Ann: Notice of General Meeting/Proxy Form, page-13

I have industry knowledge and as mentioned in other posts a financial interest in the surveying industry. What BrayWyatt says is correct about charge out rates circa $90 is correct both on long term civil and construction where it is hourly rate priced but also short term projects where it is a fixed fee.

In addition information from inside Veris indicate they have become less efficient in the delivery of work by their revenue earners and I imagine price setting had very little control ie winning the work was celebrated not the profitability of the job. The surveying industry is terrible for extracting value and commercial value in the way the industry prices particularly one man bands and it seems Veris has taken the successful acquisitions and stooped to this level and approach rather than keep doing the high margin work they once were doing. Not all but most of the acqusitions were top quality firms delivering good long term profits and Veris paid generously for them.

They have failed in stitching it all together and extracting the economies of scale. It really comes back to the fact that the consolidation and corporatisation of relationship based professional services is awfully difficult to execute. Few get it right most get it wrong.

My take is Veris’s acquisitions were price setters in the main but their strategy of increasing revenue FTEs has them now in the position of price takers. I mentioned previously when they issued those strange ASX releases about new contracts in the back end of 2018. They will now find it very difficult to get the pricing up and maintain the volumes, the rest of the market will adjust its cost base, Veris does not seem able to do that. $3m of overheads coming out, even if achieved is, will not save them. I think this is work 2% in their surveying margin. They need to move their surveying margin from 7% to 15%. Again they only need to go back to the numbers at acquisition and see what there margins were, they were up in the low 20%s for some acquisitions.

I really don’t know where this will all go. I watch with interest and self interest.