Walter Yovich (FSP 41025)

Yovich & Co. Market Update

15 February 2021 As at 12 February NZX 50G All Ords Shanghai FTSE Dow NASDAQ NZDAUD NZDUSD OCR Previous Week 13053.87 7112.93 3496.33 6489.33 31148.24 13856.30 0.9381 0.7197 0.25% Week Close 12589.64 7081.32 3655.09 6589.79 31458.40 14095.47 0.9303 0.7223 0.25% Change -3.56% -0.44% 4.54% 1.55% 1.00% 1.73% -0.83% 0.36% 0.00%

In summary, the NZX50G had 37 companies on the downside, 2 remain unchanged and 11 companies were on the upside. The NZ50G closed the week down 3.56%. Contact and , (two prominent companies on the NZX50G) dragged the market down last week, along with investors revaluing their stock holdings, with the possibility of interest rates rising mid-2022. We will all be aware that has re-entered Level 3 Covid-19 lockdown until midnight Wednesday 17 February following the discovery of three confirmed cases of community transmission in South Auckland. The rest of NZ is in Level 2. Melbourne also entered a snap-lockdown on Friday (for five days), with the Holiday Inn cluster reaching 13 confirmed UK-variant cases at that time.

The biggest movers of the week ending 12 February Down Up Meridian Energy 16.88% Heartland Group Holdings 5.95% 11.66% Summerset Group Holdings 4.60% 7.57% Holdings 3.86%

Investment News ikeGPS Seeks to set the standard for collecting, managing and analysing pole and overhead assets information for electric utilities, communications companies and their engineering service providers. Usage of IKE solution shows, (when compared to existing practices) increased efficiency for filed engineering by approximately two times and back office by approximately five times. The revenue engine for IKE is driven be the number of assets being processed through the IKE platform. In the Q3 FY21 period, less engineering activity occurred on certain network projects while COVID-19 response measures were put in place in specific U.S. regions. Revenue for the period was $2.1m, gross margin of approximately $4.3M with a gross margin percentage of approximately 67, strong balance sheet with total cash and receivables as at 31 December 2020 of approximately $18m with no debt. Current Share Price: $1.10, Target Price: $1.44.

Rakon Is a global high technology company and a world leader in its field. The company designs and manufactures advanced frequency control and timing solutions. Its three core markets are Telecommunications, Global Positioning and Space and Defence. products are found at the forefront of communications where speed and reliability are paramount. The company’s products create extremely accurate electric signals which are used to generate radio waves and synchronise time in the most demanding communication applications. Rakon has secured several significant orders from new and existing customers including a material order from a new multi-national customer. Rakon expects to deliver the majority of these orders in FY2022, with the balance in FY2023. Indicatively, Rakon expects that these orders will increase its revenue in FY2022 by at least 20% from FY2021. These orders are not expected to impact financial performance for FY21, with current guidance for FY21 of underlying EBITA of between $20m and $22m. An earnings guidance for FY2022 is expected end March 2021. Current Share Price: $0.86.

Disclaimer: This publication has been prepared for your general information. While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken for any errors or omissions. This publication does not constitute financial or insurance product advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication. No part of this publication may be reproduced without prior written permission from our company. Disclosure statements relating to the financial advisers associated with this newsletter are available on request and free of charge. Walter Yovich (FSP 41025)

Air Announced that it plans to raise capital by 30 June 2021, the capital raise was subject to Cabinet approval. The government has confirmed it plans to maintain a majority shareholding by participating in the capital raise. The announcement had very little effect on share price. Current Share Price: $1.56.

Kathmandu Provided an update on its unaudited trading performance for the six months ended 31 January 2021 (1H FY21). Group total sales for 1H FY21 were 12% above last year, including a full six-month contribution from Rip Curl. EBITDA is expected to be in the range of $47m to $49m. Group Net Debt is expected to be $7m following careful working capital management and the $207m capital raise in 2020. Online represents 13% of direct-to-consumer sales, up from 8.9% last year. The Group intends to release the full result for the half year on Tuesday 23 March 2021. An announcement regarding dividend resumption will be made at that time. Current Share Price: $1.28, Target Price: $1.70, Rating: Buy.

Contact Energy Tax paid profits for the six months ending 31 December 2020 was up 32% at $78m, EBITDAF increased by 11% to $25m. Operating free cash flow for the period was up 31% at $157m. The Board has revised dividend policy to distribute ordinary dividends targeting a pay-out ratio of between 80-100% of the average operating free cash flow of the preceding four financial years. A gross interim dividend of 23 cents has an ex-dividend date of 15 March and is payable 30 March 2021. Contact Energy has also announced a $400m equity raise via a $325m underwritten placement and a $75m non- underwritten offer. The shares will be offered at $7.00 a 7.8% discount to the 5-day volume weighted average price (VWAP) of $7.60. Under the Retail Offer, eligible shareholders in New Zealand and Australia will be invited to apply for up to NZ$50,000 / AU$46,500 (respectively) of new shares, free of any brokerage or transaction costs. Funds for the equity raise will be used to part fund a new $580m low carbon 152 megawatt Tauhara geothermal plant near Taupo, which is expected it to be built by mid-2023. Current Share Price: $7.20, Gross Yield: 6.77%, Target Price: $8.27, Rating: Buy.

Upcoming Dividend payments for NZ stocks Gross Ex Dividend Payment Current Company dividend Period cents per date price $ date share The Warehouse Group 16-Feb-21 Special 6.94 4-Mar-21 $ 3.28 Radius Residential Care Limited 18-Feb-21 Interim 0.58 26-Feb-21 $ 1.05 Downer EDI Limited 24-Feb-21 Interim 9.66 25-Mar-21 $ 4.95 Corporation Limited 24-Feb-21 Interim 8.58 26-Mar-21 $ 3.54 South Port New Zealand Limited 25-Feb-21 Interim 10.42 8-Mar-21 $ 8.58 Goodman Property Trust (NS) 3-Mar-21 Interim 1.61 18-Mar-21 $ 2.22

Disclaimer: This publication has been prepared for your general information. While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken for any errors or omissions. This publication does not constitute financial or insurance product advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication. No part of this publication may be reproduced without prior written permission from our company. Disclosure statements relating to the financial advisers associated with this newsletter are available on request and free of charge.