WEEKLY

8 November 2013

WWW.LCC.ASIA

Australian Engineering & Mining Services

M&A Rumour and Activity The Australian market closed lower after strong US economic growth figures raised the possibility that the US Federal Reserve could begin tapering its stimulus program. The Australian dollar ended the week at US94.7 cents. It was a bit of a bumpy week for the Sector with Ausdrill coming out with a downgrade and Forge also signalling problems with various contracts, going into trading halt and then Voluntary Suspension as a result. As has become the pattern in sector with downgrades, ASL closed at $1.38 before updated market guidance and then traded at $0.98, before closing out the week at $0.995. Volume on Thursday from when ASL recommenced trading was huge. Two deals were announced this week. Swick Mining Services (ASX:SWK) agreed to invest $6.5M in Swedish mineral analysis business Orexplore which is developing scanning technology. Swick said Orexplore had created a portable X-ray mineral scanner that was in a design and development stage and would allow real time assay and structural analysis in the field. Under the deal, Swick will buy an initial 23 per cent stake in Orexplore for 6.6M Swedish kronor (A$1.1M). Swick will increase the shareholding over two and a half years to 52 per cent for an additional SEK16.6M (A$2.68M) and will provide another SEK16.6 million in debt funding to help develop and commercialise products. Kreuz Holdings Limited (SGX:5RK), a Singaporean listed investment holding company that provides subsea services to the offshore oil and gas industry has been acquired by Headland Private Equity for A$405M.

News Headlines and Key Sector Developments

Ticker News/Event
ASL Has reviewed anticipated performance for FY14. ASL expects to report NPAT of between $35M and $45M for FY14 on revenues of between $825M and $925M. ASL reported NPAT of $90.4M on revenue of $1,129M for FY13

Ticker News/Event
FGE Identified concerns relating to potential underperformance on the Diamantina Power Station and West Angelas Power Station projects that were acquired in January 2012. FGE requested a trading halt and suspension from quotation to enable it to clarify the position in relation to these projects and to provide to ASX an update on its earnings guidance Wholly owned subsidiary Action Drill & Blast Pty Ltd has been awarded a three year contract for drill and blast operations at the Middlemount Coal Mine in Queensland. The contract is valued at approximately $60M over the three years Provided an earnings update. While market conditions remaining challenging SDM anticipates that likely FY14 reported earnings will be broadly in line with FY13 results and SDM remains in a strong position to participate as and when projects proceed
Source: Capital IQ, Thomson Reuters, LCC research

BKN

Guides the market to an operating EBITDA of around $85M for the first half of FY14, excluding a net positive effect from one-off items, which is not expected to be significant. If recent improvements in order intake continue, BKN still expect the full year to be broadly comparable with the operating FY13 result Provided earnings guidance for FY14. DOW expects NPAT to be flat at around $215M

NWH

DOW

SDM

IMPORTANT DISCLAIMER
This report has been prepared by Lincoln Crowne & Company Pty. Limited ("LCC"). The research is based on information obtained from sources believed to be accurate and reliable. LCC does not guarantee the accuracy, reliability, completeness or suitability of any such information and makes no warranty, guarantee or representation, expressly or impliedly about this research. LCC accepts no obligation to correct or update the information. No opinion or recommendation is made within this research. This report is not intended to be, nor should it be relied on, as a substitute for professional advice. This report should not be relied upon as the sole basis for any investment decision or planning, and LCC does not accept any responsibility on this basis for actions made. Page 1

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WEEKLY
8 November 2013

WWW.LCC.ASIA

Australian Engineering & Mining Services

Ticker Company Name

Market Cap Open Price Close Price Week High Week Low (AUD Million) (AUD) (AUD) (AUD) (AUD)

Weekly Volume % Change Trend

EV/ EBITDA

EV/ EBIT

AJL ASL AAX ANG BLY BKN BYL BOL BSA CDD CGH CLO COF DCG DSB DOW EAL EGN EHL EVZ FWD FGE GCS GNG HDX IMD LEI LCM LYL MLD MAH MYE MIN MCE MND NMS NOD NWH OTC PRG RCR RQL SND SDM SSM SWL SXE STS SWK TPP TSE UGL VMG WDS WOR WTP

AJ Lucas Group Limited Ausdrill Limited Ausenco Limited Austin Engineering Limited Boart Longyear Limited Bradken Limited Brierty Limited Boom Logistics Limited BSA Limited Cardno Limited Calibre Group Limited Clough Limited Coffey International Limited Decmil Group Limited DeltaSBD Limited Downer EDI Limited E&A Limited Engenco Limited Emeco Holdings Limited EVZ Limited Fleetwood Corporation Limited Forge Group Limited Global Construction Services Limited GR Engineering Services Limited Hughes Drilling Pty Limited Imdex Limited Leighton Holdings Limited Logicamms Limited Lycopodium Limited MACA Limited MacMahon Holdings Limited Mastermyne Limited Mineral Resources Limited Matrix Composites & Engineering Monadelphous Group Limited Neptune Marine Services Limited Nomad Building Solutions Limited NRW Holdings Limited OTOC Limited Programmed Maintenance Services RCR Tomlinson Limited Resource Equipment Limited Saunders International Limited Sedgman Limited Service Stream Limited Seymour Whyte Limited Southern Cross Electrical Engineering Structural Systems Limited Swick Mining Services Limited Tempo Australia Limited Transfield Services Limited UGL Limited VDM Group Limited WDS Limited WorleyParsons Limited Watpac Limited

