Annual Shareholders Meeting 2006 Chairmans Review As at 31 March - PDF document

Annual Shareholders Meeting 2006

Chairman’s Review As at 31 March 2006 Net Asset Value up 24% to $1.5888 $18.8 million surplus after taxation Total increase in NAV per share since IPO of 64% NAV increase of 24% vs. 14% benchmark increase Combined market value of shares and warrants 36% above the issue price Core portfolio of 7 stocks established, with 96% of funds invested

Chairman’s Review Update since balance date 31 March 30 June 2006 2006 Net Asset Value increase from 64% 84% initial IPO level of $0.97 Net Asset Value increase versus 24% 12% Benchmark increase 14% 9% Increase in combined value of 36% 56% shares and warrants over issue price Dividend paid / payable 2cps 2.5cps Dividends reinvested 38% 37%

Chairman’s Review Share price and NAV performance SHARE PRICE, COMBINED WARRANT AND SHARE PRICE AND NET ASSET VALUE PERFORMANCE KFL + KFLWA Price KFL NAV KFL Price $1 .80 $1 .60 $1 .40 $1 .20 $1 .00 $0.80 M M Jun- Jul- A S Oct- N D Jan- F M Apr- M Jun- Jul- A S N D Jan- F M Apr- M Jun- ar- ay- 04 04 ug- ep- 04 ov- ec- 05 eb- ar- 05 ay- 05 05 ug- ep- ov- ec- 06 eb- ar- 06 ay- 06 04 04 04 04 04 04 05 05 05 05 05 05 05 06 06 06

Chairman’s Review Special Dividend Announcement The Kingfish Board is pleased to declare a fully imputed Special Dividend of 2.5 cents per share, payable 4 th August 2006 based on eligible shares held on 21 st July 2006.

Manager’s Review Carmel Fisher Fisher Funds Another year of impressive performance A portfolio of quality businesses Good results in spite of a challenging climate

Agenda Review of March 2006 year Review since balance date Outlook for March 2007 year Dealing with the discount

Manager’s Review Portfolio activity during 2006 year Trophies landed Michael Hill Ryman Healthcare Software of Excellence Caught and released Just Water Pod Turners Auctions Turners & Growers Steel & Tube

Manager’s Review Highlights: Lowlights: � Our performance � The financial year exceeded a buoyant began badly with an share market 11% drop in NAV in April 2005 � Resilient and growing profits in our � We exited Turners companies Auctions after they � Ryman Healthcare failed to meet our and Mainfreight were growth expectations star performers, each lifting more than 70% in twelve months

Where did our performance come from? Year to 31 March 2006 10% 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% C C F J K M M M N P P R S S T T W u r i u o u u a o i Z o y t d a e -1% e c e a s r r d m d m m f i i t h t n n i t c E e s m n l w g i p e e o a a l t v W f f x h e r e a k & r r u i r e c n t t e s s c a p i r s a w l h M i n e a H g T t H A G a a T e a r h P e u -2% e n u y r i r e n t l b l a a o s g c c a t l e w e t t h c i g h o e n h e c n r o m a s s l r -3% o e e g n y t

Year-end Portfolio Kingfish portfolio at 31 March 2006 Software of Exc 1% NZ Exchange 2% Kidicorp 1% Cadmus 1% Comvita 1% Cash 2% Freightways 12% Mainfreight 15% Waste Management 17% Metlifecare 10% Ryman Healthcare 18% Michael Hill 9% Pumpkin Patch 11%

Manager’s Review Review since balance date NZ share market was lower for the quarter, weighed down by Telecom News flow was mediocre rather than alarming Kingfish NAV per share increased 14% from $1.5888 at 31 March to $1.7825 at 30 June, allowing for 2.5cps div paid on 16 June 13 of the 14 stocks in portfolio had share price gains, just Freightways declined 2% Strong profit results from retirement village stocks Ryman Healthcare and Metlifecare led to share price gains of 28% and 30% respectively

Freightways Cadmus Technology Where did our performance come from? Software Waste Management Kidicorp Michael Hill 3 Months to 30 June 2006 Comvita NZ Exchange Delegats Pumpkin Patch Rakon Mainfreight Metlifecare Ryman Healthcare 5% 4% 4% 3% 3% 2% 2% 1% 1% 0% -1%

Manager’s Review Review since balance date We were pleased to participate in Rakon and Delegats IPOs The Waste Management amalgamation was completed during the quarter and the shares de-listed late June The Board utilised the Kingfish debt facility to enable purchases of Delegats and Rakon ahead of the Waste Management proceeds being received We purchased additional Rakon, Delegats, Pumpkin Patch and Michael Hill Buy back continued with 2.65m purchased at an average price of $1.06 , and 3.3m warrants at an average price of $0.19 as at 30 June 2006

Manager’s Review Outlook for year ahead We remain very comfortable with the outlook for the portfolio Many of our companies have significant offshore operations (eg. Michael Hill, Pumpkin Patch) which will protect earnings from slowing NZ economy We have been vigilant in trying to find looming problems or surprises, and believe the coast is clear We continue to believe that good companies will perform in good times and bad

Manager’s Review Dealing with the discount The most appropriate measure of the skill of the Manager is the growth in the NAV However, the share price performance continues to lag that of the NAV Why does the discount prevail? – Poor performing investment manager? – Poor outlook for underlying companies? – Obscure or illiquid portfolio of investments? – Structure of Kingfish is expensive or unwieldy? – Out of sight, out of mind? – Dilutionary impact of warrants?

Manager’s Review Dealing with the discount What has the Kingfish board/manager done to ‘manage’ the discount? – Buyback of 1.5m shares representing 2.5% of Kingfish shares on issue – Encouraged share broker analysts to review the company – positive research reports produced by First NZ Capital – Developed a media campaign to promote coverage of Kingfish (more work still to be done in this regard) – Most importantly, managed the portfolio to ensure that the NAV moves in the right direction! – The discount has closed from 19% in October 2005 to 12% in June 2006

Manager’s Review A reiteration of why Kingfish remains attractive Transparency Consistent investment performance Portfolio of great stocks through one investment Share price performance Corporate governance Discount not unusual Discount provides opportunity

Manager’s Review A reiteration of why Kingfish remains attractive “For those who believe that the NZ sharemarket has longer term growth prospects, that the company’s core shareholdings will continue to prosper and that Fisher Funds will continue to excel at stockpicking, then Kingfish shares at current prices should be seen as a highly appropriate way to access that upside potential.” Barry Lindsay, First NZ Capital Kingfish Research Note 21 June 2006

Manager’s Review Thank you for your continued support

Kingfish Proxy Summary Resolution For Against Discretionary Abstain Total 1. Re-elect Rob 2,285,644 74,975 3,289,566 10,210 5,660,395 Challinor 2. Revocation and 2,275,707 16,476 3,305,846 62,366 5,660,395 Adoption of New Constitution 3. Re-appointment 2,296,106 62,366 3,301,673 250 5,660,395 of PWC