Warehouse Limited, Annual Meeting 2025

17 November 2025

Warehouse Limited (WHS)

The company will hold its Annual Shareholders Meeting at 10.00am Friday 28 November 2025.

The location is The Warehouse Group Store Support Office, 26 The Warehouse Way, Northcote, Auckland.

You can also join the meeting online at this link.

Company Overview

The company comprises three core brands: The Warehouse, Warehouse Stationery, and Noel Leeming. It employs over 10,000 people in 216 physical retail stores plus distribution centres throughout New Zealand and has three international sourcing offices in China. India and Bangladesh. It also has an online presence.

The Chair, Dame Joan Withers, who has served on the Board since 2016 will retire at the ASM and be replaced by John Journee. Robbie Tindall who has served on the Board since 2011 will also retire from the Board. Hamish Rumbold was appointed to the Board in November 2025.

Mark Stirton, the former Group Chief Financial Officer was appointed Group Chief Executive Officer with effect from 1 August 2025.

Current Strategy

The Warehouse Group’s strategy is anchored in restoring profitability and positioning the business for sustainable growth. The company’s purpose is “to build exceptional retail brands” that customers love, their team takes pride in and that deliver sustainable shareholder returns.

This strategy follows the resignation of the previous permanent CEO, Nick Grayston, who had championed an ‘agile’ structure throughout the company. On his departure during 2024, the company restructured to a more traditional organisational model.

On November 17^th, the company announced a further restructure to trim operational costs to below 31% of sales, focused on head office roles.

Previous Year Shareholder Meeting

NZSA recorded the following key items at last year’s annual shareholder meeting:

1. This was a sombre AGM, with both the Chair of the Board, Dame Joan Withers, and the acting CEO, John Journee, noting that this was the most challenging year in the company’s 40-year history.
2. Acting CEO, John Journee, expressed considerable enthusiasm and energy for the change to the brand-led strategy from the previous group ecosystem strategy.
3. Retail sales were down 11% at $3.038 billion.

The meeting report is available at this link.

Disclaimer

To the maximum extent permitted by law, New Zealand Shareholders Association Inc. (NZSA) will not be liable, whether in tort (including negligence) or otherwise, to you or any other person in relation to this document, including any error in it.

Forward looking statements are inherently fallible.

Information on www.nzshareholders.co.nz and in this document may contain forward-looking statements and projections. For any number of reasons, the future could be different – potentially materially different. For example, assumptions may be wrong, risks may crystallise, unexpected things may happen. We give no warranty or representation as to any future financial performance or any other future matter. We may not update our website and related materials for changes.

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There are no representations as to accuracy or completeness.

The information, calculations and any opinions on www.nzshareholders.co.nz and in this document are based upon sources believed reliable. The NZSA, its officers and directors make no representations as to their accuracy or completeness. All opinions reflect our judgement on the date of communication and are subject to change without notice.

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Key

The following sections calculate an objective rating against criteria contained within NZSA policies.

Governance

NZSA assessment against its key policy criteria are summarised below.

Directors Fees:  Generally good disclosure. The company’s Constitution includes the provision of retirement benefits to Directors; however, we note that the comprehensive disclosure provided in the Annual Report includes a table with a heading “shares or other benefits” with no amounts recorded.

It is not disclosed if special exertion payments are made for additional work although again, we note the Annual Report table does not include any payments.

Director Share Ownership:  Directors are required to own shares, but only after they have served as directors for five years. NZSA encourages share ownership, but does not (generally) support compulsion – this may impact independence, director diversity and the ‘market signals’ associated with director trading. In mitigation, NZSA notes the long lead time; on this basis, we do not consider this a barrier to those factors.

Five of the company’s seven directors are disclosed as holding shares.

CEO Remuneration:  The company discloses its remuneration policy on its website, which includes an overview of the remuneration philosophy applicable to the company. The People and Remuneration Committee are responsible for implementing the policy.

