2018 Annual Meeting – Speeches and Presentations

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CAVALIER ANNUAL MEETING SPEECHES
30 October 2018
SLIDE 1. WELCOME
Good morning and welcome to the 34th Cavalier Corporation Limited Annual Meeting.
My name is Alan Clarke and it is a great pleasure to be standing here for the first time as your
Chairman.
Before we start .... A few housekeeping matters ... In the unlikely case of an emergency please follow
directions from the venue staff present and head to the nearest exit which is clearly marked behind
you. Please then walk to the main doors on the lower level via the stairs for Gate G that you would
have entered from. From there gather in the car park in front of the building. The rest rooms are
located in the western part of the pre-function area outside.
I would like to open by acknowledging the Timpson family who are unable to be here today and note
their long association, along with Grant Biel and the Biel family, with Cavalier. Tony Timpson and
Grant Biel founded Cavalier and Grant remains a director of the company. Both the Biel and
Timpson families remain important and valued cornerstone shareholders to this day.
I would also like to acknowledge all other shareholders who have been able to attend today’s
meeting in person and to all those who are streaming the meeting live. And welcome to the
company’s auditors, KPMG, representatives from our banking partner the BNZ and all our
professional advisors present.
We also have a number of our staff and senior management here today. They are very experienced
and passionate about our company. Please feel free to have a chat to them after the meeting
finishes about the business and their roles.
Next year is a big one for us. 2019 marks the 60
th
birthday since the Bremworth Carpet Company
was founded by Doug Bremner in 1959. In 1988, the Bremworth Carpet Company was acquired by
Cavalier Corporation Limited which in turn was founded almost 50 years ago in 1972 by Tony
Timpson and Grant Biel.
We plan to mark these milestones through a number of events that I hope many of you will be able
to attend and I again acknowledge Grant Biel who started at Bremworth as a young engineer in
1964, 54 years ago, and who was our longest serving employee, and is now our longest serving
shareholder and Board member.
At today’s meeting you will hear from both myself and your CEO, Paul Alston. We will cover our
performance for the year ended 30 June 2018 and Paul will outline our new strategy and business
focus.
Following our presentations, there will be an opportunity for discussion and please can I ask that you
leave any questions relating to the presentations to that time.

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We will also answer any questions you may have on the resolutions at the time they are proposed
and there will be a further opportunity at the end of the meeting for you to ask any other general
questions about the company and our operations.
At the close of the meeting, I invite you all to stay and share some light refreshments with the
management team and your Board. A copy of the speeches and slide presentation from today’s
meeting will be available on our website and they have been posted to NZX.
The Notice of Meeting and the 2018 Annual Report and financial statements have been circulated or
made available to shareholders, and as a quorum is present, I declare the meeting open.
We have received apologies from Sarah Haydon, the Timpson family and Rochelle Flint ...... are there
any others?
Thank you.
The minutes of the 2017 Annual Meeting held on 31 October 2017 were confirmed as a correct
record by the Board of directors on 30 November 2017. These minutes are available for inspection at
the back of the room and are also available on request.
All voting today will be by way of a poll. This means that every share counts as one vote.
If you have NOT already cast your votes or appointed a proxy, you should have your voting forms in
hand so that you can vote today. For shareholders joining us online, they will be able to vote by
selecting and submitting their option later on during the meeting.
Shareholders who have cast postal votes, or appointed a proxy to vote on their behalf, ahead of the
meeting will not be voting today and will not need a voting form.

SLIDE 2. BOARD OF DIRECTORS
Before I introduce the Board, I am sorry to advise shareholders that Sarah Haydon suffered a boating
accident over Labour Weekend and she is still recovering at home and sends her apologies.
Sarah has announced that she will be retiring from the Board at the close of this meeting. She has
been a Director for six years and Cavalier’s Chair for three years. During that time Sarah saw the
company rationalise manufacturing and divest significant assets in New Zealand and Australia,
reducing debt and streamlining operations. Her long business and governance experience has very
ably assisted Cavalier through this difficult period. I extend our sincere thanks to Sarah and wish her
well.
Sarah asked that I pass on the following message to the meeting;
“I am very sorry to be missing this, my last AGM. I suffered a serious back injury over the holiday
weekend and won’t be able to travel for a while. I would like to thank our shareholders and my fellow
directors for giving me their support over the last few years. It has been a privilege to serve the
company through some tough years.”
Our thoughts and best wishes are extended to Sarah.

