CVC LIMITED — Interim / Quarterly Report 2007

Feb 25, 2007

CVC LIMITED AND ITS CONTROLLED ENTITIES

HALF YEAR FINANCIAL REPORT

For the half-year ended 31 December 2006

ACN 002 700 361

COMPANY PARTICULARS

CVC LIMITED

ACN 002 700 361

DIRECTORS

Vanda R Gould John S Leaver John D Read Alexander D H Beard John T Riedl

SECRETARIES

Alexander D H Beard John A Hunter

MANAGEMENT TEAM

Alexander D H Beard Michael J Bower Gaibrielle L S Cleary William J Highland John A Hunter Christian T Jensen Elliott G Kaplan Geoffrey P Leaver

PRINCIPAL AND REGISTERED OFFICE

Level 42, 259 George Street SYDNEY, NSW 2000, AUSTRALIA Telephone: $(02)$ 9087 8000 Facsimile: (02) 9087 8088

SHARE REGISTRY

Gould Ralph Services Pty Limited Share Registry Division Level 42, 259 George Street SYDNEY, NSW 2000, AUSTRALIA Telephone: $(02)$ 9032 3000 $(02)$ 9032 3088 Facsimile:

AUDITORS

HLB Mann Judd (NSW Partnership) Chartered Accountants Level 19, 207 Kent Street SYDNEY, NSW 2000, AUSTRALIA

BANKERS

Westpac Banking Corporation Limited Suncorp-Metway Limited

STOCK EXCHANGE LISTING Australian Stock Exchange Limited

CVC LIMITED & CONTROLLED ENTITIES DIRECTORS' REPORT

The Directors present their report together with the consolidated financial report for CVC Limited and its controlled entities ("CVC") for the half-year ended 31^st December 2006 and the independent review thereon.

Directors

The Directors of the Company throughout and since the end of the half-year are:

Vanda Russell Gould (Chairman) John Scott Leaver (Non Executive Director) John Douglas Read (Non Executive Director) Alexander Damien Harry Beard (Non Executive Director and Company Secretary) John Thomas Riedl (Non Executive Director)

Operating Results

The net profit after tax for the six months ended 31^st December 2006 attributable to shareholders of CVC amounted to \$7.9 million.

Review of Operations

As always the results of CVC are significantly impacted by the timing of major investment realisations. In mitigation, the Board has continued the strategy of creating more recurrent income whilst remaining cognisant of the need to continue the development and attraction of investees so as to provide regular realisation opportunities. However, in pursuing this strategy the Board remains steadfastly committed to developing longer term value for shareholders rather than on timing realisations for accounting outcomes.

The reported profit of \$7.9 million for a half year has been almost entirely generated from recurrent earnings streams from all business segments. In addition, the half-year saw significant progress in value generation and towards realisation opportunities for a number of investees including the Fern Bay property and Probiotec Limited, amongst others.

A more detailed review of operations and developments is included in the commentary that accompanies the ASX release of these results.

Auditor's Independence Declaration

A copy of the Independence Declaration given to the Directors by the lead auditor for the review undertaken by HLB Mann Judd (NSW Partnership) is included on page 15.

Dividende

Dividends of \$3,491,820 were paid during the period. Since the end of the period, the directors paid a 6 cents per share interim dividend on 22nd February 2007.

Signed and Dated Sydney this 23rd day of February 2007 in accordance with a resolution of Directors.

