Dear fellow shareholders,

On behalf of the Board, welcome to the Annual Report of NAOS Ex-50 Opportunities Company Limited (Company) for the financial year ended 30 June 2025. We extend our appreciation to all shareholders for your continued support and warmly welcome new shareholders who joined us in FY25.

The past 12 months have been defined by a shifting economic environment, with the RBA cutting interest rates in late 2024 and early 2025 to bolster economic activity, offset by volatile commodity prices, lagging inflationary pressures and a volatile macro backdrop. What did remain constant was the continued demand for large and liquid listed businesses, which saw the continued outperformance of the largest listed businesses in Australia.

Despite this backdrop, NAC delivered a +28.92% investment return for FY25, significantly outperforming the S&P/ASX 300 Industrials Accumulation Index return of +18.90%.

The Company reported a $7.55 million after-tax profit, a marked turnaround from the $13.31 million loss in FY24. The Board has declared a final quarterly dividend of 1.50 cents per share (50% franked), bringing the total FY25 dividend to 6.0 cents per share, comprising two fully franked and two 50% franked dividends.

This dividend marks the 11th consecutive year NAC has maintained or increased its annual dividend and represents a 12.77% yield, based on the 30 June 2025 closing share price of $0.47. Since inception, NAC has declared 57.15 cents per share in dividends, or 80.43 cents on a grossed-up basis, with the majority fully franked.

NAC’s strong profits reserve of 47.95 cents per share provides a strong foundation to deliver sustainable, tax-effective income to shareholders in future periods.

NAC Dividend History

In FY25, the pre-tax Net Tangible Asset backing (NTA) per share of the Company increased from $0.54 to $0.67 over the financial year, as shown in the following chart.

NAC Pre-Tax NTA Performance

Throughout the year, the Board maintained its implementation of a disciplined capital management strategy focused on maximising long-term shareholder value:

• On-Market Buyback – 1.67 million shares were acquired and cancelled, enhancing shareholder value by buying significantly below pre-tax NTA.
• No Dilutionary Share Issues – DRP shares are acquired on-market, eliminating dilution and preserving NTA integrity.
• Dividends – We remain committed to paying a consistent stream of dividends, franked to the maximum extent possible, while ensuring prudent management of the profits reserve and reinvestment capacity.

Each of these measures is part of a clear, disciplined capital allocation framework designed to support sustainable shareholder outcomes.

Importantly, alignment between shareholders, Directors, and the Investment Manager continues to strengthen. Directors and staff of the Investment Manager now hold 9.3 million NAC shares, and the Manager’s Fee Reinvestment Commitment, introduced in FY24, remains in place.

Despite broader market preferences leaning towards large-cap exposures, NAC’s differentiated strategy focusing on underappreciated businesses outside the ASX 50 positions us to continue delivering attractive long-term outcomes for shareholders.

On behalf of the Board, thank you once again for your ongoing trust and support.

Kind regards,

Sarah Williams
‍Independent Chair

21 August 2025

Dear fellow shareholders,

For the financial year ending 30 June 2025 (FY25), the NAC Investment Portfolio increased by +28.92% compared to the Benchmark S&P/ASX 300 Industrials Accumulation Index (XKIAI), which increased by +18.90%. After a tumultuous FY24, it was pleasing to produce a strong positive return, which more than offset the losses generated in FY24. It is equally rewarding to have achieved the majority of this performance from our core investments, which we steadfastly held throughout FY23 to FY25.

The NAOS team firmly believed that the core fundamentals of our investments would continue to strengthen over time, and we were confident that share prices would eventually reflect this strength, despite some delay. As noted below and in my closing outlook, despite significant share price appreciation, the valuations of most, if not all, of our core investments remain below their full potential. In fact, we believe these investments are derisking, thereby enhancing their long-term valuation potential.

Relevance, Momentum and Index Inclusion

Reflecting on my FY24 Investment Manager’s Report, I dedicated significant discussion to the distinctive market dynamics that emerged, where valuations were often overshadowed by the influence of passive capital flows and index inclusion. A prime example was the share price of Commonwealth Bank of Australia Ltd (ASX: CBA), which soared to a record valuation despite maintaining a flat earnings per share (EPS) profile for several years.

Fast forward to the end of FY25, and this market dynamic, if anything, has only strengthened, and generally equity investors of all types are being forced to ‘play the game’ and therefore focus on companies that form part of the index or are a good chance of index inclusion in the short term.