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I was delighted to join the Board just after our last Annual Meeting and have been impressed with
the ability, experience and engagement of all Cavalier’s Directors.
I’ll ask each Director to raise their hand please – John Rae (Chairman of the Remuneration
Committee and Deputy Chairman), Dianne Williams, Grant Biel and George Adams.
George is the latest appointment to the Board and he is standing for election today. He brings a
wealth of commercial and governance expertise to the Board and you will have the opportunity to
hear from him later.
Grant Biel is also standing for re-election under our director rotation policy.
I am also up for election by shareholders today as I joined the Board in November last year after the
2017 Annual Meeting and took up the role of Chairman in April of this year.
Finally, at the front table is Paul Alston, our CEO. Paul leads an able and strong leadership team,
many of who are here today and they will be more than happy to talk with you at the end of the
meeting.
Can I ask all Cavalier management and staff present to stand ... Thank you

SLIDE 3. FY18 A TURNAROUND YEAR
Until fairly recently, there was little competition for wool carpet and synthetics didn’t exist in the
quantities that they now do.
The company had a dominant footprint and an enviable following. Wool was king and prices were
strong and the company built on that great base and brand presence, producing attractive and
growing earnings for shareholders.
However, no market is static and there were a series of seismic industry changes, with new
competition from imported carpets, a consolidation of retailers, the introduction of synthetics, and a
declining wool clip with volatility in currency and raw material costs.
Some hard decisions were necessary, culminating last year in a restructured manufacturing base and
the sale of non-core assets and excess yarn and carpet stocks that significantly reduced debt.
The 2018 financial year saw an important and pleasing recovery after a very difficult restructuring
period and a disappointing result in 2017. I am pleased to say that is now behind us and we now
have clarity and purpose to build on our recovery going ahead.
While we will continue to offer a range of carpets that customers want, our focus is now firmly back
on wool – given our heritage, our expertise and our brand reputation - and going forward, our
efforts will be turned towards being a marketer of high quality, environmentally responsible carpet
solutions ... not simply a manufacturer.

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SLIDE 4. SALE OF CAVALIER WOOL HOLDINGS (CWH)
Following the end of the 2018 financial year, we announced the sale of our 27.5% shareholding in
the CWH wool scouring business for $13.5 million.
We considered the sale to be in the best interests of shareholders even though it was lower than our
book value, necessitating a non-cash write down of $11.8 million.
Our book or carrying value of all significant assets is continually assessed by the Board for any
impairment and is formally measured at period ends.
We followed our valuation methodology policy for CWH, taking into account the forward view of the
demand for scoured wool, the stability of the New Zealand wool clip, the greasy wool price impact
on scouring volume and then looking at CWH’s forward cash flows to determine a discounted cash
flow and present value for our shareholding. At year end, this analysis determined that the current
book value should remain intact. Our auditor reviewed this work and concurred.
On the 17 September, we were formally made aware of the Ferrier offer and we heard that our
partner shareholders would be accepting it. This necessitated a special board meeting on the 19
September. We then requested scenario analysis and legal advice and we referred the matter to the
26 September Board meeting for formal consideration and announced that we were in discussions
with a potential industry purchaser for our shares in CWH.
After additional analysis, the Board met again and we advised on 28 September that we had
accepted the offer.
The purchaser is an experienced wool scour operator and past shareholder in CWH and the offer
made was seen as commercial, fair and reasonable.
There were a number of factors to consider which were crystallised by this offer;
 Firstly, following our strategic review, we did not consider that part ownership of a wool
scour is a core standalone investment.
 Access to scoured wool is also not dependant on ownership in a scour.
 Importantly, our CWH investment, in our view, was not likely, in the near to medium term to
yield a cash dividend as all CWH retained earnings are required to be reinvested in
maintaining the plant and reducing CWH’s bank debt.
 In addition we believe that there would be capex requirements to fix building issues that
would most likely require additional company investment.
 The offer came from an experienced operator and owner of wool scours. If the offer was
not taken up, then our analysis indicated that any future sale prospect would need to come
from similar experienced industry investors. Direct Capital and ACC Investments, both
shareholders in CWH and experienced venture capital investors, had indicated they would
not invest but sell their investment at this value.
 We also saw that the purchaser had funds in place and that a full settlement would be
completed in a few days, providing transaction certainty.
 The sale would enable us to reduce Cavalier’s debt to very comfortable and conservative
levels. And as there would be no CWH dividend, it would in fact improve Cavalier’s cash
flows in the short to medium term through reduced debt levels, which we felt would benefit
shareholders.

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 Finally, our gearing ratio would fall from 29.5% to 21.6% on a Debt to Debt+Equity basis.
This would give us future debt capacity and allow us to consider investments that would not
only pay cash dividends but that would enhance our core business strategy of marketing
high end carpets.

SLIDE 5. STRONGER FINANCIAL PLATFORM
Our net debt position continues to improve and has been a major focus for management over the
last 12 months. The CWH sale has reduced current debt to around $18 million, and we are expecting
the year-end debt position by June 2019 to be lower again from free cash flows.
We have listened carefully to many of you with respect to your wish for a reintroduction of
dividends.
We see dividends as an integral part of shareholder value creation and an essential element of our
financial strategy.
We are fully committed to the reintroduction of a sustainable dividend programme. While we have
one good result under our belt, and considerably lower enterprise debt, we need to carefully
balance the timing of a reintroduction of an annual dividend against our core operational
performance to ensure it is repeatable and sustainable.
We too look forward to the company being able to resume the payment of annual dividends in the
near future.

