mhi appendix 4e - 31 march 2014, page-3

SP,

It seems pretty certain that they did not revalue the Chinese property. I think the increase in property value that you point out is due to the conversion from Chinese Yuan into Australian dollars. Our currency fell just over 12% from March 31st 2013 to 2014 and I think that explains the difference.

It is an amazingly strong balance sheet with $15m in cash, no debt, the new American property and the Chinese property which I really do suspect could be worth several times the $7 million or so that it seems to be valued at in the balance sheet.

I have been a shareholder in Merchant House for 14 years now and all of that time I have been waiting for the share price to come closer to the real value of the company. Maybe it will happen one day :)

I will be at the AGM again this year and I will query the market value of the Chinese property again as I did last year. We may still get a comment in the annual report in regard to that property but it doesn't seem as likely now.

GPASAS