The Warehouse Group 2018 Interim Results Announcement

The Warehouse Group Limited

26 The Warehouse Way
Northcote, Auckland 0627
PO Box 33470, Takapuna
Auckland 0740, New Zealand

phone +64 9 489 7000
fax +64 9 489 7444
web www.twg.co.nz




8 March 2018


Listed Company Relations
New Zealand Exchange Limited



The Warehouse Group Limited

Unaudited results for the 26 weeks ended 28 January 2018


Attached financial information as required by NZX Listing Rule 10.4.2

1. Appendix 1 disclosures for the 26 weeks ended 28 January 2018, Summary
Income Statement for the 26 weeks ended 28 January 2018 together with
second quarter sales
2. 2018 Interim Result Presentation
3. Media Release
4. Appendix 7 detailing a distribution of ordinary dividend of 10.0 cps to be paid on
12 April 2018 to those shareholders on the company’s share register as at
5.00pm NZT 3 April 2018
5. Interim Consolidated Unaudited Financial Statements for the 26 weeks ended
28 January 2018
6. Auditors Independent Review Report





Kerry Nickels
Company Secretary

---

Reporting Period
Previous Reporting Period
REPORTED Amount ($ 000s) Percentage change
Revenue from ordinary activities - continuing operations $ 1,598,076 down (0.9)%
Profit from ordinary activities after tax attributable to
shareholders - continuing operations
$ 35,345 down (15.1)%
Net profit attributable to shareholders $ 31,798 up 134.6 %
ADJUSTED Amount ($ 000s) Percentage change
Adjusted profit from ordinary activities after tax attributable to
shareholders
$ 37,666 down (16.4)%
Distributions Amount per share Imputed amount per share
Interim dividend 10.00 cents 3.8889 cents
Record date - Interim dividend 03 April 2018
Payment date - Interim dividend 12 April 2018
Comments
Asset Backing January 2018 January 2017
Net tangible asset backing per ordinary share 106.9 cents 107.3 cents
Basis of Report
Accounting Standards
This market announcement is based on financial statements which have been the subject of a review by the Group's auditor.
The auditor's review report and the financial statements are provided with this preliminary final report.
The information below supplements the information disclosed in the attached financial statements and management
commentary. All figures are NZ$ unless otherwise stated.
The interim financial statements of the Group have been prepared in accordance with the requirements of the Financial
Reporting Act 2013, the Companies Act 1993 and the New Zealand Stock Exchange (NZX). The Warehouse Group Limited is
registered under the Companies Act 1993 and is an FMC Reporting Entity under Part 7 of the Financial Markets Conduct Act
2013.
THE WAREHOUSE GROUP LIMITED
Results for announcement to the market
31 July 2017 to 28 January 2018
1 August 2016 to 29 January 2017
Refer to media release.

Reporting Period 31 July 2017 to 28 January 2018
Previous Reporting Period 1 August 2016 to 29 January 2017
GLOSSARY OF TERMS USED IN THIS RELEASE
"Reported" information is per the audited financial statements
"Gross Profit" equates to Retail sales less retail cost of goods sold
"EBIT" refers to Earnings before interest and tax from continuing operations
"Operating Profit" refers to EBIT from continuing operations less unusual items
"CODB" refers to costs of doing business and equates to the difference between gross profit and operating profit
"NPAT" refers to Net Profit after tax and minority interests
"Adjusted NPAT or Adjusted Profit" refers to NPAT adjusted for the after tax effect of unusual items.
"Trading EBITDA" refers to Earnings before interest, tax, depreciation and amortisation
THE WAREHOUSE GROUP LIMITED
Supplementary Information
"Unusual items" refers to any profits or losses from the disposal of properties or investments, goodwill impairment, direct costs and
adjustments relating to business acquisitions or disposals and costs connected with restructuring the Group
- 2 -

Reporting Period 31 July 2017 to 28 January 2018
1 August 2016 to 29 January 2017
SUMMARY INCOME STATEMENT
(NZ $000)2018 2017 % Change
The Warehouse940,055 975,097 - 3.6%
Warehouse Stationery 128,987 138,775 - 7.1%
Noel Leeming453,853 422,149 + 7.5%
Torpedo788,591 86,402 + 2.5%
Other group operations5,501 5,436 + 1.2%
Inter-segment eliminations(18,911)(15,997)
RETAIL SALES1,598,076 1,611,862 - 0.9%
The Warehouse49,031 59,508 - 17.6%
Warehouse Stationery 3,656 6,455 - 43.4%
Noel Leeming15,253 9,207 + 65.7%
Torpedo7776 2,424 - 68.0%
Other group operations(10,297)(7,670)
OPERATING PROFIT FROM CONTINUING OPERATIONS58,419 69,924 - 16.5%
Loss on property disposal- (812)
Restructuring costs(3,223)(3,961)
EBIT (Earnings before interest and tax from continuing operations)55,196 65,151 - 15.3%
Net interest expense(5,516)(6,586)- 16.2%
Income tax expense(14,204)(16,854)
NPAT (Net profit for the period from continuing operations)35,476 41,711 - 14.9%
Loss from discontinued operations (net of tax)(3,547)(28,073)
Minority interests(131)(83)
TAX PAID PROFIT AFTER MINORITIES AND DISCONTINUED OPERATIONS31,798 13,555 + 134.6%
ADJUSTED PROFIT37,666 45,036 - 16.4%
OPERATING MARGIN
The Warehouse5.2 % 6.1 % - 90 bp
Warehouse Stationery 2.8 % 4.7 % - 190 bp
Noel Leeming3.4 % 2.2 % + 120 bp
Torpedo70.9 % 2.8 % - 190 bp
Retail Group3.7 % 4.3 % - 60 bp
TAX PAID PROFIT MARGIN2.0 % 0.8 % + 120 bp
THE WAREHOUSE GROUP LIMITED
Supplementary Information
Previous Reporting Period
- 3 -

Reporting Period 31 July 2017 to 28 January 2018
Previous Reporting Period 1 August 2016 to 29 January 2017
ADJUSTED NET PROFIT RECONCILIATION
(NZ $000)2018 2017
ADJUSTED NET PROFIT37,666 45,036
Add back: Unusual items
Gain/(loss) on property disposal- (812)
Restructuring costs(3,223)(3,961)
(3,223)(4,773)
Less: Taxation
Income tax relating to unusual items902 1,336
Income tax expense related to depreciation recovered on building disposals- 29
Unusual items after tax(2,321)(3,408)
NET PROFIT ATTRIBUTABLE TO SHAREHOLDERS OF THE PARENT35,345 41,628
Operating model restructuring costs - refer Financial Statements note: 14
THE WAREHOUSE GROUP LIMITED
Supplementary Information
Certain transactions can make the comparison of profits between years difficult. The Group uses adjusted net profit as a key indicator of
performance and consider it provides a better understanding of underlying business performance and the Group also uses it as the basis for
determining dividend payments (after adjusting for losses from the Financial Services Group). Adjusted net profit makes allowance for the
after tax effect of unusual items which are not directly connected with the Group’s normal trading activities. The Group defines unusual items
as any profits or losses from the disposal of properties or investments, goodwill impairment, direct costs and adjustments relating to business
acquisitions or disposals and costs connected with restructuring the Group.
In January 2017 the Group commenced a program of changes to its business operating model. The changes were designed to drive an
improvement in financial performance, reduce costs and generate greater customer relevance. The changes focused primarily on
simplification to reduce complexities, drive efficiencies and increase business agility. This involved strengthening and consolidating the
various Group support service functions to drive synergy benefits, deliver efficiencies and reduce complexity. It also involved combining The
Warehouse and Warehouse Stationery and similarly combining the Noel Leeming and Torpedo7 Groups by integrating their operating
structures and executive leadership teams.

The first stage of this process has now largely been concluded and a second phase has started. The Group has engaged global management
consultancy firm, McKinsey & Company to assist with the second phase of the transformation process and strategy implementation.
- 4 -

Reporting Period 31 July 2017 to 28 January 2018
Previous Reporting Period 1 August 2016 to 29 January 2017
Quarterly Retail Sales information:
SalesSales
(31 July 2017 to 29 October 2017)
20182017
($ Million) ($ Million)
The Warehouse 357.9 377.5 - 5.2 % - 4.0 %
Warehouse Stationery59.1 63.7 - 7.2 % - 8.2 %
Noel Leeming195.1 183.6 + 6.3 % + 5.1 %
Torpedo739.2 37.8 + 3.7 % + 2.0 %
SalesSales
(30 October 2017 to 28 January 2018)
20182017
($ Million) ($ Million)
The Warehouse 582.2 597.6 - 2.6 % - 3.5 %
Warehouse Stationery69.9 75.1 - 6.9 % - 7.6 %
Noel Leeming258.8 238.5 + 8.5 % + 5.1 %
Torpedo749.4 48.6 + 1.6 % - 1.0 %
SalesSales
(31 July 2017 to 28 January 2018)
20182017
($ Million) ($ Million)
The Warehouse 940.1 975.1 - 3.6 %
- 3.7 %
Warehouse Stationery129.0 138.8 - 7.1 % - 7.9 %
Noel Leeming453.9 422.1 + 7.5 % + 5.1 %
Torpedo788.6 86.4 + 2.5 % + 0.3 %
Store Numbers
20182017201820172018201720182017
Start Quarter 2939378 77 69 67 11 12
End Quarter 2939279 77 70 67 11 12
20182017201820172018201720182017
Start Quarter 2503,970 499,547 74,591 71,927 73,216 71,169 12,652 10,109
End Quarter 2507,476 504,551 76,055 73,472 72,895 71,959 12,652 10,109
- 1 - -
1 - - 1
1 1 - -
- - - -
Noel Leeming
First quarter sales
Change in
sales
Change in
same store
sales
Year to date sales
Store footprint
(Square Metres)
The Warehouse
THE WAREHOUSE GROUP LIMITED
Supplementary Information
Second quarter sales
Change in
sales
Change in
same store
sales
The Warehouse
Warehouse Stationery
Warehouse StationeryTorpedo7
Change in
sales
Change in
same store
sales
Noel LeemingWarehouse StationeryTorpedo7
The Warehouse
Noel Leeming
Torpedo7
Store changes during the quarter
New
store
Replacement
store
Store
closure
Store
extension/
reduction
-5-

