NZAI FY21 Annual Shareholders Meeting

NZ Automotive Investments Limited, 17 Levene Pl, Mt Wellington, Auckland, 1060
+64 (9) 666 0158 | info@nzautomotiveinvestments.co.nz | nzautomotiveinvestments.co.nz
25 August 2021
Company Announcement
NZX:NZA


NZ Automotive Investments Limited

- Annual Shareholders’ Meeting
- Planned move to new car processing Hub with a consequential non-recurring pre tax gain of
approximately $0.8m in the 2022 financial year
- Covid-19 update


Annual Shareholders’ Meeting

NZ Automotive Investments Limited (NZAI/the Company) (NZX:NZA) is today holding its 2021 Annual
Shareholders’ Meeting (ASM). Attached are the following:

 Chair’s address
 Chief Executive Officer’s address
 ASM presentation.
Further details are provided in the ASM materials. A live recording of the meeting will also be broadcast
on https://www.nzautomotiveinvestments.co.nz/AGM/

Move to new car processing hub and non recurring gain

Included in the Chief Executive officer’s address is information regarding the Company’s planned move
to a new vehicle processing Hub in Auckland, and a non recurring pre-tax gain of approximately $0.8m
in FY22 as a result of the rearrangement of the Company’s leases.

With the current vehicle processing hub in Mt Wellington reaching capacity, the move to the Onehunga
site is part of a strategy to unlock growth through being able to process greater number of vehicles for
dispatch and sale through the Company’s dealership network.

As a consequence of the move and rearrangement of its leases, NZAI is expected to benefit from a
one-off non-recurring gain of approximately $0.8m pre tax in FY22. The net benefit will be used to invest
in the business as part of the Group’s drive for growth. The ongoing lease and related premises costs
from the move to the Onehunga site are not expected to be materially different from the current
arrangements

The new premises are larger and have a safer and more functional layout. The site also has space for
new equipment, enabling the automation of some existing manual processes. The Onehunga location
is also closer to a number of key suppliers and partners, creating further efficiencies, and is closer to a
commuter rail network making it more attractive to staff.

Around 40 staff from across the business will relocate to the new hub in Onehunga, including the
executive team, finance, operations, marketing, human resources, claims, quality control, dispatch and
workshop staff. The move to the new site is expected to be completed by February 2022.


Covid-19 Update

Due to the Covid-19 alert system in New Zealand having moved to level 4, all twelve 2 Cheap Cars
dealerships and the company’s car processing hub in Auckland have been closed since 11.59 pm on
Tuesday 17 August. The business is able to trade, but only on a limited basis during any move to alert
level 3.

The business was performing to the end of July ahead of the same Covid-affected period last year.
However any prolonged extension of alert level 4 or 3 restrictions could have a material impact on
financial performance over the rest of the financial year, depending on the duration and geographic
scale of the restrictions.

Ends

Authorised by
The Board of Directors

For further information please contact:

Shareholder enquiries
David Page
CEO
+64 21 980 795
David.p@nzautomotiveinvestments.co.nz

Haydn Marks
CFO
+64 21 2211 040
Haydn.m@nzautomotiveinvestments.co.nz

About NZ Automotive Investments Limited (NZAI)
NZAI is an integrated used automotive group operating throughout New Zealand via two subsidiaries: Automotive Retail and
Vehicle Finance. NZAI’s mission is to deliver quality cars and financing solutions at the most affordable prices to the average New
Zealander. Operating under the “2 Cheap Cars” brand, its Automotive Retail company is one of the largest used vehicle sellers in
New Zealand with 12 dealerships across the country. Its Vehicle Finance company operates under the “NZ Motor Finance” brand.
It was established in 2019 to diversify earnings and provide a further growth opportunity for NZAI. It originates loans entirely from
cross-selling to Automotive Retail customers, which allows NZ Motor Finance to grow its finance book with minimal acquisition
and administrative costs. www.nzautomotiveinvestments.co.nz

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New Zealand Automotive
Investments Limited
17 Levene Pl,
Mt Wellington,
Auckland, 1060

info@nzautomotiveinvestments.co.nz
nzautomotiveinvestments.co.nz


CHAIRMAN’S ANNUAL SHAREHOLDER MEETING (ASM) ADDRESS
25 August 2021.