ALEXANDER D. H. BEARD Director

VANDA R GOULD Director

CVC LIMITED & CONTROLLED ENTITIES INCOME STATEMENT FOR THE HALF YEAR ENDED 31 DECEMBER 2006

	Notes	Consolidated
		31 Dec 2006	31 Dec 2005
		5	\$
INCOME
Dividends received		2,757,418	2,619,012
Interest income		2,570,021	2,470,883
Net gain on sale of equity investments		4,719,106	135,427
Recoveries of loans			682,438
Recoveries on equity investments		67,000
Sales of services		1,014,544	493,537
Other income		315,943	420,661
Total income		11,444,032	6,821,958
Equity accounted profits /(losses)
Share of net profits/(losses) of associates	8	1,136,329	(540,329)
Share of net profits of joint ventures	8	3,385	36,019
Net equity accounted profits/(losses)		1,139,714	(504,310)
EXPENSES
Audit fees		30,000	16,000
Amortisation of intangible assets		58,500	58,500
Finance costs		95,971	70,766
Depreciation expense		17,694	23,358
Directors fees		37,000	25,000
Employee costs		787,862	612,959
Impairment expenses on loans			1,051,613
Legal and associated costs		1,691	20,894
Management and consultancy fees		820,300	592,849
Operating lease expense		185,382	175,146
Other expenses		538,337	424,073
Total expenses		2,572,737	3,071,158
Profit before related income tax expense		10,011,009	3,246,490
income tax expense	2	2,144,786	208,586
Profit		7,866,223	3,037,904
Net profit attributable to minority interests		16	2
Profit attributable to members of the parent entity	13	7,866,207	3,037,902
Basic and diluted earnings per share (cents)	4	6.75	2.39
Dividends paid during period per share (cents)	3	3.00	3.00

The above income statement should be read in conjunction with the accompanying notes to the Half Year Report.

CVC LIMITED & CONTROLLED ENTITIES BALANCE SHEET AS AT 31 DECEMBER 2006

	Notes	Consolidated
		31 Dec 2006	30 Jun 2006
		\$	\$
CURRENT ASSETS
Cash and cash equivalents	5	8,172,796	24,194,797
Trade and other receivables	6	23,964,929	15,799,635
Current tax assets			304,864
Assets held for resale	7	17,560,409
Other assets		104,332	89,531
Total current assets		49,802,466	40,388,827
NON-CURRENT ASSETS
Trade and other receivables	6	6,067,098	5,422,656
"Available-for-sale" financial assets	9	182,792,001	126,588,621
Investments accounted for using the equity method	8	8,749,263	11,157,964
Investment properties		2,808,837	2,818,637
Property, plant and equipment		37,037	19,424
Intangible assets	10	8,627,854	8,686,354
Deferred tax assets		936,051	1,039,109
Total non-current assets		210,018,141	155,732,765
TOTAL ASSETS		259,820,607	196,121,592
CURRENT LIABILITIES
Trade and other payables	11	1,058,361	2,145,874
Provisions		165,169	323,985
Current tax liabilities		1,752,151	4,641,279
Total current liabilities		2,975,681	7,111,138
NON-CURRENT LIABILITIES
Other financial liabilities		3,177,269	2,113,032
Deferred tax liabilities		38,720,825	19,491,298
Total non-current liabilities		41,898,094	21,604,330
TOTAL LIABILITIES		44,873,775	28,715,468
NET ASSETS		214,946,832	167,406,124
EQUITY
Contributed equity	12	37,652,039	38,633,426
Retained profits	13	102,452,055	98,077,668
Other reserves	14	74,842,547	30,694,856
Total parent entity interest		214,946,641	167,405,950
Minority interest		191	174
TOTAL EQUITY		214,946,832	167,406,124

The above balance sheet should be read in conjunction with the accompanying notes to the Half Year Report.

CVC LIMITED & CONTROLLED ENTITIES STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED 31 DECEMBER 2006

	Notes		Consolidated
		31 Dec 2006	31 Dec 2005
		5	S
INCOME AND EXPENSES RECOGNISED DIRECTLY IN EQUITY
"Available-for-sale" investments:
- Increase in fair values recognised in other reserves	14	66,556,945	11,474,262
- Amounts transferred from other reserves to the income
statement on sale	14	(3,568,955)	187,323
- Income tax on fair value movements taken to or from other reserves	14	(18,896,395)	(3,498,476)
- Value of equity based remuneration recognised in other reserves	14	59,441	55,223
- Value of associates equity based remuneration recognised in other reserves	14	(3,345)
Net income reflected directly in equity		44,147,691	8,218,332
Profit for the half-year		7,866,223	3,037,904
Total recognised income and expense for the half-year		52,013,914	11,256,236
Attributable to:
Shareholders		52,013,898	11,256,234
Minority interests		16
		52,013,914	11,256,236
TRANSACTIONS WITH SHAREHOLDERS IN THEIR CAPACITY AS SHAREHOLDERS
Shares issued during the half-year:
- through the dividend reinvestment plan	12	139,942	782,417
- under the executive and non-executive long term incentive plan	12	2,999	1,000
Payments for share buy-backs	12	(1,124,328)	(5,925,024)
Dividends paid to shareholders	3	(3,491,819)	(3,823,435)
Total transactions with shareholders in their capacity as shareholders		(4,473,206)	(8,965,042)
Net increase in equity for the half-year		47,540,708	2,291,194
Equity at the beginning of the half-year		167,406,124	155,218,516
EQUITY AT THE END OF THE HALF-YEAR		214,946,832	157,509,710

The above statement of changes in equity should be read in conjunction with the accompanying notes to the Half Year Report.