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THE WAREHOUSE GROUPLIMITED
FY18INTERIMRESULT
THURSDAY, 8MARCH 2018

Chair’s Introduction
The first half year has seen the start of a major Transformation across The Warehouse Group. Notable achievements in
the first half include the change in pricing strategy in our core Warehouse ‘Red Sheds’ business from hi-lo to EDLP, and
the operational integration of Warehouse Stationery (‘Blue’) with The Warehouse, and Torpedo7 with Noel Leeming.
Consequently our financial results have been directly affected by these changes, however our second quarter results
improved on our first quarter performance, and that trend is continuing into the second half.
The Group is reporting an adjusted Net Profit After Tax of $37.7M which is above the guidance range issued on 10
January 2018, and represents a (16.4)% reduction compared to the comparable period last year (in that comparison we
have excluded the results of the discontinued Financial Services operations).
In our guidance in January we highlighted an accrual for expected remuneration incentives across the business as a
material point of difference to last year. Incentives are a normal part of our remuneration structures, and only
periodically pay out based on business performance. At the start of the financial year we set targets in an environment
of major change, and incentivised milestone achievements and behaviours that align to long term shareholder value. If
we backed out all remuneration incentives from the first half numbers for this year and last year, the difference in
underlying performance is (1.7)%.
We updated the market in November on our strategy and planned transformation. The November/December/January
quarter is our peak trading period so no major new initiatives were launched in that second quarter as the business was
focused on trading the peak season. As we enter the second half, work is commencing on the next set of change
initiatives.
The business is executing on its change agenda and the Board is encouraged by the first half results, with the decline in
financial performance from these changes to date being less severe than we have seen in other retailers who have
shifted to an EDLP strategy.

The Warehouse Group H1 18 Interim Result
Retail sales were down 0.9% on last
year. Declines in Red, driven by a
change in pricing strategy, and Blue
which dealt with headwinds caused by
the internal change programme and
softer trading. Offsetting these were
strong growth in Noel Leeming and
growth in Torpedo7 sales.
A 0.7% increase in Gross Profit dollars is
driven by Noel Leeming, offset by margin
erosion in Red relating to the shift to
EDLP pricing strategy, and
underperformance in Blue.
CODB increased in the half as the
business increased its capabilities in
Information Systems teams, and
strengthened its executive and senior
management in readiness for the
Transformation.
The H117 numbers have been restated
to adjust for the classification of the sold
financial services business as a
discontinued operation.
Adjusted NPAT has been delivered
above the range signalled to the market
on 10 January, at $37.7M which is
(16.4)% down on last year.
A first half result influenced by major changes occurring in the business as the Group executes against its
Transformation plan. Noel Leeming is a bright spot amongst a backdrop of challenging performances, some
expected and some unexpected, particularly in the Blue Sheds.
$ MH1 18 H1 17Variance
Retail Sales1,598.11,611.9-0.9%
Gross Profit522.5519.0+0.7%
Gross Margin32.7%32.2%+50bps
CODB464.16449.1+3.3%
CODB29.0%27.9%+110bps
Retail Operating Profit58.469.9-16.5%
Operating Margin3.7%4.3%-60bps
NPAT (Reported)35.341.6-15.1%
NPAT (Adjusted)37.745.0-16.4%
Operating Cash Flow46.678.5-40.6%
Ordinary Dividend10.0cps10.0cps0.0cps
THE WAREHOUSE GROUP

3

Adjusted vs Reported Results
The Group adjusts reported profit for unusual and non-operating items. Unusual items include any
gains or losses from the sale of assets, adjustments in carrying values of assets, business
acquisitions or disposals and restructuring costs.
$M
EBITNPAT
H1 18H1 17H1 18H1 17
Adjusted Earnings
58.469.937.745.0
Restructure
(3.2)(3.9)(2.4)(2.9)
Property Divestments
-(0.8)-(0.6)
Deferred Tax Adjustment
(resulting from property divestments)
-0.1
Reported Earnings
55.265.235.341.6
Discontinued
(3.5)(28.0)
Attributable to Shareholders
31.813.6
THE WAREHOUSE GROUP

4

Balance Sheet
The reduction in working capital year
on year relates to timing differences in
debtors and creditor payments versus
balance date, and the removal of
Finance Receivables following the
sale of the Financial Services
business in H118.
Held for sale assets include the Lunn
Avenue site, for which we are in a due
diligence phase for development of
that site. Last year the Newmarket
site was included as available for sale
and was subsequently sold in July
2017.
Tax assets are higher largely due to
the reversal of deferred tax liabilities
connected with the property sales.
Net Debt is lower by $94M, due to
receipt from the sale of Newmarket,
and timing of cash flows, resulting in a
steadily reducing gearing level.
Equity is lower than last year, due to
the write down of the financial
services business, rather than
dividends which are based around
retail profits.
$MH1 18H1 17Variance
Inventory
Finance Receivables
Trade & other
Receivables
Trade & other Payables
Provisions
540.3
-
75.4
(291.3)
(78.5)
540.5
74.7
80.4
(329.1)
(68.3)
-0.2M
-74.7M
-5.0M
+37.8M
-10.2M
Working Capital
245.9298.2-52.3M
Fixed Assets
Held for Sale
271.4
16.2
297.1
52.3
-25.7M
-36.1M
Funds Employed
533.5647.5-114.1M
Tax Assets
Derivatives
Goodwill and brands
44.5
(12.6)
106.6
41.2
(10.7)
106.6
+3.3M
-1.9M
0M
Capital Employed
672.0784.7
-112.7M
Shareholders’ Equity
Minority Interests
Net Debt
501.8
1.0
169.2
521.2
0.2
263.3
-19.4M
+0.8M
-94.1M
Source of Funds
672.0784.7
-112.7M
Gearing
25.2%33.6%
Balance Sheet gearing is improving and is at appropriate levels.
THE WAREHOUSE GROUP

5

6
Cash Flow
The movement year on year in
operating cash flows is largely a
result of the timing of creditor
payments (part of working capital).
Proceeds from Divestments
include the proceeds from the sale
of the Financial Services business
which settled after the FY17
balance date.
Retail capital expenditure
continues to track at levels that are
in line with depreciation.
The business remains cash generative, and we continue to focus on improving the gearing
ratio and improving our management of working capital.
$MH1 18H1 17Variance
Trading EBITDA
87.399.0
-11.7M
Working Capital
Taxes Paid
Interest Paid
Other Items
(15.0)
(12.2)
(5.9)
(7.6)
14.7
(20.1)
(8.3)
(6.8)
-29.7M
+7.9M
+2.4M
-0.8M
Operating Cash Flow
46.678.5
-31.9M
Capital Expenditure
Divestments
Securitised debt sold
Dividends Received
Dividends Paid
Other
(38.9)
17.4
45.2
0.1
(20.9)
(0.4)
(38.4)
14.8
-
0.1
(17.5)
(0.8)
-0.5M
+2.6M
+45.2M
-
-3.4M
+0.4M
Net Cash Flow
49.136.7
+12.4M
Opening Net Debt
Closing Net Debt
(218.3)
(169.2)
(300.0)
(263.3)
THE WAREHOUSE GROUP

6

—
The WarehouseGroup

FY18INTERIM RESULT

—
A period dominated by
our accelerated transition
to EDLP pricing,
Customer reaction
positive with growth in
transactions and volume
of product sold
THE WAREHOUSE GROUP

9

The Warehouse –2018 Interim Result
Same Store Sales decreased by
3.7% in H1. The decrease in Q2
was 3.5%.
The reduction in Sales revenue
was an anticipated effect from the
transition to EDLP. Unit Volume of
product sold increased by 6.7%.
Gross margin percentage reduced
slightly as we invested in price as
part of our transition to EDLP and
completed clearance of
discontinued ranges.
Sales deleverage resulted in CODB
increasing by 60 bps. In dollar
terms a reduction of $5 million
reflecting progress in delivering a
simpler business.
CAPEX includes a number of
technology projects together with
the relocation of one store.
10
$MH1 18H1 17Variance
Sales
940.1975.1
-3.6%
Same Store
Sales
-3.7%+1.3%
-500bps
Gross Profit
339.2354.7
-4.4%
Gross Margin
36.1%36.4%
-30bps
CODB
290.2295.2
-1.7%
CODB
30.9%30.3%
+60bps
Operating Profit
49.059.5
-17.6%
Operating Margin
5.2%6.1%
-90bps
Capital Expenditure
19.318.3
+1.0M
Stores
9392
+1
Reduction in Operating Margin as the business managed one-off clearance of discontinued
stock lines as part of its EDLP transition.
THE WAREHOUSE GROUP