Introduction / Formalities
Good afternoon everyone, welcome to the inaugural Annual Shareholders’ Meeting of NZ
Automotive Investments Limited. My name is Karl Smith, and I am the Chairman of NZAI.
Thank you for joining us today online.
It’s unfortunate that we cannot all meet face to face, but as we all know we are making every
effort to help stop the spread of COVID-19 and follow government guidelines, which has
triggered us to activate our ASM contingency plan and hold our inaugural ASM online. Instead
of talking about Emergency exits and bathrooms, I will instead address a couple of other
housekeeping matters. Obviously, we are all meeting virtually using Zoom which means that a
couple of things are going to run a little differently to normal. We will be using the Zoom
Voting and Q&A functionality during the session.
For those shareholders who still need to cast votes, if you have registered with your CSN
number then your votes will be counted in the results of the poll. After the meeting, we will
ensure your vote is counted and collated and release the results to the NZX tomorrow in
accordance with our Continuous Disclosure obligations. Please note that votes placed during
the meeting will remain anonymous. We will also run a Q&A session after the voting, where
you can ask a question at any time via typing it into the Q & A box. We will address as many
as we can in the time that we have after the voting has taken place. To ask a question: Open
the Q&A window, type your question into the Q&A box and Click Send. We will receive the
questions online and will be able to address those at the Q & A session. For those
shareholders who still need to cast votes, I will advise you how to vote on our ordinary
resolutions later in proceedings. We have a quorum of shareholders present online - being five
shareholders having the right to vote at the meeting, so I declare the meeting open.
This afternoon you will hear from our CEO David Page and myself, followed by the formal part
of the meeting which comprises four shareholder resolutions and any other business that
may arise during this afternoon’s proceedings. It is my pleasure to introduce my fellow Board
members, David (Yusuke) Sena, Eugene Williams, Tracy Rowsell, Michele Kernahan and
Charles Bolt. We also have some key management from NZAI and our subsidiaries, 2 Cheap
Cars and NZ Motor Finance online with us today. The Company’s auditors are also present
with Vanessa Black of Grant Thornton attending online. Welcome Vanessa.

The Year That’s Been
We were proud to deliver a solid result for the year ended 31 March 2021, through the Covid-
19 pandemic, delivering net profit above guidance, and demonstrating the ongoing profitability
and resilience of the business, which I will cover later. Despite a challenging year for many
businesses through the Covid-19 pandemic, the used automotive industry has proven to be
agile in responding to evolving market conditions. Operating across Automotive Retail and
Automotive Finance, NZAI is in a strong position to continue to deliver on our purpose of
helping Kiwis afford great cars.
It has been a transformational year for NZAI, and I would like to take this opportunity to cover
some of the highlights from the year.

Board and Management Appointments
NZAI has attracted several experienced independent directors to our Board. I was appointed
as Board Chair in September 2020 and Charles Bolt, Michele Kernahan and Tracy Rowsell
also joined as directors over the period leading into the direct listing in February 2021. Our
objective as a board with a new management team, is to apply strong governance disciplines
and rigor to the company which is now accountable to a much wider stakeholder base.
We appointed David Page as CEO in late 2020 to lead NZAI through the direct listing and to
drive our next phase of growth. David has over 25 years of asset finance and banking
experience, which includes a deep knowledge of consumer, motor vehicle and commercial
asset finance. Our CFO, Haydn Marks was also appointed during this initial period. Haydn has
over 20 years of financial management and leadership experience across financial services
and technology sectors. The Board and management team bring a breadth and depth of both
corporate and industry experience, and we are now focused on setting the company up for
future success by implementing NZAI’s strategic roadmap for growth.