CVC LIMITED & CONTROLLED ENTITIES CASH FLOW STATEMENT FOR THE HALF YEAR ENDED 31 DECEMBER 2006

	Notes		Consolidated
		31 Dec 2006	31 Dec 2005
		\$	S
CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts in the course of operations		1,056,933	412,825
Cash payments in the course of operations		(3,435,311)	(1,493,296)
Interest received		1,376,048	1,318,979
Dividends received		2,757,418	2,477,235
Interest paid		(52, 926)	(57,300)
Income taxes paid		(4,291,428)	(710, 513)
Net cash flows (used in)/provided by operating activities	5(b)	(2,589,266)	1,947,930
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for property, plant and equipment		(25,507)	(1,007)
Payments for investment property			(2,833,994)
Payments for equity investments		(16, 335, 587)	(19, 436, 045)
Payments for controlled entities net of cash acquired			(190,000)
Proceeds on disposal of equity investments		14,097,748	2,947,546
Loans provided		(10,492,338)	(2,985,058)
Loans repaid		3,712,159	6,057,191
Net cash flows used in investing activities		(9,043,525)	(16, 441, 367)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings			2,100,000
Dividends paid to members of the parent entity		(3, 404, 824)	(2,957,018)
Payments for share buy-backs		(1, 124, 328)	(5,925,024)
Issue of shares		139,942
Net cash flows used in financing activities		(4,389,210)	(6,782,042)
Net decrease in cash held		(16,022,001)	(21, 275, 479)
Cash at the beginning of the half-year		24,194,797	41,277,130
CASH AT THE END OF THE HALF-YEAR	5(a)	8,172,796	20,001,651

The above cash flow statement should be read in conjunction with the accompanying notes to the Half Year Report.

NOTE 1: BASIS OF PREPARATION

The half-year financial report is a general-purpose financial report, which has been prepared in accordance with the requirements of AASB 134 Interim Financial Reporting and the Corporations Act 2001.

This interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report should be read in conjunction with the annual report for the year ended 30 June 2006 and any public announcements made by CVC during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period.

		Consolidated
	31 Dec 2006	31 Dec 2005
	\$	\$
NOTE 2: INCOME TAX EXPENSE
Income tax expense:
Prima facie income tax expense at 30% (2005: 30%) on profit before income tax	3,003,303	973,947
Increase in income tax expense due to:
Sundry items	11.140	5,998
Equity based remuneration	17,832	16,567
Decrease in income tax expense due to:
Franked dividends received	(781, 490)	(785, 704)
Recovery of deferred tax assets not previously recognised	(17,633)	(2, 222)
	2,233,152	208,586
Prior year over provision	(88, 366)
Income tax expense for the half-year	2,144,786	208,586

NOTE 3: DIVIDENDS

Dividends proposed or paid and not provided for in previous periods by the company are:

On 26 September 2006, the Company paid a final dividend in respect of the year ended 30 June 2006 of 3 cents per share, equivalent to a total dividend of \$3,491,820.

On 9 February 2007, the Company declared an interim dividend of 6 cents per share which was paid on 22 February 2007 to shareholders registered on 20 February 2007.

NOTE 4: EARNINGS PER SHARE

Basic and diluted earnings per share	Cents 6.75	Cents 2.39
Reconciliation of earnings used in calculation of earnings per share:	5	\$
Net profit	7,866,223	3,037,904
Less: profit attributable to minority interests	(16)	(2)
Earnings used in calculation of earnings per share:	7,866,207	3,037,902
	.	.

