strengthens position in chinese market

For immediate Release to the market
INDUSTREA Limited
ASX Code IDL
23 May 2008
INDUSTREA STRENGTHENS POSITION IN CHINESE MARKET
WITH MAJOR NEW $10m CONTRACT
• Industrea’s expansion into the mining safety equipment sector in
China continues
• Industrea wins major $10 million contract to supply directional drilling
and coal degasification systems to Longmei Mining Group
• Longmei to purchase four drilling and degasification systems, after
previous purchase of two in 2007
• Demand driven by growth and modernisation of Chinese mining
industry
• Boost to on-going revenue stream from sales of spare parts and
servicing
INDUSTREA’S dominance of the mining equipment sector in China in the key areas
of safety and productivity has been enhanced after winning a $10 million contract to
sell directional drilling and coal degasification systems to the Longmei Mining Group.
Longmei is one of several major Chinese clients, which include China Shenhua
Energy Company, the largest coal mining company in the country, Jingcheng Group
and Shanxi Coal.
Industrea managing director Robin Levison said China’s resources sector was one of
the largest and fastest-growing in the world and Industrea was well-positioned to
profit from it.
“The strong demand for energy, and the associated push for self sufficiency and less
reliance on imported coal, continues to drive the domestic growth of China’s
resources industry. At the same time the modernisation of mines around the country
has fuelled demand for Industrea’s products, particularly those that improve safety
and productivity.”
Mr Levison predicted that sales and revenue in China would continue to grow.
“With our subsidiary Wadam Industries handling sales and distribution in Beijing, we
will be able to increase awareness of Industrea’s expanding product range
throughout China, and continue to develop our contacts in the mining industry,” he
said.
“These contacts are especially significant with Wadam selling a variety of equipment
made by Industrea subsidiaries, along with associated OEM (Original Equipment
Manufacturers) products, with revenues arising from both initial capital sales and ongoing
revenue through sales of spare parts and servicing.
“The expansion of the recurring revenue portion of Wadam’s business has always
been a key strategic goal for Industrea as it seeks to broaden the range of products
and services provided to the Chinese market.
“As the population of Wadam-supplied equipment continues to grow in the Chinese
market, Industrea has an expectation that revenues associated with the sales of
spare parts and servicing will increase in line with total cumulative sales.”
Mr Levison said Industrea had established a global reputation for excellence,
producing equipment of the highest quality and providing efficient and effective
service and support.
“As such, we are now the preferred supplier in certain areas of mining safety and
productivity equipment for leading mining companies in countries including South
America, South Africa, Russia and South-East Asia,” he said.
Longmei Mining Group, based in north-west China, has purchased four drilling
guidance systems from Industrea for its coal mines.
It previously purchased two drilling guidance systems from Industrea in 2007.
The equipment assists in the accurate placement of in-seam horizontal bore holes.
The technology aids in the degasification of mines and is suitable for both
underground and surface drilling.
ENDS
Robin Levison Scott Emerson
Managing Director and CEO Crook Publicity
Industrea 0401 99 8181
(07) 3725 5400