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Update to all PWC shareholders regarding share redemption requests

July 28, 2023

I wanted to update you regarding share redemptions in Primary Wool Co-operative Limited (PWC).

As you are well aware it is some considerable time ago that PWC exercised any redemptions of ordinary shares. Through our investment in Carrfields Primary Wool and NZ Natural Fibres, we had considerable demand on capital in both businesses and were unable to exercise redemptions. That partnership with Carrfields was wound up toward the end of 2021 and we formed a new partnership together with Wools of New Zealand Holdings Limited.

PWC is 100% reliant on income from its investment in the Wools of New Zealand Limited Partnership (WNZLP) to provide the cash to fund redemptions.

With the downturn in the wool industry which was exacerbated by the lingering effects of Covid-19, PWC has yet to receive any return or cash from its 50% investment in WNZLP. WNZLP is working tirelessly on the wool carpet trading arm of the business with the continued aim of generating new demand for wool and ultimately increasing the trading price for wool. The partnership also successfully continues its wool trading business.

Until PWC receives a satisfactory cash return from WNZLP, all cash redemptions will continue to remain on hold, unfortunately. We simply must wait until it is prudent and possible to pay them out. We appreciate that this will be frustrating news for all our loyal and trusted shareholders, but it is a prudent approach consistently taken by the directors.

Our new strategy at WNZLP will give the Partnership the best chance to generate cash returns to PWC in the future.  This will take time and require patience from our shareholders. While I can’t give you a date when redemptions will be paid out, please be reassured that achieving this remains our highest priority for the Co-operative moving forward.

Shareholders are free to join the Board of Directors at the upcoming AGM (10 August 2023) where they will be able to provide you with further updates on their plans for the future of the business.

Thank you kindly for your patience and on-going support.

Richard Young