globes

• 98 Beacon Lighting Stores: 88 Company Stores and

• 10 Franchised Stores

• 4 Commercial Sales Offices and a Wholesale Operation

• selling products to Franchised Stores

• Vertically integrated retailer with 95% self supply, including 85% of products exclusively branded

• Emerging Businesses: Beacon International, Light Source

• Solutions and Beacon Solar

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1 COMPETITIVE POSITIONING

• Beacon Lighting has the widest range of products,

• including the latest styles and designs

• Beacon Lighting has experienced and technically capable

• Associates who can assist our customers with exciting lighting solutions

• Beacon Lighting has 98 conveniently located and well

• designed stores

• Beacon Lighting is competitively priced on like products and offers attractive promotions

• Beacon Lighting is able to provide a comprehensive

• retail offer to our customers

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1 BEACON LIGHTING TEAM

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2 FY2016 RESULTS OVERVIEW

2 FY2016 HIGHLIGHTS

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• Record sales and profit result

• Sales increased by $13.8m, 7.7% ahead of FY2015

• Gross profit dollar increased by $7.4m, 6.4% ahead

• of FY2015

• Opened 5 new company stores and purchased 2 franchised stores

• Established Light Source Solutions, the GE globe

• distribution business

• Designed and developed 509 exclusive new products

• Operating expenses down 0.9% of sales compared to

• last year

• EBITDA increased $1.8m, 6.5% ahead of FY2015

• NPAT increased $0.9m, 5.1% ahead of FY2015

• FY2016 dividends of 4.7 cents per share, an increase

• of 11.9% over FY2015

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2

YEAR-ON-YEAR RESULT

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Underlying Profit $ Inc / Dec % Inc / Dec Statutory Profit
$'000 FY2015
FY2016 [(1)] on Last Year on Last Year FY2016
Sales 179,386 193,179 13,793 7.7% 193,179
Gross Profit 116,041 123,483 7,442 6.4% 124,194
Gross Profit Margin 64.7% 63.9% 64.3%
Other Income 3,949 3,647 (302) (7.6%) 3,647
% of Sales 2.2% 1.9% 1.9%
Operating Expenses [(2)] (92,595) (97,965) (5,370) 5.8% (97,965)
% of Sales 51.6% 50.7% 50.7%
EBITDA 27,395 29,165 1,770 6.5% 29,896
EBITDA Margin % 15.3% 15.1% 15.5%
EBIT 25,042 26,619 1,577 6.3% 27,330
EBIT Margin % 14.0% 13.8% 14.1%
Net Profit After Tax 16,939 17,800 861 5.1% 18,298
NPAT Margin % 9.4% 9.2% 9.5%
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(1) During FY2016, the Beacon Lighting Group implemented a new inventory valuation system and conducted a review of the supply chain costs to be capitalised into inventory. The effect of this change in methodology was to increase inventory and gross profit by $0.7 million.

(2) Operating Expenses excludes interest, depreciation and amortisation.

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3 GROWTH STRATEGIES

3 NEW STORE ROLLOUT

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Beacon Lighting will continue to target the opening of six new company operated stores in Australia each year.

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Current Stores 98
98
96
Potential New Stores 48 91
85 10
79 11
74 13
71 88
66 85
61 14
59 15 78
53
48
16 71
17
18 64
19 58
21
54
24 48
21
42
38
29
27
FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 TODAY
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Company Stores Franchised Stores

Excludes the four Commercial Sales Offices.

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3 OPTIMISE EXISTING STORES

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Beacon Lighting believes it is able to grow sales and profit through the continued investment in the existing stores network.

• Sales Team

• Product Innovation

• Store Presentation

• Marketing Promotions

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3 ONLINE & SOCIAL MEDIA

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Beacon Lighting will continue to enhance our online presence in order to drive incremental sales.

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3 EMERGING BUSINESSES

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Beacon Lighting will continue to grow our emerging businesses: Beacon International, Light Source Solutions and Beacon Solar.

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I N T E R N A T I O N A L

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L I G H T & FA N S O U R C I N G
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COMMERCIAL ENERGY EFFICIENCY SPECIALISTS

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3 ACQUISITIONS

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Beacon Lighting intends to investigate and pursue local and international business opportunities that complement the core business activities.

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3 EFFICIENCY GAINS

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Beacon Lighting will continue to target expense efficiency gains and manage the growth of expenses.

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4 FY2017 OUTLOOK

4 FY2017 OUTLOOK

Beacon Lighting

• Company store comparative sales growth were positive

• in Q1 FY2017

• Jindalee (QLD) franchised store was converted to a company store

• Moonah (TAS) and Frankston (VIC) franchised stores will

• be converted to company stores in Q2 FY2017

• The Masson for Light (VIC) architectural lighting store was purchased in July 2016

• New stores in South Melbourne (VIC) and Marsden Park (NSW) have opened

• New stores in Brookvale (NSW), Claremont (WA), North Lakes (QLD) and Gladesville (NSW) are expected to open in FY2017

• Closely monitor the actions of Masters as they progress to closing

• all of their stores by December 11, 2016

• Expressed interested in a number of Masters sites

Summary

• Beacon Lighting expects our key growth strategies to continue to

• drive improved sales and profits in FY2017

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5 QUESTIONS