GLOBE INTERNATIONAL LIMITED — AGM Information 2012

Nov 13, 2012

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GLOBE INTERNATIONAL LIMITED

2012 ANNUAL GENERAL MEETING

WEDNESDAY, 14 NOVEMBER 2012

ADDRESS BY THE CEO, MATT HILL

Thanks Paul and thank you everyone for joining us here at the Globe International 2012 Annual General Meeting. It’s always great to see shareholders, and to be able to offer you the opportunity to see our Melbourne headquarters and our brands in person.

It was another tough year in our sector, and we were not alone in facing some extremely challenging industry and economic conditions.

There has been significant discussion this year regarding our industry and the challenges at a retail level. Surf retail, which makes up a sizeable part of our account base, particularly in the Australian sector has had a very difficult 24 months. While we moved strategically a number of years ago to exit retail and to diversify our brands and distribution channels, we are still not immune to this type of downturn. Furthermore, the European markets remained volatile throughout the past year, and the USA stagnant in terms of economic activity.

In some areas of our business these factors detracted from performance. Our footwear business had a difficult year, as did certain of our core Dwindle skate hardgoods brands. However, despite this adversity, Globe International was able to achieve another year in which we remained stable and profitable. With revenues flat in local currency terms, we were able to use the growth from recent branded investments, and structural changes, to maintain revenues. Furthermore, even with these market difficulties, we continued to invest in future programs for the years to come. Finally and most importantly we maintained financial stability and independence.

In short, in 2012, Globe International:

• Generated a profit and sustained revenues.

• Remained debt free.

• Continued to return dividends with a dividend of 2.5cent per share paid in October this year.

• Launched new brands for future growth.

• Achieved growth in brands and new product categories seeded in the prior year.

• Continued to diversify our distribution and brand portfolio.

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We have persevered through the last few years and it is a credit to our staff and team, that amidst tough conditions, we have moved the quality of our brands forward. In the past year, branded highlights have included Globe skateboards which continue to exceed expectations in all territories. Globe apparel has also continued to grow in the EU and Australia with edgier designs bringing a much needed fresh perspective to the surf apparel account base. Finally, a highlight of our recently launched 4Front Distribution fashion division was the performance of Obey clothing. The Obey brand, for which the company has exclusive distribution rights for Australia and New Zealand, achieved impressive growth and market share gain in these regions.

As such, while the financial results of the business are modest, they do not reflect the qualitative story of the business completely. 2012 was a year in which we further diversified and expanded the business, and set a framework for future years’ growth.

In 2013 we are continuing to invest in future branded programs. For this year, in Australia, we have launched the workwear brand FXD which has been well received by both wholesale accounts and consumers. FXD which is directed to a younger, next generation workwear customer, lines up our market knowledge of this consumer with our product development skills. It also provides an opportunity to further diversify our distribution channels, without compromising existing brands.

We are also pleased with the launch this year of Globe apparel in our North American division. Previously the Globe clothing program has been focused largely on the EU and Australian markets. Globe apparel has been well received, being placed in a handful of the most premium of board sports and lifestyle fashion accounts across the USA, Canada, and Central America.

Lastly for the current year Globe skateboards continue to grow in all existing markets, and are expanding well into international territories, in particular into key Asian markets.

We remain positive about the financial prospects for the years ahead and feel we made the correct moves to anticipate market changes some years ago and have been well placed to weather the storm. From a branded perspective we are more optimistic about our brand mix and offerings than has been the case for many years. We believe we have the right brands, progressive product development, and are not reliant on any one customer base or distribution channel. These are all great strengths of our business.

However, given uncertainties in the markets in which we operate, this enthusiasm needs to be tempered when projecting short term financial results. For the current year, assuming conditions do not deteriorate significantly we expect revenue, in constant currency terms, to be up moderately on the prior year. With regard to profitability, with ongoing downward pressure on margins and volatility in key markets it is difficult to predict with exact precision a final year outcome at this stage.

As always I would like to thank the Board for their guidance and support. In addition, I would like to express my gratitude to the management team and staff worldwide for their commitment and tireless efforts to push the company and our brands ahead. All have been instrumental in generating renewed creative energy and delivering a significantly overhauled profile of brands and structure for the business. As a result, we are entering an exciting new phase of innovative brand execution for Globe International which we hope will deliver solid revenue, profit and shareholder value growth in the years ahead.

Thank you

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