EBOS GROUP LIMITED — Interim / Quarterly Report 2014

Mar 27, 2014

A well planned JOURNEY

Interim Report 14

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EBOS | Interm Report 2014

FROM OUR SUPPLIERS, through our team, tO OUR cUStOMERS: together our journey OF gROwth cONtINUES...

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...wE’RE RIg

EBOS | Interm Report 2014

ht ON track

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FIVE YEAR REVENUE TREND

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For the six months to 31 December
2013 3,002
2012 755
2011 690
2010 694
2009 668
0 500 1000 1500 2000 2500 3000 3500
$MILLIONS
FIVE YEAR EBITDA TREND
For the six months to 31 December
2013 96.3
2012 27.2
2011 20.1
2010 20.7
2009 18.9
0 10 20 30 40 50 60 70 80 90 100
$MILLIONS
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FIVE YEAR CONTINUING OPERATIONS NPAT TREND

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For the six months to 31 December
2013 49.4
2012 15.0
2011 11.6
2010 11.5
2009 10.2
0 10 20 30 40 50
$MILLIONS
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EBOS HigHligHtS

• Excellent result, NPAT ahead of PFI (Prospective Financial Information).

• Symbion acquisition, progress on track.

• Revenue exceeds $3 Billion. All businesses performed well.

• Strong cash flow generation.

• Interim dividend 20.5 cents per share on enlarged capital base.

• Focus on growth initiative continues.

PERFORMaNcE aND thE journey ahEaD

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PERFORMaNcE
aND thE
journey ahEaD
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EBOS Group made an excellent start to the 2014 financial year as we seek to capitalise on our position as the leading Australasian provider of pharmaceuticals, medical and retail products to the healthcare and animal care sectors.

This was the first six month result since making our largest acquisition to date – the $1.1 billion purchase of Symbion in Australia. We delivered a performance that was in-line with what we forecast.

In the six months ending 31 December 2013 we reported NPAT of $49.4 million. To give a sense of scale this is about three times what we did for the same period a year earlier. Importantly, it also beats the $48.7 million we forecast back in June last year in our capital raising prospectus used to support the acquisition.

This is a remarkable achievement given that approximately two thirds of our earnings now come from Australia and the strong appreciation of the NZ dollar from 0.82 forecast to a weighted average Australian dollar rate for our first half of 0.89.

The strength of our result can be put down to excellent performances across all of our business units, which generated turnover in excess of $3 billion and produced EBITDA of nearly $100 million. Operating cashflows for the six month period totalled $49.6 million, or equivalent to our half year NPAT.

Our balance sheet gearing, or net interest bearing debt to net interest bearing debt plus equity, was 26.7%. Our low gearing and strong cashflow generation, combined with undrawn bank facilities of $390 million, at 31 December 2013, provide significant headroom for further growth.

Dividend grows

We have increased our half year dividend payment to 20.5 cents per share (cps) from 17.5 cps last year. This is a sure sign of confidence given our much larger capital

base. The dividend is 50% imputed and a dividend reinvestment plan offering a 2.5% discount is on offer. The dividend is payable on 4 April 2014, and is based on a record date of 14 March 2014.

growth focus continues

EBOS is a company founded on growth – a focus that will continue. Having now successfully amalgamated Symbion into the EBOS family, we as a board and management team continue to be as excited as ever by the potential for EBOS going forward. A combination of new opportunities and organic growth, when combined with financial headroom create an excellent outlook.

Market commentators and research analysts rightly query the cost saving reforms to healthcare by both Governments, and their

EBOS | Interm Report 2014

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possible impact on future spending. This has always been the situation. A good example is the Australian PBS schedule of Pharmaceutical spend where major price reductions have been achieved owing to patent expiry of major drugs. Pharmac in NZ has already achieved these savings.

Both EBOS and Symbion have an enviable track record of adjusting our business models to counteract these changes and to continue to grow our profit line. We are well diversified across multiple segments of the healthcare market and the growing Animal/ Petcare sector.

leadership transition

In February this year the board announced succession plans that would take place over the next two years to ensure that our focus on growth and outstanding performance continues. The changes outlined on the accompanying page involve the key roles of CEO, Chairman and CFO, and are designed to ensure continuity of focus and direction whilst also identifying new capability at the management level to deliver on operational performance.

In summary, Rick Christie, will retire at the 2015 AGM as Chairman after 14 successful years with the company. Mark Waller,

our long-standing Managing Director, and effective founder of what EBOS is today, will retire as CEO at the end of this financial year (August). Thereafter Mark will undertake a key project of working to drive the next phase of the EBOS growth story until taking over as Chairman in 2015. He will also mentor Patrick Davies in his new position as new Chief Executive. At the same time John Cullity will take over the position of CFO from the retiring Dennis Doherty. Both Patrick and John are currently the Symbion CEO and CFO and together have driven the success of Symbion. Both are high calibre executives with a real depth of health industry experience.

this with a blend of continuity to ensure a smooth transition. One constant however, will be our focus to deliver exceptional performance and returns for you our shareholders. In November last year we were recognised for our determination to be the leading player in the markets we operate with the accolade of the “Best Growth Strategy” in the Deloitte Top 200 Awards. We were delighted to receive this award. In addition EBOS won the “Best deal in NZ” in Finance Asia’s awards for 2013. To maintain this success we must continue to broaden our horizons. Last year’s significant move in Australia was another such step to export this New Zealand-based success story. We look forward to your continued and valued support.

At the root of our success to date has been a board that has set and supported the strategic direction of our business, backed up by an outstanding management team. Through our acquisitions we have bought excellent companies and gained excellent and talented people – Patrick and John are great examples of this.

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MaRk waLLER

Managing Director / CEO

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Well planned change and constant reinvention has been an EBOS hallmark. We are pleased to be able to introduce some new and experienced faces to the leadership team. We have also balanced

RIck chRIStIE Chairman

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MaRk waLLER

Current Position: Chief Executive and Managing Director Years with company: 30

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LatE 2014 StRatEgIc LatE 2015 chaIRMaN
gROwth
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History: As the founder of modern day EBOS, Mark has driven revenue from $9m per annum when he joined, to $6 billion today. Mark has extensive listed company experience in NZ and Australia, as well as in manufacturing, distribution marketing and retail businesses. Specialist areas include strategy and mergers and acquisitions.

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PatRIck DavIES

Current Position: Chief Executive, Symbion Years with company: 23

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LatE 2014 cEO
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History: Patrick has held senior executive roles across many sectors of the healthcare industry for over twenty years. He is also a director of Pharmacybrands Ltd (New Zealand) and the current President of the NPSA, the peak industry association for pharmaceutical wholesalers in Australia.

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RIck chRIStIE

LatE 2015 REtIREMENt Current Position: Chairman

Years with company: 14 History: Rick has been a professional director for 15 years – an ex-CEO with a strong background in investment, trade, technology, strategy and governance. He has overseen the prodigious growth of EBOS, maintaining a strong focus on core business while seeking profitable outreach into other business areas.

