contango, page-5

Chairman's Address
2005 Annual General Meeting

Contango MicroCap Limited has completed a very successful first year.

The Contango MicroCap investment portfolio increased by 49.9% over the 15 month
period, since listing on 25 March 2004 to 30 June 2005. Over the same period the All
Ordinaries Index rose by 30.8%.

Since the end of June until Friday 25 November, the portfolio has risen by a further 20.2%.
Again outperforming the All Ordinaries Index which returned 9.6%.

This level of investment return has been available to Contango MicroCap Limited because
the Manager, Contango Asset Management Limited, has been consistently positive on
markets over the last two years, and has promptly placed the money raised into the market
thereby allowing the strong market to positively impact on the portfolio's valuation.

Further, the microcap investment space is a niche area at which Contango is the pre-
eminent investment group in the category. Unfortunately, this uniqueness of Contango
MicroCap Limited currently is not being fully recognised by the market.

To help overcome this, we look to educate investors by regularly contacting the investment
and broking community with our quarterly reports. Further, we have undertaken
presentations in conjunction with the Australian Stock Exchange and contribute modestly
to their investor education program. We have arranged for the brokers that undertake
regularly monthly NAV commentary to include Contango MicroCap Limited. We have also
been reviewed by Aegis Research and they have allocated the company an approved
rating.

We have paid fully franked dividends of 9 cents over the last 12 months with a special
dividend of 4 cents, an interim of 2 cents and a final of 3 cents. The shareholders have
therefore benefited from the payment of $4.0 million in dividends and a further increase in
shareholder funds of $9.0 million. The company will continue to pay ordinary dividends
similar to those paid this year and will offer special dividends in strong investment years
like the 2004/2005 year.

Despite our excellent performance, profitable and unique investment space, measures to
educate the market and the payment of high dividends, the returns to shareholders on
market have been a little disappointing. Much of this has been due to the dilutionary
impact of the options, and the discount factor being applied to the newer listed investment
companies. We are hopeful that with the above mentioned benefits of our company being
recognised by the market the returns will be stronger this year. Certainly the well
established trusts do not suffer the discounts of the newer funds. We feel that with time
and education, Contango MicroCap will become better understood and more appropriately
valued by the market. Today's investors will be able to benefit from this re-evaluation.