New Zealand Professional Investment Services Firm

Forsyth Barr

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

New Zealand Professional Investment Services Firm, Forsyth Barr

Equity Bottom-Up

Warehouse Group Limited / Equity Bottom-Up

<ul><li>The Warehouse Group (WHS) has done it tough over the last three years, generating a cumulative operating profit (EBIT pre-IFRS-16) of NZ$91m from FY23 to FY25.</li><li>Kmart NZ delivered +2% sales growth, a c.43% gross margin and a c.13% EBIT margin in the 12-month period to June 2025, while The Warehouse (Red Sheds) made its first operating-profit loss in the 12-month period to July 2025.</li><li>We only expect WHS to be able to return to a 2% operating margin, based on a 33% gross margin and getting to 31% CODB as a percentage of sales.</li></ul>

The Warehouse Group (WHS) has done it tough over the last three years, generating a cumulative operating profit (EBIT pre-IFRS-16) of NZ$91m from FY23 to FY25.Kmart NZ delivered +2% sales growth, a c.43% gross margin and a c.13% EBIT margin in the 12-month period to June 2025, while The Warehouse (Red Sheds) made its first operating-profit loss in the 12-month period to July 2025.We only expect WHS to be able to return to a 2% operating margin, based on a 33% gross margin and getting to 31% CODB as a percentage of sales.

The Warehouse Group Tale of Two Discount Retailers