EBOS | Interm Report 2014

Well planned succession over the next two years will ensure that our focus on growth and outstanding performance continues. The elevation of high calibre executives with a real depth of health industry experience, coupled with solid continuity and mentoring, will ensure a smooth transition.

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JOhN cULLItY
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LatE 2014 cFO
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Current Position: Chief Financial Officer, Symbion Years with company: 4.5 History: John has over twenty years’ experience in finance roles within listed companies in Australia and the United States including multiple corporate acquisitions and divestments. Extensive experience negotiating corporate banking facilities including the establishment of Symbion’s current AUD 420m trade receivables securitisation facility.

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DENNIS DOhERtY

Current Position: Chief Financial Officer Years with company: 26

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LatE 2014 REtIREMENt
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History: Dennis has worked in partnership with Mark throughout his tenure as CEO and enjoyed the immense satisfaction of seeing EBOS develop under Mark’s engaging and challenging leadership. Retires knowing EBOS is in very good hands.

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thE JOURNEY forward

Understanding healthcare

A clear understanding of the dynamics driving change for manufacturers and funders of healthcare is a key catalyst for EBOS. This understanding is core to our strategic planning and in turn our target list for acquisitions.

Market driven changes over the last 20 years have seen the commoditisation of pharmaceutical and medical supplies, driving down margins and requiring EBOS to choose between being a small niche player or to aim to become the industry leader in Australia and New Zealand. EBOS has chosen to become a leader, and the recent Symbion acquisition further strengthens our position.

This has been an exciting journey for all of our stakeholders. All along, the EBOS vision has been constant: we want to be in leading positions in all of the markets in which we choose to operate. Market leading positions provide the scale that delivers efficiencies and opens new opportunities to create value from meeting both customer and manufacturer needs, in a way that neither can do alone.

With 19 acquisitions in the last 12 years EBOS has delivered; shareholders have enjoyed a compound annual return over that period of 19 per cent p.a., while the business has grown from revenues of $20 million in [1994] to $6 billion now.

EBOS | Interm Report 2014

EBOS now has market leading positions in providing healthcare and animal care products. The opportunity going forward is to leverage the group’s scale and broad set of capabilities. This is the journey we are now beginning.

There will be several milestones along the way as we seek to grow both revenue and profit. Among the first, is combining Symbion’s scale and infrastructure in Australia with the specialist knowledge and expertise of EBOS. As an example there are good prospects of developing our third party logistics business in Australia by leveraging off our NZ success.

Before becoming part of EBOS, Symbion had already invested in a fully automated logistics centre in Sydney. A similar facility is nearing completion in Melbourne. This will generate operational efficiencies and service benefits to customers.

An essential healthcare partner

EBOS is now an essential partner in enabling the provision of healthcare in New Zealand and Australia. We are a proven performer; we are trusted and innovative – and we have a very long history of delivering results. We have relationships with big pharma, the rising generic manufacturers, medical products suppliers, and with end consumers represented by healthcare providers and retailers of pharmaceutical, over the counter products and medical supplies. We offer a range of complementary services along the full supply chain continuum.

Health is one of the biggest spends of both governments and both are adopting strategies to achieve more cost efficient healthcare. Through our Onelink business

we are already supplying value-added logistics and distribution services to several New Zealand District Health Boards (DHBs).

As the New Zealand Government’s chosen supplier we will be working to deliver more services by rolling out a national supply chain for all medical and some pharmaceutical supplies to DHBs.

Onelink’s ability to do this will create further efficiencies and assist the Government to deliver more resource to front line health care. EBOS believes the model that will be put in place with the Crown agency Health Benefits Limited, will be exportable to other markets once the scale of the benefits is fully understood.

In addition, EBOS is confident that the partnership with the Crown will lead to further business relationships and opportunities.

Animal care opportunities

In animal care, a new phase of the journey is unfolding with work already underway to use the experience of Lyppards in Australia to expand into veterinary wholesale in New Zealand. This will complement the strong brand position of Masterpet in the veterinary products channel. Own brand development of Masterpet in both NZ and Australia is an exciting journey. The market reach covers all retail sectors from our own 50% owned Animates retail chain, through to grocery channels, vets, speciality stores and even direct to farm. With high pet ownership in NZ and Australia we are excited by future growth prospects.

These are some of the opportunities in the next stage of the EBOS journey. There are many more within reach as we work with

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6 Billion
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Few companies have the breadth of skill that EBOS does, from sophisticated and high tech supply chain, through to brand building and sales/marketing.

global manufacturers, marketers and with funding agencies to fully realise the benefits that scale, expertise and technology can offer.

Few companies have the breadth of skill that EBOS does, from sophisticated and high tech supply chain, through to brand building and sales/marketing. This is a powerful combination.

Now dual listed

The increasing scale of EBOS will attract interest from a wider pool of investors. In preparation for this, the Company obtained a dual listing on the Australian Stock Exchange. The ASX listing is a medium term investment by EBOS aimed at attracting a larger pool of investors which should create greater liquidity in the Company’s shares – a benefit for all shareholders.

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02

86 cOMPaNY NaME BEcOMES EBOS 22 Group Ltd.

cOMPaNY waS FOUNDED aS Early Brothers Trading Co. Ltd.

60

cOMPaNY IS listed ON thE NEw ZEaLaND StOck ExchaNgE.

00 EBOS acquires Medic Corporation, a wELLINgtON BaSED SaLES & MaRkEtINg ORgaNISatION SPEcIaLISINg IN REPRESENtINg MEDIcaL, cONSUMER, DENtaL & ScIENtIFIc BRaNDS. thIS acqUISItION tRaNSFORMS EBOS INtO thE LaRgESt INDEPENDENt hEaLthcaRE SUPPLY cOMPaNY IN NEw ZEaLaND.

96

EBOS acqUIRES thE LaRgESt PRIvatE MEDIcaL whOLESaLER IN NSw – Richard Thompson & Co.

thIS acqUISItION MaRkS thE ENtRY OF EBOS aS a MaINStREaM MEDIcaL SUPPLIER IN thE aUStRaLIaN MaRkEt.

04 Acquisition of Vernon Carus, a SPEcIaLISED INFEctION PREvENtION PROvIDER IN PUBLIc/PRIvatE hOSPItaLS aND agED caRE FacILItIES thROUghOUt aUStRaLIa.