Direct Listing on the NZX
As you’ll be aware, in February 2021 NZAI successfully listed on the New Zealand Stock
Exchange (NZX), going public via a direct listing on the NZX main board. A direct listing on
the NZX is a significant milestone in NZAI’s journey as we continue to become one of New
Zealand’s leading used automotive groups. The listing is intended to support the company’s
long-term growth, access to capital in the future for expansion of its vehicle finance business
and to create liquidity for the founders.
Established in 2011, Eugene Williams and David Sena built the 2 Cheap Cars business to its
current scale over nearly 10 years of operation. As owner-operators, Eugene and David
managed the business with a focus on shareholder value creation and efficient capital
allocation. David and Eugene have remained in their roles within the business and on the
Board and will remain cornerstone shareholders of the Company. Together they currently own
more than 90% of the current shares on issue. The Escrow arrangements put in place with

David and Eugene at the inception of the Direct Listing means that they can sell down to 45%
of their combined shareholding up until and after the release of the Company’s financial
results for the year ending 31 March 2023. As at the end of July 2021, NZAI was one of the
top 20 yielding stocks on the NZX and we look forward to continuing to deliver on this strategy.

Strategy
The Board and management team continue to implement NZAI’s strategy to be New
Zealand’s most innovative provider of vehicle solutions, delivering more affordable cars to
Kiwis than any other company in the sector. David Page our CEO will provide a more detailed
overview of our strategy later in the meeting. We are excited about the journey ahead for NZAI
over the next three to five years and beyond.

Growth in Loan Book
Our automotive finance subsidiary, NZ Motor Finance (NZMF) is relatively new, and it is
intended to be a significant growth engine to build future annuity streams and grow our overall
financial performance. During the reporting period, NZAI raised $3.3 million in net capital and
secured a bank facility of $5.0 million to fund the continued growth of the NZ Motor Finance
business’s loan book into the future. As of 31 March 2021, the value of NZMF’s loan book
doubled to $3.8 million. We will continue to leverage our retail business to provide finance
directly to our retail customers and going forward we expect to see further growth in the
financing business.
Financial Results
I was pleased that during the year, the team successfully navigated the challenges presented
by Covid-19. Like other retail businesses, NZAI’s operations and the broader automotive
industry were significantly impacted by the lockdowns relating to Covid-19 during FY21, where
the company could not fully trade for at least 68 days, or 19% of the year. We were proud to
deliver a solid result for FY21 despite the impacts of the pandemic. The group managed to
post an underlying net profit after tax of $3.8 million and pay a dividend of 5 cents per share,
representing a gross yield of 6.6%. This demonstrates the ongoing profitability and resilience
of the business.
Covid-19 Update
We have since seen our sales volumes return to pre-Covid-19 levels. Demand for used cars in
New Zealand has bounced back strongly to July 2021, and we had expected this to continue
for the balance of the financial year. However, as of August 2021, we are responding again to
lockdowns as is the rest of New Zealand. Due to the Covid-19 alert system in New Zealand
having moved to level 4, all twelve 2 Cheap Cars dealerships and the company’s car
processing hub in Auckland have been closed since 11.59 pm on Tuesday 17 August. The
business is able to trade, but only on a limited basis during any move to alert level 3. The
business was performing solidly to the end of July and ahead of the same Covid-affected
period last year. However, any prolonged extension of alert level 4 or 3 restrictions could

