great report with more to come

• Net profit after tax for full year of $20.8 million
• Second half profit 89% higher than first half
• Final dividend of 7.6 cents per share, fully franked
• Outlook for higher profit in 2009

Keybridge Capital’s net profit after tax for the year to 30 June 2008 was $20.8 million. Profit in the second half of the year was $13.6 million, an 89% increase on the first half.

The proposed final dividend is 7.6 cents per share. This dividend will be fully franked. The ex dividend date will be 21 August and the dividend will be paid on 25 September. This dividend continues the Company’s policy of fully distributing net profit to shareholders. Together with the interim dividend paid in March 2008, it brings total dividends for the year to 11.6 cents.

Managing Director of Keybridge Capital, Mark Phillips, said: “We are pleased with the final result for 2008. The investment portfolio delivered exceptional returns, tempered only by the write-downs we took in the first half of the year on one set of investments. The Company has a solid platform from which to grow earnings per share in 2009.”

Highlights

Key components of the Company’s performance in 2008 were as follows:

ƒ The investment portfolio grew from $264 million to $418 million.

ƒ The growth in investments was spread across the Company’s key asset classes of property, aviation, shipping and infrastructure.

ƒ The average level of investments through the year was $372 million and the average return on investments, pre provisions against US securitisations, was over 19% per annum.

ƒ Income was well covered by cashflow, with cash income representing 75% of total income and the remainder being accrued income to be received over the life of nvestments, which is 3 to 4 years on average.

Investments

As at 30 June 2008, Keybridge Capital’s investment portfolio totalled $418 million, split by asset class
as follows:

Asset Class Investment Balance
AUD
Share of
Portfolio
Property 98m 23%
Aviation 118m 28%
Shipping 73m 18%
Infrastructure 54m 13%
Other 75m 18%
Total 418m 100%

The Company has 31 individual investments, for an average investment size of $13.5 million.

By asset class, the Company’s investments are comprised as follows:

ƒ In Property, the majority of investments are mezzanine loans secured by commercial and residential projects located on the Australian eastern seaboard.

ƒ In Aviation, the investments are predominantly mezzanine loans secured by approximately 60 individual passenger jet aircraft.

ƒ In Shipping, the Company’s transactions are mezzanine loans and equity investments secured by 25 vessels in the wet and dry bulk cargo sectors.

ƒ In Infrastructure, the Company has invested predominantly in solar projects in Spain and a wind
project in Germany.

ƒ The Other segment of the investment portfolio comprises seven transactions, predominantly senior and some subordinated loans, spread across a range of industries, including natural resources, equipment leasing and financial services.

Capital Management

The Company currently has $476 million of available capital. This comprises contributed equity of $261 million and committed debt facilities of $215 million provided by Commonwealth Bank, BankWest, St.George Bank and National Australia Bank. The maturity of the debt facilities was
extended during the year to June 2011.

At 30 June 2008, the Company had cash and undrawn debt of $70 million.

Outlook

Whilst the prevailing market environment remains challenging, the balance of supply and demand in the property, aviation, shipping and infrastructure markets in which Keybridge Capital participates is, in general, sound. This, together with the risk mitigants that the Company has structured into its investments, provides confidence that the investment portfolio can continue to deliver solid earnings.

Our current outlook is for the Company’s profit to increase in 2009 and for earnings to be around 15 to 16 cents per share. We are conscious, however, that uncertainty must attach to any current outlook and we remain alert to possible further changes in market conditions.

The present economic environment will, in due course, provide a financier such as Keybridge Capital with an increased flow of transactions with attractive risk-adjusted returns. Given this likelihood, the Company has begun developing a funds management platform for its activities. The Company has been successful in obtaining a wholesale funds management license and is progressing discussions with investors to ensure optimal fund design.

The Company expects to continue growing earnings per share over the next 2 to 3 years. Beyond that, we are confident of developing the Keybridge Capital business so that it will grow further in both size and profitability.