EBOS acquires the Nature’s Kiss business INcLUDINg thE ‘hERO’ REtaIL BRaND aNtIFLaMME. 05

EBOS cOMPLEtES thE EBOS acquires the scientific acquisition of Health Support business Global Science Ltd (NOw caLLED ONELINk) IN NEw ZEaLaND aND FROM thE gOvERNMENt. Quantum Scientific IN thIS BUSINESS PROvIDES aUStRaLIa IN ORDER tO SPEcIaLISED LOgIStIcS OF ExPaND OUR ExIStINg MEDIcaL cONSUMaBLES MEDIc ScIENtIFIc BUSINESS. aND PhaRMacEUtIcaLS FOR a NUMBER OF NEw ZEaLaND’S DhBS.

EBOS | Interm Report 2014

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06

EBOS acquires the leading NSW based Australian medical wholesaler Vital Medical Supplies, aS wELL aS thE LEaDINg taSMaNIaN MEDIcaL whOLESaLER taSMED PtY LtD. thESE acqUISItIONS tRaNSFORM EBOS INtO thE LEaDINg aUStRaLIaN MEDIcaL whOLESaLER IN thE PRIMaRY caRE MaRkEt (gENERaL PRactItIONERS).

EBOS attaINS aN NZx tOP50 LIStINg.

EBOS acquires Masterpet Corporation, a SUccESSFUL aNIMaL hEaLthcaRE BUSINESS IN NEw ZEaLaND aND aUStRaLIa aND vIa OwNERShIP, 50% OF thE aNIMatES REtaIL PEt StORE gROUP. ExPaNDINg INtO 08 aNIMaL caRE PROvIDES EBOS EaRNINgS DIvERSItY, EBOS gROUP hIghER MaRgINS aND revenues exceed a LESS REgULatED $1b for the first time. ENvIRONMENt.

07

EBOS acquires the New Zealand pharmaceutical wholesaler Propharma and pre-wholesale third party logistics provider Healthcare Logistics from the Zuellig Group . EBOS IS NOw thE LaRgESt PhaRMacEUtIcaL whOLESaLER IN NEw ZEaLaND aND NUMBER ONE OR twO PRE – whOLESaLE (thIRD PaRtY LOgIStIcS) PROvIDER IN NEw ZEaLaND.

10 EBOS DIvEStS ItS PORtFOLIO OF ScIENtIFIc BUSINESSES IN NEw ZEaLaND & aUStRaLIa tO thE NUMBER twO gLOBaL ScIENtIFIc SUPPLY cOMPaNY BaSED IN thE USa.

EBOS acquires Crown Scientific tO FURthER ExPaND OUR aUStRaLIaN PRESENcE IN thIS MaRkEt. EBOS BEcOMES thE cLEaR NUMBER twO SUPPLIER IN thE cOMBINED aUStRaLIaN aND NEw ZEaLaND ScIENtIFIc SUPPLY MaRkEt.

13

EBOS acquires Symbion, thE LEaDINg PhaRMacEUtIcaL whOLESaLER IN thE cOMBINED PhaRMacY aND hOSPItaL MaRkEtS IN aUStRaLIa aND vIa OwNERShIP, LYPPaRD, thE NUMBER twO vEtERINaRY whOLESaLER IN aUStRaLIa.

thE SYMBION acqUISItION tRaNSFORMS EBOS INtO thE LaRgESt aND MOSt DIvERSIFIED aUStRaLaSIaN MaRkEtER, whOLESaLER aND DIStRIBUtOR OF hEaLthcaRE, MEDIcaL aND PhaRMacEUtIcaL PRODUctS, BY REvENUE, aND a LEaDINg aUStRaLaSIaN aNIMaL caRE PRODUctS MaRkEtER & DIStRIBUtOR.

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EBOS SNaP ShOt

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StaFF cUStOMERS EFFIcIENtLY PROcESSINg ORDERS
EBOS have a combined staff roll of As the demand grows in these sectors, Electronic ordering throughout our
over two thousand employees across we have grown to include a combined network annually is now three quarters
Australasia. customer base of 30,387 . of all orders processed adding significant
value and efficiency, minimising waste
in distribution costs for all our customers
and suppliers.
77%
ElECtrONiC
2 242
,
19,605
AUStrAliA
23%
mANUAl
84.5% 10NEw ZEAlAND,782
HEAltHCArE
64.5%
AUStrAliA
15.5%
ANimAl CArE 35.5%
NEw ZEAlAND
85.9% milliON
OrDErS
HEAltHCArE 5.4 PrOCESSED
14.1%
ANimAl CArE
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EBOS | Interm Report 2014

PRODUct SkU’S

We have a significant range of products serving both the healthcare and animal care sectors.

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150
125 124,000
100
75
50
25
00 20,000
144,000
SkU’S
HEAltHCArE ANimAl CArE
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FINaNcIaL StatEMENtS

Six months to 31 December 2013

SUMMaRY OF
FINaNcIaL hIghLIghtS	16
ShaREhOLDER caLENDaR	16
REvIEw REPORt	17
cONDENSED cONSOLIDatED
INcOME StatEMENt	18
cONDENSED cONSOLIDatED
StatEMENt OF
cOMPREhENSIvE INcOME	19
cONDENSED cONSOLIDatED
StatEMENt OF chaNgES
IN EqUItY	19
cONDENSED cONSOLIDatED
BaLaNcE ShEEt	20
cONDENSED cONSOLIDatED
caSh FLOw StatEMENt	22
NOtES tO thE INtERIM
FINaNcIaL StatEMENtS	23
DIREctORY	37

69.7% 30.3% NEw ZEAlAND AUStrAliA

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SUMMaRY OF FINaNcIaL hIghLIghtS

Revenue EBITDA Proft before income tax expense Proft for the period Shareholders’ interest Earnings per share Interest cover Net interest bearing debt to net interest bearing debt plus equity Net asset backing per share	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 755,250 27,230 20,828 14,959 215,903 25c* 6.0 30.8% 410c	Year ended 30 Jun 13 $’000 Audited
	3,001,512		1,823,169
	96,247		58,243
	69,347		42,214
	49,409		28,207
	961,131		304,877
	34c		47c*
	5.5		5.4
	26.7%		36.3%
	651c		465c

• Earnings per share for comparative periods has been adjusted for the bonus share element included in the rights issue of 5 July 2013, as required by International Financial Reporting Standards. This is to allow a direct like for like comparison of the current period earnings per share with comparative periods.

ShaREhOLDER caLENDaR

Interim dividend record date 14 March 2014 Interim dividend payable 4 April 2014 Release of full year result Late August 2014 Final dividend payable Late October 2014 Annual General Meeting 31 October 2014

EBOS | Interm Report 2014

REvIEw REPORt tO thE ShaREhOLDERS OF EBOS gROUP LIMItED

We have reviewed the condensed consolidated interim financial statements on pages 18 to 36. The condensed consolidated interim financial statements provide information about the past financial performance of the EBOS Group Limited and its financial position as at 31 December 2013. This information is stated in accordance with the accounting policies referred to on page 23.

This report is made solely to the company’s shareholders, as a body. Our review has been undertaken so that we might state to the company’s shareholders those matters we are required to state to them in a review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company’s shareholders as a body, for our engagement, for this report, or for the opinions we have formed.