Incentives: The current CEO is paid a short-term incentive (STI) and a long-term incentive (LTI), both in cash. However, for FY25, the Acting CEO (John Journee) was not entitled to any form of STI or LTI as part of his remuneration agreement.

NZSA encourages fulsome disclosure in relation to any incentive payments made to the CEO, including disclosure of measures (or measure ‘groups’), weightings, targets, and the level of achievement versus target for each component associated with any awards. This methodology is supported by the NZX Remuneration Reporting Template.

The STI is awarded at a target of 50% of base salary with a maximum achievement at 60% of base salary. For the current CEO, Mark Stirton, the STI methodology for FY26 is disclosed, with the financial weighting now at 70% with the personal targets weighting at 30%.

The LTI is awarded at a target of 50% of base salary, with a performance maximum of 75% of base salary. The measure is total shareholder returns (TSR) which is favoured by NZSA as it aligns with shareholders’ interests. As noted above, the CEO was not entitled to any LTI award for FY25.

The company is one of few that offers disclosure of both the gender pay gap and CEO/employee remuneration ratio. We note there is no gender pay gap; all employees are paid according to the role rather than their gender.

Golden Parachutes: In the interests of transparency, NZSA believes there should be explicit disclosure around the severance terms and notice periods associated with the CEO, including whether specific termination payments are offered.

There is no disclosure around the terms and conditions of the new CEO’s termination arrangements, although NZSA acknowledges that his appointment took effect after the end of the financial year.

Director Independence:  Most directors are independent. John Journee is considered non-independent by the Board, given his recent role as the company’s interim Chief Executive. NZSA does not consider this short-term appointment, made under extenuating circumstances, a barrier to his longer-term independence nor his ability serve as an independent Chair.

Board Composition:  NZSA appreciates the full disclosure of an individual skills matrix that allows investors to make their own judgements as to how Director’s skills relate to the core skills required by the company.

We also appreciate WHS’s commitment to developing New Zealand’s Director capability, through participation in the IoD’s Future Director Programme. The company has appointed the largest number of participants in the Programme.

The nature of the company’s board indicates a commitment to thought, experiential and social diversity, with relevant experience for The Warehouse Group.

Director Tenure:  NZSA looks for evidence of ongoing succession or ‘staggered’ appointment dates that reduce the risks associated with effective knowledge transfer in the event of succession. We also prefer a term maximum of 9-12 years, unless there are exceptional circumstances that may apply.

With the retirement of Dame Joan Withers and Robbie Tindall, directors’ appointment dates range from 2020 to 2024, indicating a commitment to succession planning as well as the requirement for governance to support the company’s new strategy. We note that post-ASM, three of the company’s six directors have had strong operational retail industry experience, with a further two directors offering a strong link to technology.

ASM Format: Warehouse Limited is holding a ‘hybrid’ meeting, (i.e., physical, and virtual), a format preferred by NZSA as a way of promoting shareholder engagement while maximising participation.

Independent Advice for the Board & Risk Management:  NZSA looks for evidence, through disclosures, that a Board has access to appropriate internal and external expertise to support board assurance activities. We also look for disclosure of key risks and risk governance activities.

Directors can access independent external advice following the process set out in the Board Charter. Directors and the Company Secretary have unfettered access to each other. 

The Company has an internal audit function that is independent of the Company’s external auditors. The internal audit function of the Company is undertaken by the Company’s own internal audit team with the assistance of a co-source internal audit partner. KPMG replaced Ernst & Young as the Company’s co-source internal audit partner during the 2025 financial year. The internal audit team reports to, and is directed by, the Audit and Risk Committee

The company offers excellent disclosure of strategic, financial, business, and operational risks, the company’s risk appetite, individual mitigations, and the processes by which these are governed.

Audit

NZSA assessment against its key policy criteria are summarised below.

Audit Independence:  Good disclosure.