have a material impact on our financial performance over the rest of the financial year,
depending on the duration and geographic scale of the restrictions. In the immediate term,
NZAI’s priority is to support our staff, our customers, and our suppliers. Although we expect
the business to be impacted during the latter part of our first half FY22, NZAI’s reliance on its
New Zealand customer base and its focus on used cars (less discretionary than new cars)
means that, as previously demonstrated, NZAI has relative resilience in a downturn and
recovery. NZAI’s geographical spread, coupled with its strong financial position, also places
the Company in a strong position to weather the storm.
How Is NZAI Differentiated in The Automotive Market?
Across New Zealand, we know that everyday Kiwis rely on safe, reliable, and affordable
transport to get them from A to B, with around three quarters of the working population driving
a motor vehicle to work. The automotive industry has been growing at a rate of 3% per annum
and it is estimated that more than half of the fleet will be replaced over the next 10 years. The
average age of New Zealand’s 4.4 million light vehicles is just over 14 years, a figure which is
slowly increasing. This demonstrates the need to refresh our domestic fleet with newer,
cleaner, safer and more reliable vehicles. On that point, NZAI is in fact differentiated in the
automotive market in New Zealand in three key ways:
1. Higher quality, more affordable cars.
Firstly, our subsidiary 2 Cheap Cars has been a disruptor in the automotive retail market with
its high volume, low margin business model. The number of cars, and size of the 2 Cheap
Cars’ operations, means it benefits from economies of scale. This allows the company to price
cars lower than its competitors and pass on savings to our customers.
2. Japan-based procurement team.
Secondly, NZAI is different from other used car dealerships, in that we are one of the few used
car dealerships in New Zealand that has a Japan-based procurement team who attend
auctions, inspect, and hand-pick vehicles to export to New Zealand. This allows us to manage
quality, buy at scale and have a diverse offering that matches the demand of customers at all
times. We are not reliant on the NZ domestic market for sourcing vehicles. Sourcing vehicles
from the 78 million car fleet in Japan allows us to stock multiple brands, broaden our product
offering and enables NZAI to pivot quickly to ensure we keep up with the changing demands
of the New Zealand marketplace. Having a Japan-based procurement team also enabled us to
maintain a strong supply chain throughout the Covid-19 lockdowns.
3. Accelerating the shift towards climate friendly vehicles.
Thirdly, NZAI is very well placed to respond to increasing demand for electric, hybrid and low-
emission vehicles stemming from the Government’s new Clean Car Discount program. In Q4
FY21, 21% of 2 Cheap Cars sales were electric or hybrid electric vehicles and 68% of all
vehicles sold last year would have either been eligible for a rebate or be zero rated (based on
the clean car scheme rules from 1 January 2022). We have recently adjusted our purchasing
schedule towards cleaner cars, and we anticipate that the percentage of cars eligible for the

rebate or no penalty will grow to between 75 to 80% over the coming year. Of course, this is
Covid-19 dependent! Given 2 Cheap Cars’ flexibility in buying patterns, we are well positioned
to source quality low emission vehicles that are affordable for all Kiwis. Overall, we see the
move towards cleaner cars as a significant opportunity for the NZAI Group. David Page will
talk more to you on the numbers as part of his presentation.
Looking Forward with a Strategy to Grow
As we look into the future, our objective is to expand the capabilities of our vehicle processing
hub in Auckland to unlock growth, increasing import volumes and expanding and modernizing
our dealership network. We are pleased to announce that NZAI is moving to an expanded
motor vehicle Hub processing premises for 2 Cheap Cars in Onehunga in the New Year,
which will greatly assist this goal. David will tell you more about this later. We will continue to
grow our online presence and develop our digital platforms for our customers to transact more
through online channels, while leveraging the retail business to continue to build a diversified
automotive services group. NZMF will continue to grow its loan book organically via the 2
Cheap Cars sales and network platforms, through forming partnerships with other financing
partners, and over time exploring acquisitive bolt-on growth opportunities. We continue to
streamline and digitize operations to provide the platform for growth over the next 3-5 years
and beyond. Finally, we will continue to build our brands and improve our customer
experience.
Thank you to our staff for your continued efforts over the past year, particularly through the
capital raise and direct listing on the NZX and thank you to our shareholders and customers
for your support and confidence in NZAI. This brings an end to the formal part of the meeting.
In closing, I would like to acknowledge our shareholders. Thank you for your support and for
your attendance online today. A summary of proceedings and voting at today’s annual
meeting will be released to the NZX. As always, my fellow directors and our CEO are always
contactable to discuss matters which you as shareholders wish to raise and our contact details
are included on our website or on the ASM meeting announcement posted on the NZX
Good afternoon.