Board of Directors’ responsibilities

The Board of Directors is responsible for the preparation, in accordance with New Zealand law and generally accepted accounting practice, of the condensed consolidated interim financial statements which give a true and fair view of the financial position of the Group as at 31 December 2013 and of the results of operations and cash flows for the six months ended on that date.

independent Accountant’s responsibilities

We are responsible for reviewing the condensed consolidated interim financial statements presented by the Board of Directors in order to report to you whether, in our opinion and on the basis of the procedures performed by us, anything has come to our attention that would indicate that the condensed consolidated interim financial statements do not present fairly the matters to which they relate.

Basis of Opinion

A review is limited primarily to enquiries of company personnel and analytical review procedures applied to financial data and thus provide less assurance than an audit. We have not performed an audit and, accordingly, we do not express an audit opinion.

We have reviewed the condensed consolidated interim financial statements of EBOS Group Limited for the six months ended 31 December 2013 in accordance with the Review Engagement Standards issued by the External Reporting Board.

Other than in our capacity as auditors under the Companies Act 1993, the provision of due diligence work, internal control assurance services and other advisory services we have no relationship with or interests in EBOS Group Limited or any of its subsidiaries.

Opinion

Based on our review, which is not an audit, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial statements on pages 18 to 36 do not present fairly the financial position of the Group as at 31 December 2013 and the results of operations and cash flows for the six months ended on that date in accordance with NZ IAS 34: Interim Financial Reporting and IAS 34: Interim Financial Reporting.

Our review was completed on 18 February 2014 and our review opinion is expressed as at that date.

Chartered Accountants Christchurch, New Zealand

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cONDENSED cONSOLIDatED INcOME StatEMENt

For the Six Months ended 31 December 2013

For the Six Months ended 31 December 2013
revenue Proft before depreciation, amortisation, fnance costs and income tax expense Depreciation Amortisation of fnite life intangibles Proft before fnance costs and tax Finance costs Proft before income tax expense Income tax expense Proft for the period	NOTES 2(a) 2(b) 2(b) 2(b) 2(b)	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 755,250 27,230 (2,171) (91) 24,968 (4,140) 20,828 (5,869) 14,959	Year ended 30 Jun 13 $’000 (Audited)
		3,001,512		1,823,169
		96,247		58,243
		(5,187)		(4,922)
		(6,162)		(1,514)
		84,898		51,807
		(15,551)		(9,593)
		69,347		42,214
		(19,938)		(14,007)
		49,409		28,207
Earnings per share Basic (cents per share) Diluted (cents per share) Calculated on a weighted average basis of the number of shares on issue.			25 25
		34		47
		34		47

EBOS | Interm Report 2014

cONDENSED cONSOLIDatED StatEMENt OF cOMPREhENSIvE INcOME

For the Six Months ended 31 December 2013

For the Six Months ended 31 December 2013
Proft for the period Other comprehensive income Items that may be reclassifed subsequently to proft or loss: Cash fow hedges gains/(losses) Related income tax Translation of foreign operations total comprehensive income net of tax	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 14,959 (485) 144 (329) 14,289	Year ended 30 Jun 13 $’000 (Audited)
	49,409		28,207
	404		2,773
	(137)		(359)
	(20,695)		(6,365)
	28,981		24,256

cONDENSED cONSOLIDatED StatEMENt OF chaNgES IN EqUItY

For the Six Months ended 31 December 2013

		NOTES	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 208,601 14,959 (341) (329) (10,682) 3,695 215,903	Year ended 30 Jun 13 $’000 (Audited)
Equity at start of period Proft for the period Other comprehensive income: Movements in cashfow hedge reserve Movement in foreign currency translation reserve Dividends paid to company shareholders Shares issued			304,877		208,601
			49,409		28,207
			267		2,414
			(20,695)		(6,365)
		4	(21,992)		(21,298)
		3	649,265		93,318
Equity at end of period			961,131		304,877

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cONDENSED cONSOLIDatED BaLaNcE ShEEt

As at 31 December 2013

As at 31 December 2013
Current assets Cash and cash equivalents Trade and other receivables Prepayments Inventories Current tax refundable Other fnancial assets – derivatives total current assets Non-current assets Property, plant and equipment Capital work in progress Prepayments Deferred tax assets Goodwill Indefnite life intangibles Finite life intangibles Investment in associates total non-current assets total assets Current liabilities Trade and other payables Finance leases Bank loans Current tax payable Employee benefts Other fnancial liabilities – derivatives Deferred purchase consideration total current liabilities	NOTES 7	31 Dec 13 $’000 (Unaudited)	31 Dec 12 $’000 (Unaudited) 41,782 178,149 2,912 162,248 1,575 35 386,701 22,053 191 348 6,357 180,422 30,867 269 18,838 259,345 646,046 263,147 411 9,001 4,219 8,021 870 – 285,669	30 Jun 13 $’000 (Audited)
		92,580		198,014
		755,396		736,429
		7,269		7,837
		505,835		558,350
		1,401		1,628
		2,630		3,546
		1,365,111		1,505,804
		98,437		95,131
		693		787
		–		16
		28,936		34,361
		721,046		722,158
		56,941		59,324
		82,067		95,145
		22,620		19,013
		1,010,740		1,025,935
		2,375,851		2,531,739
		874,358		892,645
		968		1,189
		176,560		215,675
		19,615		6,378
		22,460		25,725
		1,668		2,872
		–		865,000
		1,095,629		2,009,484

EBOS | Interm Report 2014

cONDENSED cONSOLIDatED BaLaNcE ShEEt CONTINUED

As at 31 December 2013

As at 31 December 2013
Non-current liabilities Bank loans Trade and other payables Deferred tax liabilities Finance leases Employee benefts total non-current liabilities total liabilities Net assets Equity Share capital Foreign currency translation reserve Retained earnings Cash fow hedge reserve total equity	NOTES 7 3	31 Dec 13 $’000 (Unaudited)	31 Dec 12 $’000 (Unaudited) 127,273 4,113 10,784 1,034 1,270 144,474 430,143 215,903 111,665 361 104,636 (759) 215,903	30 Jun 13 $’000 (Audited)
		262,641		151,357
		9,605		8,489
		40,073		48,365
		2,566		3,296
		4,206		5,871
		319,091		217,378
		1,414,720		2,226,862
		961,131		304,877
		850,553		201,288
		(26,370)		(5,675)
		134,685		107,268
		2,263		1,996
		961,131		304,877

