BKI Investment Company Limited

2015 ANNUAL GENERAL MEETING

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BKI Investment Company Limited

CHAIRMAN’S ADDRESS

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Disclaimer

This material has been prepared by BKI Investment Company Limited.

The information within this document is not intended to provide advice to investors or take into account an individual’sfinancial circumstances or investment objectives. This is general investment advice only and does not constitute adviceto any person. The opinions within this document are not intended to represent recommendations to investors, they arethe view of BKI Investment Company Limited as of this date and are accordingly subject to change.

Information related to any company or security is for information purposes only and should not be interpreted as asolicitation of offer to buy or sell any security. The information on which this presentation is based has been obtainedfrom sources we believe to be reliable, but we do not guarantee its accuracy or completeness.

Investors should consult their financial adviser in relation to any material within this document.

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Non Executive Directors

Robert Millner Chairman of the BoardChairman of the Investment CommitteeMember of the Remuneration Committee

David Hall AM Independent Non-Executive DirectorChairman of the Audit CommitteeMember of the Nomination Committee; Remuneration Committee

Alex Payne Non-Executive DirectorChairman of the Remuneration CommitteeMember of the Audit Committee, Investment Committee; Nomination Committee

Ian Huntley Independent Non-Executive DirectorMember of the Audit Committee, Investment Committee; Remuneration Committee

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Management

Thomas Millner Chief Executive OfficerInvestment Committee

Will Culbert Senior Investment AnalystInvestment Committee

Jaime Pinto Company SecretaryCorporate Administration Services

Martin Bocxe MGI Sydney

Auditors

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Delivering Strong Results

2015 2014 Growth

Ordinary Dividend Income $44.6m $38.6m 16%

Net Operating Result* $40.9m $35.9m 14%

Earnings Per Share* 7.40cps 7.15cps 4%

Total Ordinary Dividends Per Share 7.20cps 6.95cps 4%

Management Expense Ratio (MER) 0.18% 0.17%

* Excluding Special Dividends

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Why we do what we do…

…because we are also shareholders in the Company.

6.4% Grossed up

DividendYield

0.18%ManagementExpense Ratio

…We invest for the long term with an aim to createwealth for BKI shareholders, through an increasing fullyfranked dividend and capital growth

…We focus on keeping costs low, we do not chargeexternal portfolio management or performance fees

Grossed up yield, based on a tax rate of 30% and share price as at 30 September 2015.

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The thicker

the carpet…

The thinner

the dividend!

Low Cost + Income Growth

Low Costs - BKI Management Expense Ratio Growing Fully Franked Dividends - BKI Dividends paid to shareholders

0.18%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

0.80%

2.0

0

2.1

0

2.2

0

2.5

0

2.5

0

2.6

0

2.7

0

3.0

0

3.0

0

3.0

0

3.0

0

2.5

0

2.7

5

3.0

0

3.0

0

3.2

0

3.2

0

3.2

5

3.4

0

3.4

5

3.5

0

3.5

5

3.6

5

1.0

0

0.5 0

.50

1.0

0

0.5

0

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50Ordinary Dividends Special Dividends

Over 20 years,

administration

fees of 2.0% can

dilute the total

return on an

investment by

more than 30%!

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Low CostBased on $100,000 investment in a Listed Investment Company, using a 10% return pa over a 20 year period.

$651,072

$560,441

$466,096

$21,678

$112,309

$206,654

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

Income to the Shareholder Administration Fees

0.18%pa MER

1.0%pa MER

2.0%pa MER

0.18% 1.00% 2.00%

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Income GrowthDividends + Franking Credits received from a $100,000 investment in BKI at inception versus Bank Quarterly Interest.Highlights the opportunity of receiving a fully franked dividend in a falling interest rate environment.

Source: BKI; Bloomberg. An investor who spent the equivalent of $100,000 to purchase BKI shares upon listing in December 2003 would have received fully franked dividends of $6,092 in 1H 2016. The franking credits enhance the income by a further $2,611

(total income of $8,703). The same investment in a term deposit (based on the cash rate) would be earning pre tax interest of $2,153 with no franking credits. Figures include reinvestment of dividends and cash, Ignores capital appreciation of BKI shares.

Assumes tax rate of 30%.

We focus on dividend payments –not generating management or performance fees

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15

BKI Dividend BKI Franking Interest

BKI Investment Company Limited

CEO ADDRESS

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Net Operating ResultFY2004 – FY2015

$3.5

$10.3 $10.1$12.5

$18.3$20.7

$22.4

$25.3$27.7

$29.9

$35.9

$40.9

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

$ M

illio

ns

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DividendsFY2004 – FY2015

2.0

0

2.1

0

2.2

0 2.5

0

2.5

0

2.6

0

2.7

0 3.0

0

3.0

0

3.0

0

3.0

0

2.5

0 2.7

5 3.0

0

3.0

0

3.2

0

3.2

0

3.2

5

3.4

0

3.4

5

3.5

0

3.5

5

3.6

5

1.0

0

0.5

0.5

0

1.0

0 0.5

0

1.00

1.50

2.00

2.50

3.00

3.50

4.00Ordinary Dividends Special Dividends

Ce

nts

pe

r Sh

are

Total Shareholder

Returns including the

benefit of franking

credits passed on from

BKI to shareholders.

BKI has ample franking

credits to ensure

dividends are fully

franked into the future.

