The Directors have pleasure in submitting to shareholders the 20th Annual Report and audited accounts of the Company for the year ended 30 June 2007.

BUSINESS ACTIVITIES
The groups sole business activities during the 2006/07 financial year continued to be jewellery retailing and manufacturing.

CONSOLIDATED FINANCIAL RESULTS
The Group has recorded a tax paid surplus of $21,017,000 for the year ended 30 June 2007 (2006 - $15,774,000). This surplus was achieved on total operating revenue of $350,184,000 (2006 - $309,229,000). The Group adopted New Zealand International Financial Reporting Standards (NZ IFRS) from 1 July 2005. This resulted in restating June 2005 comparatives.

The accounts for the year ended 30 June 2007 have been presented in accordance with the accounting principles and policies detailed on pages 31 to 37 of the annual report.

SHAREHOLDERS' FUNDS/RESERVES
Total Shareholders Funds of the Group now stand at $72,504,000. Contributed equity decreased to $4,752,000 due to a share buyback of $9,106,000 in the last quarter of the financial year. The Groups reserves at 30 June 2007 totalled $67,752,000.

ACCOUNTING POLICIES
There have been no changes in accounting policies during the year.

DIVIDENDS
Your Directors paid an interim dividend of 10 cents per share, with full imputation credits and franking credits attached on the 2nd April 2007. Overseas shareholders were also paid a supplementary dividend. On the 16th August 2007, your Directors declared a final dividend of 16 cents per share payable on the 15th October 2007. The share register will close at 5:00pm on the 5th October 2007 for the purpose of determining entitlement to the final dividend. Overseas shareholders will also be entitled to a supplementary payment on the final dividend.

The total ordinary dividend for the year was 26 cents (fully imputed), (2006 - 23 cents). The payout represents 47.8 % of the tax paid profit of the group.

DIRECTORS
Richard Michael Hill and Gary John Gwynne retire by rotation and being eligible offer themselves for re-election. Emma Jane Hill, having been appointed a Director by the Board on 22nd February 2007 retires in accordance with Section 3.3.3 of the NZX Listing rules and being eligible offers herself for reelection at the Annual Meeting on November 8, 2007.

DIRECTORS' REMUNERATION
Directors remuneration and all other benefits received, or due and receivable during the year was as follows:-

*Note - Executive Directors do not receive Directors fees. Executive remuneration includes salary, superannuation, bonus payments, retirement allowances and provision of a vehicle received in their capacity as employees.

Emma Hill was appointed as a director on 22 February 2007.

REMUNERATION OF EMPLOYEES
The number of employees (not including Directors) whose remuneration exceeded $100,000 is as follows:-

Australian remuneration has been converted into New Zealand dollars at the exchange rate used for translating the Australian results into New Zealand dollars, 0.87 (2006 - 0.89).Canadian remuneration on the same basis at 0.78 (2006 - 0.78).

INFORMATION ON DIRECTORS
The qualifications and experience of the Directors are shown on page 21. The Directors are responsible for the preparation of the financial statements and other information included in this Annual Report. The financial statements have been prepared in conformity with generally accepted accounting principles to give a true and fair view of the financial position of the Company and Group and the results of their operations and cash flows.

The Company appoints independent chartered accountants to audit the Financial Statements prepared by the Directors and to express an opinion on these Financial Statements. The independent auditors report, which sets out their opinion and the basis of that opinion is set out on page 24 of the annual report.

DONATIONS
The total of donations made during the year amounted to $75,400.

INTERESTS REGISTER
The following new entry was made in the Interests Register during the year:
Murray Doyle - Director of Aspiring Asset Management

INTERESTS REGISTER
There were no new entries made in the Interests Register during the year.

On behalf of the Directors,

R. M. Hill

M. R. Parsell