/ 21

cONDENSED cONSOLIDatED caSh FLOw StatEMENt

For the Six Months ended 31 December 2013

For the Six Months ended 31 December 2013
Cash fows from operating activities Receipts from customers Interest received Payments to suppliers and employees Taxes paid Interestpaid Net cash infow from operating activities Cash fows from investing activities Sale of property, plant & equipment Purchase of property, plant & equipment Payments for capital work in progress Payments for intangible assets Acquisition of associates Acquisition of subsidiaries Costs associated with acquisition of subsidiaries Net cash (outfow)/infow from investing activities Cash fows from fnancing activities Proceeds from issue of shares Proceeds from borrowings Repayment of borrowings Dividends paid to equity holders of parent Net cash infow/(outfow) from fnancing activities Net (decrease)/increase in cash held Effect of exchange rate fuctuations on cash held Net cash and cash equivalents at beginning of period Net cash and cash equivalents at end of period Cash and cash equivalents	NOTES 5 3 4	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 751,727 446 (738,896) (8,239) (4,140) 898 437 (1,129) (182) (83) – – – (957) 3,695 2,700 (6,044) (10,682) (10,331) (10,390) (167) 52,339 41,782 41,782 41,782	Year ended 30 Jun 13 $’000 (Audited)
		2,927,400		1,917,358
		1,461		1,198
		(2,855,278)		(1,869,090)
		(8,460)		(13,458)
		(15,551)		(9,593)
		49,572		26,415
		476		403
		(15,485)		(2,943)
		–		(778)
		(631)		(142)
		(2,988)		–
		(366,853)		49,263
		–		(5,993)
		(385,481)		39,810
		151,119		93,318
		317,716		30,009
		(211,011)		(21,474)
		(21,992)		(21,298)
		235,832		80,555
		(100,077)		146,780
		(5,357)		(1,105)
		198,014		52,339
		92,580		198,014
		92,580		198,014
		92,580		198,014

EBOS | Interm Report 2014

NOtES tO thE INtERIM FINaNcIaL StatEMENtS

For the Six Months ended 31 December 2013

1. FINaNcIaL StatEMENtS

These unaudited interim financial statements have been prepared in accordance with Generally Accepted Accounting Practice in New Zealand (“NZ GAAP”). They comply with New Zealand Equivalent to International Accounting Standard 34 (NZ IAS 34) “Interim Financial Reporting” and International Accounting Standard IAS 34, as applicable for profit orientated entities.

The same accounting policies and methods of computation are applied in the interim financial statements as were applied in the financial statements for the year ended 30 June 2013. These financial statements should be read in conjunction with the financial statements and related notes included in the Company’s Annual Report for the year ended 30 June 2013. The information is presented in thousands of New Zealand dollars unless otherwise stated.

2. PROFIt FROM OPERatIONS

a) revenue Revenue from the sale of goods Revenue from the rendering of services Management fees Interest revenue	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 753,378 1,308 118 446 755,250	Year ended 30 Jun 13 $’000 (Audited)
	2,955,281		1,811,465
	44,770		10,506
	–		–
	1,461		1,198
	3,001,512		1,823,169

/ 23

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

2. PROFIt FROM OPERatIONS (CONTINUED)

	Proft before income tax expense Proft before income tax has been arrived at after crediting/(charging) the following gains and losses from operations: Gain on sale of property, plant and equipment Change in fair value of derivative fnancial instruments Share of profts of associates Proft before income tax has been arrived at after (charging) the following expenses by nature: Cost of sales Write-down of inventory Finance costs: Bank interest Other interest expense Total fnance costs Net bad and doubtful debts arising from: Impairment loss on trade & other receivables Depreciation of property, plant & equipment Amortisation of fnite life intangibles Operating lease rental expenses: Minimum lease payments Donations Employee beneft expense Defned contribution plan expenses Costs associated with acquisition of subsidiaries Other expenses Total expenses Proft before income tax expense	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 227 79 410 (656,945) (1,280) (3,863) (277) (4,140) (357) (2,171) (91) (4,788) (30) (33,750) (1,259) – (30,327) (735,138) 20,828	Year ended 30 Jun 13 $’000 (Audited)
(b)
		286		170
		(115)		257
		619		585
		(2,701,778)		(1,597,475)
		(1,550)		(2,227)
		(15,229)		(8,979)
		(322)		(614)
		(15,551)		(9,593)
		(1,249)		(14)
		(5,187)		(4,922)
		(6,162)		(1,514)
		(12,993)		(9,227)
		(41)		(29)
		(97,585)		(76,213)
		(5,576)		(2,927)
		–		(5,993)
		(85,283)		(71,833)
		(2,932,955)		(1,781,967)
		69,347		42,214

EBOS | Interm Report 2014

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

3. ShaRE caPItaL

ShaRE caPItaL	ShaRE caPItaL
Fully paid ordinary shares Balance at beginning of period Dividend re-invested – October 2012 April 2013 October 2013 Bonus issue – June 2013 Institutional placement – June 2013 Share issue costs Rights issue – July 2013 Share issue costs Issue of consideration shares – July 2013 Share issue costs Issue of shares to executives and staff under employee share ownership scheme			Six months 31 Dec 13 (Unaudited)	No. ’000 52,107 429 – – – – – – – – – 63 52,599	Six months 31 Dec 12 (Unaudited) Total $’000 107,970 3,445 – – – – – – – – – 250 111,665		Year ended 30 Jun 13 (Audited)
		No. ’000	Total $’000			No. ’000	Total $’000
		65,546	201,288			52,107	107,970
		–	–			429	3,445
		–	–			357	3,100
		996	9,500			–	–
		–	–			1,999	–
		–	–			10,591	90,026
		–	–			–	(3,503)
		22,941	149,119			–	–
		–	(7,356)			–	–
		58,127	498,146			–	–
		–	(144)			–	–
		–	–			63	250
		147,610	850,553			65,546	201,288

/ 25

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

4. DIvIDENDS

DIvIDENDS
recognised amounts Fully paid ordinary shares - Final – prior year - Taxable bonus issue - Interim – current year Unrecognised amounts Final dividend Interim dividend	Six months 31 Dec 13 (Unaudited)	Six months 31 Dec 12 (Unaudited) Cents per share Total $’000 20.5 10,682 – – – – 20.5 10,682 – – 17.5 9,205 17.5 9,205	Year ended 30 Jun 13 (Audited)
	Cents per share Total $’000		Cents per share Total $’000
	15.0 21,992		20.5 10,682
	– –		– 1,411
	– –		17.5 9,205
	15.0 21,992		38.0 21,298
	– –		15.0 21,992
	20.5 30,260		– –
	20.5 30,260		15.0 21,992

The Board approved an interim dividend of 20.5 cents per share on 18 February 2014. The record date for the dividend is 14 March 2014 and the dividend will be paid on 4 April 2014. The Group’s dividend reinvestment plan will be operable for this interim dividend.