Audit Rotation:  The company ensures the Lead Audit Partner is rotated at 5 years as required by the NZX Listing Rules however the appointment and rotation of the Lead Audit Partner is not disclosed. PwC were appointed Auditor in 2004. NZSA encourages the company to provide further detail in relation to audit tender and/or renewal processes.

Environmental Sustainability

Overall approach: The Warehouse Group has made solid progress in aligning with the Aotearoa New Zealand Climate Standards. Its FY2025 climate-related disclosures reflect a maturing approach to governance, metrics, and emissions reduction. Notably, it achieved a 45% reduction in Scope 1 and 2 emissions against a FY23 base and met its sustainability-linked loan target ahead of schedule. While The Warehouse is not in a high-emissions sector, it has taken its obligations seriously, developing a Climate Transition Plan and integrating climate risk into its enterprise systems. In addition, even though a pathway to Scope 3 disclosure is in place and partial data is reported, NZSA expects this to be followed through with full, quantified Scope 3 emissions and target setting in FY2026.

Sustainability Governance: The board retains formal oversight of sustainability and climate matters, supported by its Environmental and Social Sustainability (ESS) Committee, which provides strategic and governance leadership. Executive management responsibility lies with the GM Sustainability and the Operational Sustainability Committee. Sustainability responsibilities are well-embedded, and the board’s skills matrix confirms environmental and CSR capability. The governance structure supports board-level accountability and regular review of climate issues across operations.

Strategy and Impact: The Warehouse has developed its first Climate Transition Plan, built around four levers: decarbonising operations, enabling customer emissions reduction, circular initiatives, and value chain decarbonisation. The strategy is aligned with commercial planning and embedded in the FY26–28 business strategy. Adaptation measures are included, though no standalone roadmap with defined milestones is disclosed. Given the company’s low risk profile, NZSA views this as proportionate but expects further development. Actions to date include solar-powered stores, partial fleet electrification, and energy efficiency upgrades. Transition planning is integrated but still maturing.

Risk and Opportunity: The company’s enterprise risk management system incorporates climate risk, which is reviewed at both the executive and board levels. While the Group does not operate in a climate-exposed industry, it recognises risk exposure through its supply chain and logistics network. Some risks (e.g. insurance availability, acute weather disruptions) have been flagged for further monitoring.

Metrics and Targets: The Warehouse reports detailed emissions inventories for Scope 1 and 2, including year-on-year comparisons against a FY23 baseline. A 65% reduction target by FY30 is in place, with a net-zero ambition by 2040. FY25 performance shows a 45% drop in Scope 1 and 2 emissions, exceeding interim targets. Partial Scope 3 data was disclosed under the permitted deferral, and the company signals full Scope 3 reporting will follow in FY26. Other metrics include sustainable packaging coverage, waste diversion, and private label sustainability attributes.

Assurance: Limited assurance was provided by Bureau Veritas over FY25 energy, emissions (Scope 1, 2, selected 3), and waste disclosures, including some recalculated data for FY24 and FY23. NZSA considers the scope appropriate and encourages continued expansion as Scope 3 reporting matures.

Ethical and Social

NZSA assessment against its key policy criteria are summarised below.

Whistleblowing:  Good disclosure.

Political Donations:  There is a clear statement in the Annual Report that political donations are not made.

Financial & Performance

The Warehouse’s share price fell from $1.07 to $0.80 (as of 20^th October 2025) over the last 12 months – a 25% decline. This compares unfavourably with the NZX50 which rose 4% in the same period. The capitalisation of WHS is $277m, placing it 60^th out of 115 companies on the NZX by size and makes it a mid-sized company.

¹ per share figures based off actual shares at balance date (not weighted average)

² Attributable to shareholders of the parent.

³ Includes Torpedo 7. Metrics associated with T7 are excluded in 2024 and 2025.