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New Zealand Automotive
Investments Limited
17 Levene Pl,
Mt Wellington,
Auckland, 1060

info@nzautomotiveinvestments.co.nz
nzautomotiveinvestments.co.nz


CEO’S ANNUAL SHAREHOLDER MEETING (ASM) ADDRESS

Slide 11 – Business Highlights
Thanks Karl.
It has been a very busy time for NZAI and I am pleased to say that the hard work is paying off
as we start to see areas of our strategy progress, which I will talk to later in the presentation.
Today I will provide an overview of NZAI - I will keep this brief as we have shared this
information a number of times recently in other forums and it is available on our website.
I will also provide an update on our recent trading performance, both FY March 21 and year to
date.
I will then cover our strategy for growth and share some of the progress we are making
against our strategic goals, including the opportunity for us presented by the Government’s
clean car policy.
I will then pass back to Karl to complete the meeting formalities and will be available for
questions at the end.

Slide 12 – About NZAI
NZAI is an integrated used automotive group operating throughout New Zealand via two
divisions: Automotive Retail and Vehicle Finance.
We employ 75 staff across the group, with six based in Japan.
Our retail business operates under the brand 2 Cheap Cars (2CC) and includes both the
procurement of vehicles out of Japan and retail car sale in NZ.
A key point of difference is procurement. Having the team in Japan inspecting the cars pre-
purchase ensures the best quality at the best price. It is also worth pointing out that we have
NZTA approved compliance centers to inspect the cars against safety standards as they enter
New Zealand, ensuring independence.
Once we have dispatched the cars to our dealerships it takes about 23 days to sell on
dealership, which is positive for cashflow.

Slide 13 – Automotive Procurement & Retail
We sell cars nationwide through 12 dealerships and sell a range of well-known makes and
models.

Slide 14 – Automotive Finance
Finance demand continues to be strong from customers. One of NZAI’s key strategic
objectives is to grow our in-house finance company, New Zealand Motor Finance (NZMF).
Of all cars sold on 2CC dealerships, currently 30% of those sales arrange finance at point of
sale. Our 2CC Finance team offers a range of solutions to customers including our own in-
house finance offering, NZMF.
NZMF was established in 2019 and has shown strong growth to $4.5 million as at July.
However, with the total amount financed through 2CC dealerships closer to $30 million per
annum we can look to take on more of this finance over time.
It is a balance for us as we also offer other finance companies’ products, who we have long
standing relationships with and which we earn a revenue stream from.
NZMF saw growth of 138% in FY21 and has now helped over 500 customers purchase their
car.
The book sits just below $4 million in FY21, is growing fast and we have plenty of headroom to
grow.
Our selective criteria have led to a good quality portfolio, as evidenced by a 0.11% write-off
rate.
The drivers underpinning finance growth are:
 Increase car sales
 Increase % of cars financed
 Increase % of cars financed by NZMF

Slide 15 – Loan Book Funding
We have good headroom to grow, with the opportunity to increase the NZMF % of the 30% an
obvious opportunity. But we need to manage the growth, to optimize the funding and
opportunity available.
As at 31 March, we had $6.7 million funding available to grow the loan book.

Slide 16 – FY21 Performance Highlights
I’m pleased to share key highlights from FY March 21.
In the three years leading up to FY21, NZAI achieved average revenue and income of $76.2
million and during this time the average EBITDA, including finance income, on a normalised
basis was $7.3 million, representing around a 10% EBITDA margin.
Covid-19 saw us closed for 68 days (or 19% of the year), but we adapted and with good cost
management to minimize the impact and maintain the platform for growth and still managed to
produce underlying NPAT of $3.8 million for FY21.
Cashflow remains sound and a strong dividend was declared and paid in June.

Slide 17 – Track Record of Paying Dividends
The business has a proven track record of declaring and paying dividends.
Our policy of 50-60% NPAT dividend pay-out ratio meant a fully imputed 5cps dividend paid in
early June 2021, representing a gross dividend yield of 6.6% based on the market valuation at
that time.