10

—
Sales
Apparel continued to perform strongly with Sales and margin both increasing. Customers have
reacted positively to our curated assortment and our pricing.
With the warmer summer weather this year Seasonal categories have performed well with Water
Sports and Pools, Cooling and Outdoor Furniture leading the way.
Unit growth has been particularly strong in Grocery, with our Confectionery and Health & Beauty
categories performing ahead of expectations. Our dollar deals with specific dollar price points
have contributed to this result.
Gross Profit
Gross Profit declined $15.5M in the half as we invested in price and continued our clearance of
discontinued lines. This was particularly apparent in our Home and Leisure departments. In
Apparel our margins continued to improve.
CODB
Focus throughout the half on cost reduction, however CODB leverage is challenging with
declining Sales during the half. Productivity and developing a simpler business continues to be
a focus.
11
The Warehouse –2018 Interim Highlights
Key Categories performing well, reflecting better range selection and solid trading plans.
THE WAREHOUSE GROUP

11

—
Stores
In the period we relocated our Rolleston store to a new larger site. We also opened a
Clearance site at Balmoral, Auckland.
Focus
With the transition to EDLP largely complete we are continuing to focus on price elasticity
with a view to improving gross margins. Completion of the one-off clearance of discontinued
products will take place in H2.
Further reduction in CODB is expected in H2 as we continue to remove complexity from our
operating model.
12
The Warehouse –2018 Interim Highlights
Continued emphasis on reshaping our Operating Model for sustainable profitability.
THE WAREHOUSE GROUP

12

FY18 INTERIM RESULT

—
Warehouse Stationery
operating profit
impacted by one-off
integration complexity
THE WAREHOUSE GROUP

14

Significant one off impact to the business from integration to Red systems
Warehouse Stationery –2018 Interim Result
Significant sales impact from softer
performance in communications
and technology segments and one-
off impact of the integration of Blue
sheds business onto core Red
sheds systems.
Number of transactions similar to
last year but reduction in average
sale price due to higher value
category performance.
Improved trend in Back to School
trading.
Margin percentage increased 50
bps reflecting reduced mix of
technology.
Increase in CODB percentage as a
result of sales deleverage and high
level of fixed cost. Emphasis
placed on maintaining service
levels.
We opened two new stores in Q4
F17 in Haweraand Johnsonville,
Wellington. We opened a Store
within a Store in Rolleston in Q2
this half (as part of our Red shed
store).
15
$MH1 18H1 17Variance
Sales
129.0138.8
-7.1%
Same Store Sales
-7.9%+1.2%
-910bps
Gross Profit
51.354.5
-5.9%
Gross Margin
39.8%39.3%
+50bps
CODB
47.648.0
-0.9%
CODB %
37.0%34.6%
+240bps
Operating Profit
3.76.5
-43.4%
Operating Margin
2.8%4.7%
-190bps
Capital Expenditure
0.41.4
-1.0M
Stores
7067
+3
THE WAREHOUSE GROUP

15

FY18 INTERIM RESULT

—
Another strong
performance from Noel
Leeming resulting in year
on year operating profit
growth of 66%
THE WAREHOUSE GROUP

17

Noel Leeming Group –2018 Interim Result
A significant increase in Operating Profit, with continued focus on providing end to end service
for our customers through our Passionate Experts.
Strong sales results in H1
resulted in sales growth of 7.5%
with SSS +5.1%.
Key growth came from the
Cellular and Audio categories.
Gross Profit was $13.2m up on
H1 17. This was as a result of
the increase in sales volumes
and an improved GP% of 150bps
driven by category mix and
promotional activity.
One-off adjustment in the
treatment of supplier funded
rebates for store fixtures results
in an additional $2.7m into GP.
Strong Operating Profit of
$15.3m up $6.1m, 65.7% on
H1 17.
During H1 17 we opened two
new stores, being Royal Oak,
Auckland and Rolleston,
Christchurch. In addition, we
relocated our Northwood,
Christchurch site and extended
our Taupostore.
18
$MH1 18H1 17Variance
Sales
453.9422.1
+7.5%
Same Store Sales
+5.1%+9.9%
-480bps
Gross Profit
99.986.7
+15.3%
Gross Margin
22.0%20.5%
+150bps
CODB
84.677.5
+9.3%
CODB
18.6%18.3%
+30bps
Operating Profit
15.39.2
+65.7%
Operating Margin
3.4%2.2%
+120bps
Capital Expenditure
8.47.0
+1.4M
Stores
7977
+2
THE WAREHOUSE GROUP

18

FY18 INTERIM RESULT

—
Torpedo7 Group sales
grew 2.5% with strong
growth coming fromthe
Torpedo7 retail stores
THE WAREHOUSE GROUP

20

21
Torpedo7 Group –2018 Interim Result
Strong sales growth in New
Zealand, led from the Torpedo7
retail stores (same store sales bricks
& mortar up 12.2%).
T7 online NZ continues to grow,
partially offsetting decline in the
Australian online business.
1-day’s sales have flattened out
after strong growth last year.
Key sales growth has come from the
Bike and Water categories.
Product mix and clearance of aged
inventory have impacted GP%, this
has resulted in GP$’s flat on H1 17.
CODB increase highlights
investment in brand awareness and
stores, this has resulted in an
Operating Profit of $0.8m.
In the period we closed the Number
1 Fitness store at Penrose and
relocated to be within the existing
Torpedo7 store at Mt Wellington,
Auckland. In addition we have been
operating two pop-up stores
(Westgate, Auckland and
Remarkables, Queenstown).
A challenging first half for Torpedo7 Group
$MH1 18 H1 17Variance
Sales88.686.4+2.5%
Gross Profit21.021.00%
Gross Margin23.7%24.3%-60bps
CODB20.218.69.0%
CODB22.8%21.5%+130bps
Operating Profit0.82.4-68.0%
Operating Margin0.9%2.8%-190bps
Capital Expenditure0.50.2+0.3M
Stores1112-1
THE WAREHOUSE GROUP

21

—
The WarehouseGroup

—
Key strategic Initiatives
—
While the second quarter was time for us to focus on trading, some key strategic initiatives were
advanced in the first half.
Move to EDLP in Red
All categories transitioned to EDLP by the end of Q1 with exceptions for whiteware and fine
jewellery.
Range curationongoing and SKUcount for H2 is better thantarget.
Private label curated to 32 brands from ~80 at end of FY17 and transition underway.
Childrenswear, the first category to transition to EDLP in FY17 H2, continues to show positive
sales on top of last year’s gains. H1 sales up 4.8% whilst clearance burn and promotional
investment both reduced.
Dynamic Buying and Sourcing
We continue to lower cost of goods sold through sourcing direct ($6.5m YTD).
India office operational with significant growth from South East Asia and more than 50 new
suppliers on-boarded.
Merchandise team restructured and new sourcing roles added to create a fully cross functional
product team. Design and Quality teams continue to grow and are now embedded as part of
the wider product team.
First phase of sourcing systemimplemented providing a cross functional critical path for the
combined product team. (Rolling implementation as new orders are placed).
Private label products delivering 16 point margin advantage over national brands (vs LY).
THE WAREHOUSE GROUP

23

—
Key strategic Initiatives (cont)
—
Marketing
Reduction in promotional intensity driven by move to EDLP.
Channel mix and message optimisation continuing.
Increased focus on data driven marketing and personalisation.
RFP for Media planning and buying in progress. The planistounify our media planning and
buying behaviours with a single fully-integrated, tech-enabled partner for the entire business.
Marketing team restructure to drive innovation and efficiency in progress under our new
Group CMO, Jonathan Waecker.
Education
Test for Purple School carried out during 6 weeks of Back to School period.
Post implementation review underway and next steps to be determined but lots of clear
positives.
Fulfilment & Logistics
ChrisFoord hired as Chief Logistics Officer, bringing experience of large scale
transformation from his time at Fonterra.
THE WAREHOUSE GROUP

24

—
Transformation Update
—
H2 will see the majority of the Transformation initiatives intensify. Areas of
opportunity have been identified and bottom up analysis and validation will begin at
pace mid March.
We see that most of the Transformation projects not already executed will impact
FY19 far more than the second half of FY18. We do expect some incremental costs
as the Transformation progresses.
We have appointed a new Chief Transformation Officer to drive the programme of
work, Scott Newton, who has relevant NZ based Transformation project experience.
We remain committed to last year’s three year goals of ~7% EBIT.
THE WAREHOUSE GROUP

25

—
The WarehouseGroup

—
Outlook & Full Year Earnings Guidance
—
Retail Environment
Retail conditions remain generally favourable, despite increasing competitive activity.
Headwinds for H2 18 remain increased competition.
Transformation
The second quarter is always a peak trading period for the business. The second half
will focus on accelerating our transformation initiatives.
Full Year Guidance
H2 18 is expected to be similar to H2 17. Therefore FY18 Adjusted Net Profit After
Tax subject to material changes in trading conditions is expected to be in the range of
$50M to $53M. This represents a decrease of 25-27% in profit for the full year.
Today the Board has declared an interim dividend of 10cps payable on 12 April 2018.
THE WAREHOUSE GROUP

27

THE WAREHOUSE GROUP

28

---

_________________________________________________________________________________

To: Market Information Services Section
NZX Limited
_________________________________________________________________________________

Auckland, 8 March 2018

The Warehouse Group (NZX.WHS) Interim Results for the 26 weeks ended 28 January 2018
The Warehouse Group reports interim result above guidance range
The Warehouse Group today announced an Adjusted
1
Net Profit After Tax result of $37.7M for first six months of
the 2018 financial year, above the recent guidance range of $32-$35M.

