resukts and outlook broadly in line.

Highlights:

- Debt to Equity ration reduced from 91% to 62%, excellent result. The Company has an undrawn $7 million overdraft facility at call but all other debt is equipment related, with no covenants and not requiring refinance. Debt reduction in the next six months will be $10 million and capital expenditure will be around $5 million.

- Cashflow up 15% to $24.3 million.

- Cost reductions totalling $6mill p/a. Board and senior management have taken fee and salary reductions of between 5% and 20% with all bonus schemes suspended. General office staff reductions including some redundancies. Following a senior management restructuring, several head office staff have been relocated to site operations, reducing overheads and bolstering site management. General reductions in expenditures and suspension of senior management training. This is supported by a move to centralised purchasing. Capital expenditures reduced to around $5 million from $25 million in the first half year.

Lowlights:

- Margins dropped from 10% to 7.9%.

- Second half revenue expected to drop 25% - 30%.

Waving my eyes over the report at first glance it seems management is looking to place the company in an excellent position for growth in the second half of CY09, looking to cut cost significantly and reduce debt.