Preliminary result and dividend

The Chair of The Colonial Motor Company, Ash Waugh, today announced a Trading Profit after Tax for the 30 June 2026 financial year of $18.7m, marginally ahead of the previous year but affected by the Middle East conflict during much of the second half. He reminded Shareholders that on 26 February the Company indicated in the Half Year Report that positive growth in some vehicle segments and strong used vehicle trading had delivered a solid result for the Company, and that the aim was to hold onto and ideally build on those gains in the second half. That was not to be the reality, as the geopolitical environment abruptly shifted two days later with the beginning of the Middle East conflict. The resulting oil shock and supply disruption significantly impacted the sales mix in the light vehicle market and this shift continues. Demand for diesel vehicles slowed and the desire for New Energy Vehicles (NEVs) dominated the market for a time, as customers quickly reacted to ballooning fuel prices and oil supply uncertainty. Understandably, the timing of this shock was unfavourable for the Group’s businesses, Mr Waugh said, falling as it did in a window where vehicle supply, model changes and the inventory mix were not positioned to take advantage of the demand shifts. He reported there was some better news. Management across the Group acted quickly and decisively, revaluing inventory to meet the market and by doing so, limiting potential impacts and maintaining sales momentum. While margins were inevitably affected, the ability to finish with an improved profit after tax position relative to last year was a satisfying and respectable outcome in what was a disrupted trading environment. The Company’s balance sheet was strong, particularly relative to the two previous years. This was the result of significantly lower inventory levels and reduced external borrowings. Ash Waugh noted exciting new models were due soon, with a focus on NEVs. The arrival of Mazda’s all new electric 6e model was imminent and it would be quickly followed by the CX-6e. The current Ford model range remained resilient and was maintaining its market share. The Ford Motor Company would, as it had in the past, continue to adapt its portfolio to meet evolving market trends, as demonstrated with the launch of the Ranger Hybrid. New Zealand Automotive Limited had successfully previewed the new JAC T9 plug-in hybrid ute at Fieldays and Mitsubishi had also announced exciting new vehicles due this year. Southpac was currently focused on bringing the more fuel-efficient Next Generation DAF to market, with the first customer trucks already on the road. Also, the strength of the agri-sector in general was driving growth in the Company’s tractor and implements business, a welcome recovery. Mr Waugh pointed to the focus on growth in used vehicles that would continue across the Group. The Dealerships had proven over the last two years that without market disruption this business had more potential. The Company was pleased to have secured an expanded representation of the BYD brand into the Canterbury and Wairarapa regions, joining the Energy Motors subsidiary that had operated a BYD dealership in New Plymouth. From a strategic perspective, access to a range of competitively priced NEV product was a priority. On the property front, he explained the added BYD dealership opportunities would require a significant investment in property and facilities in Christchurch and the other regions where the Company would now have representation. Plans had also been finalised for a more significant Ford facility on Harris Road in Botany and at the Rangiora branch, with construction about to begin. Ash Waugh said the Middle East conflict had acted as a catalyst in lifting the level of adoption of NEVs, particularly in the passenger segment. The fact was, business and consumers always seek to adapt, so life goes on. Local and geopolitical disruption seemed to be the ‘new normal’ for a time to come and the Company had to respond by continuing to adapt. The New Zealand economy appeared to be slowly improving, with our agri-based country showing a degree of resilience. The Team across the Group had a busy year ahead. The Directors had declared a fully imputed dividend of 25 cents per share to be paid on Monday, 5 October 2026 and with a record date of Friday, 25 September. This would take the total dividend for the year to 40 cps, representing 70% of the Trading Profit after Tax, ahead of the 35 cents per share in the previous year. ENDS ___________________________________________________________________________