SCHOOLBLAZER LIMITED — AGM Information 2021

Feb 23, 2021

24 February 2021

Company Announcements Office Australian Securities Exchange Authorised for immediate release

AGM Presentation

Please find attached the presentation to be made by the Company at the 117th Annual General Meeting of HGL Ltd held at 11am this morning.

This presentation has been authorised for release by the Board of HGL Ltd.

Iain Thompson Company Secretary

'growth from solid foundations...'

HANCOCK AND GORE

$SINCE$ 1898

H N G : A S X

117TH Annual General Meeting

24th February 2021

Contents

• 1 . 2020 Results Summary
• 2 . HGL Review
• 3 . Strategic Transition
• 4 . YTD Update and Opportunities
• 5 . Outlook / Vision
• 6 . Objectives For CY 2021
• 7 . Proxy Results

2020 Results Summary

	2020 $M	2019 $M
Revenue	38,095	39,220
Underlying EBIT	1,934	605
Operating Result	(12,699)	1,461
NTA Per Share at book value	$0.170	$0.197

Highlights:

• JSB Impairment $11.0 M
• Capital raisings of $2.6 M April 2020 and $4.1 M October 2020
• Franking credits $8.9 M
• Tax Losses $21.9 M Revenue and $11.1 M Capital
• Mountcastle acquisition of LW Reid and successful integration

HGL Review

• Historic returns: Strategic transition to diversify investment strategy, strengthen and diversify portfolio and capital base, redeploy into higher risk adjusted returns, including capital light strategies to deliver long term after tax shareholder returns targeted at > 15% per annum.
• Alignment of interest: Partner with strategically aligned business owners and operators to capitalise on objectives and opportunities and reward outperformance. Seek to add value to business partners through experience, networks, M&A opportunities and access to capital.
• Investment in people: Planned change to skew remuneration towards performance based remuneration structure to attract & retain a high calibre team that is self-funding and rewarded through investment outperformance.
• Increase HGL brand equity: Significant investment of time and resources required in building reputational strength of HGL. Specifically develop relationships with deal flow channels including like minded investors, stock broking firms, investment bankers, legal and accounting advisers, incubators and entrepreneurial hubs, academic and research organisations.
• Balance sheet strengthening: Balance sheet needs to be strengthened and recycled and redeployed into minimum targeted 15% IRR investment opportunities.
• Share price not reflective of underlying investment value: Substantial value in underlying investments not reflected in current share price.

HGL Review

• Two high quality scale businesses Mountcastle and Pegasus with strong and aligned management, fragmented industries with opportunities for consolidation and growth.
• Underperforming JSB business merged with FOS Lighting who have executed turnaround and are positioning for IPO in 2021
• SPOS and BLC under review for potential opportunities to unlock value and partner to drive growth and return on investment
• Strategic shift from conglomerate to diversified investment company with a focus on active management and driving acceptable shareholder returns.
• Seek to better communicate the investment potential and underlying value of HGL investments through shift to investment based reporting of investments replacing consolidation and equity accounting – allowing investors to more accurately measure performance
• Seek to become trusted partner of choice that seeks to solve partner problems and is adept at identifying and pursuing opportunities

Strategic Transition

Staged Transition to Diversified Investment Company to drive substantial shareholder returns

YTD Update and Opportunities

• January YTD EBIT from continuing operations approx. $1.7 M vs $0.4 M 2020
• All businesses EBIT positive and ahead of 2020 with strong contributions from Pegasus and Mountcastle
• HGL Head Office debt free
• Underperforming JSB investment merged with FOS lighting and aggressively restructured to progress towards IPO in 2021
• Head office costs restructured to achieve current run rate as at Feb 2021 of < $700 K vs $2.1 M in prior year
• Income opportunities in Head office undertaken to further reduce cash costs – with objective for Head office to be a meaningful profit centre
• Dealflow pipeline strong and increasing in listed and portfolio companies
• ASX Listed Investment Portfolio established in January and annualising returns > 30% YTD
• Opportunities under due diligence for potential new fund strategies upon completion of acquisition of SIAL

Outlook / Vision

• Balance Sheet to be restated to reflect "fair value" of investments. This is expected to result in a one-off initial profit to more accurately reflect value as independently assessed in FY 2021 Financial Statements
• Future annual profitability will be derived from dividends, annual restatement of investment values, realisations of investments during the year, funds management income and performance fees, corporate activity including underwriting income, interest on corporate and mezzanine lending investments, convertible note interest and income from direct property investments.
• Intention to structure investment portfolio to include sufficient allocation to recurrent income opportunities to enable the resumption of dividends when possible
• Intention to participate in meaningful corporate activity including sponsoring and underwriting of IPO's, takeovers / schemes of arrangement, restructuring of under performing companies and active investment style to restore value to underperforming small cap / micro cap investments when balance sheet permits

Objectives CY 2021

BASELINE GOAL 2021
Introduce new investors, refresh communications and marketing, launch funds and participate in M&Aactivity, adopt new accounting policy to independently assess investment value as part of annual audit.
Enhance networks of advisors, brokers, referrals to build quality investment pipelineAttract experienced investment professionals to bring networks and opportunities to HGLDevelop deep market insights and intelligence in targeting quality research, connections, marketparticipation and analysis in key areas of interest
Target realisations from portfolio and redeployment into more diversified portfolio
Meaningful acquisition, organic growth and external capital raising
Unmarketable parcels: Intention to initiate on-market buy-back when appropriate
At least 2 strategic Investments > $2 M equity value each
Grow FUM in ASX Listed portfolio. Drive investment outperformance and performance feesRefresh PDS and strategy, demonstrate returns and target meaningful growth in FUMAttract quality experienced investment manager
Allocate capital to meaningful ASX investment portfolio Annual return target > 20% per annum… preIPO , underwriting …placements … strategic stakes … counter-cyclical / turnaround focus
Enhance alignment with management. Meaningful value extraction / repositioning
Assist in IPO prior to June 30, 2021
Eliminate non-core costsDrive towards Head Office being a profit contributor

'growth from solid foundations...'

HANCOCK AND GORE

$SINCE$ 1898

H N G : A S X

117TH Annual General Meeting

24th February 2021