ALS LIMITED — Earnings Release 2010

May 24, 2010

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25 May 2010

asx/media release

Campbell Brothers FY2010 profit comparable to FY2008

Campbell Brothers Limited (ASX Code: CPB) today announced that it had achieved net profit after tax (attributable to equity holders of the Company) of $75.3 million for the year ended March 2010, in line with guidance provided to the market in February 2010. The result was down 29.1% on the record $106.2 million realised in the year ended March 2009 and was generated from a turnover of $825.5 million, representing a 10.3% decrease on the $920.3 million of 2009.

The Chairman of Campbell Brothers, Geoff McGrath, said the 2010 full year results compare favourably with those achieved two years ago, whereby revenue was 6.9% ahead of that earned in the year to March 2008 ($772.3 million) and net profit after tax was up 5.7% (March 2008 underlying net profit after tax excluding unusual items: $71.3 million).

“In historical terms, both revenue and net profit after tax for the 2010 financial year were second only to the record results booked in the year to March 2009”.

Directors have declared a final partly franked (50%) dividend for the year of 55 cents per share (2009: 50 cents partly franked) bringing the total partly franked (50%) dividend for the year to $1.00 (2009: $1.00 partly franked). The dividend will be paid on 1 July 2010 on all shares registered in the Company’s register at the close of business on 11 June 2010. The DRP discount will be 7.5% (2009: 7.5%).

The consolidated result is summarised as follows:

Financial Results $’000 ALS Minerals ALS Environmental ALS Coal ALS Tribology ALS Industrial Campbell Chemicals Reward Distribution Intra-group revenue Total divisional	Revenue	Contribution
	FY2010 FY2009 + / - 204,984 310,790 (34.0%) 245,205 234,920 4.4% 61,755 59,159 4.4% 29,826 23,957 24.5% 19,823 - N/A 151,799 164,310 (7.6%) 117,785 132,785 (11.3%) (5,644) (5,570)	FY2010 FY2009 + / - 53,344 112,220 (52.5%) 43,798 28,362 54.4% 15,034 13,189 14.0% 4,643 2,075 123.7% 1,299 - N/A 8,246 7,928 4.0% 3,424 3,411 0.4%
	825,533 920,351 (10.3%)	129,788 167,185 (22.4%)
Net finance expenses Net gain/(loss) on foreign exchange Unallocated corporate costs and net result attributable to minority interest Income tax expense	(11,121) (14,415) (6,514) 7,955 (5,881) (9,999) (30,971) (44,517)
Net profit after tax	75,301 106,209 (29.1%)

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The Managing Director of Campbell Brothers, Greg Kilmister, said that the year to March 2010 saw the Group produce a sound financial performance in an uncertain economic environment, demonstrating the benefits of the scalability of its businesses and its global footprint, especially in relation to its laboratory services business.

“The fall in revenue and profit was largely due to reduced global demand in mineral exploration markets for analytical testing services provided by the ALS Minerals division. Mineral sample flows decreased by between 20 and 51 percent in different regions of the world, and yet our hub and spoke model produced excellent performance in our Minerals Division under these very challenging circumstances. All other divisions of the ALS Laboratory Group produced improved revenue and profit contribution over the previous year”.

During the year, the Group continued its strategy of business expansion and diversification in laboratory testing and inspection services.

•  In November 2009, ALS Laboratory Group expanded its profile in the Australian water services sector with the acquisition of Ecowise Environmental Pty Limited (now part of the ALS Environmental division).

•  In Jan 2010, the ALS Laboratory Group broadened its technical services capability through the acquisition of PearlStreet Limited (now ALS Industrial division), the largest non-destructive testing services provider in Australia, which provides testing, inspection and asset care services to the energy, resources and infrastructure sectors.

These acquisitions were funded from a one for six renounceable rights issue of ordinary shares undertaken at $22.00 per share, raising approximately AUD192 million in share capital (net of underwriting fees and other costs). A total of 8,939,575 new shares were allotted on 11 November 2009.

The addition of these new businesses to the portfolio, together with existing operational capacity, have placed the Group in a strong position to take advantage of opportunities as business conditions improve.

Mr Kilmister stated that recent business volumes indicate that growth is returning to the markets serviced by the Group.

“Although the ALS Minerals business experienced a significant reduction in sample volumes during the year as global exploration activity fell in response to tight credit conditions, increases in sample flows in the last two months of the financial year give cause for cautious optimism about the year ahead”.

“Whilst the contribution margin as a percentage of revenue fell substantially from the previous year, the division’s ability to react quickly in reducing its variable costs produced a strong margin performance given the difficult market conditions”, he added.

The ALS Environmental division produced a strong result for the full year to March 2010, with the increase in revenue driven by both acquired and organic growth.

Cost control initiatives across all regions resulted in a significant improvement in contribution margin. The integration of Ecowise Environmental into the Australian water resources

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segment of the ALS Environmental division offers strong growth potential for the coming year.

Continuing resilient levels of global export activity provided the impetus for a healthy performance by ALS Coal in Australia. ALS’ African coal operations had a more challenging year due to a higher exposure to smaller local producers. The division maintained its focus on efficiency during the year producing a consistently strong contribution margin on revenue.

ALS Tribology had the benefit of a full twelve months’ contribution from its North American business, Staveley Services (acquired August 2008), in the year to March 2010 and strong organic growth in Australia. A focus on expense management enabled the division to significantly improve its contribution margin on revenue.

Mr Kilmister said that the directors are optimistic about the potential for the ALS Industrial division, established following the acquisition of PearlStreet Limited in January 2010, to contribute significantly to the Group in terms of both its own performance as integration synergies are realised and through the increased breadth of services now available to existing and future clients.

The Campbell Chemicals division experienced varied economic conditions across its many markets in Australia and the Pacific. The industrial chemicals business returned improved margins on sales despite lower revenue and the weakening US dollar.

“A focus on client service and operational efficiency in the face of difficult market conditions enabled the Panamex trading business to produce a consistent revenue and margin performance”, Mr Kilmister said.

Reward Distribution realised reduced revenue as a result of tight tourism and hospitality markets, strong pricing competition and the continuing reassessment of target markets.

“The business is realising the benefits of cost control initiatives of the previous twelve months as evidenced by improving contribution margin on revenue despite falling sales”.

Subsequent to the end of the financial year, on 18 May 2010, the Company made an offer for all the shares in Perth-based metallurgical and mineral testing services company, Ammtec Limited (ASX Code: AEC), at $3.35 per share. The offer values Ammtec at $123 million, with the offer conditional on the bid reaching 90 percent acceptance level.

On 19 May 2010, ALS acquired the Sydney-based Pharma business, BV Pharma, from Amdel Limited. It will be integrated into the ALS Environmental division’s Food & Pharmaceutical business.

ENDS:

For further information:

Greg Kilmister, Managing Director, Campbell Brothers Limited, +61 7 3367 7900

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