Ann: Preferred Contractor for Christmas Creek Min, page-39

re: Ann: Preferred Contractor for Christmas C... "...and it happened twice!"

Yes, MAH has downgraded their profit guidance twice in the past 2 years, but both the October 2010 and September 2012 profit guidance downgrades came as a result of issues in MAH's construction work. The downgrade in April 2009 was due to backlash in the industry during the GFC.

As I said in another post, MAH's mining division is leaps and bounds ahead of its construction division. Their mining services deliver an 8% margin before tax while their construction services deliver a 2.5% margin. The inherent risk of working this contract is far smaller than the contract that saw MAH cop a hiding in September. If we are to look at the prior trends that are relevant to this project (i.e. observing MAH's mining performance instead of their construction performance), it should succeed, not fail. The only risk I see is that we miss out on the contract, but for MAH to come out and promote the opportunity of receiving it does demonstrate that their confident in getting the go-ahead.