SLIDE 6. AN EXCITING FUTURE
We are genuinely excited about our future with our new clear strategic focus as a marketer of high
end carpet solutions.
 We have a very strong financial platform to support growth initiatives;
 We have an in depth knowledge of the market opportunities; and
 We have a team of passionate and talented staff supporting us,
Thank you and I will now pass over to Paul who will talk more about our progress and plans.

SLIDE 7. CEO PRESENTATION, PAUL ALSTON
Thank you, Alan.
Good morning everyone.
As I discussed at last year’s AGM and as Alan has outlined, we have gone through significant change
in the last couple of years.
With this necessary restructuring behind us, we can now focus on our new and revised strategy,
something we have been developing over the last 12 months and some of which I will share with you
today.

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SLIDE 8. OUR COMPANY
Cavalier is now predominantly a carpet business – comprised of Cavalier Carpets, our carpet entity,
and Elco Direct, our wool procurement business.
Through Cavalier Carpets we manufacture, market and sell carpets to customers across New
Zealand, Australia and targeted international markets. We do this using our Cavalier Bremworth
and Norman Ellison brands.
Our manufacturing operations now span Whanganui, Napier and Auckland and we have sales and
marketing offices in Auckland, Wellington, Christchurch, Sydney, Melbourne, Brisbane, Adelaide, and
Perth.
Raw wool is dyed and spun into yarn in Napier, dyed wool is felted into yarn in Whanganui and all of
it, together with synthetic yarns we import, is made into carpet in Papatoetoe.
Cavalier also owns wool buying business Elco Direct, which has a loyal customer base throughout the
North Island.
We have made significant change to our business in the last couple of years, to address our over-
capacity and better align both this capacity and our capability to our markets. All our manufacturing
facilities are now operating more efficiently, with capacity to expand if demand increases.

SLIDE 9. RESETTING OUR BUSINESS
Before we talk strategy and realising future growth, I thought it important to recap on what we’ve
done over the past few years to transform Cavalier and ensure a positive future for our business.
The changes have been significant but necessary to put Cavalier back on track.
This has included reducing warehousing and distribution centres from two to one; consolidating
carpet tufting operations from two to one; and consolidating our carpet yarn spinning operations
from four to two. We also closed two distribution centres in Australia and outsourced these
functions.
At a business level, we introduced synthetic carpets under the Cavalier Bremworth brand; exited out
of the loss making Australian tile manufacturing business; and developed and expanded our felted
yarn capability.
We have also restructured the New Zealand administrative functions; sold non-core property in
Australia to reduce debt; exited the NEC Auckland site in September 2018, which will deliver
significant cost savings; and most recently, sold our shareholding in the wool scouring business.
So all in all, a very busy few years! The significant costs associated with the changes and disruptions
caused by the restructuring are now behind us.

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SLIDE 10. YEAR IN REVIEW
It was pleasing to report an improved performance in FY18 with increased profitability, positive
cashflows and reduced debt.
Revenue was $148.1 million, down 5% mainly due to first quarter supply issues in wool products
following the consolidation of the spinning operations, and some general softer market conditions
flowing through in both New Zealand and Australia.
The $6.0m profit turnaround is a move in the right direction and a big improvement from last year,
with much room for further improvement in future years.
We generated in excess of $12.0m of operating cashflows, which enabled a $10.8m reduction in net
debt – this is compared with a negative $5.1m cash out flow the previous year.
We continue to experience lower wool prices and a more favourable NZD/AUD cross rate which
contributed to improved margins last year. This is in addition to careful expense management.
The manufacturing consolidation is now well behind us and we are producing the required volume
to support our sales teams and stronger margins should continue into 2019.
Following some of the most difficult wool trading conditions in history, Elco made a very respectable
profit on what is a very small asset base. This is a relationship business that has been managed
extremely well and provides a great service to its customers on minimal overheads. This business
also supports our high end wool strategy focus.

SLIDE 11. A NEW STRATEGIC FOCUS
The change in defining our strategy is subtle but profound.
Cavalier has always been a good marketer - but we have also defined ourselves primarily as a
manufacturer which sells the carpets it makes.
While that is still the case, the shift to being firstly a marketer of carpets means a ‘customer first’
focus. We will look at our customers and ensure we are alive to market changes, fashion trends and
those quiet seismic changes, like the introduction that was seen with synthetics.
We are and will remain a proud and highly successful manufacturer – but we will also ensure that we
are not simply making great carpets, but that we are making desirable carpets that our customers
want and which generate strong and sustainable margins.
The change as I said is subtle - but it is fundamental to a successful future.
We are now moving our focus to profitable growth and we have a number of investment initiatives
under way to achieve that in the 2019 financial year.
As we roll out our new strategy - to build a great high margin New Zealand flooring business by being
a marketer of high end carpet solutions - we are confident we are on track to long-term sustainable
growth, with improving margins and quality earnings.

