GR ENGINEERING SERVICES LIMITED — AGM Information 2011

Nov 9, 2011

AGM Company Presentation 10 November 2011

Ref: 90038 1584:P:jm

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DISCLAIMER
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This document has been prepared by GR Engineering Services Limited (“GR Engineering”) to provide an overview and update of GR Engineering‟s activities and 2010/2011 financial performance.

Any statements, opinions, projections or other material contained in this document do not constitute any commitments, representations or warranties by GR Engineering and associated entities or its directors, agents and employees. Except as required by law, and only to the extent so required, directors, agents and employees of GR Engineering shall in no way be liable to any person or body for any loss, claim, demand, damages, costs or expenses of whatsoever nature arising in any way out of, or in connection with, the information contained in the document.

This document includes certain statements, opinions, projections and other material, which reflect various assumptions. The assumptions may or may not prove to be correct. Recipients of the document must make their own independent investigations, consideration and evaluation of the opportunity to participate in any investment. By accepting this document the recipient agrees that if it proceeds further with its investigations, consideration or evaluation of the opportunity to participate in any investment it shall make and rely solely upon its own investigations and inquiries and will not in any way rely upon the document.

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PRESENTATION OUTLINE
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 About GR Engineering

 FY11 Financial Results

 FY12 Outlook



Recent and Current Project Photos

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ABOUT GR ENGINEERING
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

• Australian based Engineering Design and Construction Contractor servicing the mining and minerals processing industry.

 Specialising in Engineering, Procurement and Construction (EPC) contracting to provide turnkey project delivery with secure cost, time, plant performance and contract completion warranties and guarantees – hard money contracting.

 Founded in October 2006 but management team origins go back to 1986 when establishing JR Engineering.

 Employs +185 professional and support staff plus 150 -

300 direct construction workforce and subcontractors.



ASX listed 19 April 2011 following successful IPO.

 Offices in Perth, Kalgoorlie and Brisbane.

 Provided services in over 20 countries across a range of commodities.



• Very strong in gold, base metals and industrial mineral commodities.

• GRES operates in a niche market – Limited EPC competitors, high barriers to entry.

• Over 80% of revenue is non-tendered.

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ABOUT GR ENGINEERING
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GR Engineering’s Clients

Gold Base Metals Other

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FY11 FINANCIAL RESULTS
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• NPAT of $21.1 million against IPO forecast of $18.8 million.

• Revenue of $142.5 million against IPO forecast of $138.3 million.

• Fully franked dividend of 4 cents as per IPO forecast, payable 10 November 2011. In line with target 50% - 60% payout policy.

• Current market cap of $280M (at $1.87 share price).

• Almost 80% of shares are still with original shareholders.

Financial Year Ending 30 June	FY11 Actual $’000	FY10 Actual $’000	% Change
Total Revenue	142,511	128,217	+11.1
EBITDA	28,877	24,228	+23.1
Depreciation & Amortisation	(542)	(500)	+10.2
EBIT	28,335	23,728	+19.2
Net Interest Income	912	699	+36.8
PBT	29,247	24,427	+19.7
Tax	(8,149)	(6,592)	+23.6
NPAT	21,098	17,835	+18.3

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FY11 FINANCIAL RESULTS
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

Revenue and EBIT history.

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Revenue ($ Millions)
160.0 142.5
128.2
140.0
106.2
120.0
100.0 79.1
80.0
60.0
40.0
20.0
0.0
2008A 2009A 2010A 2011A
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Earnings Before Interest and Tax
($ Millions)
28.3
30.0
23.7
25.0 21.1
20.0
12.6
15.0
10.0
5.0
0.0
2008A 2009A 2010A 2011A
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 Balance sheet strength:

• Balance sheet can support significant project bonding requirements for larger EPC Contracts with aggregate value of around $400M. Normally 5-10% of Contract value.

• Very low capital expenditure/strong cash flow business.

• No material debt.

• Zero intangibles.

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

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FY11 FINANCIAL RESULTS
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Revenue Analysis

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Revenue by Service
Studies &
Studies &
Consulting 6%
Consulting
11%
2010A 2011A
Project Design Project Design
& Construction & Construction
94% 89%
Revenue by Commodity
Nickel
15%
Nickel
18%
Other 2011A
2010A 2% Gold Other
64% 21%
Gold
80%
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FY12 OUTLOOK
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• Maintain robust financial performance:

• Carrying forward $100M revenue into FY12.

• Since won a further $55M of work resulting in $150M revenue for FY12 on basis of conversion of Conditional Letter of Intent.

• Currently undertaking 25 feasibility studies of which over 17 are gold related studies including 6 for overseas projects – record levels.

• Recently completed and current final stage studies with a potential EPC contract value of +$850M over the next 1 to 3 years. Target 50% conversion rate.

• Confident of further near to medium term study conversions to contribute to FY12 revenue.

• Currently undertaking 8 projects.

• Strong balance sheet and cash balance to continue.

• Increasing opportunities in larger +$100M EPC projects.

• Maintain strong focus on gold projects given current world financial and currency volatility.

• Increasing involvement in iron ore projects initially via studies and design services.

• Major mining companies are now also looking at EPC project delivery as a result of significant cost/time overruns within alternate delivery models (EPCM) – opportunity for GRES.

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FY12 OUTLOOK
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• Continue with proven business model.

• Rising costs to be recognised in study estimates and tenders.

• Maintain strong OHSE performance (current LTIFR for FY11 onwards is zero).

• Maintain excellent industry track record and reputation for cost efficient, timely, safe and „fit for purpose‟ project delivery.

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• Continue focus on organic growth via:

• Additional high quality staff and continue staff retention strategy.

• Brisbane office expansion.

• Increasing international study and project services.

• Attracting new clients/maintain current clients.

• Larger EPC project opportunities.

• Management, organisational structure, balance sheet and client base in place to cater for future company growth. GRES can accommodate significant revenue growth if opportunities convert to work won.

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RECENT AND CURRENT PROJECT PHOTOS
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Xstrata Nickel – Cosmos Plant Upgrade

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RECENT AND CURRENT PROJECT PHOTOS
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Integra Mining – Randalls Plant Upgrade

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RECENT AND CURRENT PROJECT PHOTOS
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First Quantum Minerals – Ravensthorpe Bagging Plant

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RECENT AND CURRENT PROJECT PHOTOS
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Ramelius Resources – Mt Magnet Plant Refurbishment

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RECENT AND CURRENT PROJECT PHOTOS
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Newcrest Mining – Telfer Flotation Upgrade

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RECENT AND CURRENT PROJECT PHOTOS
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CBH Resources – Rasp Project

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RECENT AND CURRENT PROJECT PHOTOS
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CBH Resources – Rasp Project

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RECENT AND CURRENT PROJECT PHOTOS
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Oz Minerals – Prominent Hill Paste Plant

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RECENT AND CURRENT PROJECT PHOTOS
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Mineral Resources – Christmas Creek 1 Desands Plant

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RECENT AND CURRENT PROJECT PHOTOS
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Raub Australian Gold Mines – Raub Plant Upgrade (Malaysia)

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