EBOS | Interm Report 2014

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

5. NOtES tO thE caSh FLOw StatEMENt

reconciliation of proft for the period with cash fows from operating activities Proft for the period Add/(less) non-cash items: Depreciation Gain on sale of property, plant & equipment Share of profts of associates Amortisation of fnite life intangibles Loss/(gain) on derivatives/fnancial instruments Deferred tax Provision for doubtful debts Movements in working capital: Trade and other receivables Prepayments Inventories Current tax refundable/payable Trade and other payables Employee benefts Foreign currency translation of opening working capital balances Cash costs classifed as investing activities: Costs associated with acquisition of subsidiaries Working capital items acquired Net cash infow from operating activities	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 14,959 2,171 (227) (410) 91 (79) 1,264 (125) 2,685 (2,312) 1,475 749 (3,609) (12,231) (473) (345) (16,746) – – 898	Year ended 30 Jun 13 $’000 (Audited)
	49,409		28,207
	5,187		4,922
	(286)		(170)
	(619)		(585)
	6,162		1,514
	115		(257)
	(2,901)		12
	(156)		(441)
	7,502		4,995
	(18,811)		(560,276)
	584		(3,118)
	52,515		(395,353)
	13,464		(1,503)
	(17,171)		621,643
	(4,930)		21,832
	(32,990)		(6,421)
	(7,339)		(323,196)
	–		5,993
	–		310,416
	49,572		26,415

/ 27

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

6. SEgMENt INFORMatION

(a) Products and services from which reportable segments derive their revenues

The Group’s reportable segments are:

Healthcare: Incorporates the sale of human healthcare products in a range of sectors, own brands, retail healthcare and wholesale activities.

Animal care: Incorporates the sale of animal care products in a range of sectors, own brands, retail and wholesale activities.

Corporate: Includes net funding costs and parent company central administration expenses that have not been allocated to the healthcare or animal care segments.

(b) Segment revenues and results

The following is an analysis of the Group’s revenue and results by reportable segment:

Segment revenues and results The following is an analysis of the Group’s revenue and results by reportable segment:
revenue from external customers Healthcare Animal care Corporate Segment result Healthcare Animal care Corporate Segment expenses Healthcare: Depreciation Amortisation of fnite life intangibles Income tax expense Animal care: Depreciation Amortisation of fnite life intangibles Income tax expense Corporate: Finance costs Income tax credit Proft for the period Healthcare Animal care Corporate * Includes costs associated with the acquisition of subsidiaries of $5.993m.	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 673,312 81,492 446 19,573 9,378 (1,721) (1,622) (15) (5,116) (549) (76) (2,395) (4,140) 1,642 12,820 6,358 (4,219) 14,959	Year ended 30 Jun 13 $’000 (Audited)
	2,823,018		1,652,450
	177,033		169,521
	1,461		1,198
	81,922		49,068
	15,720		18,670
	(1,395)		(9,495)*
	(4,439)		(3,785)
	(5,139)		(1,194)
	(20,133)		(13,146)
	(748)		(1,137)
	(1,023)		(320)
	(4,402)		(4,588)
	(15,551)		(9,593)
	4,597		3,727
	52,211		30,943
	9,547		12,625
	(12,349)		(15,361)*
	49,409		28,207

• Includes costs associated with the acquisition of subsidiaries of $5.993m.

EBOS | Interm Report 2014

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

6. SEgMENt INFORMatION (CONTINUED)

The accounting policies of the reportable segments are consistent with the Group’s accounting policies. Segment result represents profit before depreciation, amortisation, finance costs and tax. This is the measure reported to the chief operating decision maker for the purposes of resource allocation and assessment of segment performance.

(c) Segment assets

The following balance sheet items are not allocated to operating segments as they are not reported to the chief operating decision maker at a segment level:

• Assets

• Liabilities

• Capital expenditure

(d) revenues from major products and services

The Group’s major products and services are the same as its reportable segments i.e. healthcare, animal care and corporate.

(e) geographical information

The Group operates in two principal geographical areas; New Zealand (country of domicile) and Australia.

The Group’s revenue from external customers by geographical location (of the reportable segment) and information about its segment assets (non-current assets excluding financial instruments and deferred tax assets are detailed below):

revenue from external customers New Zealand Australia Non-current assets New Zealand Australia	Six months 31 Dec 13 $’000 (Unaudited)	Six months 31 Dec 12 $’000 (Unaudited) 642,183 113,067 755,250 207,464 26,686 234,150	Year ended 30 Jun 13 $’000 (Audited)
	650,064		1,257,302
	2,351,448		565,867
	3,001,512		1,823,169
	207,002		206,945
	752,182		765,616
	959,184		972,561

(f) information about major customers

No revenues from transactions with a single customer amount to 10% or more of the Group’s revenues (December 2012: Nil, June 2013: Nil).

/ 29

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

7. BaNk FacILItY aND BORROwINgS

The Group fully complies with and operates within the financial covenants under the arrangements with its bankers. At 31 December 2013 the Group has unutilised term and revolving cash advance facilities of $79.8m (December 2012: $68m, June 2013: $69.5m).

The Group also has a trade debtor securitisation facility of which $310m was unutilised at 31 December 2013 (December 2012: Nil, June 2013: $302.8m).

On 5 July 2013 the Group refinanced its syndicated banking facilities. The effect of this refinancing was to retain the facility head room that was in place at 30 June 2013 in addition to funding the settlement of the acquisition of the Symbion Group on 5 July 2013. This refinancing also extended the maturity profile of the Group’s borrowing facilities. The Group is committed to repayments of its term debt facilities of approximately $20m per year with quarterly repayment terms.

The Groups new facilities are summarised below:

Facility	Amount (NZD)	maturity
Term debt facilities	$85.6m	July 2015
Term debt facilities	$95.1m	July 2016
Term debt facilities	$101.1m	July 2017
Working capital facilities	$90.9m	July 2015
Securitisation facility	$456.3m	September 2015

8. SIgNIFIcaNt tRaNSactIONS DURINg thE PERIOD

On 4 July 2013 EBOS Group Limited received a net $141.8m in proceeds from a non re-nounceable rights issue to existing shareholders.

On 5 July 2013, in accordance with the sale and purchase agreement to purchase the Symbion Group, the full deferred consideration payable balance of $865m was settled in favour of the previous owners of the Symbion Group, Zuellig Group. This consideration was made through an issue of EBOS Group Limited shares to the Zuellig Group of $498m and cash consideration of $367m. The cash consideration paid was funded by additional debt funding of $134m and cash reserves.

As a result of this transaction the Zuellig Group holds 40% of the shares in EBOS Group Limited. Also on the 5 July 2013 two new Directors, Peter Williams and Stuart McGregor, were appointed to the Board of EBOS Group Limited and represent the Zuellig Group.

In addition to the above in December 2013 EBOS Group Limited was also registered on the Australian Stock Exchange along with its continuing listing on the New Zealand Exchange.

9. RELatED PaRtY DIScLOSURES

EBOS Group Limited is the immediate parent, ultimate parent and controlling party.