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We have identified three key pillars to help us achieve this: Marketing and Product Development;
Sales; and People.
Underpinning these pillars. Technology and Manufacturing support will be required. We will invest in
a new IT system this year replacing our 30 year old system that has served us admirably but is well
past its use by date.
And now that we are producing the required volume from the manufacturing plants, efficiency
improvement will remain a focus. This is an area we are putting a lot of resource into, particularly
Napier where we have a new management team in place.

SLIDE 12. MARKETING AND PRODUCT DEVELOPMENT PILLAR
Our marketing and product development efforts will be centred around our new high margin
strategic focus – particularly wool.
It is our intention to transform from carpet manufacturer to smart carpet marketer.
This will require increased investment in our marketing and product development functions.
We will build on the success of our Cavalier Bremworth World of Difference positioning and
integrate and promote our New Zealand wool story and quality proposition.
Cavalier Bremworth was and still is a market leader in product development. For the past two years
we have challenged the product development team to create new and exciting products with a point
of difference, and we will be progressively launching these into the market over the next 12 months.
A couple of the products we have recently launched are on display today and Amit Gupta, our
product development manager, is here with a couple of concepts we are currently working on. At
the conclusion of the meeting he will be available to discuss what he is doing for those who are
interested. Investment in research and development and creating ranges that command a premium
is a priority and critical for our success.
With our increased marketing investment, it is our intention to do more in Australia, particularly
within the trade, with a focus on wool and the highly valued Cavalier Bremworth brand. Australia is a
much bigger market than New Zealand and we believe that is a significant growth opportunity for us.
The awareness around plastics and its impact on the environment is becoming much more
prominent. As you are probably aware, many supermarkets are banning plastic bags globally and
there is considerable research being done on the disturbing impact of plastics in the oceans and food
chain – this “anti-plastic” sentiment is building strongly and we are experiencing a shift back to
natural woollen textured products, something which we are well placed to take advantage of.

SLIDE 13. OPPORTUNITY IN THE GLOBAL WOOL MARKET
We recently commissioned a US market research firm to explore wool carpet opportunities in the
rest of world wool markets (outside of Australasia). Wool carpet is our heritage and currently the
majority of our sales are in Australia and New Zealand.

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The research identified wool carpet opportunities for us in these rest of world markets, particularly
in North America and the UK. We have recently undertaken market studies to explore some of these
opportunities and will be presenting some of the new products to potential customers in these
markets in the next few weeks.
Once again understanding our market, listening to our customers, high quality manufacturing
capability, leading edge product development and having a range of unique products are all critical
to our success.

SLIDE 14. DOMOTEX GERMANY
For the first time in our history, Cavalier will have a stand at the annual trade show in Domotex in
Hanover Germany in January 2019.
Domotex is the largest and most important flooring trade show globally and we will be displaying
our new woollen products and a number of concepts we are considering launching.
Ag Research Wool New Zealand will be accompanying us and have a space in our area – they will be
promoting the benefits of New Zealand wool backed by their research. Ag Research have been
doing a considerable amount of work on plastics and its impact on the environment which fits nicely
into our push of high-end woollen products.

SLIDE 15. SALES PILLAR
It is our intention to be the market leader in New Zealand for high end carpets, to grow our market
share in Australia and selectively expand our presence in other Rest of World Markets.
We are encouraging both our sales teams and our trade customers to focus on higher margin sales,
particularly wool products, and we are providing both training and sale incentives.
We are carefully considering new market options and investment channels – and currently assessing
opportunities to expand our presence. For example, we are developing higher end, niche market
opportunities with interior designers and architects and will continue to promote innovative
products, such as rugs.
Our rug offering was launched at the start of this year in order to complement the growth in the
hard flooring segment and keep us relevant.

SLIDE 16. WOOL TRAINING KIT
Training and educating our retailers to sell wool again and promote its virtues, in addition to
environmentally friendly synthetic carpets, is important and we recently introduced wool training
modules for retailers.
These have been very successful and due to the interest generated, we have launched a training
module for our exclusive recycled synthetic Econyl fibre. We have one of these wool kits here on
display today and Dean Chandler, our GM of NZ sales, is happy to talk to those who want to have a
closer look.

