WEEKLY

26 July 2013

WWW.LCC.ASIA

Australian Engineering & Mining Services

Market review The market made solid gains throughout the week with the S&P / ASX100 ending the week up 1%. The Australian dollar lost ground early in the week but recovered to end flat at US92 cents. A profit downgrade by Ausenco saw large losses and renewed speculation about the state of mining services. Ausenco CFO Craig Allen was reported in the press stating that clients aren't making decisions at this point in time or spending capital. LCC sees this as a key factor hindering markets, one which is likely to remain in the short term. The market as a whole is likely to remain uncertain until the reporting season (in August) completes.

4400

S&P/ASX 100 Index

0.940

AUD vs USD

4200 0.920 4000

3800 26 Jun 13

11 Jul 13

26 Jul 13

0.900 26 Jun 13

11 Jul 13

26 Jul 13

Source: Capital IQ

News Headlines and Key Sector Developments

Ticker News/Event
AAX Has been affected by a number of contract specific issues, a softer market and extraordinary costs associated with right-sizing the business to maintain sustainable longer term margins. As a result, the companys unaudited first half 2013 performance is expected to deliver revenues of $255M, underlying EBITDA between $15 and $16M and underlying net profit after tax between $6 and $7M. Full year results will be below the current market consensus levels of revenues between $564M and $661M and reported net profit after tax between $29M to $41M Released its quarterly update. Production levels remained stable at 112% of designed plant capacity throughout Q4 FY13. A current order backlog of US$80M exists, which will support full production until the end of Q2 FY14

Ticker News/Event
CGH Brown Consulting, CGHs wholly owned civil and urban infrastructure services business, has expanded into Western Australia with the acquisition of Perth based E-Tec Consultants, a 21-person structural and civil engineering firm. E-Tecs forecast FY2013 revenue is approximately $4.4M, and EBIT of approximately $1.0M

MCE

WOR

Vale has extended WORs services contract for the S11D Project. Vales multi-billion dollar S11D Project is a world class 90M tonnes per annum iron ore processing facility located approximately 1,940 km north east of Sao Paulo in Para State, Brazil, in one of the worlds richest ore bodies
Source: Capital IQ, Thomson Reuters, 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 1

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WEEKLY
26 July 2013

WWW.LCC.ASIA
Market Cap Open Price Close Price (AUD Million) (AUD) (AUD) High (AUD) Low Weekly Volume Trend TEV/ EBITDA TEV/ EBIT

Australian Engineering & Mining Services

Ticker Company Name

(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 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 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

388 344 185 295 243 774 30 61 39 795 112 855 32 353 21 1625 62 47 152 11 231 367 78 74 48 159 5558 101 168 338 188 53 1767 86 1464 65 268 10 295 305 37 66 145 88 162 23 50 8 451 1189 18 52 5407 100

1.30 1.16 2.12 3.57 0.56 4.88 0.28 0.12 0.17 5.70 0.36 1.17 0.14 2.10 0.38 3.93 0.52 0.15 0.29 0.05 4.20 4.90 0.44 0.46 0.26 0.80 16.77 1.48 4.20 1.90 0.15 0.66 9.40 0.87 17.10 0.04 1.08 0.06 2.45 2.30 0.17 0.87 0.70 1.09 1.00 0.35 0.29 0.05 0.89 7.80 0.02 0.37 22.38 0.58

1.45 1.10 1.50 4.03 0.54 4.60 0.27 0.13 0.17 5.53 0.37 1.10 0.13 2.10 0.45 3.75 0.55 0.15 0.26 0.05 3.81 4.26 0.46 0.49 0.27 0.76 16.48 1.45 4.31 1.96 0.15 0.70 9.50 0.91 16.10 0.04 0.96 0.05 2.50 2.30 0.15 0.84 0.66 1.14 1.00 0.37 0.30 0.05 0.88 7.25 0.02 0.36 21.91 0.55

1.59 1.26 11.5% 1.29 1.02 -5.2% 2.19 1.42 -29.5% 4.24 3.57 12.9% 0.61 0.53 -3.6% 5.06 4.58 -5.7% 0.30 0.27 -1.8% 0.14 0.12 8.3% 0.17 0.17 3.0% 5.70 5.49 -3.0% 0.37 0.33 1.4% 1.22 1.09 -5.6% 0.14 0.12 -8.8% 2.12 2.02 0.0% 0.45 0.38 17.1% 3.96 3.67 -4.6% 0.56 0.50 5.8% 0.16 0.15 0.0% 0.30 0.26 -8.8% 0.05 0.05 -3.8% 4.33 3.79 -9.3% 5.00 4.23 -13.1% 0.50 0.44 4.5% 0.50 0.46 7.7% 0.27 0.23 3.9% 0.90 0.73 -5.0% 16.77 16.20 -1.7% 1.49 1.44 -2.0% 4.44 4.09 2.6% 2.05 1.89 3.2% 0.16 0.14 3.4% 0.70 0.66 6.1% 9.75 9.20 1.1% 0.94 0.86 4.6% 17.40 15.90 -5.8% 0.04 0.04 -5.4% 1.11 0.94 -11.1% 0.06 0.05 -3.6% 2.56 2.40 2.0% 2.36 2.25 0.0% 0.17 0.15 -9.1% 0.87 0.82 -3.4% 0.70 0.62 -5.7% 1.20 1.08 4.1% 1.02 0.98 0.0% 0.37 0.35 5.7% 0.31 0.29 5.3% 0.05 0.05 0.0% 0.98 0.86 -1.1% 8.07 7.13 -7.1% 0.02 0.02 5.6% 0.37 0.36 -1.4% 22.54 21.54 -2.1% 0.59 0.55 -6.0%

NM 2.8x 2.9x 5.8x 2.4x 5.2x 1.8x 2.9x 4.8x 6.9x 1.6x 7.3x 3.2x 3.7x 2.8x 3.4x 7.3x NM 2.4x 7.8x 3.8x 2.7x 3.4x 4.4x 3.9x 3.1x 3.2x 5.5x 3.9x 3.5x 1.2x 2.0x 7.3x NM 5.7x 66.1x 1.4x 1.2x 5.8x 4.4x 2.7x 7.4x 1.4x 7.4x 5.1x 2.2x 1.7x NM 5.1x 9.0x NM 2.4x 10.4x NM

NM 4.8x 3.4x 6.7x 3.8x 6.8x 2.9x 5.1x 12.2x 8.1x 2.5x 7.5x 4.4x 4.0x 3.6x 6.1x 9.1x NM 5.2x 12.9x 5.0x 3.5x 5.1x 4.8x 6.0x 3.7x 6.6x 5.7x 4.1x 5.3x 2.1x 2.6x 11.0x NM 6.5x NM 1.8x 1.7x 7.1x 6.1x 4.3x 8.0x 2.0x 9.3x 6.2x 5.3x 3.3x NM 9.8x 12.3x NM 5.4x 11.5x 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. Page 2

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