Media Release Downer EDI Limited ACN 003 872 848 Level 3, 190 George Street Sydney NSW 2000 PO Box N692 Grosvenor Place NSW 1220 T F W E 61 2 9251 9899 61 2 9251 1987 www.downeredi.com [email protected] For Immediate Release 2 August 2007 Downer EDI full year results update Downer EDI Limited (Downer EDI) will announce its full year results on 21 August 2007. The company believes based on its current expectations and assumptions that reported Net Profit After Tax (NPAT) for the full year will be $101.5m which is significantly lower than its previous guidance of $157-160m. Underlying NPAT is in line with guidance previously advised to the market. Revenue for the full year will be in line with previous guidance at $5.4 billion up 15% on the $4.7 billion of the previous year. The underlying EBIT performance for the year is also in line with guidance given at the full year results in August 2006 ($275m). The revised outcome net of tax has been impacted by a number of factors relating to previously identified problem contracts, principally: �� commercial settlement of disputes prior to and post 30 June 2007; �� expensing higher costs and delays; �� a more conservative approach to contractual issues; and �� offset by a $33m one-off second half tax credit. Importantly, there have been no new contracts identified as having significant disputes during the reporting period and cash will be received for recent contract settlements. Recovery programs relating in particular to Iluka Resources and the Coppabella coal mine project continue to be pursued to recover funds for our shareholders. Gearing (net debt to equity) for the full year will be approximately 45% compared to the half year level of 71% and well within our target range. Second half operating cashflow was broadly in line with second half underlying EBIT. The group’s unused financing lines are in Media Release Continued Page 2 excess of $600m as at 30 June 2007 and the company is in compliance with its banking covenants. In our recovery year the Company will deliver a profit of $101.5m notwithstanding the disappointing impact of one-off items. Underlying performance of the group continues to improve year on year. The Company is confident that 2008 will deliver a substantially improved profit result over the 2007 year. Management change The Board and Managing Director Stephen Gillies have agreed that he will step down from the company, effective immediately. Mr Gillies will be available to the company as a consultant for a further three months to facilitate an orderly transition. “I have greatly enjoyed my time at Downer EDI and am very proud of what has been built. The time is right for me to move on to new challenges. The time is also right for Downer EDI,” said Mr Gillies. The Board wishes to thank Stephen for his service to Downer EDI over 19 years, 11 as Managing Director and CEO. Under his stewardship Downer EDI has transformed from a small company with a narrow shareholder base and a high portion of one-off revenue, to being Australia’s leading provider of engineering services for essential infrastructure with a largely annuity based revenue stream. Revenue has grown from $1.3 billion in June 2000 to over $5.4 billion for the twelve months ended 30 June 2007. The Board has appointed Brent Waldron as interim CEO. Until his departure in May 2007 Brent was Deputy CEO of Downer EDI and prior to that CEO of Downer EDI’s Works Infrastructure business in New Zealand (now Downer EDI Works). Brent will be supported by a committee of the Board. The Board has commenced a global search for a new CEO and will consider both internal and external candidates. Downer EDI Limited ACN 003 872 848 Level 3, 190 George Street Sydney NSW 2000 PO Box N692 Grosvenor Place NSW 1220 T F W E 61 2 9251 9899 61 2 9251 1987 www.downeredi.com [email protected] Media Release Continued Page 3 Downer EDI Limited (www.downeredi.com) is an Australian top-100 company that provides comprehensive engineering and infrastructure management services to the public and private transport, energy, communications and resources sectors across Australia, New Zealand, Asia Pacific and into the United Kingdom. Brands of Downer EDI and its primary business divisions Contacts: Media John Shuey, General Manager, Corporate Affairs, (02) 9240 9000 or 0413 705 491 Investors Ross Moffat, General Manager, Investor Relations (02) 9240 9042 or 0412 256 224 Downer EDI Limited ACN 003 872 848 Level 3, 190 George Street Sydney NSW 2000 PO Box N692 Grosvenor Place NSW 1220 T F W E 61 2 9251 9899 61 2 9251 1987 www.downeredi.com [email protected]
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