The result was driven by a number of major changes in the business over the first half as part of the Group’s
transformation program.

The core Warehouse business had an encouraging result, proving that customers were responding positively to
the shift to every day low prices and change in product assortment. The core Warehouse (‘Red Sheds’) business
successfully transitioned its pricing strategy from Hi-Lo discounting to one of Every Day Low Pricing. The peak
trading period for the Red Sheds was encouraging given that change, with strong customer support for the new
product and price offer.

The Noel Leeming Group continued its strong growth in sales and earnings and the Torpedo7 Group reported sales
up 2.5% on the same period last year.

Group online sales in NZ were $117.4M, up 10.5% compared to the same period last year.

Gross profit of $522.5M at Group level increased by 0.7% compared to HY17.

Chair Joan Withers explained that the Group’s primary focus in the first half had been to relentlessly tade the peak
retail season, while also focusing on its ambitious transformation agenda.

“A key pillar of our strategy is to fix our retail fundamentals, which means driving major changes in the way we
operate the business, and how we delight our customers.”

“With a strong team now in place, and support from external experts, we are confident that we can successfully
execute our next major change agenda in 2018 to drive improved performance” said Ms Withers.

The Warehouse

The Red Sheds reported sales of $940.1M, which was down, as expected, from $975.1M in HY17 due to the
transition in pricing and product strategy resulting in a reduction in average selling price.

That reduction has been offset at a Gross Profit level by a reduction in clearance and promotional markdown. It is
expected that the net cash gross profit percentage will improve and more than offset the decline in average selling
price now that the clearance of discontinued ranges has been completed.

EBIT for the Red Sheds was down (17.6%) compared to the same period last year, reflecting increased logistics
costs for overall higher unit volumes, and employee cost increases. Same store sales decreased (3.6)% in the half,
an improvement over the Q1 result of (5.2)%.

Notwithstanding the absolute decline year on year in profit generated from the Red Sheds division, overall the first
half performance has been encouraging given the degree of change that has been absorbed by the business.

Noel Leeming

Noel Leeming reported sales of $453.9M for HY18, a 7.5% increase on the same period last year and same store
sales increased by 5.1% in the half.

Cellular and portable audio were standout categories for Noel Leeming for the half, and the business saw gains
across all but the TV product categories, which was on-par with last year.

Operating profit for the half was $15.3M, an increase of $6.1M or 65.7% on HY17. The operating profit result was
helped by a $2.7M non-recurring item, being a change in accounting treatment of supplier funded store fixtures.

Torpedo 7 Group

Torpedo7 Group reported sales of $88.6M for HY18, up 2.5% on the HY17.

Operating profit of $0.8M decreased by (68.0)% over the same period last year. Clearance of aged stock and
changes in product mix have impacted margins, and efforts to increase brand awareness for the offline retail have
driven some cost expansion.

During the period a number of legacy issues were tackled including addressing inventory and sales issues within
the Number One fitness and Shotgun supplements divisions.

After strong growth in FY17, the daily deals site 1-day saw flat sales growth.

Warehouse Stationery

Blue Sheds reported sales of $129.0M for HY18, a decrease of (7.1%) or $9.8M compared to the same period last
year.

The stationery business started to recover towards the end of the half year as it entered the key Back-to-School
trading period.

Operating profit of $3.7M decreased by 43.4% over the same period last year.

The operational integration of Warehouse Stationery (Blue sheds) into the Red Sheds caused a number of internal
systems and process challenges, which when coupled with a softer trading performance in key categories, saw a
sharp decline in performance for Blue.

The return to more normal performance levels is a key focus for what has been historically a very strong performer
for the Group.

Outlook

Subject to any material shifts in anticipated trading conditions, the board expects the second half year performance
to be at a similar to that of H217. Adjusted Net Profit After Tax for the year to therefore expected to be between
$50.0M and $53.0M, representing approximately a 22% to 25% profit decline year on year.

The Board has announced a 10 cents per share interim dividend. The final dividend will be announced at the full
year, as the Board is planning to review the Group’s dividend policy, following the sale last year of the Financial
Services business.

Key interim facts

 Adjusted
1
Net Profit After Tax result of $37.7M
 Gross profit of $522.5M
 Net profit after tax of $35.5M
 Group retail sales for the period were $1,598.1M
 Costs of doing business of $464.1M

ENDS

Background: The Warehouse Group Limited

The Warehouse Group Limited comprises 93 Warehouse stores, 74 Noel Leeming stores. 5 Lifestyle Appliance stores, 70 Warehouse
Stationery stores and 11 Torpedo7 stores in New Zealand and several online businesses. The company had turnover of $3.0 billion
in FY17 and employs over 12,000 people.

Contact details regarding this announcement:

Media: Julia Morton, Head of PR and Media, +64 21 875 388

Investors and Analysts: Mark Yeoman, Group Chief Financial Officer

To be contacted via Kim Russell +64 9 488 3285 or +64 21 452 860


1
A reconciliation of adjusted net profit to reported net profit is detailed on page 4 of the NZX release and in note 4 of the interim financial
statements. Certain transactions such as any profits or losses from the disposal of properties, goodwill impairment, direct costs and adjustments
relating to business acquisitions or disposals and costs connected with restructuring the Group can make the comparisons of profits between
periods difficult. The Group monitors adjusted net profit as a key indicator of performance and uses it as the basis for determining dividends and
believe it helps investors to understand how the underlying business in performing.

---

;
Appendix 7 of Listing Rules.
Number of pages including this one
(Please provide any other relevant
New Zealand Stock Exchange Listing Rule 7.12.2. For rights, Listing Rules 7.10.9 and 7.10.10. details on additional pages)
For change to allotment, Listing Rule 7.12.1, a separate advice is required.
Full name
of Issuer
Name of officer authorised to
Authority for event,
make this notice
e.g. Directors' resolution
Contact phone
Contact fax
numbernumber
Date
Nature of event
BonusIf ticked,
Rights Issue
Tick as appropriate
Issue
state whether:Taxable
/ Non TaxableConversionInterestRenouncable
Rights IssueCapital
If ticked, stateFull
non-renouncable
changeCallDividend
whether:
InterimYearSpecial
EXISTING securities affected by this
If more than one security is affected by the event, use a separate form.
Description of theISIN
class of securities
If unknown, contact NZX
Details of securities issued pursuant to this eventIf more than one class of security is to be issued, use a separate form for each class.
Description of theISIN
class of securities
If unknown, contact NZX
Number of Securities toMinimum
Ratio, e.g
be issued following eventEntitlement
1 for 2 for
Conversion, Maturity, Call
Treatment of Fractions
Payable or Exercise Date
Tick if
provide an
pari passu
ORexplanation
Strike price per security for any issue in lieu or date
of the
Strike Price available.
ranking
Monies Associated with Event
Dividend payable, Call payable, Exercise price, Conversion price, Redemption price, Application money.
Source of
Payment
Amount per security
Excluded income
(only applicable to PIEs)
SupplementaryAmount per security
Currencydividendin dollars and cents
details -
Listing Rule 7.12.7
Total monies
TaxationAmount per Security in Dollars and cents to six decimal places
In the case of a taxable bonusResident
Imputation Credits
issue state strike priceWithholding Tax(Give details)
Foreign
FWP Credits
Withholding Tax(Give details)
Timing
(Refer Appendix 8 in the Listing Rules)
Record Date 5pmApplication Date
For calculation of entitlements -Also, Call Payable, Dividend /
Interest Payable, Exercise Date,
Conversion Date. In the case
of applications this must be the
last business day of the week.
Notice DateAllotment Date
Entitlement letters, call notices,For the issue of new securities.
conversion notices mailedMust be within 5 business days
of record date.
OFFICE USE ONLY
Ex Date:
Commence Quoting Rights:
Security Code:
Cease Quoting Rights 5pm:
Commence Quoting New Securities:
Security Code:
Cease Quoting Old Security 5pm:
(09) 489 8900
NZ WHSE 000 1S6
3 April, 2018
Enter N/A if not
applicable
12 April, 2018
In dollars and cents
Not Applicable
$0.100
New Zealand dollars$0.017647
$34,684,312
$0.006944$0.038889$
12 April, 2018
Date Payable
$0.000000$0.000000
EMAIL: announce@nzx.com
Joan Withers
THE WAREHOUSE GROUP LIMITED
Ordinary Shares (346,843,120)
Notice of event affecting securities
(09) 488 3241
Directors' resolution
03201807
Retained earnings

---

The Warehouse Group Limited
For the 26 weeks ended 28 January 2018
Interim Financial Statements

