New Brand Identity For Carpet Business & Operational Update

MARKET RELEASE
4 November 2020

NEW BRAND IDENTITY FOR CARPET BUSINESS AND OPERATIONAL UPDATE

 New Bremworth brand identity leads Cavalier’s transformational strategy towards
sustainable, interior solutions business.
 Exit from synthetic carpet market well-advanced.
 Q1 results up on previous year.
 Sales revenues for first quarter of FY21 have continued to be stronger than anticipated when
the Company first came out of COVID-19 Level 4 lockdown in April.
 Further reduction in net debt to $1.4m as at end of October 2020, putting the Company in a
strong position from which to execute the transformation.
 Sale and leaseback of the Auckland property, with the net proceeds to be invested in
supporting the new strategy, remains underway.

New brand identity

Cavalier Corporation Limited (NZX: CAV) announces that its Cavalier Bremworth carpet operation is
to return to its original name Bremworth while moving forward and embracing modern, progressive
values into its business

At the centre of the new brand is the focus on natural fibre design and innovation to make home
interiors, and our planet, healthier and more sustainable.

CEO, Paul Alston, said: “The renewed commitment to Bremworth is an outward sign of the
transformation that’s been happening within the Company. We will springboard off the quality of
the heritage Bremworth brand while looking to the future, taking with us the values set by our
founders more than six decades ago that have made us New Zealand’s most trusted carpet brand.”

Exit from synthetic carpet market well-advanced

A key pillar of the Company’s long-term vision to be a global leader in designing and creating
desirable, high performing, safe and sustainable interior products is its recommitment to focus on
100 percent pure New Zealand wool.

In July 2020, the Company announced it was exiting the synthetic carpet market – a move that will
reduce its use of imported synthetic fibre annually by 2.5 million kilograms.

“Since we announced in July that we were exiting the synthetic carpet market and returning to wool,
we’ve been blown away by the positive feedback from retailers, customers and the rural sector.
We’ve received fantastic support from the wider industry, with developers, designers and architects
just as excited as we are about the direction the Company is heading in,” said Paul Alston.

Chair of Cavalier, George Adams, said: “We’ve taken the first steps towards a natural, more
sustainable future. Being authentic is important to us and our transformation runs much deeper
than simply exiting synthetic carpet production. It’s about becoming transformative thinkers, being
united in our beliefs, introducing disruptive innovation, creating new product categories and
incorporating sustainability throughout our design and manufacturing process.”

“We’re now a purpose-led business. We’re embracing nature to protect and make a genuine
difference to the wellbeing of people and the planet.”

Operational update

Q1 results are up on the previous year from better-than-anticipated demand and increased margin.
While the outlook for the economy, including further impacts from COVID-19, continues to be
uncertain, trading for the first quarter of FY21 has been stronger than anticipated, with sales
revenues up 3% on the previous year.
New Zealand sales revenues are up approximately 10% and Australian sales revenues are down
approximately 5% on the previous year as a result of the Australian operation having largely
withdrawn from the synthetic carpet market.
Woollen carpet revenues have been encouraging, with New Zealand up 23% on a relatively low base
and Australia in line with the previous year, despite ongoing COVID-19 restrictions in the state of
Victoria and disruptions from port strikes. Australian sales are expected to lift as COVID-19
restrictions are eased and product delayed by port disruptions starts to flow normally.
As previously advised, total sales revenue for FY21 is expected to reduce as Cavalier exits the
synthetic carpet business, and as a consequence of COVID-19.
From FY23 onwards, growing revenues are expected as new sales replace and eclipse the previous
synthetic carpet sales and as the economy recovers from COVID-19, with the full benefits of the
transformation expected from FY25 onwards.
Net debt has continued to decrease significantly - from $14.5m as at the end of June to $1.4m as at
the end of October – reflecting the cash being released from the sell down of synthetic carpet stocks
and stronger-than-expected trading. This puts the Company in a strong position from which to
execute its transformation.
The sale and leaseback of the Auckland property, which shareholders approved in mid-September, is
still being finalised, with the net proceeds to be invested in supporting the new strategy.
ENDS

For further information please contact:
Paul Alston
Chief Executive Officer
palston@cavbrem.co.nz
+64 21 918 033 or +64 9 277 1135
Jackie Ellis
Media and Investor Relations
Jackie@ellisandco.co.nz
+64 27 246 2505