		Number of Shares
Weighted average number of ordinary shares	116.555.133	127.005.299

NOTE 5: NOTES TO THE CASH FLOW STATEMENT

a) Reconciliation of Cash and Cash Equivalents

For the purposes of the cash flow statement, cash includes cash on hand and at bank and short-term deposits at call, net of outstanding bank overdraft. Cash as at the end of the interim reporting period is reconciled to the related items in the balance sheet as follows:

	Consolidated
	31 Dec 2006	30 Jun 2006
	s	\$
Cash and cash equivalents	8,172,796	24,194,797
b) Reconciliation of profit after income tax to the net cash (used in)/provided by operating activities:
	31 Dec 2006	31 Dec 2005
	5	\$
Profit after income tax	7,866,223	3,037,904
Add/(less) non-cash items:
Share of equity accounted losses/ (profits)	(1, 139, 714)	504,310
Dividend income received as equity investments		(141,777)
Other income received as equity instruments		(164,026)
Depreciation and amortisation of property, plant and equipment	17,694	23,358
Amortisation of intangible assets	58,500	58,500
Net impairment provisions decrease	(67,000)	(242, 176)
Net profit on disposal of investments	(4,719,106)	(135, 427)
Equity remuneration	62,440	56,223
Interest income not received	(1, 193, 973)	(1, 151, 904)
Interest expense not paid	43,045	13,466
Movement in income tax provision	(2,584,263)	(710, 513)
Movement in deferred tax assets and liabilities	437,620	208,585
Changes in assets and liabilities:
Trade and other receivables	(273, 554)	(337, 347)
Trade and other payables	(1,087,511)	919,023
Provisions	5,134	2,372
Other assets	(14, 801)	7,359
Net cash (used in)/provided by operating activities	(2,589,266)	1,947,930
NOTE 6: TRADE AND OTHER RECEIVABLES
Current
Trade and other receivables	3,841,306	648,235
Loans to other corporations	13,080,618	11,735,465
Loans to related entities	7,043,005	3,415,935
	23,964,929	15,799,635
Non-Current
Loans to other corporations	3,075,640	2,559,452
Loans to Director related entities	1,913,605	1,848,688
Loans to related entities	1,077,853	1,014,516
	6,067,098	5,422,656

NOTE 7: ASSETS HELD FOR RESALE

	Consolidated
	31 Dec 2006	30 Jun 2006
	\$	\$
Shares in associated entity (a)	3,601,933
Shares in listed corporations at market value	13,958,476	$\sim$
	17,560,409

(a) Shares in associated entity

This represents CVC's interest in the Lauden CVC Property Trust which was previously disclosed in Note 8 investments accounted for using the equity method.

NOTE 8: INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Equity accounted shares in listed associated companies (a)	471.210	516.386
Equity accounted shares in other associated companies (a)	8.159.108	10.526.018
Equity accounted interests in joint ventures (b)	118.945
	8.749.263	11.157.964

(a) Associated entities

Details of associated entities are as follows:

	% Ownership at end of half-year		Carrying value		Contribution to net profit
	31 Dec 06	30 fun 06	31 Dec 06	30 lun 06	31 Dec 06	31 Dec 05
			\$	\$	S	\$
CVC Private Equity Limited	25%	25%	4,873,780	4.729,024	46,306	162,691
CVC Reef Investment Managers Limited	$50\%$	50%	10.246	32,048	(21, 802)	(22,068)
Lauden CVC Property Trust	45%	45%	$\theta$	3,604,087	(2.154)	(17, 826)
Ron Finemore Transport Pty Limited	25%	25%	570,658	508,061	62,598	(326, 834)
CVC Trinity Property Fund	$39\%$	20%	471.210	516,386	(243)
Winten (No. 20) Pty Limited	$50\%$	50%	2.704.424	1.652.798	1.051.624	(336,292)
			8,630,318	11.042.404	1.136.329	(540,329)

(b) Joint Ventures

Details of joint ventures are as follows:

		% Ownership at end of half-year	Carrying value		Contribution to net profit
	31 Dec 06	-30 fun 06	31 Dec 06	30 lun 06	31 Dec 06	31 Dec 05
			\$	\$	S	\$
Bel-Air Real Estate	$50\%$	50%	×.			51
Chevron Developments	$50\%$	50%	116,611	113,175	3,437	36,031
Skyline Investments Australia	$50\%$	50%	2,334	2,385	(52)	(63)
			118.945	115.560	3.385	36,019