Consolidated Income Statement
Unaudited Unaudited Audited
26 Weeks 26 Weeks 52 Weeks
Ended Ended Ended
28 January 29 January 30 July
Note
2018 2017 2017
$ 000 $ 000 $ 000
Continuing operations
Retail sales
3
1,598,076 1,611,862 2,980,771
Cost of retail goods sold(1,075,587) (1,092,854) (2,008,859)
Gross profit522,489 519,008 971,912
Other income5,214 4,372 8,144
Lease and occupancy expenses(80,564)(76,168)(156,659)
Employee expenses(264,397)(253,645)(486,196)
Depreciation and amortisation expenses
3
(28,838)(29,054)(58,376)
Other operating expenses(95,485)(94,589)(170,988)
Operating profit from continuing operations
3
58,419 69,924 107,837
Unusual items
4
(3,223)(4,773)(605)
Earnings before interest and tax from continuing operations55,196 65,151 107,232
Net interest expense(5,516)(6,586)(12,527)
Profit before tax from continuing operations49,680 58,565 94,705
Income tax expense(14,204)(16,854)(23,691)
Net profit for the period from continuing operations35,476 41,711 71,014
Discontinued operations
Loss from discontinued operations (net of tax)
15
(3,547)(28,073)(50,283)
Net profit for the period31,929 13,638 20,731
Attributable to:
Shareholders of the parent
31,798 13,555 20,429
Minority interests131 83 302
31,929 13,638 20,731
Profit attributable to shareholders of the parent relates to:
Profit from continuing operations35,345 41,628 70,712
Loss from discontinued operations(3,547)(28,073)(50,283)
31,798 13,555 20,429
Earnings per share attributable to shareholders of the parent:
Basic earnings per share9.2 cents 3.9 cents 5.9 cents
Diluted earnings per share9.2 cents 3.9 cents 5.9 cents
Earnings per share attributable to shareholders of the parent from continuing operations:
Basic earnings per share10.3 cents 12.1 cents 20.5 cents
Diluted earnings per share10.2 cents 12.0 cents 20.4 cents
Consolidated Statement of Comprehensive Income
Unaudited Unaudited Audited
26 Weeks 26 Weeks 52 Weeks
Ended Ended Ended
28 January 29 January 30 July
2018 2017 2017
$ 000 $ 000 $ 000
Net profit for the period31,929 13,638 20,731
Items that may be reclassified subsequently to the Income Statement
Movement in foreign currency translation reserve(6)- -
Movement in hedge reserves (net of tax)4,867 13,423 7,265
Total comprehensive income for the period36,790 27,061 27,996
Attributable to:
Shareholders of the parent36,659 26,978 27,694
Minority interest131 83 302
Total comprehensive income36,790 27,061 27,996
Attributable to:
Total comprehensive income from continuing operations40,337 55,134 78,279
Total comprehensive income from discontinued operations(3,547)(28,073)(50,283)
Total comprehensive income36,790 27,061 27,996
Total comprehensive income from continuing operations attributable to:
Shareholders of the parent
40,206 55,051 77,977
Minority interest131 83 302
Total comprehensive income40,337 55,134 78,279
2

Consolidated Statement of Changes in Equity
Foreign Employee
Currency Share
Share Treasury Hedge Translation Benefits Retained Minority Total
(Unaudited)
Capital Stock Reserves Reserve Reserve Earnings Interest Equity
For the 26 weeks ended 28 January 2018
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
Balance at the beginning of the period365,517 (7,471)(15,174)- 2,138 140,512 867 486,389
Profit for the half year- - - - - 31,798 131 31,929
Movement in foreign currency translation reserve- - - (6)- - - (6)
Movement in derivative cash flow hedges- - 6,457 - - - - 6,457
Movement in de-designated hedges- - 303 - - - - 303
Tax related to movement in hedge reserve- - (1,893)- - - - (1,893)
Total comprehensive income- - 4,867 (6)- 31,798 131 36,790
Share rights charged to the income statement- - - - 288 - - 288
Share rights exercised- 1,411 - - (1,725)314 - -
Dividends paid- - - - - (20,811)(4)(20,815)
Treasury stock dividends received- - - - - 101 - 101
Balance at the end of the period365,517 (6,060)(10,307)(6)701 151,914 994 502,753
Foreign Employee
Currency Share
Share Treasury Hedge Translation Benefits Retained Minority Total
(Unaudited)
Capital Stock Reserves Reserve Reserve Earnings Interest Equity
For the 26 weeks ended 29 January 2017
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
Balance at the beginning of the period365,517 (7,832)(22,439)- 3,623 171,560 167 510,596
Profit for the half year- - - - - 13,555 83 13,638
Movement in foreign currency translation reserve- - - - - - - -
Movement in derivative cash flow hedges- - 18,340 - - - - 18,340
Movement in de-designated hedges- - 303 - - - - 303
Tax related to movement in hedge reserve- - (5,220)- - - - (5,220)
Total comprehensive income- - 13,423 - - 13,555 83 27,061
Share rights charged to the income statement- - - - 1,048 - - 1,048
Share rights exercised- 2,224 - - (2,505)281 - -
Dividends paid- - - - - (17,342)(67)(17,409)
Treasury stock dividends received- - - - - 73 - 73
Balance at the end of the period365,517 (5,608)(9,016)- 2,166 168,127 183 521,369
Foreign Employee
Currency Share
Share Treasury Hedge Translation Benefits Retained Minority Total
(Audited)
Capital Stock Reserves Reserve Reserve Earnings Interest Equity
For the 52 weeks ended 30 July 2017
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
Balance at the beginning of the period365,517 (7,832)(22,439)- 3,623 171,560 167 510,596
Profit for the year- - - - - 20,429 302 20,731
Movement in derivative cash flow hedges- - 9,484 - - - - 9,484
Movement in de-designated hedges- - 606 - - - - 606
Tax related to movement in hedge reserve- - (2,825)- - - - (2,825)
Total comprehensive income- - 7,265 - - 20,429 302 27,996
Contributions by and distributions to owners:-
Share rights charged to the income statement- - - - 1,283 - - 1,283
Minority interest capital contribution- - - - - - 750 750
Share rights exercised- 2,509 - - (2,768)259 - -
Dividends paid- - - - - (52,026)(352)(52,378)
Treasury stock dividends received- - - - - 290 - 290
Purchase of treasury stock- (2,148)- - - - - (2,148)
Balance at the end of the period365,517 (7,471)(15,174)- 2,138 140,512 867 486,389
3

Balance Sheet
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
Note
2018 2017 2017
ASSETS
$ 000 $ 000 $ 000
Current assets
Cash and cash equivalents
11
44,778 44,535 47,492
Finance business receivables- 74,675 -
Trade and other receivables
6
75,367 80,427 71,088
Inventories540,339 540,513 491,818
Derivative financial instruments
12
426 500 -
Taxation receivable- - 4,959
660,910 740,650 615,357
Assets held for sale
17
20,368 52,281 77,142
Total current assets681,278 792,931 692,499
Non-current assets
Property, plant and equipment
9
244,091 252,929 252,175
Intangible assets
10
133,922 150,778 127,726
Derivative financial instruments
12
647 291 541
Deferred taxation45,723 41,853 40,911
Total non-current assets424,383 445,851 421,353
Total assets1,105,661 1,238,782 1,113,852
LIABILITIES
Current liabilities
Borrowings
11
74,237 81,162 49,593
Trade and other payables
7
291,308 329,092 267,304
Derivative financial instruments
12
10,980 9,634 17,299
Taxation payable1,262 667 -
Provisions
8
58,962 49,525 49,769
436,749 470,080 383,965
Securitised borrowings associated with assets held for sale- - 56,717
Other liabilities directly associated with assets held for sale
17
4,194 - 5,443
Total current liabilities440,943 470,080 446,125
Non-current liabilities
Borrowings
11
139,712 164,121 159,453
Securitised borrowings
11
- 62,597 -
Derivative financial instruments
12
2,701 1,855 2,507
Provisions
8
19,552 18,760 19,378
Total non-current liabilities161,965 247,333 181,338
Total liabilities602,908 717,413 627,463
Net assets502,753 521,369 486,389
EQUITY
Contributed equity359,457 359,909 358,046
Reserves(9,612)(6,850)(13,036)
Retained earnings151,914 168,127 140,512
Total equity attributable to shareholders501,759 521,186 485,522
Minority interest994 183 867
Total equity502,753 521,369 486,389
Net assets per share145.7 cents 151.0 cents 141.2 cents
4