Turning to CBA, its share price, excluding dividends, has increased by +46% in FY25, following a 37% increase in FY24, marking the seventh consecutive year of share price growth. For further context, the chart below compares the grossed-up yield of CBA shares to Australian Government 10-year bond yields over a 10-year period. As the chart illustrates, despite CBA’s flat profit growth outlook, its shares are arguably being priced similarly to a government bond. This suggests investors perceive CBA’s risk profile as being closely correlated with the Australian government’s balance sheet.

Commonwealth Bank vs Australian 10 Year Bond - Yield

CBA has several qualitative attributes that continue to drive its rising valuation. In our view, these include:

• Relevance – CBA is now the 9th largest listed bank by market capitalisation. This makes CBA relevant not only to Australian investors but also to some of the world’s largest investors. As CBA’s relevance grows, the pool of passive buyers expands against a relatively fixed supply of CBA shares, fuelling demand.
• Momentum – As CBA continues to become a larger part of numerous indices, alongside its growing relevance, a self-reinforcing cycle emerges. Investors who are underweight in CBA, and thus lagging in relative performance, may feel compelled to purchase shares to align their portfolios with index exposure, further amplifying price momentum.
• Index Inclusion – With a market capitalisation exceeding A$300 billion, CBA is not only the largest company on the ASX but also a significant constituent in numerous global indices, including those tracking Asian financials and developed market banks. As CBA’s size grows, it attracts greater attention from prominent global indices, reinforcing its appeal to investors.

From a NAOS standpoint, we will continue to focus on what we can control. Our investment philosophy centres on investing in emerging companies that deliver high returns on invested capital and are led by experienced, aligned management teams. These companies operate in industries poised for sustained revenue growth, where they hold clear competitive advantages, and their business models are transparent to investors. Notably, 100% of NAC’s portfolio is outside the ASX indices, ensuring our investments diverge significantly from the benchmark, the S&P/ASX 300 Industrials Accumulation Index.

Below, I have expanded upon several core investments within the NAC investment portfolio, outlining why we believe these companies have the potential to generate significant long-term value for shareholders irrespective of their share price movements in FY25.

Urbanise.com (ASX: UBN) – Strategic Partnership with National Australia Bank (ASX: NAB)

UBN has been an investment within the NAC Investment Portfolio for over four years. Our investment thesis centres on the strength of UBN’s strata management software, which it successfully developed and brought to market.

Prior to our involvement, UBN underwent several iterations, and, like many ASX-listed companies, suffered from misguided strategic decisions by former board members and management. These missteps, in our view, led to a loss of focus and significant capital waste, resulting in accumulated losses exceeding $100 million on the balance sheet.

Since our involvement as investors, UBN has shown notable progress. A pivotal catalyst for this turnaround was the appointment of Darc Rasmussen as Director and subsequently Chairman, coupled with the replacement of most prior Directors and the addition of another Independent Director. We believe these changes were critical in sharpening UBN’s strategic focus, reinforcing its commitment to its strata management software, and addressing both industry needs and deficiencies in its own platform.

This strategic shift culminated in May 2025, with the signing of a strategic partnership with Australia’s largest business bank, National Australia Bank Ltd (ASX: NAB). Key highlights of this partnership include:

• NAB acquired an initial 15% stake in UBN with the option to purchase an additional 4.99% within 12 months of the product launch through a share placement at $1.255 per share.
• UBN and NAB will collaborate to develop and launch a data and payments integration service tailored for strata managers and their clients.
• UBN will receive recurring payments from NAB for the development, implementation, and ongoing maintenance of the service outlined above.

UBN and NAB will seek to deliver a best-in-class service for strata managers and their clients by integrating UBN’s fully cloud-based strata management software with NAB’s tailored banking solutions designed to address the specific needs of the strata industry. For context, there are approximately 2.3 million strata-titled properties (also known as lots) in Australia, underscoring the significant market potential for this offering.

Body corporates, also known as the Owners Corporations, are a mandatory component of a strata scheme, which comprises multiple strata-titled properties. These entities must maintain bank accounts to collect strata levies from lot owners and facilitate payments for various expenses, including cleaning, maintenance, and capital works programs. Typically, these accounts are divided into an Admin Fund and a Capital Works (or Sinking) Fund. A strata manager, appointed by the body corporate, oversees the management and accounting of these accounts.

Based on publicly available information, we estimate the average funds held in body corporate bank accounts are approximately $3,500 per lot. Applied to Australia’s ~2.3 million strata-titled properties, this suggests around $8 billion in deposits within strata-related accounts. We believe this estimated quantum of funds within strata bank accounts may even be conservative.

