EVZ LIMITED — AGM Information 2014

Nov 27, 2014

28 November 2014

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Chairman’s Address to 2014 AGM

The ongoing focus of the EVZ Group is to ensure that all businesses within the Group contribute an acceptable level of profitability.

To this end and during the 2014 financial year a substantial restructure and turnaround in the fortunes of the Brockman Engineering business commenced which included new management, a restructure of the workforce, targeted expansion of its offering both geographically and customer based and capital expenditure in new equipment to enhance productivity.

This restructure gained momentum in the 2[nd] half of the financial year with Brockman winning a number of projects, which played out in the last quarter of the financial year and into the new financial year.

In the current financial year Brockman is achieving improved earnings and continues to win work which has resulted in a strong current forward order book. This is a direct result of the new management and productivity improvements associated with capital investment. Brockman is very competitive in the market place, consistently being in the last 2 tender panellists.

Whilst the turnaround is not yet complete the progress made to date is expected to underpin its improved budget expectations for FY15 and beyond.

A concurrent focus for the Brockman business is to build its forward order project portfolio, secure maintenance opportunities which provide recurring revenue streams, further improve project delivery and productivity and enhance its labour talent pool.

The Group’s Syfonic roof drainage business, Syfon Systems, both nationally and in Asia is an industry leader. Syfon also continues to expand its roof refurbishment business. The profit performance for the Syfon group for the 2014 financial year was in line with budget expectations and it also entered this new financial year with record forward work in hand.

Since then the Syfon Group has traded profitably and continues to win new work which provides visibility on its expected 2015 performance. Pleasingly the Asian operation has had significant success in building its major project portfolio.

During FY14 the TSF Engineering business continued the rollout of the Melbourne Airport Tri-generation project and the project is nearing completion. TSF is currently negotiating an extension to the completion date until the end of February 2015.

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Unfortunately the current higher gas prices and government’s inaction with respect to formulating a policy on a national clean energy strategy has seen TSF’s clean energy offering stall. Potential customers for TSF’s Tri-generation offering are reluctant to invest in this capital expenditure until government policy is set and there is more certainty around gas prices.

The TSF Maintenance business has and continues to be a solid and profitable performer for the Group and there is an ongoing concentration to further expand this recurring revenue business by enhancing management skills and with active client and geographical diversification. We are forecasting double digit revenue growth in this business for the current year and the financial year beyond.

In the past 12 months EVZ has pursued various strategies to reduce its current debt levels. This included the possibility of divestment of businesses, improving working capital levels and other capital market options. During this period EVZ has received 2 conditional offers for businesses in the Group, which after significant consideration the Directors rejected as not being in the best interests of shareholders. Directors will continue to pursue various debt reduction strategies which have the support of the Commonwealth Bank of Australia. To this end the Commonwealth Bank has extended the Groups banking facilities to 1 October 2015. Directors will continue to keep Shareholders abreast of developments.

Finally, the EVZ Group enters the current financial year in a better position and with considerably more forward work in hand and this is expected to result in an improved Group profit performance.

I will now hand over to our CEO, Scott Farthing.

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