At 30 June 2013 ZHHA Pty Limited, a subsidiary of EBOS Group Limited, owed CB Norwood Pty Limited, a subsidiary of the Zuellig Group, $7.230m and Zuellig Group Incorporated $1.856m. These balances were repaid during the period.

As at 31 December 2013 no balances were owing to related parties of EBOS Group.

No amounts owed to related parties have been written off or forgiven during the period.

10. EvENtS aFtER BaLaNcE DatE

Subsequent to 31 December 2013 the Board have approved an interim dividend to shareholders. For further details please refer to note 4.

EBOS | Interm Report 2014

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

11. PROSPEctIvE FINaNcIaL INFORMatION

The EBOS Group Limited pro-rata renounceable entitlement offer prospectus issued on 5 June 2013 contained prospective financial information (PFI) for the six month period ended 31 December 2013.

The following information is a comparison of the financial statements of EBOS Group Limited from the prospectus dated 5 June 2013 with the actual result for the same period for the six months ended 31 December 2013.

CONDENSED CONSOliDAtED iNCOmE StAtEmENt

For the Six Months ended 31 December 2013

revenue Proft before depreciation, amortisation, fnance costs and income tax expense Depreciation Amortisation of fnite life intangibles Proft before fnance costs and tax Finance costs Proft before income tax expense Income tax expense Proft for theperiod	Actual $M (Unaudited)	Adjusted PFI (1) $M (Unaudited) 2,980.7 97.3 (6.7) (7.8) 82.8 (17.3) 65.5 (19.7) 45.8	Original PFI $M (Unaudited)
	3,001.5		3,169.6
	96.2		103.6
	(5.2)		(7.1)
	(6.1)		(8.5)
	84.9		88.0
	(15.6)		(18.4)
	69.3		69.6
	(19.9)		(20.9)
	49.4		48.7

CONDENSED CONSOliDAtED StAtEmENt OF COmPrEHENSiVE iNCOmE

For the Six Months ended 31 December 2013

Proft for the period Other comprehensive income Items that may be reclassifed subsequently to proft or loss: Cash fow hedges gains Related income tax Translation of foreign operations total comprehensive income net of tax*	Actual $M (Unaudited)	Adjusted PFI (1) $M (Unaudited) 45.8 – – (25.4) 20.4	Original PFI $M (Unaudited)
	49.4		48.7
	0.4		–
	(0.1)		–
	(20.7)		–
	29.0		48.7

• Represents non-profit foreign currency exchange movements arising from the conversion of the Group’s Australian dollar balance sheet items into the Group’s financial reporting presentation currency, being New Zealand dollars.

(1) The original PFI was determined on an assumed NZD:AUD exchange rate of 0.82:1 for the purpose of converting the Group’s Australian dollar denominated trading results, cashflows and balance sheet. To better understand the underlying performance of the Group the original PFI has been restated using the actual exchange rates that have eventuated on which actual results to 31 December 2013 have been recognised.

/ 31

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

11. PROSPEctIvE FINaNcIaL INFORMatION (CONTINUED)

CONDENSED CONSOliDAtED StAtEmENt OF CHANgES iN EqUitY

For the Six Months ended 31 December 2013

Equity at start of period Proft for the period Other comprehensive income: Movements in cashfow hedge reserve Movement in foreign currency translation reserve Dividends paid to company shareholders Shares issued Equity at end of period	Actual $M (Unaudited)	Adjusted PFI (1) $M (Unaudited) 301.7 45.8 – (25.4) (22.0) 646.3 946.4	Original PFI $M (Unaudited)
	304.9		305.3
	49.4		48.7
	0.3		–
	(20.7)		–
	(22.0)		(22.0)
	649.2		646.3
	961.1		978.3

EBOS | Interm Report 2014

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

11. PROSPEctIvE FINaNcIaL INFORMatION (CONTINUED)

CONDENSED CONSOliDAtED BAlANCE SHEEt

As at 31 December 2013

Current assets Cash and cash equivalents Trade and other receivables Prepayments Inventories Current tax refundable Other fnancial assets – derivatives Investments total current assets Non-current assets Property, plant and equipment Capital work in progress Prepayments Deferred tax assets Goodwill Indefnite life intangibles Finite life intangibles Investment in associates total non-current assets total assets Current liabilities Trade and other payables Finance leases Bank loans Current tax payable Employee benefts Other fnancial liabilities – derivatives total current liabilities	Actual $M (Unaudited)	Adjusted PFI (1) $M (Unaudited) 55.1 761.9 7.6 483.3 – – 48.9 1,356.8 86.5 – – 9.6 736.1 30.8 122.6 19.5 1,005.1 2,361.9 845.0 0.3 188.7 14.3 19.8 0.9 1,069.0	Original PFI $M (Unaudited)
	92.6		74.9
	755.4		832.0
	7.3		8.2
	505.8		521.8
	1.4		–
	2.6		–
	–		54.8
	1,365.1		1,491.7
	98.4		94.6
	0.7		–
	–		0.2
	28.9		10.2
	721.0		729.2
	56.9		30.8
	82.1		137.6
	22.6		19.5
	1,010.7		1,022.1
	2,375.8		2,513.8
	874.4		913.6
	1.0		0.3
	176.6		211.3
	19.6		16.2
	22.5		21.3
	1.6		0.9
	1,095.7		1,163.6

/ 33

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

11. PROSPEctIvE FINaNcIaL INFORMatION (CONTINUED)

CONDENSED CONSOliDAtED BAlANCE SHEEt (CONTINUED)

As at 31 December 2013

Non-current liabilities Bank loans Trade and other payables Deferred tax liabilities Finance leases Employee benefts total non-current liabilities total liabilities Net assets Equity Share capital Foreign currency translation reserve Retained earnings Other reserves Cash fow hedge reserve total equity	Actual $M (Unaudited)	Adjusted PFI (1) $M (Unaudited) 280.6 16.4 43.4 0.9 5.2 346.5 1,415.5 946.4 849.2 (30.1) 127.6 0.5 (0.8) 946.4	Original PFI $M (Unaudited)
	262.6		300.0
	9.6		17.9
	40.1		47.4
	2.5		0.9
	4.2		5.7
	319.0		371.9
	1,414.7		1,535.5
	961.1		978.3
	850.6		849.2
	(26.4)		(1.3)
	134.7		130.8
	–		0.5
	2.2		(0.9)
	961.1		978.3