Public data suggests that over 70% of the strata-related bank deposit market is held by one major Australian bank, which also processes a significant portion of the associated payments. We also believe there is a high level of fees associated with said payments.

Banks use customer deposits to fund a portion of the loans they provide (e.g., mortgages, car loans), generating a net interest margin (NIM) by lending at higher rates than those paid on deposits. Strata-related bank accounts, which typically earn low deposit rates, allow banks to achieve a higher-than-average NIM on these funds. Consequently, a bank with a significant share of the strata deposit market benefits from a substantial cost advantage and a stable, low-cost funding base, particularly when compared to term deposits, which may cost banks approximately 4-5% annually.

The 2024 Macquarie Strata Management Benchmarking Report indicates that only ~22% of Australian strata managers qualify as ‘higher-performing businesses’. According to the report, a key aspect of a higher-performing business is its investment in technology to create operational efficiencies and generate materially higher profit margins than the industry average.

It is no surprise that the strata industry is generally characterised by legacy technology systems, both from a strata banking perspective and a strata management perspective. We estimate that ~60% of strata managers rely on outdated DOS/Windows or on-premises software systems, which limit scalability and efficiency, forcing firms to hire more staff to manage growth. Consequently, as shown in the chart below, average profit margins in strata management have declined steadily over the past two decades.

Strata Managers - Average Profit Margin

The opportunity for UBN’s strata division lies in addressing these challenges, with revenue potential driven by three key factors:

1. Software Revenue Growth – At the close of FY25, UBN generated over $7 million in recurring revenue, purely from its strata management software, holding an estimated ~15% market share in Australia with a historical growth rate of ~3% per annum. Should the NAB payments portal gain traction within the strata management industry, we anticipate accelerated growth as managers adopt UBN’s software alongside NAB’s potentially best-in-class payment platform to maximise efficiencies. The chart below shows the potential based on the total lots in Australia.

Number of Strata Lots Using Software

2. Recurring Revenue from the NAB Payments Platform – Starting in FY26, UBN will receive a fixed recurring fee of $1.3 million from NAB for maintaining the payments platform. Additionally, UBN may receive variable recurring fees tied to the volume of strata-related bank accounts held with NAB. With an estimated $8 billion in strata deposits, UBN’s recurring revenue is expected to be tied to a portion of the net interest margin (NIM) generated from these deposits. UBN has publicly projected this opportunity at approximately $50 million annually, equivalent to an interest cost of ~0.625%.

3. Market Consolidation – Over the longer term, consolidation among strata software providers presents a compelling opportunity. With 3-4 providers each holding 15-20% market share, UBN stands out as the only major player with a fully cloud-based platform. Providers with legacy systems face a critical choice: invest heavily in cloud migration or merge with a provider like UBN that already offers a scalable, modern solution.

Looking forward, we believe UBN has the potential to generate more than $20 million p.a. in recurring revenue from its strata-related products over the next 3-5 years, with incremental revenue expected to deliver progressively higher margins. Importantly, this recurring revenue in theory will be very sticky, potentially commanding a premium valuation multiple in the market.

The next 12-18 months will be critical in determining the success of the UBN-NAB partnership and whether the strata industry truly understands the real benefits to them and their clients.

COG Financial Services (ASX: COG) – Board Overhaul and Strategic Reset

In last year’s letter, I outlined the critical changes we felt were necessary for COG to restore shareholder value and establish a sustainable path to growing earnings per share (EPS). Through early FY25, COG persisted with its prior strategy, resulting in a share price decline from $1.10 to a low of $0.86 in March 2025.

COG Financial - Share Price & Key Events

This trajectory shifted dramatically following a significant board overhaul: three directors, including the Chair, resigned, one transitioned to a non-executive role, and two new non-executive directors were appointed, with one assuming the Chair position. To support this transition, NAOS and other major shareholders sold a significant portion of their holdings, which enhanced liquidity in COG shares and enabled new directors and institutional investors to acquire meaningful stakes. We believe owning a smaller share of a revitalised, high-potential business is preferable to a larger stake in an underperforming company with limited prospects for improvement.

