WEEKLY

12 July 2013

WWW.LCC.ASIA

Australian Engineering & Mining Services

Macro Market Commentary The market made solid weekly gains as the resources sector recovered although some ground was lost late in the week after China's finance minister Lou Jiwei lowered expectations for Chinas economic growth. Lou, speaking in the US, said 7% growth is likely this year (lower than the government's 2013 target of 7.5%). The Australian dollar was largely flat ending the week at US91.5 cents. Standard & Poors has released survey results indicating capex by Australian corporates outside the financial sector could tumble by 12% this year on a slowdown in mining investment. The decline would be the worst capex growth figures in the last 10 years. LCC expects those companies which can deliver productivity improvements and diversify revenue sources will thrive in the long term as shutdowns and other vital maintenance programs are undertaken.

4200

S&P/ASX 100 Index

0.980 0.960 0.940 0.920 0.900 12 Jun 13

AUD vs USD

4100 4000
3900

3800 12 Jun 13

27 Jun 13

12 Jul 13

27 Jun 13

12 Jul 13

Source: Capital IQ

News Headlines and Key Sector Developments

Ticker News/Event
AAX Acquired the Canadian oil sands business Projex Technologies to grow its energy business and expand its offering in Canadas oil sands market. The acquisition price of $15.2M represents a multiple of 2.9 times anticipated 2014 full year EBITDA of $5.2M. The acquisition, which is subject to a number of conditions precedent, is expected to be completed in late July 2013. AAX will fund the acquisition from available cash and facilities Has provided a market update on the dispute in relation to the Elliott Facility. AJL maintains its intention to dispute and defend vigorously any entitlement of either Elliott or Athena to recover damages if any such claim is brought by them and in respect of which those companies are seeking more information through preliminary court processes. AJL is seeking more details and evidential material as to how either Elliott or Athena has suffered any recoverable damage Has accepted the resignation of its Chief Executive Officer Mr Dennis Quinn. Mr Ross Dunning AC has been appointed as interim Managing Director
Source: Capital IQ, Thomson Reuters, LCC research

Ticker News/Event
TPP Released its Appendix 4C for the three months to 30 June 2013. Cash at the end of the June 2013 quarter has increased to $1.7M from the previous quarters balance of $1.5M. This includes receipt of $500,000 from new shares issued and net operating cash outflow representing an increasing investment in working capital for on-going contracts including the recently awarded contract for the refurbishment of a fuel storage tank in the Pilbara Has been awarded a contract by Sasol North America, Inc. (Sasol) for an integrated GTL and ethane cracker complex. The contract is for WOR to provide Integrated Program Management Team (IPMT) services for the frontend engineering and design phase, with the intent to subsequently provide IPMT services to the engineering, procurement and construction phase of the project. Current project costs are estimated between US$16 to US$21B

AJL

WOR

EGN

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.

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WEEKLY
12 July 2013

WWW.LCC.ASIA

Australian Engineering & Mining Services

Ticker Company Name

Market Cap Open Price Close Price (AUD Million) (AUD) (AUD)

High (AUD)

Low

Weekly

Volume Trend

EV/ EBITDA

EV/ EBIT

(AUD) % Change

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 NFK NWH OTC PRG RCR RQL SND SDM 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 Norfolk Group Limited NRW Holdings Limited OTOC Limited Programmed Maintenance Services RCR Tomlinson Limited Resource Equipment Limited Saunders International Limited Sedgman 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

260 312 262 251 223 866 31 52 39 767 97 936 36 334 16 1656 71 47 143 13 265 441 77 65 39 157 6117 100 173 332 175 52 1668 79 1486 65 76 286 10 298 295 41 62 149 82 155 21 49 7 430 1265 11 53 5306 110