The Warehouse have now had two-three consecutive disappointing years, and the market has responded by dramatically slashing the value of the company from $1,394m in 2021 to only $277m today. In addition to a tough New Zealand domestic economy, competition is also affecting their business model.

There are also some potential debt issues, with the debt equity ratio elevated at 4.30. NZSA acknowledges that this ratio is adversely affected by IFRS 16requirements that lease liabilities are stated in the balance sheet. WHS has a total future lease liability of $714m, while current borrowings increased to $135m (up from $82.9m in 2024). Offsetting this somewhat, the company also has cash at bank of $39m.

Note 11.2 in the financial statements sheds more light on this current debt position. The company does have available bank credit facilities of $450m, which seems incongruous considering total equity is only $300m.

Most metrics declined on the prior year. Revenues were up 2% to $3,088m, but the gross margin declined to 32%. Operating profit from continuing operations was down by 40% to $40.5m meaning that WHS reported NPAT of -$2.4m.

Operating profit as a percentage of Revenue is 1.3%, highlighting the wafer-thin available margin for the company. As noted above, the company’s announcement that it intends to restructure to reduce operating costs is acknowledgment of this situation.

The Warehouse (appropriately) did not pay dividends in FY25.

Operating cashflows were positive, but down 61% to $72.3m on flat inventory levels. This equates to $0.21 when translated to cents per share. Inventory turnover was up 6% to 4.41. Inventory turnover is a useful metric that measures efficiency of inventory management for a retailer. Inventory turnover measures how often during a period (in this case annual) the company turns over its stock.

NTA per share rose slightly to $0.46 and the company trades at a 73% premium to its NTA, indicating that the market holds a sentiment that future positive cashflows are likely to benefit shareholders.

The company released an investor presentation in conjunction with their annual results and provided some non-quantifiable forward-looking statements in particular; “The retail environment in New Zealand remains challenging, with low consumer confidence and ongoing cost-of-living pressures impacting household spending. This is expected to persist for the balance of 2025”. 

Sir Stephen Tindall remains the largest shareholder with a 27.01% interest in the company and the Tindall Foundation is the 2^nd largest shareholder with 21.31%.

Resolutions

Caroline Rainsford was appointed to the Board in August 2022. She is the Country Director for Google NZ, where she is responsible for driving the overall revenue and business strategy for New Zealand. Partnering with government, policy teams and New Zealand business leaders, she is focused on helping New Zealand businesses grow and transform in the digital age. Prior to joining Google in 2017, Caroline was the Marketing and Product Director for the Latitude NZ (previously GE Capital) business as well as the Brand Director for the Australian and New Zealand regions. Her earlier career included roles with Philips Royal Electronics in the Middle East, Turkey and Africa. Caroline holds a Bachelor of Commerce (Hons) from the University of Auckland.

We will vote undirected proxies IN FAVOUR of this resolution.

Hamish Rumbold was appointed to the Board 1 November 2025 and is therefore required to offer himself for election. He is a Non-Executive Director with multi-sector expertise across key governance domains: customer experience, digital and data strategy, technology transformation, cybersecurity, and risk & compliance.

He is a governance professional and a graduate of the Australian Institute of Company Directors (AICD). Hamish currently serves as a Non-Executive Director for House of Travel Holdings and Livestock Improvement Corporation (LIC). He is also the Non-Executive Director and Chair of Perigee HoldCo Limited, a majority private equity-owned FX remittance business trading. Hamish previously held general management and executive roles with Air New Zealand and Kiwibank.

We will vote undirected proxies IN FAVOUR of this resolution.

This is an administrative resolution.

We will vote undirected proxies IN FAVOUR of this resolution.

Proxies

You can vote online or appoint a proxy at https://nz.investorcentre.mpms.mufg.com/voting/WHS  

Instructions are on the Proxy/voting paper sent to you.

Voting and proxy appointments close 10.00am Wednesday 26 November 2025.

Please note you can appoint the Association as your proxy. We will have a representative attending the meeting.

The Team at NZSA