Consolidated Statement of Cash Flows
Unaudited Unaudited Audited
26 Weeks 26 Weeks 52 Weeks
Ended Ended Ended
28 January 29 January 30 July
Note
2018 2017 2017
Cash flows from operating activities
$ 000 $ 000 $ 000
Cash received from customers1,603,868 1,613,069 2,996,090
Payments to suppliers and employees(1,541,019) (1,509,992) (2,841,679)
Income tax paid(12,174)(20,091)(27,454)
Interest paid(5,868)(8,344)(16,008)
44,807 74,642 110,949
Loans repaid by finance business customers25,775 86,898 171,188
New loans to finance business customers(23,938)(82,998)(154,049)
Net cash flows from operating activities46,644 78,542 128,088
Cash flows from investing activities
Proceeds from sale of property, plant and equipment107 14,827 79,714
Proceeds from business disposal
16
17,291 - -
Minority interest capital contribution- - 750
Purchase of property, plant, equipment and software(38,925)(38,434)(70,575)
Contingent consideration- (1,000)(1,000)
Other items- - (327)
Net cash flows from investing activities(21,527)(24,607)8,562
Cash flows from financing activities
Proceeds from / (Repayment) bank borrowings4,822 (43,651)(79,821)
Proceeds from / (Repayment) securitised borrowings(11,555)2,472 (3,408)
Repayment of finance leases(262)(629)(1,196)
Purchase of treasury stock- - (2,148)
Treasury stock dividends received 101 73 290
Dividends paid to parent shareholders(20,933)(17,479)(52,404)
Dividends paid to minority shareholders(4)(67)(352)
Net cash flows from financing activities(27,831)(59,281)(139,039)
Net cash flow(2,714)(5,346)(2,389)
Opening cash position47,492 49,881 49,881
Closing cash position44,778 44,535 47,492
Reconciliation of Operating Cash Flows
Profit after tax31,929 13,638 20,731
Non-cash items
Depreciation and amortisation expenses
3
28,838 29,912 60,191
Intangible asset impairment
10 ,9
- 22,714 40,061
Share based payment expense288 1,048 1,283
Interest capitalisation238 272 524
Supplier contributions(2,699)- -
Movement in deferred tax(5,042)(3,977)(555)
Movement in de-designated derivative hedges218 218 436
Total non-cash items21,841 50,187 101,940
Items classified as investing or financing activities
Net loss/ (gain) on sale of property, plant and equipment399 1,289 (9,979)
Loss on business disposal1,458 - -
Direct costs relating to business disposal- - 946
Supplementary dividend tax credit122 137 378
Total investing and financing adjustments1,979 1,426 (8,655)
Changes in assets and liabilities
Trade and other receivables(3,775)(3,368)4,248
Finance business receivables2,229 (1,110)6,210
Inventories(48,521)(38,800)9,895
Trade and other payables25,435 66,450 7,557
Provisions9,306 (8,480)(6,811)
Income tax6,221 (1,401)(7,027)
Total changes in assets and liabilities(9,105)13,291 14,072
Net cash flows from operating activities46,644 78,542 128,088
5

Notes to the Financial Statements
1. GENERAL INFORMATION
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
3. SEGMENT INFORMATION
The interim financial statements of the Group have been prepared in accordance with Generally Accepted Accounting Practice in New Zealand (NZ
GAAP). They comply with NZ IAS 34 Interim Financial Reporting and IAS 34 Interim Financial Reporting and consequently, do not include all the
information required for full financial statements. These Group interim financial statements should be read in conjunction with the annual report for the
year ended 30 July 2017.
These financial statements have been prepared under the historical cost convention except for the revaluation of certain financial instruments
(including derivative instruments). The reporting currency used in the preparation of the financial statements is New Zealand dollars, rounded to the
nearest thousands unless otherwise stated.
The accounting policies that materially affect the measurement of the interim financial statements have been applied on a consistent basis with those
used in the audited financial statements for the 52 weeks ended 30 July 2017 and the unaudited interim financial statements for the 26 weeks ended
29 January 2017.
There have been no significant changes in accounting polices applied by the Group during the current half year period.
Seasonality
The Group's revenue and profitability follow a seasonal pattern with higher sales and operating profits typically achieved in the first half of the financial
year as a result of additional sales generated during the Christmas trading period.
Approval of Financial Statements
These consolidated interim financial statements were approved for issue by the Board of Directors on 7 March 2018. Unless as otherwise stated, the
financial statements have been reviewed by our Auditors, but are not audited.
The Warehouse Group Limited (the Company) and its subsidiaries (together the Group) trade in the New Zealand retail and financial services sectors.
The Company is a limited liability company incorporated and domiciled in New Zealand. The Group is registered under the Companies Act 1993 and is
an FMC Reporting Entity under Part 7 of the Financial Markets Conduct Act (FMCA) 2013. The address of its registered office is Level 4, 4 Graham
Street, PO Box 2219, Auckland. The Company is listed on the New Zealand Stock Exchange (NZX).
Operating segments
The Group has four operating segments trading in the New Zealand retail sector. These segments form the basis of internal reporting used by
management and the Board of Directors to monitor and assess performance and assist with strategy decisions.
Each of the four retail segments represent a distinct retail chain, synonymous with its segment name. Customers can purchase product from the retail
chains either on-line or through the Group’s physical retail store network. The Group’s store network currently has 93 The Warehouse stores , 70
Warehouse Stationery stores, 79 Noel Leeming stores and 11 Torpedo7 stores. The Warehouse predominantly sells general merchandise and
apparel, Noel Leeming sell technology and appliance products, Torpedo7 sells sporting equipment and as the name indicates Warehouse Stationery
sells stationery.
Group support office functions, such as Information Systems, Finance, Brand Executives and People Support are operated using a shared services
model which allocates the costs of these support office functions to individual brands calculated on an arm’s length basis. The remaining support
office functions which relate to corporate and governance functions, a property company and the Group’s interest in a chocolate factory are not
allocated and form the main components of the “Other Group operations” segment.
6

Notes to the Financial Statements - continued
3. SEGMENT INFORMATION - (Continued)
Operating performance
(Unaudited)(Unaudited)(Audited)(Unaudited)(Unaudited)(Audited)
26 Weeks 26 Weeks 52 Weeks 26 Weeks 26 Weeks 52 Weeks
Ended Ended Ended Ended Ended Ended
28 January 29 January 30 July 28 January 29 January 30 July
2018 2017 2017 2018 2017 2017
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000
The Warehouse940,055 975,097 1,761,399 49,031 59,508 84,531
Warehouse Stationery 128,987 138,775 278,181 3,656 6,455 15,743
Noel Leeming 453,853 422,149 810,705 15,253 9,207 19,264
Torpedo788,591 86,402 157,726 776 2,424 2,675
Other Group operations5,501 5,436 8,603 (10,297)(7,670)(14,376)
Inter-segment eliminations(18,911)(15,997)(35,843)
Retail Group1,598,076 1,611,862 2,980,771 58,419 69,924 107,837
Unusual items(3,223)(4,773)(605)
Earnings before interest and tax from continuing operations55,196 65,151 107,232
Net interest expense(5,516)(6,586)(12,527)
Profit before tax from continuing operations49,680 58,565 94,705
Operating margin
The Warehouse (%)
5.2 6.1 4.8
Warehouse Stationery (%)2.8 4.7 5.7
Noel Leeming (%)3.4 2.2 2.4
Torpedo7 (%)0.9 2.8 1.7
Total Retail Group (%)3.7 4.3 3.6
Capital expenditure and depreciation
(Unaudited)(Unaudited)(Audited)(Unaudited)(Unaudited)(Audited)
26 Weeks 26 Weeks 52 Weeks 26 Weeks 26 Weeks 52 Weeks
Ended Ended Ended Ended Ended Ended
28 January 29 January 30 July 28 January 29 January 30 July
Note
2018 2017 2017 2018 2017 2017
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000
The Warehouse19,322 18,330 36,374 20,132 20,332 40,819
Warehouse Stationery409 1,386 3,861 2,829 3,403 6,722
Noel Leeming 8,411 6,996 10,382 4,675 4,044 8,421
Torpedo7474 185 581 520 571 1,059
Other Group operations10,421 2,541 10,253 682 704 1,355
Retail Group39,037 29,438 61,451 28,838 29,054 58,376
Discontinued Finance business335 1,303 2,513 - 858 1,815
Total Group
9
39,372 30,741 63,964 28,838 29,912 60,191
Balance sheet information
(Unaudited)(Unaudited)(Audited)(Unaudited)(Unaudited)(Audited)
359,457 359,909 358,046 359,457 359,909 358,046
(9,612)(6,850)(13,036)(9,612)(6,850)(13,036)
151,914 168,127 140,512 151,914 168,127 140,512
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000
The Warehouse499,216 492,567 461,772 224,399 210,479 182,389
Warehouse Stationery84,358 85,345 72,176 12,863 38,569 32,746
Noel Leeming 171,883 176,379 160,287 117,684 126,137 108,008
Torpedo750,770 50,131 51,742 11,586 11,956 11,269
Other Group operations92,709 138,198 90,229 3,290 2,575 2,039
Retail Group898,936 942,620 836,206 369,822 389,716 336,451
Discontinued Finance business8,550 102,382 77,142 4,194 7,661 5,443
Operating assets / liabilities907,486 1,045,002 913,348 374,016 397,377 341,894
Unallocated assets / liabilities
Cash and borrowings

44,778 44,535 47,492 213,949 307,880 265,763
Derivative financial instruments

1,073 791 541 13,681 11,489 19,806
Intangible Goodwill and Brands

106,601 106,601 106,601 - - -
Taxation45,723 41,853 45,870 1,262 667 -
Total1,105,661 1,238,782 1,113,852 602,908 717,413 627,463
REVENUEOPERATING PROFIT
DEPRECIATION & AMORTISATIONCAPITAL EXPENDITURE
TOTAL ASSETSTOTAL LIABILITIES
7