The most notable outcome of all the changes mentioned above was the appointment of Tony Robertson as Chair and John Dwyer as a Non-Executive Director. These appointments are significant for several reasons:

• Proven Insurance Broking Expertise – Tony Robertson and John Dwyer co-founded PSC Insurance (ASX: PSI), a listed insurance broking business that debuted in late 2014 at $1.50 per share and was acquired in mid-2024 by the UK-based Ardonagh Group for $6.20 per share, valuing the company at $2.26 billion. Over the ~9-year listing, a $1 investment in PSI grew to ~$7 (including dividends), delivering a ~25% IRR. Importantly, in our opinion, an insurance broking business shares many of the attributes of a finance broking business and, to a lesser extent, a novated leasing business. PSC’s success in driving organic growth, executing accretive acquisitions, and maintaining aligned management offers a proven playbook for COG’s transformation.

PSC Insurance - Share Price

• Track Record in Leading ASX-Listed Companies– Robertson and Dwyer have an exemplary track record of running a listed business and maintaining a strong business valuation. Many management teams find it challenging to lead a public company, often due to difficulties in managing expectations, communicating a clear strategy, and consistently focusing on key financial metrics, such as EPS growth, to demonstrate strategic execution. COG has historically lacked this discipline, resulting in an incoherent strategy and insufficient focus on EPS growth and return on invested capital (ROIC). Their expertise addresses this critical gap.
• Significant Alignment with COG Ordinary Shareholders – Once appointed, both Robertson and Dwyer were quick to acquire ordinary shares in COG. At the time of writing, Dwyer owns ~4.5m shares with a further ~2.5m options exercisable at $1.30, and Robinson owns ~2.5m ordinary shares with the same number of options. For us, this highlights their commitment to restoring COG’s value and driving consistent earnings growth over the medium term.

With the new Board in place, COG has swiftly advanced its simplification strategy. The sale of minority stakes in Earlypay Ltd (ASX: EPY) and Centrepoint Alliance Ltd (ASX: CAF) has generated ~$25 million in cash proceeds. The remaining step in this simplification effort, in our view, is addressing the Westlawn Group, COG’s asset management business. We believe this business contributes less than $2 million to group profitability but adds significant complexity to the balance sheet and cash flow statement due to Westlawn’s debenture program. If this business were to be sold, it would enable current and prospective shareholders to clearly see the capital-light nature and strong free cash flow generated by COG’s core operations.

Ultimately, for COG to achieve long-term success, it must deliver consistent organic earnings growth, even if that growth rate is ~5-10% p.a. While the full strategy is yet to be disclosed, we anticipate that Robertson and Dwyer’s insurance broking expertise will drive improvements in COG’s underdeveloped insurance broking division. Given the thousands of finance broking transactions that occur through a COG-owned or aligned broker, the potential for cross-selling insurance products is substantial.

At the very least, we believe COG now has a credible opportunity to unlock its full potential as Australia’s largest finance, broking & aggregation business. While its ultimate scale and valuation remain uncertain, comparable businesses with steady organic growth and strategic acquisitions have historically commanded premium earnings multiples. Accordingly, COG’s future valuation could be significant, provided it executes effectively under its revitalised leadership.

XRF Scientific (ASX: XRF) – New Core Investment

XRF Scientific stands out as an emerging company that has sustained consistent growth over the past five to ten years without significant equity issuance. Over the last decade, XRF has achieved compound annual revenue growth of ~10.6% and EPS growth of ~12.9%.

XRF Scientific - EPS & Return on Invested Capital (ROIC)

Founded in 1972 and listed on the ASX in 2007, XRF manufactures equipment and chemicals for sample preparation and analysis, serving production mines, construction companies and commercial analytical laboratories around Australia and globally. Its revenue model comprises upfront equipment sales and recurring consumable sales, the latter critical for maintaining machine performance in high-stress environments (e.g., extreme heat). In our view, XRF’s competitive edge lies in its unique ability to supply both equipment and consumables across the entire sample preparation workflow, unlike peers who typically offer only partial solutions.

In FY25, XRF is projected to deliver ~$60 million in revenue and ~$9.4 million in NPATA, with operating margins expanding from 5-8% five years ago to over 23% today. We attribute this margin growth to a new manufacturing facility in Melbourne, operational since circa 2019, as well as the increasing proportion of high-margin consumable sales, driven by the growing number of XRF machines in the market.