Slide 18 – NZ Used Car Industry
This slide provides some context of the scale and how well established our market is.
With 4.4 million vehicles registered in NZ and 150,000 used passenger imports annually, it is
estimated that around half of the total fleet (2.2 million) will need to be replaced in the next 10
years.
With the introduction of the new Government Clean Car Standard earlier this year, this
represents a huge opportunity for NZAI.

Slide 19 – Industry Trend to Cleaner Cars
Clean Cars
In June, the Government introduced new measures to help drive down New Zealand’s
transport emissions. The Clean Car Discount aims to increase the uptake of low-emission cars
by implementing a rebate scheme for EV/HEVs. From 1 January, this will include other low
emission vehicles.
While policy implications are still being ironed out and impacts understood, we support the
intention to have a cleaner New Zealand fleet over time.
To put this in context:
1. A used Nissan Leaf would receive a rebate of $3,450.
2. A used Mazda Axela would sit in the neutral zone and have no rebate or tax payable.
3. A used Honda Odyssey would have a tax payable of $1,147.
And our customers being middle New Zealand will be a key tipping point to adoption.
Currently two thirds of our sales would be neutral or receive a rebate. We need to monitor and
adapt to the changes in demand, and adjust our buying accordingly.
With our end-to-end supply chain, we need to manage how quickly we adapt based on
consumer behaviour; we are monitoring this very closely.
In the normal replacement cycle, more than half of the vehicles in New Zealand are predicted
to be replaced over the next 10 years.

Slide 20 – Electric Vehicles & Other Climate Friendly Cars to Consider
To accelerate the shift to clean cars, we talk about the three As.
• Availability – where we can influence the supply
• Affordability – where we work hard to keep costs down
• Awareness – where we share knowledge to help educate our customers
We will play a role in each of these areas, but again it is important to note that we will
ultimately respond to customer demand.
This is a key opportunity in the market for us and critical for delivering on our purpose.

Slide 21 - Our Strategy
Our purpose is helping Kiwis afford great cars.
1. EXPAND OUR SUPPLY CHAIN
Areas of focus and investment:
• Expand our HUB car processing capability to unlock growth.
• Actively increase supply of quality affordable EV and HEVs.
• Use our knowledge and network to help Kiwis understand EV / HEVs.
• Embrace the entrepreneurial spirit of the founders.
• Leverage our scale to drive efficiencies.
• Continued synergies from Japanese presence.

2. GROW RETAIL DISTRIBUTION PLATFORM
Areas of focus and investment:
• Expansion of national dealership footprint.
• Upgrade and modernize physical dealerships.
• Upskill our sales staff and automate our processes.
• Increase capacity of existing dealerships.
• Uplift finance penetration.

3. GROW VERTICAL INTEGRATION
Areas of focus and investment:
• Increase finance penetration within the group.
• Implement digital application and fulfilment.
• Grow loan book from third party automotive retail dealers.
• Explore opportunities for acquisition growth.

4. IMPROVE DIGITAL OFFERING
Areas of focus and investment:
• Refine full end-to-end online buying process.
• Develop a meaningful partnership network who deliver value for our customers.
• Streamline and automate internal processes, creating capacity.

5. BUILD BRAND AND CUSTOMER EXPERIENCE
Areas of focus and investment:
• Deepen our connection with our 130,000 followers on social media, through thought
leadership and education on emerging trends, challenges and opportunities.
• Invest in the best talent, increasing people capability.
• Uplift Net promoter score.
• Focus on improving and streamlining our processes.
• Invest in our Customer Care team.

Slide 22 - Strategic Execution
I am very pleased to announce that we have signed an agreement to execute one of our key
priorities, that is to uplift the number of cars we can efficiently process.
To do this, we have entered into an agreement that will see us exit our current car processing
sites that we have almost outgrown later this year and early next year, and enter into a new
site with a range of benefits.
Benefits include:
• A pre-tax net benefit of $0.8 million from lease negotiations
• Increased car processing capacity to sell more cars and unlock future growth
• A more functional layout and space for new equipment, which will enable NZAI to
automate existing manual processes
• The Onehunga location is also closer to a number of suppliers and partners
The lease will commence in January 2021, or earlier if mutually agreed.