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SLIDE 17. PEOPLE PILLAR
Investment in our people is vitally important for our success.
We want to create a great place to work from the inside out and Cavalier is a business as much
about its people as it is about its products – the two are intimately linked.
The best strategies will not succeed if we do not have an engaged work force and therefore
investment in this area is important. Strengthening and building our organisation culture is a priority
and we are putting processes and resources in place to support this.
We are focused on attracting key talent and growing and retaining talented people. Having a great
culture within our business is essential for this.

SLIDE 18. OUTLOOK FOR FY19
We are making great progress but there is a great deal still to do. The market has been quiet in the
first quarter this year, however, we are anticipating another year of improving financial
performance.
We are and will continue to increase our investment in essential manufacturing capex and
expanding our direct and indirect marketing investment.
We continue to experience lower wool prices and a more favourable NZD/AUD cross rate. Demand
for wool continues to grow with environmental factors becoming more prominent.
The manufacturing consolidation is now well behind us and we are now producing the required
volume to support our sales teams, making great carpets that our customers want and giving our
customers confidence that we can supply.
We are continuing to target efficiency improvements in manufacturing with further gains still to be
realised and strong margins should continue in 2019. With our substantially reduced debt, we are
in a strong position to invest in our core business as well as identify and capitalise on growth
opportunities.
Our balance sheet will continue to improve from free cashflows notwithstanding our increased
operational investments.
So this is a big investment year for us. We will continue to invest in our core business operations,
particularly into a new IT system, customer relationships, expanding global presence and innovation,
support marketing, as well as exploring investment opportunities and growing our market presence.

SLIDE 19. THE FUTURE
We are excited and optimistic about our future and the new strategic direction we have set for
ourselves.
There will always be challenges to address and overcome and we are focused on delivering an
improved performance and value for shareholders.

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We will continue to build on our leadership position in wool and increase the focus on high-end,
higher margin products.
There are growth opportunities in woollen products outside of New Zealand and to support this, we
will be investing in R&D and marketing – innovation and market led product development is critical
for our success.
We have seen a steady reduction in sheep numbers in New Zealand in the last 35 years – from 70
million to around 28 million today – and with the current low wool prices, there is a call to action for
the industry to promote wool as a desirable high end product.
Cavalier is playing an important role in this – we want to see New Zealand’s wool industry positioned
as one of the best in the world and we can do that through the manufacture, marketing and sale of
high end woollen carpets.
As Alan has said, we are moving towards the Cavalier Bremworth Group’s 60
th
birthday. We do this
with a clear purpose, knowing that we are building our business and brands into something that our
founders, shareholders, staff and customers can all be proud to have a part in.
Thank you for your time today. I will now pass you back to the chairman for the formal part of the
meeting.

SLIDE 20. SHAREHOLDER DISCUSSION
Thank you Paul.
I would now like to invite questions in relation to the annual report or today’s presentations. There
will be an opportunity to ask questions about each resolution as they are put to shareholders to
vote.
Please note that only shareholders, proxy holders or corporate representatives of a shareholder may
ask questions. For the purposes of addressing questions from shareholders, we will deal with those
from shareholders present at the meeting first before dealing with questions from shareholders
participating online.
If you have a question, could you please raise your hand and wait for the microphone. Please clearly
state your name if you are a shareholder, or, if you are a proxy holder or corporate representative,
please state the interests you represent.
Those shareholders participating online should similarly identify themselves and submit their
questions by typing into the textbox within the webcast interface and Linda Arbuckle will read these
out so that the questions can be heard by the meeting.
PAUSE
Shareholders also submitted several questions prior to the meeting. A question relating to the CWH
sale has been addressed within the presentation. A second question was on marketing spend and I
will hand this over to Paul. The last question was on directors’ fees and I will respond to this shortly.

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SLIDE 21. RESOLUTIONS
I would now like to move to the resolutions before the meeting. These were notified in the Notice of
Meeting and explanatory notes have been provided.
Voting on each of the resolutions in the Notice of Meeting will be by way of poll.
Only shareholders who have not already voted, proxy holders or corporate representatives of a
shareholder may vote on today’s resolutions.
Please use the voting paper you received in the mail or were given when you registered for this
meeting.
For shareholders joining us online, you can vote by ticking the appropriate boxes on screen and
submitting your vote.
Following each resolution, please complete your voting paper by ticking “FOR”, “AGAINST” or
“ABSTAIN” in the appropriate place on the form. Please do not tick the “DISCRETION” box.

SLIDE 22. RESOLUTIONS
Resolution one: Auditors
The first resolution is to record the reappointment of KPMG as auditors of the company and
authorise the directors to fix the auditors’ remuneration.
Are there any matters for discussion or questions from the floor?
Q & A
Thank you. Please tick the appropriate box on your voting form to vote on this resolution.