			Consolidated
			31 Dec 2006	30 Jun 2006
			5	\$
NOTE 9: "AVAILABLE-FOR-SALE" FINANCIAL ASSETS
Non-Current
Shares in listed corporations - at market value			170,800,849	110,764,571
Other investments - at cost			11,991,152	12,222,396
Other investments - at fair value				3,601,654
			182,792,001	126,588,621
NOTE 10: INTANGIBLE ASSETS
Management agreements and licences			1,170,000	1,170,000
Accumulated amortisation			(263,250)	(204,750)
Total management agreements and licences			906,750	965,250
Goodwill			7,721,104	7,721,104
Total intangible assets			8,627,854	8,686,354
NOTE 11: TRADE AND OTHER PAYABLES
Trade and other payables			469,150	1,558,713
Loans from joint venture entities			75,000	75,000
Sundry creditors and accruals			472,253	428,986
Goods and services tax payable			41,958	83,175
			1,508,361	2,145,874
		31 Dec 2006		31 Dec 2005
NOTE 12: CONTRIBUTED EQUITY	Number	5	Number	\$
Issued and paid-up ordinary share capital
Balance at the beginning of the half-year	117,185,681	38,633,426	127,447,838	52,509,394
Shares issued during the period:
- through the dividend reinvestment plan	99,522	139,942	567,856	782,417
- under the employee long term incentive plan			200,000
- under the employee share acquisition plan Shares bought back on market	2,079 (803, 117)	2,999 (1,124,328)	800 (4,716,437)	1,000 (5,925,024)
Balance at the end of the half-year	116,484,165	37,652,039	123,500,057	47,367,787

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$\overline{1}$

	Consolidated
	31 Dec 2006	31 Dec 2005
	S	\$
NOTE 13: RETAINED PROFITS
Balance at the beginning of the half-year	98,077,668	82,300,999
Net profit attributable to shareholders	7,866,207	3,037,902
Dividends	(3,491,820)	(3,823,435)
Balance at the end of the half-year	102,452,055	81,515,466

NOTE 14: OTHER RESERVES	Asset Revaluation Reserve S	Consolidated Employee Equity Benefit Reserve	Total S
Half year ended 31 December 2006:
Balance at the beginning of the half-year	30,478,801	216,055	30,694,856
Equity based remuneration for the half-year		59,441	59,441
Option exercised		(3.345)	(3,345)
Increase in fair values of "available-for-sale" investments	66,556,945		66,556,945
Fair value decrements transferred to the income statement
during the period on realisation	(3,568,955)		(3,568,955)
Deferred income tax in respect of fair value movements	(18,896,395)		(18,896,395)
Balance at the end of the half-year	74,570,396	272,151	74,842,547
Half year ended 31 December 2005:
Balance at the beginning of the half-year	20,301,127	106,827	20,407,954
Equity based remuneration for the half-year		55.223	55,223
Increase in fair values of "available-for-sale" investments	11,474,262		11,474,262
Fair value decrements transferred to the income statement
during the period on realisation	187,323		187,323
Deferred income tax in respect of fair value movements	(3,498,476)		(3,498,476)
Balance at the end of the half-year	28,464,236	162,050	28,626,286

NOTE 15: SEGMENT REPORTING

The revenues and results by business segments are as follows:

	Private Equity and Venture Capital 5	Listed Investments S	Property \$	Funds Management \$	Unallocated, Corporate and Tax S	Consolidated 5
Half-year ended 31 December 2006:
Segment revenues	3,141,587	5,072,328	1,807,446	641,360	781,311	11,444,032
Segment result	3,141,587	5,072,328	1,797,646	574,966	(1,715,232)	8,871,295
Half-year ended
31 December 2005:
Segment revenues	1,509,701	2,778,531	622,850	851,176	1,059,700	6,821,958
Segment result	458,088	2,778,531	606,739	703,568	(796, 126)	3,750,800

Segment revenues and results exclude equity accounted profits/losses and are shown before related income tax expense.

NOTE 16: ASSETS PER SECURITY

		Consolidated
	31 Dec 2006	30 June 2006
	Cents	Cents
Net assets per share	184.5	142.9
Net tangible assets per share	177.1	135.4

The figures above are calculated based on the consolidated balance sheet of CVC Limited.

NOTE 17: CONTINGENT ASSETS AND LIABILITIES

There are no significant changes in the contingent assets and liabilities as disclosed in the 2006 annual report.

NOTE 18: SUBSEQUENT EVENTS

On 16 January 2007 CVC provided \$3.375 million mezzanine finance to the Sakkara Group for its Synergy North project, a 40 unit residential project on Sydney's North Shore.

On 9 February 2007 the Company declared an interim dividend of 6 cents per share which was paid on 22 February 2007 to shareholders registered on 20 February 2007.