XRF Consumables Revenue & Profit Before Tax

Given XRF’s premium valuation, driven by its high-quality attributes, our focus is on how XRF can sustain revenue growth greater than 8% annually for the foreseeable future. We believe the following strategies will drive this growth:

• Expanding Market Share in Underpenetrated Regions (e.g., USA and Europe) – In Australia, XRF has gained significant market share in crushing and testing equipment in laboratories. Outside of Australia, XRF is still in its infancy, particularly in North America’s robust mining sector. By strengthening its direct sales network and distributor partnerships, XRF is poised to accelerate growth in these regions.
• Diversifying into Adjacent Industries (e.g., Cement and Water Testing) – XRF’s equipment is versatile, applicable beyond mining to industries like cement production, water processing, and food quality testing, where consistent analysis is critical. While these markets individually are smaller than mining, they collectively represent a substantial opportunity, currently accounting for less than 10% of XRF’s revenue.
• Leveraging Acquisitions for Technology Growth – The global sample preparation and testing market is surprisingly fragmented, with hundreds of small private businesses offering innovative but under-scaled technologies. XRF’s growing scale enables it to acquire highly complementary products, bypassing lengthy or costly in-house development. By integrating these technologies, enhancing them as needed, and leveraging its global sales and distribution network, XRF can unlock significant value. Recent acquisitions, though modest in immediate earnings impact, bring valuable intellectual property and product diversity. With minimal share dilution and cash outlay, these deals position XRF for substantial long-term growth.

Outlook for FY26

At our October 2024 national roadshows, we emphasised the goal of delivering a +10-20% return for the NAC portfolio in FY25, supported by the low valuations of our core holdings and modest earnings growth projections.

We are pleased to deliver a return of ~30% in FY25. This is further underscored by the promising outlook for our core holdings, particularly given their current valuations.

Below, I outline the key value-creating catalysts for select portfolio companies, underscoring their medium-term potential despite significant FY25 share price gains:

MaxiPARTS (ASX: MXI)

• First ‘Clean’ Full-Year Result – Over the circa three years since NAOS became a shareholder, MXI’s half-year and full-year results have been consistently impacted by one-off events, complicating the assessment of its true earnings potential. While these events have generally supported long-term value creation, they have introduced short-term complexity. Our investment thesis for MXI centres on it being a capital-light scaled distribution business, which generates strong cash flows, has solid (and growing) barriers to entry and enjoys a high degree of repeat business, bolstered by a structurally increasing demand for its products and services. For MXI, the FY25 result is expected to provide a clear financial picture, highlighting robust cash flow, rising margins, and revenue growth.
• Enhanced Capital Management Flexibility – MXI has deployed significant capital over the past 2-3 years to fuel its growth strategy and achieve scale. As the business transitions to organic growth, we anticipate substantial cash flow generation post-capex and lease obligations, further supported by income tax loss credits for the next ~12-18 months. This should shift MXI’s net debt position to a net cash position, granting the Board greater flexibility in capital management. With a current dividend payout ratio of just 30% of post-tax profits—despite no tax liability—an obvious option is to significantly increase this ratio or conduct a buyback should the share price continue to sit materially below intrinsic value.
• Entry into European Truck Parts Market – Supply Network Limited (ASX: SNL), trading as Multispares, competes with MXI in a similar, albeit slightly different space. SNL enjoys EBITDA margins roughly double what MXI currently generates. We believe this is largely due to its well-established catalogue of European as well as Japanese truck parts. We believe their dominance in European parts is so substantial that they are essentially the only aftermarket provider of scale, meaning the only alternative to the Original Equipment Manufacturers (OEMs) for European parts. Recently, Sampa, a European truck parts manufacturer, entered the Australian market with a major distribution centre in Truganina. Over time, this could provide MXI with access to a large-scale European parts catalogue. Recent history shows that MXI has a solid track record of growing its Japanese truck parts catalogue (see graph below), so hopefully, the opportunity with Sampa could potentially transform MXI’s European sales into a key driver of growth for the business.

MXI’s Japanese Sales

Bravura Solutions (ASX: BVS)

• Expert Leadership and Aligned Shareholders– BVS’s turnaround has been bolstered by new major shareholders, prompting significant board changes and a new CEO appointment in late FY25. Importantly, these new shareholders and directors with proven expertise from Constellation Software Inc. (TSX: CSU) have driven progress but have yet to fully shape BVS’s strategy and operations. We expect their influence to materialise in FY26, focusing on:

• A strong focus on value-based pricing and deeper engagement with existing clients to drive revenue growth.
• Maximising the efficiency and effectiveness of the current cost base.
• Disciplined capital allocation and proactive capital management to optimise returns.