Resolution two: Re-election of Grant Biel
The next resolution is for Grant Biel’s re-election. He retires by rotation and has put himself forward
for re-election. The Board considers Grant to be a non-independent director and unanimously
supports his re-election.
I would now like to invite Grant to say a few words.
GRANT TO SPEAK
Thank you Grant. Are there any questions from the floor?
Q & A
Thank you. Please tick the appropriate box on your voting form.

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Resolution three: Election of Alan Clarke
The next resolution is regarding my election so I’ll ask John Rae to chair the meeting for this
resolution.
First, a bit on my background ....
Thank you, I’ll now pass over to John.
ALAN TO SIT, JOHN TO STAND
Thank you Alan. The Board considers Alan to be an independent director and unanimously supports
his election.
Are there any matters for discussion or questions from the floor?
Q & A
Please tick the appropriate box on your form to vote on this resolution.
I’ll now hand back to Alan.

Resolution four: Election of George Adams
Then next resolution is in regards to the election of George Adams as a director.
George is a professional director with a wealth of governance experience. He is currently a director
for Tegel, chairman of Worksafe’s Occupational Health Advisory Board, Chairman of the Business
Leaders Health and Safety Forum and sits on the board of a number of private companies.
He was previously managing director for Coca-Cola Amatil New Zealand and Fiji and he is a
Chartered Member of the IOD and is a Chartered Accountant. If elected, George will take over as
Chairman of the Audit committee following Sarah Haydon’s retirement at the close of this meeting.
The Board considers George to be an independent director and unanimously supports his election.
George, would you like to say a few words.
GEORGE TO SPEAK
Thank you. Are there any matters for discussion or questions from the floor?
Q & A
Thank you. Please tick the appropriate box on your form.

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Resolution five: Director remuneration
The final resolution today is in regards to Directors’ remuneration. The Directors’ fee pool was last
increased in 2007, 11 years ago. The directors are seeking shareholder approval for an increase in
the pool from $350,000 to $450,000 per annum
This allows the company to remunerate directors at an appropriate level, particularly given the
number of years since the last fee increase and the considerable developments in governance
requirements since that time.
We are very conscious of the company’s recent financial performance. However, it is my duty to
attract and retain high calibre directors on your behalf who will add value to Cavalier and our future
strategy.
The Board took into consideration the benchmarking report provided by PricewaterhouseCoopers
and we sought separate independent advice from a number of parties.
Are there any matters for discussion or questions from the floor?
Q & A
Thank you.
Please tick the appropriate box on your voting form to vote on this resolution.
As previously advised in the notice of meeting, the directors and their associated persons are
disqualified from voting their own shareholdings or discretionary proxy votes on this resolution.
COLLECTION OF VOTING PAPERS
The voting papers will now be collected. Please ensure you have signed the form.
If you have any difficulty, or do not have a voting paper, please raise your hand and someone will
assist you.
We received postal and proxy votes ahead of the meeting, of approximately 26 million shares
representing 37.7% of the total number of shares in the company.
Our auditor, KPMG, will act as scrutineer for the poll and will confirm the final results of voting on
each of the five resolutions after the meeting.

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SLIDE 23. OTHER BUSINESS AND CLOSE OF THE MEETING
That brings the formal part of the meeting to a close. Is there any other business shareholders would
like to discuss regarding today’s presentations or our progress?
PAUSE
In closing, I would like to thank shareholders for your continued support and for your attendance
today.
A summary of proceedings and voting at today’s annual meeting will be released to the NZX and
posted on the company’s website once the results are available.
That’s the formal business concluded. We’d be delighted if you could join us for refreshments at the
back of the room.

---

Annual Shareholders’ Meeting
30 October 2018

Cavalier Corporation | Annual Meeting 2018
Board of Directors
2
G C W (Grant) Biel
T H G (George) AdamsA W (Alan) ClarkeS E F (Sarah) Haydon
Retiring at today’s meeting
J M (John) Rae
D V (Dianne) Williams
Leadership Team
CEO: Paul Alston
CFO: Victor Tan
GM Australia: Michael Richardson
National Sales Manager NZ:
Dean Chandler
GM Product Development/ Marketing:
Rochelle Flint
GM Manufacturing: Craig Wallis
GM Comms/Culture: Lenska Papich

Cavalier Corporation | Annual Meeting 2018
FY18 has been a turnaround year for Cavalier Corporation.
As we roll out our new strategy, to be a marketer of high
end carpet solutions, we are confident we are on track to long-
term sustainable growth, with improving margins and
quality earnings.
The Board, management and staff are excited and optimistic
about our future, particularly the company’s renewed focus
on wool, and the opportunity this presents locally and globally.
3

•Sale of 27.5% interest in Cavalier Wool
Holdings Limited for $13.5m in cash
•The sale includedthe property held by
50% owned CWS Assets Limited which had
been leased to CWH
•Proceeds have been offset against
borrowings
•Non-cash write-down of $11.8m
Sale of Cavalier Wool Holdings
4
Cavalier Corporation | Annual Meeting 2018
Sale in best interests of the company:
•In line with new strategy to be a
marketer of high end carpet solutions
-not just a manufacturer
•Secured a long term scouring and
access agreement
•CWH investment did not yield a cash
dividend to Cavalier
•Significant future capex identified

