SCHOOLBLAZER LIMITED — AGM Information 2008

Feb 4, 2008

Level 5, 34 Hunter Street Sydney NSW 2000 GPO Box 4406 Sydney NSW 2001

Phone: +612 9221 7155 Fax: +612 9233 2713 Email: hgl@hgl.com.au Web: www.hgl.com.au

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AGM 2008 Chairman’s address

As there is extensive commentary and analysis in both the accounts and the eight page review sent to all shareholders before Christmas I will not go into a lengthy discussion on those accounts in my address. I am of course happy to take questions on the 2007 year later on during the meeting.

Results in summary

However, let me briefly re‐cap our results.

In summary last year was excellent.

• Earnings per share increased by 71% to 32.4 cents;

• Core earnings per share increased by 24% to 19.2 cents;

• Dividends per share increased by 24% to 14.4 cents; and

• The company achieved a return of 25% on shareholders’ funds before recognising the profit from the sale of MMC. After recognising this gain the return was 34%.

Our businesses performed well in 2007; businesses owned at the end of the previous financial year increased their earnings before interest and tax (EBIT) by 15% to $14.9 million. Biante, acquired in April 2007, contributed a further $0.7 million to this result. For those interested we have examples of the model cars sold by Biante on display around the room.

A significant non core transaction in 2007 was the $6.7 million profit after tax from the sale of our 37% equity interest in MMC Asset Management and the cancellation of our management contract with MMC Contrarian. We accepted as consideration equity in Contrarian which gave us a 6% shareholding in that company.

I believe these results again demonstrate the continuing success of our strategy which has created consistent increases in core earnings which has in turn enabled the board to increase dividends by 14% compound per annum since 2003.

HGL strategy

HGL’s strategic objectives are to consistently increase core profits and dividends through

• Growing the profitability of our current businesses;

• Acquiring businesses in line with our acquisition criteria set out on page 9 of the annual report;

HGL Limited ABN 25 009 657 961

investing in businesses

Level 5, 34 Hunter Street Sydney NSW 2000 GPO Box 4406 Sydney NSW 2001

Phone: +612 9221 7155 Fax: +612 9233 2713 Email: hgl@hgl.com.au Web: www.hgl.com.au

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• Utilising our funds management skills to assist MMC Contrarian Limited; and

• Investing in publicly listed companies where appropriate.

We believe these strategies will continue to meet our objectives and in turn enhance the net worth of the company and ultimately shareholder wealth.

We have commenced programs to further increase the awareness of HGL amongst the investment community.

Operating investments

At the 30 September 2007 HGL had $68 million invested in 12 businesses. The first quarter of this financial year has started well with the earnings before interest and tax (EBIT) from businesses owned at the start of the previous financial year increasing by 8% to $4.4 million. After including the contribution of Biante, our total EBIT in the first quarter has increased by 23% to $5.1 million. Biante has performed very well in the first quarter of the financial year and we anticipate it will continue to perform very well for the remainder of the year. I find it difficult to pick out individual businesses, other than Amcla, for special comment because almost all are performing very well and are a credit to their management team.

During 2005 we acquired Amcla for an initial payment of $4 million and paid $1m deferred consideration in 2006 when a pre determined level of gross margin for the first year was achieved. This investment has been a disappointment and last year we wrote off $2 million of its goodwill. We have reduced the costs and changed the management of Amcla and it now employs executives who we have successfully worked with in the past. We are attempting to improve its performance by more targeted selling and by identifying complimentary product lines to distribute through the pharmacy channel. In the first quarter Amcla generated a very small profit, if we can improve sales and develop new product lines the profits will improve further.

Listed investments

At 30 September 2007 HGL had $76 million at market value invested in listed shares of which MMC Contrarian and Hunter Hall Limited comprised $57 million. Recently there has been a substantial deterioration in equity values. Since 30 September our portfolio has reduced in value by $12m before tax. The main falls have been MMC Contrarian $6 million, Credit Corp $2 million and Hunter Hall $2 million. We would expect the value of these investments to recover when the equity market recovers.

Last year Hunter Hall increased its earnings per share by 44% and paid fully franked dividends of 75 cents per share. We expect that 2008 should see further growth for Hunter Hall, although with the recent turbulent equity markets its rate of growth is difficult to estimate.

HGL Limited ABN 25 009 657 961

investing in businesses

Level 5, 34 Hunter Street Sydney NSW 2000 GPO Box 4406 Sydney NSW 2001

Phone: +612 9221 7155 Fax: +612 9233 2713 Email: hgl@hgl.com.au Web: www.hgl.com.au

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As a result of the reconstruction of MMC Asset Management and MMC Contrarian our investment that was largely goodwill was converted into one that was mainly supported by cash and other assets that can easily be turned into cash. This was an excellent outcome for HGL shareholders.

After initially owning 6% of Contrarian we increased our ownership to 14%. We are very much aware that the share price of Contrarian has fallen by 18% since September and the discount to net tangible assets is 12%.

With Kevin Eley recently appointed Chairman we believe we can work with the Board of Contrarian to create a valuable business. We are presently waiting to see who is appointed Contrarian’s new Chief Executive Officer and for an update on its strategy. After considering those updates we will assess our various options in relation to our investment in Contrarian.

Balance sheet

Our balance sheet remains strong, total shareholder funds increased by 26% to $93 million and gearing was a conservative 20% at 30 September 2007 with an interest cover of nine times normalised earnings. Currently net debt of $30 million is at about the same level as September 2007. We are continuing to look at investment opportunities and will endeavour to make more acquisitions when the targets satisfy our acquisition criteria.

Outlook

As I mentioned earlier the profits from our businesses, excluding Biante, in the first quarter of the financial year have increased by 8% compared to the previous year and by 23% after the inclusion of Biante. If trading continues at current levels the EBIT of our businesses for the first half is expected to exceed the previous year by at least 20%. As we also include in our profit and loss account dividends from Hunter Hall and MMC Contrarian and as these have not yet been declared I am presently unable to quantify our core profit for the first half.

I would like to thank our business partners, employees and my fellow directors for their contribution to what has been a very successful period.

PG Miller

5 February 2008

HGL Limited ABN 25 009 657 961

investing in businesses