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BARBEQUES GALORE LIMITED
Dear Fellow Shareholders:
By all measures of performance, fiscal 2000 was another outstanding year
for Barbeques Galore, as sales and earnings again rose to record highs.
Operationally, our active program of opening new stores in the United
States continued to accelerate; we neared the completion of our highly
successfully store refurbishment program in Australia; and we launched new
initiatives that are expected to further enhance operating efficiencies and
margins in the future. Additionally, we quietly and successfully launched our e-
commerce website that we plan to officially introduce and market in late Spring
2000.
U.S. Expansion Continues at a Brisk Pace
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A household name throughout Australia, Barbeques Galore is expanding its
specialty retailing niche and fast becoming well known in key United States
markets. With 57 company-owned and operated and 11 franchised stores operating
in the United States, Barbeques Galore is the only full-line retail chain
specializing in barbecues, fireside and related accessories. For the consumer,
this means depth of product selection with competitive pricing, along with a
highly trained staff of barbecue specialists providing unparalleled product
knowledge and service, including delivery and assembly.
Barbeques Galore offers an upscale, friendly shopping environment, where
consumers return often for a wide range of accessories, books, savory sauces and
marinades and even Omaha Steaks. The Company offers a wide selection of leading
brands of gas, charcoal and electric grills, including its renowned proprietary
brands, Turbo, Bar-B-Chef, Capt'N Cook and Cook On.
We also are expanding our line of fireside products for both gas and
traditional fireplaces. Currently less than 10% of the Company's sales, this
market has excellent growth prospects, particularly in the Eastern states. It is
a market that is a natural, counter cyclical adjunct to the barbecue business.
During the past 12 months, we opened 12 new stores in the United States and
hope to open 10 to 15 stores in the new fiscal year. Our strategy remains to
strengthen our presence in proven, existing markets and at the same time,
prudently expand into new geographic regions, this year to include Miami,
Florida.
In 1999, new stores were added in the greater Los Angeles, Dallas and
Phoenix areas, as well as in Maryland. For the first time, we entered Charlotte,
North Carolina, opening two new stores. The typical Barbeques Galore store in
the United States has 5,000 to 6,000 square feet, of which approximately 3,500
to 4,000 square feet is selling space and a modular design that is easily
rearranged for special promotions and seasonal products.
Subsequent to the close of the fiscal year, we also opened a new
distribution center in Charlotte. The 27,300 square foot facility will serve our
Eastern stores and should provide tangible cost savings.
In May 1999 we launched our e-commerce website, www.bbqgalore.com, which
offers a full range of barbecues, related accessories and fireside products and
features an "Ask the Expert" message board and toll free telephone support. By
plan, the launch was quiet and without fanfare. It was designed to allow us to
thoroughly test the technology and our fulfillment procedures, as well as to
fine tune the site to meet customers' requirements.
We are pleased to report that by fiscal year end, the website had achieved
online sales in all 50 states. The number of visitors is growing daily, and the
average online sales ticket is double that of the average ticket in the U.S.
retail stores.
Continuing Benefits from Renovations Boost Australian Performance
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While Australia is a more mature market, we are experiencing excellent
sales growth through our store refurbishment program, which began approximately
six years ago. During 1999, four stores were upgraded or relocated, leaving
approximately four stores to be completed within the next two years. There are
currently 35 Company-owned stores in Australia and 49 licensed stores.
As the "category killer," Barbeques Galore enjoys an estimated 90% consumer
awareness among Australians. Our stores in Australia, which provide reverse
seasonality benefits, are more than twice the size of those in the United States
and also offer a complete line of patio furniture and camping equipment.
AUSTRALIA - 327 Chisholm Road, Auburn, NSW 2144 Tel: +61 2 9704 4177 Fax:
+61 2 9704 4212 www.barbequesgalore.com.au
USA - 15041 Bake Parkway, Suite A, Irvine, CA 92618 Tel: +1 949 597 2400 Fax:
+1 949 597 2434 www.bbqgalore.com
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[LOGO OF BARBEQUES
GALORE(R)]
Australia also is home for our manufacturing operations, where we recently
added new state-of-the-art equipment that will enable us to maintain our
leadership position and realize measurable efficiencies.
Sales and Earnings Achieve Record Highs
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The successful execution of our growth strategies resulted in significant
financial progress. For the fiscal year ended January 31, 2000, net income rose
to US$4.0 million, equal to US$0.89 per share, from US$3.2 million, or US$0.71
per share, the prior year, representing a 24 percent increase. Operating income
for fiscal 2000 increased 25% to US7.5 million from US$6.0 million a year ago.
Net sales for the year advanced 20% to US$168.8 million from US$140.3
million a year earlier. For our stores in the United States, sales rose 33% to
US$78.8 million from US$59.2 million, with same store sales increasing 14.6% for
the year. Net sales for our Australian stores increased 11% to US$90 million
from US$81 million a year ago. Same store sales in Australia increased 3.9% over
the prior year.