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Capital GrowthTotal Shareholder Returns including franking creditsAs at 30 June 2015

7.3%

20.5%

15.7%

12.3%11.8%

7.1%

16.5%

11.4%

7.0%

8.8%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

1 Year 3 Yrs pa 5 Yrs pa 7 Yrs pa 10 Yrs pa

BKI Total Shareholder Returns S&P/ASX 300 ACC INDEX

The S&P/ASX300 Accumulation Index has been franked at 80%

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Portfolio Movements

Main Sales

Toll Holdings

ALS Limited

DUET Group

APA Renounceable Rights

GWA Group

South32 Limited

Healthscope Limited

Medibank Private

UGL Limited

AGL Renounceable Rights

Seven West Media

Arrium Limited

Total Sales $57m

Main Purchases

National Australia Bank

APA Group

Sydney Airport

Transurban Group

QUBE Holdings

Santos Limited

Wesfarmers Limited

Lindsay Australia

Toll Holdings

ASX Limited

Primary Healthcare

Suncorp Group

Total Investment $96m

0%

10%

20%

30%

40%

50%

60%

70%

BKI Average Portfolio Turnover = 7.4% Typical Active Equity Manager Portfolio Turnover = 30% - 50%+

(Average Turnover = (Total Sales + Total Purchases) / Total Assets)

Low Portfolio Turnover

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Portfolio Movements

Finance

Healthcare

Energy

Infrastructure

Consumer

Long term investors constantly remain focused on futureopportunities.

The following sectors have an attractive long termthematic and the BKI portfolio is well positioned tocapture future growth:

Healthcare

Finance

Energy

Infrastructure

Consumer

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Looking Ahead – Long Term Investment

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Healthcare - Increasing life expectancy inAustralia and other developed countries hasled us to invest further into the Healthcaresector for the aging population thematic.

Major investments during the year included: Primary Health Care Regis HealthCare Ramsay HealthCare

Looking Ahead – Long Term Investment

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Looking Ahead – Long Term Investment

Finance - Attractive fully franked dividendyields and sound EPS growth rates expectedfrom the Banks, Diversified Financials andthe Insurance companies.

Major investments during the year included: National Australia Bank ASX Limited Suncorp Group

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Energy - Population growth and furtherurbanisation is a real driver for consumptionof energy requirements.

Major investments during the year included: Santos Limited Wesfarmers Limited APA Group

Looking Ahead – Long Term Investment

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Infrastructure - Long term, stable investmentopportunities. Freight Distribution andAirport, Gas, Road and TelecommunicationsInfrastructure.

Major investments during the year included APA Group Sydney Airports Transurban Group Qube Logistics

Looking Ahead – Long Term Investment

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Consumer – Non-cyclical essential goods andservices. Domestic population growth plusincreasing export demand for high qualityAustralian produce.

Major investments during the year included Wesfarmers Limited Lindsay Australia

Looking Ahead – Long Term Investment

BKI Investment Company Limited

1ST QUARTER FY2016 UPDATE

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Market Snapshot

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

S&P/ASX 300 Acc Index - Dividend Yield

5.0

7.5

10.0

12.5

15.0

17.5

20.0

S&P/ASX 300 Index - PE Multiple (X)

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

55,000

S&P/ASX 300 Acc Index

0.40

0.50

0.60

0.70

0.80

0.90

1.00

1.10

1.20

Australin Dollar - $USD

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BKI PerformanceTotal Shareholder Returns including franking creditsAs at 30 September 2015

The S&P/ASX300 Accumulation Index has been franked at 80%

8.5%

15.4%

13.2%

10.8%10.1%

0.9%

10.8%

8.1%7.6% 7.0%

0.0%

2.5%

5.0%

7.5%

10.0%

12.5%

15.0%

17.5%

20.0%

1 Year 3 Yrs pa 5 Yrs pa 7 Yrs pa 10 Yrs pa

BKI Total Shareholder Returns S&P/ASX 300 ACC INDEX

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Acquisition of Unlisted Share Portfolio

BKI completed the 2nd acquisition of an unlisted investment company• Net assets of $17m• Long term investment portfolio• Investments complementary to BKI’s portfolio

Looking to engage in similar transactions in the future

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BKI PortfolioTop 25 Shareholdings as at 30 September 2015

14 IAG Limited 1.8%

15 Invocare Limited 1.7%

16 Suncorp Group Limited 1.6%

17 Ramsay HealthCare 1.5%

18 ARB Corporation 1.5%

19 Woodside Petroleum 1.5%

20 ASX Limited 1.4%

21 Coca-Cola Amatil 1.3%

22 Sonic Healthcare 1.2%

23 AMP Limited 1.2%

24 Sydney Airports 1.2%

25 Brambles Limited 1.2%

Cash & Cash Equivalents 4.7%

Total 85.8%

1 National Australia Bank 9.2%

2 Commonwealth Bank 8.7%

3 Westpac Bank 7.3%

4 Telstra Corporation 5.7%

5 TPG Telecom 5.5%

6 ANZ Banking Group 4.8%

7 Wesfarmers Limited 4.5%

8 BHP Billiton Limited 4.2%

9 APA Group 3.4%

10 New Hope Corporation 3.0%

11 Woolworths Limited 3.0%

12 Transurban Group 2.4%

13 AGL Energy Limited 2.3%

Stock % of Total Portfolio

Stock % of Total Portfolio

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1st Quarter FY2016 Update*

Revenue and Net Operating Income (excluding Special Dividend Income) in-line with thesame time last year.

Special Dividend Income - BKI expects to receive approx. $660k in Special DividendIncome in the first half of FY2016 from New Hope Corporation, Suncorp Group, andMilton Corporation.

Dividends - Barring any unforeseen circumstances, BKI is confident of at leastmaintaining the Interim and Final Ordinary Fully Franked Dividends during FY2016.

* Figures referred to in the “1st Quarter FY2016 Update” are unaudited.

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Our aim is to create wealth

for BKI shareholders,

through an increasing fully

franked dividend and

capital growth.