Urbanise.com (ASX: UBN)

• Payments Portal Launch – UBN and NAB are prioritising an industry-leading payments portal, emphasising usability and functionality. Scheduled for launch in mid-FY26, the portal’s success will hinge on customer feedback, a critical factor in the UBN-NAB partnership’s long-term impact.
• Initial Product Uptake – Success for UBN going forward will depend on how many of Australia’s ~2.3 million strata lots transition to its integrated software and NAB banking platform. Following the launch, the speed and scale of adoption will be key to capturing a significant share of this market.
• Capital Management Initiatives – Based on the potential revenue opportunities available for UBN in their ANZ strata operations, we anticipate that the company will focus on high-return, low-risk opportunities. This could involve capital management initiatives to prioritise the strata business.
• NAB’s Option Exercise – As part of the original agreement, NAB can acquire an additional 4.99% of UBN at $1.255 per share within 12 months of the payments portal launch, increasing its stake to 19.99%. This option could signal confidence in the partnership’s progress.

COG Financial Services (ASX: COG)

• New Board and Strategic Overhaul – Following the March 2025 board renewal, new Chair Tony Robertson and Director John Dwyer, former PSC Insurance founders, have yet to fully implement their vision for COG. Their expertise suggests a simple and repeatable strategy with an emphasis on driving consistent organic growth, which we expect to take shape in FY26.
• Business Simplification – As previously stated, COG’s CY23-24 share price decline stemmed from poor capital allocation and operational complexity. We have already seen steps to unwind this complexity via sales of COG’s minority investments in Earlypay (ASX: EPY) and Centrepoint Alliance (ASX: CAF). Divesting Westlawn Finance, which adds over $100 million in assets and liabilities via its debenture program, would further simplify COG’s balance sheet and clarify its cash flow profile.
• Insurance Broking Opportunity – COG facilitates ~$10 billion in annual finance for assets and equipment. Insurance broking has always been considered a growth lever for COG, given the complementary nature of offering insurance alongside finance for the purchase of business-critical equipment. COG’s insurance broking strategy has historically underperformed, falling short of expected growth. With the expertise of the new directors, we anticipate a renewed focus on revitalising this division. Given COG’s scale in finance broking, facilitating thousands of significant transactions annually, enhancements to the insurance broking operations could drive substantial organic growth for years to come.

MOVE Logistics (NZX/ASX: MOV)

• Stabilised Leadership – MOV has faced significant challenges from adverse economic conditions and management missteps, marked by two CEO resignations over the past three years. FY25 marks the first full year under the leadership of CEO Paul Millward and a refreshed executive team. Given the team has only been together as a group for <6 months, we don’t expect transformative results immediately, but a stronger 1H FY25 and optimistic FY25 guidance suggest a robust 2H and instil confidence in MOV’s path to profitability in FY26.
• New Zealand Economy Recovery – Through late FY25, New Zealand’s economy endured a two-year recession, marked by budget constraints, high interest rates, and reduced post-COVID immigration, performing worse than many developed nations. With a new government and declining interest rates, expected to continue, early signs suggest rising economic activity. For MOV, a logistics provider, this could drive significant tailwinds: (1) increased volumes from existing customers, (2) improved pricing power, and (3) less aggressive tendering as competitors prioritise efficiency over volume. While the timing, FY26 or FY27, remains uncertain, any economic upturn could substantially boost MOV’s profitability.
• Market Consolidation – New Zealand’s logistics sector remains fragmented, with numerous small private operators and a single dominant player. Due to the recent downturn, as well as ageing ownership (e.g. baby boomers), a significant number of these private operators have ceased trading or, in our view, will exit the logistics industry in the near term. We expect this trend to continue or even accelerate, as operators must have the network, systems, and assets to run an efficient and productive business that can offer clients a clear value proposition, as opposed to a pure trucking-only operation.

While the catalysts outlined above may seem granular, we believe their realisation in FY26 could drive significant shareholder value, particularly if accompanied by a valuation re-rating and sustained earnings growth. This underpins our conviction that the intrinsic value of our investments far exceeds their current share prices, even after NAC’s impressive +28.92% portfolio return in FY25.

I look forward to updating you over the next 12 months on the progress of these investee companies concerning these catalysts, and we remain confident that many should materialise as anticipated. The NAOS team and I remain steadfastly committed to delivering sustainable, positive returns for all NAC shareholders through a concentrated portfolio of Australian and New Zealand emerging companies.

I would also like to acknowledge our long-standing NAC shareholders for their unwavering support, particularly during periods of performance volatility. As a sign of my confidence in NAC’s long-term value creation, I have continued to acquire shares and will do so as long as this potential remains.

Kind regards,

Sebastian Evans
‍Managing Director and Chief Investment Officer

NAOS Asset Management Limited