•Major focus on debt reduction over
the past twelve months.
•Making good progress and further
reductions expected in the short
term.
•Further reduction in borrowings
post-sale of CWH wool scouring
business.
•Committed to re-introduction of
dividends as part of long term
financial strategy.
Stronger Financial Platform
Debt position continues to improve
5
58.8
59.0
53.9
32.7
36.5
42.3
40.2
33.3
29.4
18.0
0
10
20
30
40
50
60
70
Jun-14Dec-14Jun-15Dec-15Jun-16Dec-16Jun-17Dec-17Jun-18Sep-18
Net Debt $m
Aggressive debt
reduction programme
Investment into brand
and consolidating
manufacturing operations
Major focus on
reducing debt
Sale of
CWH for
$13.5m
Cavalier Corporation | Annual Meeting 2018

Cavalier Corporation | Annual Meeting 2018
New strategy with a focus on being a marketer
of high quality, environmentally responsible
carpet solutions, with a wool bias.
Based on Cavalier’s proven and differentiated
positioning as an innovator of high quality floor
solutions.
Supported by a passionate and experienced
team with in depth market knowledge.
An Exciting Future
6

Paul Alston
CEO
Cavalier Corporation | Annual Meeting 2018
7

Auckland
•Head office
•Tufting factory
•Sales office
Cambridge
•Wool store
Taumarunui/Raetihi/Taihape
•Wool stores
Wanganui
•Felting plant
•Wool store
Napier
•Spinning factory
Wellington
•Sales office
Christchurch
•Sales office
Our Company
Operations are based in New Zealand and Australia with exports around the world
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Brisbane
•Sales office
Sydney
•AU head office
•Administration
•Sales office
Melbourne
•Sales office
Adelaide
•Sales office
Perth
•Sales office
Cavalier Corporation | Annual Meeting 2018

Restructuring undertaken in the past few years in
response to market challenges and changes within
the industry:
•Rationalisation and optimisation of warehousing,
distribution and manufacturing facilities
•Sale of property and loss making assets
•New product development
•Cost reductions
The significant manufacturing costs associated with
the restructuring are now behind us.
Resetting Our Business
9

Cavalier Corporation | Annual Meeting 2018
$148.1m
Year in Review
10
REVENUE
$4.0m NPAT
$10.0m EBITDA
Normalised earnings
STRONGER
FINANCIAL
POSITION.
Balance Sheet
$10.8m
Reduction in net debt
A NEW
STRATEGIC
FOCUS
Improved
Margins

SHIFT IN FOCUS FROM BEING A
MANUFACTURER TO A MARKETING-LED
BUSINESS
Remain a proud and successful
manufacturer of high quality carpets.
Move towards customer-led marketing
focus –delivering carpets that our
customers want.
Focus on delivering long term sustainable
growth, improving margins and quality
earnings.
A New Strategic Focus
11
Cavalier Corporation | Annual Meeting 2018

Cavalier Corporation | Annual Meeting 2018
We will promote our New Zealand wool
story and quality proposition. We will
continue to lead in product innovation.
“Leadership in product development is not
new for Cavalier, in fact it is what has set
us apart for many years.”
Marketing
12
Strategic Pillars
INITIATIVES:
•Activity tailored towards high end, high margin
proposition
•Increase investment into marketing
•Grow capability in product innovation and
leadership
•Investment into research and development
•Creation of ranges that command a premium
•Focus on wool and the highly valued Cavalier
Bremworth brand.

Percentage of sales
•Wool carpets are our heritage.
•Majority of current sales into
Australia and New Zealand.
•Growth opportunities in other
world markets with wool
carpets –particularly North
America and the UK.
•US wool carpet market
estimated at USD$513m.
•UK wool carpet market
estimated at USD$498m.
Opportunity In The Global Wool Market
13Cavalier Corporation | Annual Meeting 2018
Strategic Pillars
2%
42%
55%
0.5%
0.5%

Domotex Germany
January 2019
The largest and most
important flooring trade show
globally

We will develop wool and higher
margin sales opportunities
“It is our intention to become the
dominant force in the New Zealand
market, grow market share in
Australia and expand in other
international Markets.”
Sales
15
Cavalier Corporation | Annual Meeting 2018
Strategic Pillars
INITIATIVES
•Focus on higher margin sales opportunities and
wool
•Careful consideration of new market options and
investment channels
•Enhanced retail initiatives and promotions to
align with high margin programme
•Launch of wool training module for retailers
•Develop higher end, niche market opportunities
with interior designers and architects
•Continue to promote innovative products, such
as rugs