Slide 23 - Strategic Execution (continued)
This diagram illustrates the size and scale of the new car processing hub in Onehunga.

Slide 24 - Strategic Execution (continued)
Other areas of strategic progress the business has made recently include:
NZMF continues to grow the loan book, up 18% to $4.5 million since March 2021 and has
made progress in signing a partnership agreement to provide finance to third parties and has
another one in the pipeline.
NZAI remains focused on digital transformation – 2 Cheap Cars now has “buy now’’ online
capability for customers to transact online and purchase vehicles and complete finance
applications.
We are leveraging our strong position on electric and hybrid vehicles, which continues to
make up 21% of cars sold.

Slide 25 – Year to Date Performance
NZAI has had a successful first four months of the year in the lead up to the latest Covid-19
lockdown.
The 2 Cheap Cars business has had solid trading for the first four months of the year, where
there has been a bounce back in car sales.
Revenues are up 37% to $24.7 million to July 21, driven by vehicle sales which are up 28% on
the same period last year, through recapturing lost vehicles sales from Covid-19, and through
stronger finance penetration.
NZMF continues to grow the loan book, up 18% to $4.5 million since March 2021 and now has
576 loans.
Revenues and income across the Group are up 38% to $25.2 million to July 2021.
The 2 Cheap Cars business continues to work to manage supply chain challenges caused by
inflationary headwinds across labour, shipping and compliance in the current environment.

Slide 26 – Outlook
NZAI will continue to execute its strategy and is well positioned to work through latest Covid-
19 challenges. While the extent of the current lockdown remains unknown, we remain positive.
As a consequence of the property move and rearrangement of its leases, NZAI is expected to
benefit from a net one-off non-recurring gain of approximately $0.8 million before tax in FY22.
As mentioned earlier, the net benefit will be used to invest in the business as part of the
Group’s drive for growth.
Ongoing lease costs from the move to the Onehunga site are not expected to be materially
different from current arrangements.
The 2 Cheap Cars business will continue to leverage its position to import and sell more
EV/HEVs.
The NZMF automotive finance business will continue to be a focus area for growth and will
continue to grow its loan book organically from 2 Cheap Cars, through forming partnerships,
and over time exploring acquisition opportunities.
NZAI expects to deepen its connection with 130,000 followers on social media and is focused
on attracting and retaining staff.

Slide 27 – Outlook Continued

The business was performing to the end of July ahead of the same Covid-affected period last
year. However, any prolonged extension of alert level 4 or 3 restrictions could have a material
impact on financial performance over the rest of the financial year, depending on the duration
and geographic scale of the restrictions.
The used car sector has proven very resilient in the past, and the purchase of a used car is
less discretionary than a new car. We service a mid range buyer, not the lowest price and not
the highest prices range of used cars, as such demand is less impacted by shocks.

Slide 28 – Outlook Continued
In response to the current Covid-19 lockdown, NZAI’s first priority is to support staff,
customers and suppliers in the immediate term.
In the middle to longer term a cost management focus, responding to inflationary headwinds
across labour, shipping and compliance will be a focus.
These along with executing on the move to the new hub, embedding lean processes and
delivering efficiencies, while also working to deliver uplift in worker engagement / retention will
be critical for us.

Slide 29-31 – Our Customers, Our Team and Our Business
Our customers and our team are very important to us here at NZAI.
2 Cheap Cars has a lot of happy customers as you can see, and we currently have an
average net promoter score of 4.38 out of 5 for July 2021.
We are building on our culture across the NZAI group of companies and are planning activities
to keep staff engaged and motivated – which is key to retain and attract good employees.
[Now I will hand back over to Karl to take you through the resolution voting process.]