EBOS | Interm Report 2014

NOtES tO thE INtERIM FINaNcIaL StatEMENtS CONTINUED

For the Six Months ended 31 December 2013

11. PROSPEctIvE FINaNcIaL INFORMatION (CONTINUED)

CONDENSED CONSOliDAtED CASH FlOw StAtEmENt

For the Six Months ended 31 December 2013

CONDENSED CONSOliDAtED CASH FlOw StAtEmENt For the Six Months ended 31 December 2013
Cash fows from operating activities Receipts from customers Interest received Payments to suppliers and employees Taxes paid Interestpaid Net cash infow from operating activities Cash fows from investing activities Sale of property, plant & equipment Purchase of property, plant & equipment Payments for intangible assets Acquisition of associates Acquisition of subsidiaries Net cash (outfow) from investing activities Cash fows from fnancing activities Proceeds from issue of shares Increase of investment in Class B Note Proceeds from borrowings Repayment of borrowings Dividendspaid to equityholders ofparent Net cash infow from fnancing activities Net (decrease) in cash held Effect of exchange rate fuctuations on cash held Net cash and cash equivalents at beginningofperiod Net cash and cash equivalents at end ofperiod Cash and cash equivalents	Actual $M (Unaudited)	Adjusted PFI (1) $M (Unaudited) 2,929.0 0.4 (2,856.8) (16.9) (17.3) 38.4 - (13.4) - - (369.3) (382.7) 148.1 (4.8) 134.3 (26.9) (22.0) 228.7 (115.6) (2.6) 173.3 55.1 55.1 55.1	Original PFI $M (Unaudited)
	2,927.4		3,113.1
	1.5		0.4
	(2,855.3)		(3,035.0)
	(8.4)		(17.4)
	(15.6)		(18.4)
	49.6		42.7
	0.5		-
	(15.5)		(14.6)
	(0.6)		-
	(3.0)		-
	(366.9)		(369.3)
	(385.5)		(383.9)
	151.1		148.2
	-		(5.3)
	317.8		140.0
	(211.0)		(19.2)
	(22.0)		(22.0)
	235.9		241.7
	(100.0)		(99.5)
	(5.4)		-
	198.0		174.4
	92.6		74.9
	92.6		74.9
	92.6		74.9

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NOtES tO thE INtERIM FINaNcIaL StatEMENtS

For the Six Months ended 31 December 2013

11. PROSPEctIvE FINaNcIaL INFORMatION (CONTINUED)

The material reasons for the differences between the ‘adjusted’ prospective financial information (‘adjusted PFI’) and actual figures are as follows:

Condensed Consolidated income Statement:

Profit before depreciation, amortisation, finance costs and tax of $96.2m was consistent with the $97.3m forecast in the adjusted PFI.

Depreciation ($1.5m) and amortisation ($1.7m) were down on adjusted PFI due to less depreciable property, plant and equipment and finite life intangible assets being acquired at the time of acquisition than were forecast in the adjusted PFI.

Finance costs were down $1.7m on adjusted PFI due to a lower than forecast net debt balance and a lower bank funding margin being negotiated under the Groups new syndicated banking facility agreement entered into on 5 July 2013.

The above movements have resulted in NPAT for the six months to December 2013 being $3.6m higher than was forecast in the adjusted PFI.

Condensed Consolidated Balance Sheet:

The Group’s Net Debt position of $346.6m (bank loans offset by cash and cash equivalents and investments) is less than adjusted PFI, $365.3m, by $18.7m. This is primarily due to less cash being tied up in working capital items (receivables $6.5m, trade and other payables $29.4m offset by inventory ($22.5m)) due to timing differences for receipts from customers and inventory purchases/payments.

Investments are nil compared to $48.9 in the adjusted PFI. This is as a result of this balance for 31 December 2013 being offset against loans and borrowings as a result of a difference in accounting policies from that used in the preparation of the adjusted PFI. The treatment at 31 December 2013 is consistent with the policy applied in the 30 June 2013 annual financial statements.

Property, plant and equipment is up $11.9m on the adjusted PFI as a result of land and building valuations acquired as part of the Symbion acquisition being higher than forecast in the adjusted PFI.

Deferred tax assets are $19.3m higher compared to the adjusted PFI as a result of additional deferred tax assets being recognised on the acquisition of Symbion than were forecast in the adjusted PFI.

Goodwill is lower than adjusted PFI by $15.1m due to the net assets acquired as part of the acquisition of the Symbion Group, post fair value acquisition adjustments, being higher than was originally forecast in adjusted PFI.

Indefinite life intangible assets are $26.1m higher than adjusted PFI and Finite life intangible assets $40.6m lower than the adjusted PFI due to the finalisation of the valuations of the intangibles acquired as part of the acquisition of the Symbion Group.

Condensed Consolidated Cash Flow Statement:

Net operating cash flows are up $11.2m on adjusted PFI due to less cash being tied up in working capital balances at period end than were anticipated in the adjusted PFI as a result of timing differences for receipts from customers and inventory purchases/payments.

Net investing activity and financing activity cash flows are materially consistent with the PFI.

EBOS | Interm Report 2014

DirECtOrY

COrPOrAtE HEAD OFFiCE 108 Wrights Road PO Box 411 Christchurch 8024 Telephone +64 3 338 0999 Fax +64 3 339 5111 E-mail: ebos@ebos.co.nz Internet: www.ebos.co.nz

AUDitOr

Deloitte Christchurch BANkErS ANZ National Bank Limited Auckland Bank of New Zealand Christchurch

DirECtOrS

rick Christie Independent Chairman mark waller Chief Executive and Managing Director Elizabeth Coutts Independent Director Peter kraus Stuart mcgregor Sarah Ottrey Independent Director Barry wallace Peter williams

SENiOr ExECUtiVES

mark waller	Chief Executive
michael Broome	Group General Manager – Healthcare Logistics/ProPharma
Angus Cooper	General Manager – Group Projects/Mergers & Acquisitions
Patrick Davies	Chief Executive – Symbion Group
Dennis Doherty	Chief Financial Offcer
Sean Duggan	Chief Executive – Masterpet Group
kelvin Hyland	General Manager – EBOS Healthcare New Zealand
David lewis	General Manager – EBOS Healthcare Australia
greg managh	Group General Manager – Onelink/MIS

SOliCitOr

Chapman Tripp Christchurch

SHArE rEgiStErS

Computershare Investor Services Ltd Private Bag 92119 Auckland 1142, New Zealand Telephone: +64 9 488 8777 Computershare Investor Services Pty Ltd GPO Box 3329 Melbourne, Victoria 3001, Australia Telephone: 1800 501 366

mANAgiNg YOUr SHArEHOlDiNg ONliNE:

To change your address, update your payment instructions and to view your investment portfolio including transactions, please visit: www.computershare.co.nz/investorcentre

General enquiries can be directed to:

• enquire@computershare.co.nz

• Private Bag 92119, Auckland 1142, New Zealand or GPO Box 3329, Melbourne, Victoria 3001, Australia

• Telephone (NZ) +64 9 488 8777 or (Aust) 1800 501 366

• Facsimile (NZ) +64 9 488 8787 or (Aust) +61 3 9473 2500

Please assist our registrar by quoting your CSN or shareholder number.

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A well planned JOURNEY

www.ebos.co.nz