A Bright Future
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Our new advertising slogan in the United States, "Not a barbecue aisle. A
barbecue store," and our Australian slogan, "We know the outdoors inside out,"
symbolize the Company's core strengths in those markets and differentiate our
unique specialty retailing concept. We see many growth opportunities through new
store openings in the United States and Australia, further refurbishment of
stores in Australia and efficiencies to be realized through operating
enhancements and greater manufacturing capabilities.
We are also enthusiastic about our website, which will further enhance name
recognition throughout the United States and help us identify customer demand
and potential new store locations. Please visit the site, as well as our stores.
We know you will be impressed and proud to be associated with Barbeques Galore.
During the year, we announced the promotion of two senior executives:
Benjamin A. Ramsey, Jr., who joined Barbeques Galore in 1993 and is now
serving as Executive Vice President; and Peter Spring, a 19-year Veteran who has
been with the Company since he was 22 years old, and who became Chief
Operating Officer of our Australian operations. We are confident that these
talented senior executives will make major contributions to the Company's
continuing growth.
Subsequent to the close of the year, we invested US$1.2 million to acquire
a one third equity interest in Renegade Gas Pty. Ltd. Based in Australia,
Renegade, which recently entered the gas distribution business, is affiliated
with Bromic Pty. Ltd., a highly successful distributor of gas components in
Australia that recently commenced operations in the United States. Barbeques
Galore has held a one third interest in Bromic for many years.
Our Company's many achievements reflect the collective efforts of our staff
members, to whom we express deep appreciation and gratitude. We also wish to
thank our customers, shareholders and vendors for their continued loyal support.
The ultimate objective of any company is to enhance shareholder value. You
have our commitment that we will continue to work diligently towards meeting
this goal.
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Sincerely,
/s/ Sam Linz /s/ Robert Gavshon /s/ Sydney Selati
Sam Linz Robert Gavshon Sydney Selati
Chairman of the Board Executive Deputy Chairman President, Barbeques Galore USA
May 10, 2000
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BARBEQUES GALORE LIMITED
ACN 008 577 759
NOTICE OF ANNUAL GENERAL MEETING
NOTICE is hereby given that the nineteenth Annual General Meeting of Barbeques
Galore Limited (the "Company") will be held at 327 Chisholm Road, Auburn, New
South Wales, on Tuesday, 27 June 2000 at 10:00 a.m.
Ordinary Business
1. To receive the financial statements of the Company and of the consolidated
entity for the year ended 31 January 2000 and the reports of the directors
and auditors thereon.
2. To elect two directors:
Gordon Howlett retires by rotation in accordance with the provisions of Article
63 of the Company's Constitution and being eligible, offers himself for re-
election.
Sydney Selati retires by rotation in accordance with the provisions of Article
63 of the Company's Constitution and being eligible, offers himself for re-
election.
General
3. To transact any business which may be lawfully brought forward.
Proxies and other matters
4. (a) A member entitled to attend and vote is entitled to appoint not more
than two proxies.
(b) Where more than one proxy is appointed, each proxy must be appointed
to represent a specified proportion of the member's voting rights.
(c) A proxy need not be a member of the Company.
(d) Proxies given by companies must be executed under seal or under the
hand of an officer or attorney duly authorised in writing.
(e) To be effective, the form appointing a proxy and the Power of Attorney
(if any) under which it is signed (or an attested copy thereof), must
be delivered to the registered office of the Company at 327 Chisholm
Road, Auburn, New South Wales, Australia not later than 10:00 a.m. on
Friday, 23 June 2000 or by facsimile to 61-2-97044212.
By order of the Board,
/s/ David M Glaser
David M Glaser
B.Com, ACA.
Company Secretary
29 May 2000
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BARBEQUES GALORE LIMITED
ACN 008 577 759
PROXY FORM
Registered office: 327 Chisholm Road, Auburn, New South Wales, 2144.
In respect of the Annual General Meeting to be held on 27 June 2000 or any
adjournment thereof:
I/We (BLOCK LETTERS)
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of
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being a member/members of Barbeques Galore Limited
hereby appoint
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of
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or failing him/her
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of
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or failing him/her the Chairman of the meeting, as my/our proxy to vote for
me/us and on my/our behalf at the said Annual General Meeting of the company in
respect of __________________ shares.
Signed this day of 2000
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Signature of shareholder/s
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Optional: Should you desire to direct your proxy how to vote, please insert "x"
in the appropriate box against each item, failing which your proxy will vote as
he/she thinks fit, or abstain from voting.
Agenda item no (2) For Against Abstain
Re-election as director: Mr Gordon Howlett [_] [_] [_]
Mr Sydney Selati [_] [_] [_]
Notes
(1) If the number of shares is not inserted above it will be assumed that the
proxy is for all shares registered in the name of the member.
(2) A member entitled to attend and vote is entitled to appoint not more than
two proxies.
(3) Where more than one proxy is appointed, each proxy must be appointed to
represent a specified proportion of the member's voting rights.
(4) A proxy need not be a member.
(5) To be effective, proxy forms (duly completed) must reach the registered
office no later than 10:00 a.m. on Friday, 23 June 2000 or by facsimile to
61-2-97044212.