Retailer: Wool training kit
Cavalier Corporation | Annual Meeting 201816

We will create a great place to work, from
the inside out.
“Cavalier is a business as much about its
people as is about its products. The two are
intimately linked.”
People
17
Cavalier Corporation | Annual Meeting 2018
Strategic Pillars
INITIATIVES
•Increased investment in people, culture and
communications programmes
•Focus on attracting key talent, and growing and
retaining existing people
•Company-wide engagement survey
•Continue to celebrate diversity and promote
inclusion

•Favourable wool prices.
•Balance sheet continues to strengthen –further
debt reduction expected.
•NZD/AUD more favourable.
•Demand for wool continues to grow –positive
effect on wool trading volumes.
•Continued cost management.
•Efficiency improving in manufacturing operations
and further gains to be realised.
•Investment into new IT system, customer
relationships, expanding global presence and
innovation.
•Continue to assess new business and market
opportunities in line with strategy.
Outlook for FY19
Another year of improving financial performance and growth
18
Cavalier Corporation | Annual Meeting 2018

•Build on leadership position in wool.
•Increased focus on high-end, higher margin
products.
•Growth opportunities in woollen products
outside of New Zealand.
•Increased R&D and marketing spend –
innovation and product development.
•Opportunities for growth in Australia and
Rest of World markets.
•Invest in and promote the environmental
benefits of our woollen products.
•Increased investment in our people
The Future
19
Cavalier Corporation | Annual Meeting 2018

Shareholder Discussion
20

Resolutions
21

Resolutions
Resolution 1: That the directors are authorised to fix the fees and expenses of the auditor, KPMG.
Resolution 2: That Grant Biel, who retires by rotation at the Annual Meeting and is eligible for re-election, be re-
elected as a director of the Company.
Resolution 3: That Alan Clarke, who retires at the Annual Meeting and is eligible for election, be elected as a
director of the Company.
Resolution 4: That George Adams, who retires at the Annual Meeting and is eligible for election, be elected as a
director of the Company.
Resolution 5: That the total directors’ fee pool be increased by $100,000 per annum from $350,000 per annum
to $450,000 per annum (exclusive of GST), being the aggregate payable to all directors of the Company for their
services as directors of the Company, with such sum to be divided among the directors as the Board may from
time to time determine.

Other Business
Close of the Meeting
23

EBITDAEarnings Before Interest, Tax, Depreciation and Amortisation. EBITDA excludes profit/losses generated by the
wool scouring business, in which Cavalier has a 27.5% shareholding. The results for this business are equity
accounted on a separateline in the annual accounts and therefore not included in the consolidated EBITDA.
Normalised EBITDAEBITDA excluding abnormal items and non-trading adjustments. A reconciliation of EBITDA to normalised
EBITDA is below.
NPATNet Profit After Tax
Glossary and Reconciliation
$000’sFY18FY17
EBITDA10,324(2,232)
Restructuring costs(189)6,309
Reversal of impairment of fixed assets(137)(1,505)
Normalised EBITDA9,9982,572
Cavalier Corporation | Annual Meeting 2018

Cavalier Corporation | Annual Meeting 2018
This presentation has been prepared by Cavalier Corporation Limited (“CAV”).The information in this presentation is of a general nature only. It is
not a complete description of CAV.
This presentation is not a recommendation or offer of financial products for subscription, purchase or sale, or an invitationorsolicitation for such
offers.
This presentation is not intended as investment, financial or other advice and must not be relied on by any prospective investor.It does not take
into account any particular prospective investor’s objectives, financial situation, circumstances or needs, and does not purportto contain all the
information that a prospective investor may require. Any person who is considering an investment in CAV securities should obtainindependent
professional advice prior to making an investment decision, and should make any investment decision having regard to that person’s own
objectives, financial situation, circumstances and needs.
Past performance information contained in this presentation should not be relied upon (and is not) an indication of future performance.This
presentation may also contain forward looking statements with respect to the financial condition, results of operations and business, and business
strategy of CAV. Information about the future, by its nature, involves inherent risks and uncertainties. Accordingly, nothinginthis presentation is a
promise or representation as to the future or a promise or representation that a transaction or outcome referred to in this presentation will
proceed or occur on the basis described in this presentation. Statements or assumptions in this presentation as to future matters may prove to be
incorrect.
A number of financial measures are used in this presentation and should not be considered in isolation from, or as a substitutefor, the information
provided in CAV’s financial statements available at www.cavcorp.co.nz.
CAV and its related companies and their respective directors, employees and representatives make no representation or warranty of any nature
(including as to accuracy or completeness) in respect of this presentation and will have no liability (including for negligence)for any errors in or
omissions from, or for any loss (whether foreseeable or not) arising in connection with the use of or reliance on, information in this presentation.
Disclaimer
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