Business Transformation for Growth

1. Business Transformation for Growth Grant Rockman CFO M G Kailis Group

2. MG KAILIS GROUP OF COMPANIES

3. MG Kailis Group History • Established by the late Michael George Kailis by selling his wife’s car • In 1967 Michael convinced three Cray fishermen in Dongara to convert their vessels to Prawn vessels to experiment with Prawning off the Exmouth Coast, WA • In the 70’s we developed the ‘K Class’ fishing vessels and built over 100 vessels • With our Prawn infrastructure we developed the Pearl Production business off the coast of Broome, - became second largest pearl producer. • In early 2000’s developed the Tropical Rock Lobster Industry in Cairns

4. Prawning in 1967 in Exmouth

5. Prawning today in Exmouth

6. Balance Scorecard Strategy Map – Seafood Business

7. Objective: Raise Fish Trawl Productivity • Traditional fishing methods: • hours can be wasted, fish in areas at wrong times, fishing by markers • There is no controlled alignment between fish caught and market demand. • Retailers now award supply contracts based on specie Project: A Data Driven Targeted Fishing Strategy Challenge Solution Results • move to a ‘Targeted Fishing Strategy’ to reduce fuel cost, person exertion, increase catch rate and target specific species. • Requires a transformational process involving: vessel technologies, business analytics, and industry based data scientist and data warehouse support. • In operating two different vessels for 6 months, one using the traditional methods and the other using data driven method we achieved: • A catch rate improvement of over 30%. • A profit improvement of over $400k

8. Fish Trawl Hours Utilisation Report by Area

9. Objective: Optimise Ship Repair & Maintenance Staff Utilisation • Workforce Requirements are project based and highly seasonal • Trade requirements are highly variable dependent on the project • Short range pipeline visibility Project: Data Driven Trade and Project Management Challenge Solution Results • Employee key staff, and transform 60% of workforce as project based contractors • Use business analytics to review and monitor utalisation by trade daily • Use historical data to forecast future labour requirements • An increase in utalisation by 5% • significant pipeline growth from being able to rapidly scale quality labour aligned to project requirements.

10. Kailis Marine

11. Kailis Australian Pearls

12. Objective: Increase ‘Number of Doors’ Selling Kailis Jewellery Objective: Increase ‘Number of Doors’ selling Kailis Jewellery • Luxury jewellery requires a tactile experience • Excess slow moving inventory freezes the flow of working capital • MRP process did not integrate inventory ‘sold’ to retail and wholesale channel Project: Integrate Business Analytics into MRP Process Challenge Solution Results • Utilisation of business analytics to incorporate inventory ‘sold’ by production by held in a Retailer’s inventory • Development of Vendor and enhanced consignment model to increase physical inventory exposed to the end customer • Growth in wholesale channel footprint • Removal of bottleneck of slow moving items held with stockists • Improved efficiency in working capital management