1.24 0.91 1.86 3.15 0.51 4.39 0.25 0.12 0.17 5.18 0.34 1.13 0.12 1.89 0.34 3.50 0.51 0.16 0.25 0.05 4.50 4.52 0.43 0.43 0.21 0.71 16.90 1.26 4.39 1.80 0.14 0.71 8.11 0.78 15.40 0.03 0.47 0.95 0.05 2.45 2.12 0.17 0.74 0.70 1.07 0.83 0.34 0.28 0.05 0.75 6.90 0.01 0.38 19.94 0.58

1.23 1.00 2.12 3.43 0.49 5.15 0.28 0.11 0.17 5.34 0.32 1.21 0.14 1.99 0.34 3.82 0.63 0.15 0.25 0.06 4.38 5.12 0.45 0.43 0.22 0.75 18.14 1.43 4.43 1.93 0.14 0.69 8.97 0.84 16.34 0.04 0.47 1.03 0.05 2.52 2.23 0.17 0.79 0.68 1.05 0.96 0.34 0.29 0.05 0.84 7.71 0.01 0.37 21.50 0.60

1.25 1.18 -0.8% 1.03 0.81 9.9% 2.20 1.77 14.3% 3.44 3.01 8.9% 0.52 0.47 -3.9% 5.18 4.29 17.3% 0.28 0.25 12.0% 0.12 0.11 -4.3% 0.17 0.16 0.0% 5.43 5.16 3.1% 0.35 0.31 -6.0% 1.24 1.10 6.6% 0.15 0.12 16.7% 2.02 1.89 5.0% 0.35 0.34 0.0% 3.91 3.44 9.1% 0.63 0.51 23.5% 0.17 0.15 -6.3% 0.26 0.22 -2.0% 0.07 0.05 20.0% 4.82 4.11 -2.7% 5.14 4.40 13.3% 0.45 0.41 5.9% 0.44 0.43 0.0% 0.22 0.21 4.9% 0.78 0.68 4.9% 18.49 16.01 7.3% 1.43 1.26 13.5% 4.46 4.32 0.9% 1.93 1.73 6.9% 0.15 0.14 0.0% 0.73 0.68 -2.8% 8.98 8.11 10.6% 0.85 0.78 7.7% 16.34 14.92 6.1% 0.04 0.03 9.4% 0.48 0.47 0.0% 1.06 0.92 7.9% 0.05 0.05 0.0% 2.53 2.41 2.9% 2.29 2.11 5.2% 0.17 0.16 0.0% 0.80 0.74 6.8% 0.75 0.67 -3.6% 1.13 1.05 -1.9% 1.04 0.83 15.7% 0.34 0.33 0.0% 0.29 0.28 3.6% 0.06 0.05 0.0% 0.86 0.75 12.0% 7.83 6.88 11.7% 0.01 0.01 0.0% 0.39 0.36 -3.9% 21.58 19.86 7.8% 0.60 0.58 3.5%

NM 2.7x 4.0x 5.1x 2.3x 5.6x 1.8x 2.7x 4.8x 6.7x 1.5x 8.1x 3.4x 3.5x 2.5x 3.4x 8.1x NM 2.4x 8.5x 4.3x 3.4x 3.4x 3.6x 3.5x 3.1x 3.5x 5.4x 4.0x 3.5x 1.1x 2.0x 7.0x NM 5.8x 66.1x NM 1.5x 1.2x 5.8x 4.3x 2.8x 6.9x 1.5x 6.5x 4.9x 2.1x 1.7x NM 5.0x 9.4x NM 2.5x 10.2x NM

NM 4.6x 4.7x 5.9x 3.7x 7.4x 3.0x 4.9x 12.2x 7.8x 2.2x 8.4x 4.6x 3.8x 3.2x 6.2x 10.0x NM 5.1x 14.2x 5.7x 4.3x 5.1x 3.9x 5.2x 3.6x 7.1x 5.6x 4.2x 5.2x 2.0x 2.6x 10.5x NM 6.6x NM NM 1.9x 1.7x 7.1x 5.9x 4.5x 7.3x 2.1x 8.2x 5.9x 5.0x 3.2x NM 9.6x 12.9x NM 5.5x 11.3x NM

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.

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