SILVER CHEF ANNOUNCES MAJOR RESTRUCTURING

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1 SILVER CHEF ANNOUNCES MAJOR RESTRUCTURING MEDIA/ASX ANNOUNCEMENT 26 February 2018 Silver Chef Limited (ASX: SIV) announces today, in conjunction with its first half results, that it has made the decision to exit its GoGetta business. As a result, there will be renewed focus on the hospitality business in order to maximise the growth opportunities in both Australia and overseas. This is a significant change in the strategic focus of the Company and provides a pathway to continued growth and expansion over coming years. The Company s first half financial results have been significantly impacted by additional provisioning. The Company indicated at 30 June it was undertaking a rigorous strategic review of GoGetta. The business remains profitable and the execution of a comprehensive strategic plan has improved performance in the first half of FY18. GoGetta s underlying financial performance, as measured by return on assets (ROA), improved in the first half. Despite this, the Board and Management believe it is in the best interests of shareholders to exit the GoGetta business as there remains a considerable challenge in achieving acceptable returns comparable with the proven hospitality brand. Effective immediately all sales and marketing activities in the GoGetta business will cease and the Company will exit existing customer contracts in an orderly manner over the next 12 to 18 months. Silver Chef Chief Executive Officer Damien Guivarra said the decision, while difficult, will allow the Company to focus exclusively on the domestic and international expansion of its core hospitality business which it knows well and continues to deliver strong shareholder returns. Bringing our focus back to a single brand operating under a proven model will allow us to dive deeper into the hospitality industry where we know we can drive profitable growth and returns, he said. It will also allow us to sharpen our focus on strong growth opportunities in North America and New Zealand. As part of the run-down of the GoGetta business approximately 12 staff will be re-deployed to the core hospitality division with a further 39 staff to leave the business. As a purpose-driven company and a certified B-Corp, the decision to make staff redundant was not an easy one and the Company is working closely with staff to ensure their welfare is a priority. A core team will be retained within GoGetta to manage the orderly running-down of existing contracts and asset remarketing program. The Company will work closely with clients, vendors and brokers to ensure the process is completed in a timely manner that minimises financial and reputational risk. Redundancy costs estimated for the exit of GoGetta are expected to initially be in the order of $3M (before tax) and will largely be brought to account in the second half of FY18. Recovery of arrears and assets in the GoGetta Back Book of poor performing customer contracts, particularly in the Light Commercial channel, has provided significant challenges. The Board has elected to recognise additional non-cash impairment provisions in the first half result reflecting in part the decision to exit GoGetta. The Board however is confident of realising the pre-provision book value of GoGetta net assets through the exit process. Business Transformation The Silver Chef business will undertake a significant transformation project to facilitate the next stage of growth, post the decision to exit GoGetta.

2 The project includes a restructuring of the Company s Australian operations, continued expansion in North America and a complete overhaul of the Company s digital capabilities. The Australian business will be consolidated under a streamlined management structure. As part of the transformation project, the business recently completed a restructuring of the executive management team. Rob Phelps (previously Executive General Manager of Silver Chef s Northern Region in Australia) has been appointed to the position of President - Silver Chef Canada; Chief Financial Officer (CFO) Doug McAlpine has been appointed as Executive General Manager of the consolidated Australian and NZ business; and Group Finance Manager, Michael Darke, will take on the role of Acting CFO as the Company works through the recruitment process for a permanent replacement. Mr Guivarra said Canada remains a vast opportunity for the business. We are committed to ensuring the Canadian business has the appropriate human and capital resources to grow a significant presence and contribution to overall group performance, he said. Mr Guivarra said the transformation project and the deep focus on one global hospitality brand, based on its 30 years of experience in the sector, will support the Company s next stage of growth and profitability. We have the resources to develop and implement a new business structure and a focus that will be fundamental to delivering the full benefits of a one-brand strategy over the medium and long term, he said. We are looking forward to exploiting the full potential of a business with a single brand targeting proven markets. The transformation project comprises four pillars: 1. Silver Chef will become a single brand dedicated solely to hospitality. This sharper focus will enable a deeper understanding of both customers and the industry, which will unlock additional growth in dedicated hospitality channels such as coffee and franchise; 2. A restructure of the Australian business will support this strategy, create national alignment and enable the operational teams to focus on delivering further growth in the domestic market; 3. The Group will continue its aggressive expansion into the North American market on the back of in-depth market and customer intelligence, and customer focused technology; 4. The Group will utilise available capital to accelerate development of technology over the next three years to continue to build scalable systems to improve both customer experience and internal efficiencies. First Half Financial Overview The statutory accounting loss for the Silver Chef Group for the six months to 31 December 2017 is $13.1 million after taking into account additional provisioning that has been recognised against aged GoGetta arrears and unrecoverable rental assets. This compares to a statutory accounting profit in the previous corresponding period of $4.6 million. The statutory results are summarised below:

3 ($ million unless otherwise stated) 31 December December 2016 Change Revenue % Rental assets (at cost) and finance lease receivables % Net operating profit/(loss) after tax (13.1) Net operating cash flows % Basic EPS (cents per share) (33.3) Dividend (fully franked) The performance of the GoGetta business for the first six months and additional provisions taken have had a substantial effect on the 31 December 2017 results as set out below: ($ million unless otherwise stated) Hospitality GoGetta Unallocated overheads Revenue EBITDA (13.5) 58.8 Profit/(loss)before tax 14.2 (18.3) (14.5) (18.6) Net operating profit/(loss) after tax 9.9 (12.8) (10.2) (13.1) Total Hospitality Result The Hospitality business contributed profit before tax and group overheads of $14.2 million against a previous corresponding period of $18.7 million. The hospitality result is calculated after recognising provisioning against the risk of specific aged receivables and unrecoverable rental assets of $4.8 million (before tax). The Company has elected to take additional provisioning against these exposures as part of repositioning the Australian business for strong future earnings growth under the revised management structure discussed above. The first half result reflects slightly softer activity levels in Queensland and New South Wales offset in part by an excellent contribution from New Zealand. Canada s contribution to the group earnings position remains small, but slightly below our expectations based on its asset base. Financial Outlook As the business reconfigures to support a hospitality only strategy, group overheads will be carefully reviewed to ensure the cost structure is appropriate to support the restructured business. As a result of supporting the GoGetta exit strategy and managing an orderly reduction to the Group s overhead structure it is likely that some cost inefficiency will be carried during the period to 30 June 2018.

4 The earnings outlook for the full year is materially changed as a consequence of the decision to exit GoGetta. The Company now expects to report a statutory net accounting loss in the range of $9 million to $12 million. The underlying hospitality pre-tax contribution to that result is a profit in the range of $20 million to $24 million. A summary of the upper end of these expectations is as follows: ($ million unless otherwise stated) Hospitality GoGetta Overheads Ongoing operations 40 - (16) 24 Discontinuing operations - (1) (11) (12) One-off additional impairments (5) Profit/(loss) before tax 35 (21) (27) (13) Income tax (10) Net profit/(loss) after tax 25 (15) (19) (9) (20) - Total (25) The Company s long term financial goal is to deliver sustainable return on equity from the hospitality business in the range of 20%-25% in keeping with the historical performance of that business. Capital Management Renegotiation of the Company s senior lending arrangements has commenced to accommodate the Company s new operating circumstances. Financial covenants will need to be restructured to reflect a hospitality only business in the future and separate arrangements for repayment of the GoGetta share of senior debt on an accelerated basis will also need to be agreed. The Company expects to conclude these negotiations by 31 March Once the terms of the senior lending arrangement are amended the Company s intention is to immediately utilise the securitisation warehouse facility announced in December 2017 to support future growth. The Company has received a waiver for the technical breach created by the decision to exit GoGetta and the additional provisioning taken as at 31 December As a consequence of the need to renegotiate the senior facility as described above, the Company is required to record the entire drawn amount as current in the 31 December 2017 financial statements. The renegotiated debt funding position will be reflected in the 30 June 2018 financial statements. The Company is in a strong financial position with securitisation funding ready to be drawn following renegotiation of the syndicated facility, and a significant level of cash will be generated as it exits GoGetta. Strategic Outlook The Board and Management believe the decision to discontinue the GoGetta business will deliver sustained growth, higher return on equity and profitability over the medium and long term. The winding down of the GoGetta business will allow the Company to focus exclusively on growth in the core hospitality market in Australia while investing further into markets with high growth potential like Canada and New Zealand.

5 Mr Guivarra said the Silver Chef brand, business model and partner network are all significant competitive advantages that had allowed the Company to deliver consistent growth for over 30 years. We believe there is significant untapped addressable market in the Australian hospitality industry, both in our existing channels and new channels, and when combined with an exponentially larger offshore market, we are confident in the opportunities available to grow Silver Chef. The Company will continue to invest heavily in technology over the next three years to effectively and efficiently scale the business and to continue delivering outstanding customer experience. ENDS Media enquiries to: Ben Ready Director RG Communications About Silver Chef Silver Chef was established in 1986 to help businesses fund their equipment needs through the Rent-Try- Buy and Rent-Grow-Own Solutions. This keeps their options open and preserves their cash to grow their business. Silver Chef Limited is an Australian Securities Exchange-listed company (ASX Code: SIV) focused on long term rentals of commercial equipment to small-to-medium enterprise in the hospitality space. The company has a significant presence in Australia and growing exposure to the New Zealand and North American markets.