Notes to the Financial Statements - continued
4. ADJUSTED NET PROFIT
Adjusted net profit reconciliation
Unaudited Unaudited Audited
26 Weeks 26 Weeks 52 Weeks
Ended Ended Ended
28 January 29 January 30 July
Note
2018 2017 2017
$ 000 $ 000 $ 000
Adjusted net profit37,666 45,036 68,185
Add back: Unusual items
Gain/(loss) on property disposal- (812)11,455
Restructuring costs
14
(3,223)(3,961)(12,060)
Unusual items before taxation(3,223)(4,773)(605)
Income tax relating to unusual items902 1,336 169
Income tax expense related to depreciation recovered on building disposals- 29 2,963
Unusual items after taxation(2,321)(3,408)2,527
Net profit attributable to shareholders of the parent35,345 41,628 70,712
5. DIVIDENDS
Dividends paid
Unaudited Unaudited Audited Unaudited Unaudited Audited
26 Weeks 26 Weeks 52 Weeks 26 Weeks 26 Weeks 52 Weeks
Ended Ended Ended Ended Ended Ended
28 January 29 January 30 July 28 January 29 January 30 July
2018 2017 2017 2018 2017 2017
$ 000 $ 000 $ 000
Prior year final dividend6.0 5.0 5.0 20,811 17,342 17,342
Interim dividend- - 10.0 - - 34,684
Total dividends paid6.0 5.0 15.0 20,811 17,342 52,026
CENTS PER SHAREDIVIDENDS PAID
Certain transactions can make the comparison of profits between years difficult. The Group uses adjusted net profit as a key indicator of
performance and consider it provides a better understanding of underlying business performance and the Group also uses it as the basis for
determining dividend payments (after adjusting for losses from the Financial Services Group). Adjusted net profit makes allowance for the after tax
effect of unusual items which are not directly connected with the Group’s normal trading activities. The Group defines unusual items as any profits or
losses from the disposal of properties or investments, goodwill impairment, direct costs and adjustments relating to business acquisitions or
disposals and costs connected with restructuring the Group.
On 7 March 2018 the Board declared a fully imputed interim dividend of 10.0 cents per ordinary share to be paid on 12 April 2018 to all shareholders
on the Group's share register at the close of business on 3 April 2018.
8

Notes to the Financial Statements - continued
6. TRADE AND OTHER RECEIVABLES
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
2018 2017 2017
$ 000 $ 000 $ 000
Trade receivables41,789 44,576 45,207
Prepayments11,719 10,538 9,453
Business disposal proceeds receivable- 1,000 -
Rebate accruals and other debtors21,859 24,313 16,428
75,367 80,427 71,088
7. TRADE AND OTHER PAYABLES
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
2018 2017 2017
$ 000 $ 000 $ 000
Trade creditors and accruals231,004 242,727 204,784
Goods in transit creditors21,940 18,681 21,187
Capital expenditure creditors549 1,716 2,802
Goods and services tax12,725 37,913 10,768
Reward schemes, lay-bys, Christmas club deposits and gift vouchers14,934 16,147 15,820
Interest accruals928 1,505 1,089
Payroll accruals9,228 10,403 10,854
Total trade and other payables291,308 329,092 267,304
8. PROVISIONS
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
2018 2017 2017
$ 000 $ 000 $ 000
Current liabilities58,962 49,525 49,769
Non-current liabilities19,552 18,760 19,378
Total provisions78,514 68,285 69,147
Provisions consist of:
Employee entitlements
65,011 55,416 55,693
Make good provision7,909 7,868 8,012
Sales returns provision4,104 4,119 3,708
Onerous lease1,490 882 1,734
Total provisions78,514 68,285 69,147
9

Notes to the Financial Statements - continued
9. PROPERTY, PLANT, EQUIPMENT AND COMPUTER SOFTWARE
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
Note
2018 2017 2017
$ 000 $ 000 $ 000
Assets held for sale
17
11,874 52,281 8,064
Property, plant and equipment244,091 252,929 252,175
Computer software
10
27,321 44,177 21,125
Net book value283,286 349,387 281,364
Movement in property, plant, equipment and software
Balance at the beginning of the period281,364 364,673 364,673
Capital expenditure
3
39,372 30,741 63,964
Depreciation and amortisation
3
(28,838)(29,912)(60,191)
Impairment (Financial Services computer software)- - (17,347)
Disposals(8,612)(16,115)(69,735)
Balance at the end of the period283,286 349,387 281,364
10. INTANGIBLE ASSETS
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
Note
2018 2017 2017
$ 000 $ 000 $ 000
Computer software
9
27,321 44,177 21,125
Brands23,523 23,523 23,523
Goodwill83,078 83,078 83,078
Net book value133,922 150,778 127,726
Movement in Goodwill
Balance at the beginning of the period83,078 105,792 105,792
Impairment- (22,714)(22,714)
Balance at the end of the period83,078 83,078 83,078
The Group performs a detailed impairment assessment annually of the Group's intangible assets and considers if there are any indicators of
impairment at each interim reporting date. The Group’s interim review did not identify any significant indicators of impairment in any of the Group’s
cash generating units (CGU) except for the Torpedo7 Group.
The Torpedo7 trading performance during the current half year was below expectation and caused the Group to reassess the carrying value of the
Torpedo7 Goodwill asset ($25.622 million). The assessment is predicated on an improvement in trading and margin uplift, but is principally based on
store expansion which will provide Torpedo7 with greater scale. The board continue to support the concept of the store expansion but recognise
there is uncertainty and any adverse changes in key assumptions around the store rollout program and margin uplift could give rise to an impairment
of goodwill. The Board's assessment is that the recoverable amount continues to support the existing carrying value of goodwill, however the Board
will reassess the carrying value of goodwill at year end when the current Torpedo7 strategy review has been completed and there is more evidence of
the impact of recently commenced business improvement initiatives.
10

Notes to the Financial Statements - continued
11. BORROWINGS
Net debt
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
2018 2017 2017
$ 000 $ 000 $ 000
Cash on hand and at bank44,778 44,535 47,492
Bank borrowings73,981 80,329 49,159
Lease liabilities256 833 434
Current borrowings74,237 81,162 49,593
Bank borrowings15,000 40,000 35,000
Lease liabilities104 305 169
Fixed rate senior bond (coupon: 5.30%)125,000 125,000 125,000
Fair value adjustment relating to effective interest647 291 541
Unamortised capitalised costs on senior bond(1,039)(1,475)(1,257)
Non-current borrowings139,712 164,121 159,453
Securitised borrowings- 62,597 56,717
Total borrowings213,949 307,880 265,763
Net debt169,171 263,345 218,271
Committed bank credit facilities at balance date are:
Bank debt facilities
260,000 340,000 280,000
Bank facilities used(88,981)(120,329)(84,159)
Unused bank debt facilities171,019 219,671 195,841
Securitised debt facility- 150,000 150,000
Securitised facility used- (62,597)(56,717)
Unused securitised debt facility - 87,403 93,283
Letter of credit facilities28,000 32,526 32,389
Letters of credit(5,670)(11,933)(13,153)
Unused letter of credit facilities22,330 20,593 19,236
Total unused bank facilities193,349 327,667 308,360
12. DERIVATIVE FINANCIAL INSTRUMENTS
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
2018 2017 2017
$ 000 $ 000 $ 000
Current assets426 500 -
Non-current assets647 291 541
Current liabilities(10,980)(9,634)(17,299)
Non-current liabilities(2,701)(1,855)(2,507)
Total derivative financial instruments(12,608)(10,698)(19,265)
Derivative financial instruments consist of:
Current assets
426 500 -
Current liabilities(10,980)(8,684)(16,899)
Foreign exchange contracts(10,554)(8,184)(16,899)
Current liabilities- (950)(400)
Non-current assets647 291 541
Non-current liabilities(2,701)(1,855)(2,507)
Interest rate swaps(2,054)(2,514)(2,366)
Total derivative financial instruments(12,608)(10,698)(19,265)
US Dollar forward contracts - cash flow hedges
Notional amount (NZ$000)353,576 310,758 331,674
Average contract rate ($)0.7127 0.7034 0.7115
Spot rate used to determine fair value ($)0.7355 0.7261 0.7520
The Group continues to manage its foreign exchange and interest rate risks in accordance with the policies and parameters detailed in the 2017
Annual Report.
The Group’s foreign exchange contracts hedge forecast inventory purchases priced in US dollars over the next 12 months. The following table lists the
key inputs used to determine the fair value of the Group's foreign exchange contracts at balance date.
11

Notes to the Financial Statements - continued
13. FAIR VALUE MEASUREMENT
Asset / (Liability)
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
Note
2018 2017 2017
Derivatives used for hedging
$ 000 $ 000 $ 000
Foreign exchange contracts(Level 2)
12
(10,554)(8,184)(16,899)
Interest rate swaps(Level 2)
12
(2,054)(2,514)(2,366)
Senior bond fair value adjustment relating to effective interest(Level 2)
11
(647)(291)(541)
Fixed Rate Senior Bond
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
2018 2017 2017
Face value ($000)125,000 125,000 125,000
Coupon (%)5.30 5.30 5.30
Market yield (%)3.85 4.15 4.03
MaturityJune 2020 June 2020 June 2020
NZX quoted closing price ($)