269 311 188 284 175 1,009 39 88 30 1,047 114 1,135 67 383 20 2,217 90 53 166 12 189 360 95 92 67 150 5,780 117 183 421 176 70 2,127 62 1,622 89 19 344 22 335 494 41 73 167 54 97 162 29 75 8 697 1,167 10 101 5,319 181

1.17 1.46 1.64 3.90 0.44 6.10 0.34 0.19 0.14 7.18 0.40 1.46 0.24 2.46 0.44 4.93 0.73 0.18 0.35 0.06 3.27 4.18 0.58 0.67 0.32 0.74 17.54 1.79 4.95 2.58 0.15 1.02 11.31 0.70 18.33 0.05 0.07 1.36 0.10 2.78 3.59 0.17 0.93 0.85 0.22 1.33 1.01 0.52 0.34 0.05 1.33 7.42 0.01 0.81 21.91 0.98

1.01 1.00 1.52 3.88 0.39 5.96 0.35 0.19 0.13 7.22 0.36 1.46 0.26 2.27 0.42 5.10 0.75 0.17 0.29 0.06 3.13 4.18 0.56 0.61 0.32 0.72 17.14 1.68 4.70 2.44 0.14 0.93 11.43 0.66 17.57 0.05 0.07 1.24 0.12 2.83 3.62 0.17 0.93 0.75 0.19 1.24 1.00 0.47 0.35 0.05 1.36 7.15 0.01 0.70 21.55 0.98

1.17 1.47 1.64 3.96 0.45 6.12 0.38 0.19 0.14 7.31 0.40 1.46 0.26 2.51 0.44 5.40 0.75 0.18 0.35 0.06 3.30 4.18 0.58 0.68 0.32 0.74 17.76 1.79 4.96 2.58 0.16 1.02 11.53 0.72 18.44 0.05 0.07 1.40 0.12 2.85 3.82 0.18 0.93 0.85 0.22 1.35 1.03 0.52 0.35 0.05 1.43 7.51 0.01 0.81 22.05 0.98

0.92 0.93 1.47 3.77 0.37 5.69 0.34 0.18 0.13 7.02 0.36 1.45 0.24 2.21 0.41 4.93 0.70 0.16 0.28 0.06 3.05 4.18 0.52 0.61 0.31 0.68 16.89 1.57 4.60 2.36 0.14 0.89 11.16 0.61 17.50 0.05 0.07 1.18 0.10 2.74 3.48 0.17 0.90 0.70 0.19 1.22 0.98 0.46 0.33 0.05 1.33 7.06 0.01 0.66 21.06 0.93

-14.1% -31.8% -7.3% -0.5% -11.5% -2.3% 2.9% -2.6% -3.7% 0.6% -10.0% 0.3% 10.6% -7.7% -4.6% 3.4% 3.4% -2.9% -18.6% 0.0% -4.3% 0.0% -3.4% -9.0% 0.0% -2.7% -2.3% -6.1% -5.1% -5.4% -6.7% -8.4% 1.1% -5.7% -4.1% -4.0% -2.9% -9.2% 15.0% 1.8% 0.8% 0.0% 0.0% -11.2% -11.6% -6.8% -1.0% -10.6% 3.0% 0.0% 2.3% -3.6% 50.0% -14.2% -1.6% 0.5%

NM 2.8x 4.6x 6.7x 3.7x 8.1x 2.0x 3.8x 3.9x 8.9x 2.7x 6.9x 7.9x 4.9x 2.4x 4.0x 7.7x NM 3.4x 7.8x 5.7x 2.7x 3.8x 6.9x 4.9x 4.1x 3.5x 7.4x 4.9x 3.4x 1.4x 3.0x 6.5x 5.9x 6.0x 93.8x 1.5x 2.6x 2.4x 6.4x 7.1x 3.2x 7.7x 2.7x NM 3.6x 4.1x 2.7x 2.5x NM 6.4x 15.8x NM 3.9x 10.2x 2.5x

NM 5.0x 6.0x 8.2x 11.1x 11.9x 3.5x 8.2x 11.6x 10.7x 5.3x 7.2x 14.6x 5.6x 3.3x 7.2x 9.1x NM 9.7x 10.8x 9.4x 3.3x 6.1x 7.6x 7.1x 5.4x 7.4x 7.8x 5.2x 5.1x 2.8x 4.3x 9.9x 77.6x 6.8x NM 2.1x 3.5x 3.5x 7.8x 9.6x 6.5x 8.2x 5.9x NM 4.0x 5.0x 8.8x 4.8x NM 12.6x 29.5x NM 8.5x 11.6x 11.6x

So urce: Capital IQ, LCC research

IMPORTANT DISCLAIMER
This report has been prepared by Lincoln Crowne & Company Pty. Limited ("LCC"). The research is based on information obtained from sources believed to be accurate and reliable. LCC does not guarantee the accuracy, reliability, completeness or suitability of any such information and makes no warranty, guarantee or representation, expressly or impliedly about this research. LCC accepts no obligation to correct or update the information. No opinion or recommendation is made within this research. This report is not intended to be, nor should it be relied on, as a substitute for professional advice. This report should not be relied upon as the sole basis for any investment decision or planning, and LCC does not accept any responsibility on this basis for actions made. Page 2

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