TAMAWOOD LIMITED — Capital/Financing Update 2018

Jun 7, 2018

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8 June 2018

TWD Profit Update

The Board of Tamawood reaffirms today that the fully franked final dividend of 16 cents will be maintained.

Tamawood has witnessed an increase in sales and full fees in the past 30 days, which should be reflected in the first half FY19.

Tamawood advises the market that the net profit after tax is expected to be down approximately $800,000 compared to FY17. As previously announced, the reasons for this decline in profit are:

• There have been significant delays experienced by customers receiving confirmation of bank approvals, as a consequence of the recent Banking Royal Commission, resulting in commencement of construction being delayed.

• There has been a significant amount of inclement weather causing production delays over the last three months.

• The set up costs in expanding the regional NSW operations combined with the margin erosion experienced in Sydney due to significant delays between signed contracts and land registration caused subcontractor and supplier price rises above those initially estimated.

• Recent changes in enforcement processes by the Queensland Building and Construction Commission (“QBCC”) has resulted in significant costs including legal fees defending the actions taken by the QBCC. Three out of the four matters have now been withdrawn by the QBCC at the Tribunal, however, this has still impacted the business with additional administrative costs and significant amounts of management time in handling the matters.

• All new regional office expenses including fitout, establishment and staff costs have been experienced during FY18.

The Board is confident that all current indicators point to dividends being maintained or increased for the foreseeable future and like to point out that we have not experienced a decline in dividends over the last 18 years.

Robert Lynch Chairman

F: (07) 3272 7311 A: PO Box 16 Sherwood Qld 4075

ABN: 56 010 954 499

T: 1300 10 10 10