On 16 February 2007 CVC announced that it had completed a placement of 55 million ordinary shares for \$2.00 per share. The placement will be made in two tranches. The first tranche was the placement of 17.4 million shares which was completed on 22 February 2007 and the remaining tranche of 37.6 million shares is subject to shareholder approval at a General Meeting to he held on 28 March 2007.

On 21 February 2007 Winten (No. 20) Pty Limited signed an agreement with Aspen Group Limited appointing them as developer of the Fern Bay Seaside Village for \$76.6 million returning approximately \$21 million to CVC. CVC holds a 50% interest in Winten (No. 20) Pty Limited as set out in Note 8(a) Associated entities.

On 22 February 2007 at a meeting of shareholders of Green's Food Limited the acquisition by Nestle Purina Petcare was approved and is subject to approval from the Supreme Court of New South Wales on 26 February 2007. CVC holds 15.9 million shares in Green's Food Limited and subject to Supreme Court approval will return approximately \$14.3 million.

CVC LIMITED & CONTROLLED ENTITIES HALF YEARLY REPORT

DIRECTORS' DECLARATION

In the opinion of the Directors:

• the interim financial statements and notes set out on pages 4 to 13, are in accordance with the Corporations Act $(a)$ 2001 including:
• complying with Accounting Standards and interpretations and the Corporations Regulations 2001, and $(i)$
• $(ii)$ giving a true and fair view of the consolidated entity's financial position as at 31 December 2006 and of its performance, as represented by the results of its operations, changes in equity and its cash flows, for the half-year ended on that date; and
• $(b)$ there are reasonable grounds to believe that CVC Limited will be able to pay its debts as when they become due and payable.

This declaration is made in accordance with a resolution of the Board of directors.

Dated at Sydney 23rd day of February 2007.

ALEXANDER D. H. BEARD Director

VANDA R GOULD Director

CVC LIMITED & CONTROLLED ENTITIES HALF YEARLY REPORT

AUDITOR'S INDEPENDENCE DECLARATION

To the Directors of CVC Limited:

As lead auditor for the review of CVC Limited and its controlled entities for the half-year ended 31 December 2006, I declare that, to the best of my knowledge and belief, there have been:

a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the review; and

b) no contraventions of any applicable code of professional conduct in relation to the review.

Mark Muller Partner

HLB MANN JUDD (NSW Partnership) Chartered Accountants

Sydney, 23rd February 2007

CVC LIMITED & CONTROLLED ENTITIES HALF YEARLY REPORT

INDEPENDENT REVIEW REPORT

To the members of CVC Limited (ACN 002 700 361)

Scope

We have reviewed the accompanying half year financial report of the CVC Limited Group ("the consolidated entity") which comprises the balance sheet as at 31 December 2006, and the income statement, statement of changes in equity and cash flow statement for the half-year ended on that date, accompanying notes to the financial statements and the directors' declaration as set out on pages 4 to 14. The consolidated entity comprises CVC Limited and the entities it controlled during the half-year.

Directors' Responsibility for the Half-Year Financial Report

The directors of the company are responsible for the preparation and fair presentation of the half year financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Act 2001. This responsibility includes designing, implementing and maintaining internal controls relevant to the preparation and fair presentation of the half-year financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditors' Responsibility

Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of an Interim Financial Report Performed by the Independent Auditor of the Entity, in order to state whether, on the basis of the procedures described, we have become aware of any matters that makes us to believe that the financial report is not in accordance with the Corporations Act 2001 including giving a true and fair view of the consolidated entity's financial position as at 31 December 2006, and its performance for the half-year ended on that date, and complying with Accounting Standard AASB 134: Interim Financial Reporting and the Corporations Regulations. As the auditor of the consolidated entity, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-vear financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001. We confirm that the independence declaration required by the Corporations Act 2001, provided to the directors of CVC Limited on 23 February 2007 would be in the same terms if provided to the directors as at the date of this auditors' review report.

Statement

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the halfvear financial report of the CVC Limited Group is not in accordance with the Corporations Act 2001, including:

• giving a true and fair view of the consolidated entity's financial position as at 31 December 2006 and of its $(i)$ performance for the half-year ended on that date; and
• complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations $(ii)$ Regulations 2001.

HLB Mann Judd (NSW Partnership) Chartered Accountants

M D Muller Partner

Sydney, 23rd February 2007