1.03924 1.04262 1.04087
Fair value ($000)129,905 130,328 130,109
14. RESTRUCTURING COSTS
The following table sets out the Group’s financial instruments that are measured subsequent to initial recognition at fair values and are grouped into
levels based on the degree to which the fair value is observable:
Level 1 - fair value measurements derived from quoted prices in active markets for identical assets.
Level 2 - fair value measurements derived from inputs other than quoted prices included within level 1 that are observable for the asset or liability,
either directly or indirectly.
Level 3 - fair value measurements derived from valuation techniques that include inputs for the asset or liability that are not based on observable
market data.
There has been no transfers between levels or changes in the valuation methods used to determine the fair value of the Group’s financial instruments
during the current and comparative periods. Sensitivities to reasonably possible changes in non-market observable valuation inputs would not have a
material impact on the Group’s financial results.
Specific valuation techniques used to value financial instruments are:
• Forward exchange contracts determined using forward exchange market rates at the balance date (refer note 12).
• Interest rate swaps calculated as the present value of the estimated future cash flows based on the applicable market interest yield rates at balance
date.
Except for the Group’s fixed rate senior bond (refer note 11) and derivatives (detailed above) the carrying value of the Group’s financial assets and
liabilities approximate fair value. The fixed rate senior bond is listed on the NZX and measured at amortised cost. The fair value of fixed rate senior
bonds at balance date, based on the last price traded on the New Zealand stock exchange (level 1 valuation), were as follows.
In January 2017 the Group commenced a program of changes to its business operating model. The changes were designed to drive an improvement
in financial performance, reduce costs and generate greater customer relevance. The changes focused primarily on simplification to reduce
complexities, drive efficiencies and increase business agility. This involved strengthening and consolidating the various Group support service
functions to drive synergy benefits, deliver efficiencies and reduce complexity. It also involved combining The Warehouse and Warehouse Stationery
and similarly combining the Noel Leeming and Torpedo7 Groups by integrating their operating structures and executive leadership teams.
The first stage of this process has now largely been concluded and a second phase has started. The Group has engaged global management
consultancy firm, McKinsey & Company to assist with the second phase of the transformation process and strategy implementation.
12

Notes to the Financial Statements - continued
15. DISCONTINUED OPERATIONS
Financial Services Group results and cash flows
(Unaudited)(Unaudited)(Audited)
26 Weeks 26 Weeks 52 Weeks
Ended Ended Ended
28 January 29 January 30 July
2018 2017 2017
$ 000 $ 000 $ 000
Finance business revenue3,315 10,321 20,392
Expenses(5,893)(15,476)(28,893)
Business acquisition, disposal and restructuring costs(1,458)- (1,283)
Impairment of assets- (22,714)(40,061)
Loss before interest and tax(4,036)(27,869)(49,845)
Interest expense(324)(2,292)(4,049)
Loss before tax(4,360)(30,161)(53,894)
Income tax expense813 2,088 3,611
Loss from discontinued operations(3,547)(28,073)(50,283)
Cash flows from discontinued operations
Net cash flows from operating activities
(683)(5,905)(169)
Net cash flows from investing activities16,956 (1,303)(3,208)
Net cash flows from financing activities(23,226)(470)(2,660)
16. BUSINESS DISPOSAL - FINANCIAL SERVICES GROUP
For the 26 weeks ended 28 January 2018
Note
Total
$ 000
Cash and cash equivalents of the subsidiaries sold(2,831)
Sale proceeds settled in cash20,122
Consideration17,291
Finance business receivables56,669
Property, plant and equipment1,011
Computer software7,090
Securitised borrowings related to the sold subsidiaries(45,162)
Other working capital(2,317)
Carrying value of net assets sold17,291
Claw back provision1,458
Loss on business disposal
15
(1,458)
On 24 July 2017, the Group announced it had approved the conditional sale of the Group’s Financial Services business except for Diners Club
(NZ), to Finance Now, a subsidiary of SBS Bank. Final agreement was reached on 9 September 2017 and a sale and purchase agreement was
executed on that date. The Group also has plans in place to exit the Diners Club (NZ) business. As a result, the Financial Services Group is
reported as a discontinued operation.
The full year results and cashflows from the Financial Services Group are as follows.
Claw back provision
The sale of the Group’s Financial Services businesses on 9 September 2017, exposes the Group to a few actual and contingent liabilities
connected with a claw back provision and warranties contained in the sale and purchase agreement.
The Group will be required to pay up to an aggregate of $3.0 million (termed claw back) if the Group’s Finance receivable’s impairment provisions
are less than the actual write-offs experienced during the 9 month period following completion. The Group estimates this liability to be $1.458
million at balance date.
The Group was also required to make warranties, which are typical for a transaction of this nature. These warranties are largely covered by an
insurance contract, however there are some items which are not covered, such as tax claims. These warranty claims are capped at $18.0 million
(representing the purchase consideration) and expire after 18 months and have been treated as contingent liabilities.
13

Notes to the Financial Statements - continued
17. HELD FOR SALE
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
2018 2017 2017
$ 000 $ 000 $ 000
Property11,818 52,281 -
Financial Services Group assets classified as held for sale
Finance business receivables
8,457 - 67,355
Plant and equipment17 - 1,044
Computer software39 - 7,020
Other assets37 - 1,723
Total assets classified as held for sale20,368 52,281 77,142
Other liabilities directly associated with assets held for sale(4,194)- (5,443)
18. COMMITMENTS
Unaudited Unaudited Audited
As at As at As at
28 January 29 January 30 July
2018 2017 2017
(a) Capital commitments
$ 000 $ 000 $ 000
Within one year2,969 5,258 7,339
(b) Operating lease commitments
Future minimum rentals payable
0-1 Years118,175 121,731 120,363
1-2 Years102,784 109,032 105,533
2-5 Years236,442 249,329 242,456
5+ Years247,459 299,121 270,975
Total operating lease commitments704,860 779,213 739,327
19. RELATED PARTIES
20. CONTINGENT LIABILITIES
The Group has no material contingent liabilities other than those referrred to in note 16 and those arising in the normal course of business, being
primarily letters of credit issued to secure future purchasing requirements and store lease commitments.
Except for Directors' fees, key executive remuneration and dividends paid by the Group to its Directors, there have been no other related party
transactions during the period.
Capital expenditure contracted for at balance date but not recognised as liabilities is set out below:
Commitments for minimum lease payments in relation to non-cancellable operating leases at
balance date are as follows:
The Group committed to a plan in July 2017 to exit its Financial Services credit card businesses and has executed the first part of the disposal
plan when it sold the Group’s Financial Services business excluding Diners Club (NZ) on 9 September 2017. Accordingly, assets and liabilities
relating to the Financial Services Group are classified as held for sale at balance date. In addition to the net assets of the Financial Services
Group the Group also held surplus property assets which are intended to be sold. At balance date the Group is currently in the process of selling a
property at Lunn Avenue, Auckland.
14

---

PricewaterhouseCoopers, 188 Quay Street, Private Bag 92162, Auckland 1142, New Zealand
T: +64 9 355 8000, F: +64 9 355 8001, pwc.co.nz
Independent review report
To the shareholders of The Warehouse Group Limited
Report on the interim financial statements
We have reviewed the accompanying interim financial statements of The Warehouse Group Limited
(the Company) including its subsidiaries (the Group) on pages 2 to 14, which comprise the balance
sheet as at 28 January 2018, and the consolidated income statement, consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated
statement of cash flows for the period ended on that date, and a summary of significant accounting
policies and selected explanatory notes. The Group comprises the Company and its controlled entities
at 28 January 2018 or from time to time during the financial period.
Directors’ responsibility for the interim financial statements
The Directors are responsible on behalf of the Company for the preparation and presentation of these
interim financial statements in accordance with International Accounting Standard 34 Interim
Financial Reporting (IAS 34) and New Zealand Equivalent to International Accounting Standard 34
Interim Financial Reporting (NZ IAS 34) and for such internal controls as the Directors determine are
necessary to enable the preparation of interim financial statements that are free from material
misstatement, whether due to fraud or error.
Our responsibility
Our responsibility is to express a conclusion on the accompanying interim financial statements based
on our review. We conducted our review in accordance with the New Zealand Standard on Review
Engagements 2410Review of Financial Statements Performed by the Independent Auditor of the
Entity(NZ SRE 2410). NZ SRE 2410 requires us to conclude whether anything has come to our
attention that causes us to believe that the interim financial statements, taken as a whole, are not
prepared in all material respects, in accordance with IAS 34 and NZ IAS 34. As the auditors of the
Company, NZ SRE 2410 requires that we comply with the ethical requirements relevant to the audit of
the annual financial statements.
A review of interim financial statements in accordance with NZ SRE 2410 is a limited assurance
engagement. The auditor performs procedures, primarily consisting of making enquiries, primarily of
persons responsible for financial and accounting matters, and applying analytical and other review
procedures. The procedures performed in a review are substantially less than those performed in an
audit conducted in accordance with International Standards on Auditing (New Zealand) and
International Standards on Auditing. Accordingly, we do not express an audit opinion on these interim
financial statements.
We are independent of the Group. Our firm carries out other services for the Group as providers of
treasury advisory services and agreed upon procedures at the Annual General Meeting. The provision
of these other services has not impaired our independence.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that these interim
financial statements of the Company are not prepared, in all material respects, in accordance with IAS
34 and NZ IAS 34.

PwC2
Who we report to
This report is made solely to the Company’s shareholders, as a body. Our review work has been
undertaken so that we might state to the Company’s shareholders those matters, which we are
required to state to them in our review report and for no other purpose. To the fullest extent permitted
by law, we do not accept or assume responsibility to anyone other than the shareholders, as a body, for
our review procedures, for this report, or for the conclusion we have formed.
For and on behalf of:
Chartered AccountantsAuckland
7 March 2018