IMDEX LIMITED — Interim / Quarterly Report 2014

Feb 16, 2014

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8 Pitino Court, Osborne Park Western Australia 6017

PO Box 1262, Osborne Park Western Australia 6916

Tel: +61 (0) 8 9445 4020 Fax: +61 (0) 8 9445 4042 imdex@imdexlimited.com www.imdexlimited.com ABN 78 008 947 813

17 February 2014

Company Announcements Office ASX Limited Exchange Centre 20 Bridge Street SYDNEY NSW 2001

Dear Sir/Madam

RESULTS ANNOUNCEMENT, APPENDIX 4D AND FINANCIAL REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2013

Please find attached the 1H14 Results Announcement of Imdex Limited regarding the Group’s financial results and operating performance for the half year ended 31 December 2013.

The Appendix 4D and Half Yearly Financial Report for the half year ended 31 December 2013 follow this announcement.

Yours faithfully

Imdex Limited

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Paul Evans

Company Secretary

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Providing innovative drilling fluids and advanced down hole instrumentation worldwide.

IMDEX CONTINUES TO PROGRESS ITS DIVERSIFICATION STRATEGY

17 February, 2014

Imdex Limited (ASX: IMD) today announced its results for the six months ended 31 December 2013 (1H14). The results reflected growth in the company’s Oil & Gas Division to record levels offset by a contraction in the Minerals Division given the cyclical industry downturn and an earlier seasonal shutdown within this sector.

Commenting on the company’s 1H14 results, Imdex’s Managing Director, Mr Bernie Ridgeway said:

“While the overall Group results were down due to the challenging market conditions for our minerals business, it was pleasing to see continuing growth within the Oil & Gas Division and record levels for the half year.

“Prudent working capital initiatives and the partial sale of our shareholding in Sino Gas & Energy Holdings Ltd further reduced our debt levels. These initiatives, together with extended and improved debt facilities, enable us to actively pursue a number of growth opportunities and maintain our longer-term strategy of ongoing investment in the development of advanced technologies.”

“Imdex today is in a stronger position to benefit from existing trading conditions, any upturn in the minerals industry, and the attractive growth opportunities within our global oil and gas business”, added Mr Ridgeway.

Overview of 1H14 financial results

• Combined revenue (including Imdex’s share of VES International joint venture (VES) revenue) of $101.9 million, down 25% (1H13: $127.6 million);

• EBITA (including equity accounted VES result and profit on the partial sale of Imdex’s holding in Sino Gas and Energy (SEH)) was $20.0 million, down 24% (1H13: a profit of $26.2 million);

• Excluding profit from the SEH transaction, Imdex’s 1H14 EBITA result was a $0.1 million loss;

• • Net profit after tax was $15.3 million, down 8% (1H13: $16.6 million);

• Gross margins were largely maintained;

• Sound balance sheet with comfortable gearing, net debt / capital ratio reduced to 13% (1H13: 23.1%); and

• Banking facilities extended to December 2016 with covenants rebased on EBITDA rather than EBITA.

“While we cannot change the market conditions, continuing investment in our strategies for future growth is strengthening our Mining Division’s competitive advantage and its ability to yield additional returns from current trading conditions and when any upturn occurs. The cyclical nature of the minerals industry is the key motivator behind the company’s aggressive product development and diversification strategy.

“The main outcome from these strategies is to increase our customer base and derive more annuity style revenue. The company is developing a robust Oil & Gas Division to take advantage of the substantial growth opportunities within the global energy sector,” said Mr Ridgeway.

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Minerals Division

Imdex’s Minerals Division consists of the AMC and REFLEX businesses. These businesses market innovative drilling fluids, chemicals, solids removal technologies (SRUs), data management solutions, together with geo-analytical consulting services and software, for the global minerals industry. AMC is the leading provider of drilling fluids to the global industry and REFLEX is a global provider of data management and data analysis solutions to that industry.

Financial performance

Imdex’s Minerals Division revenue was down 38% to $63.7 million (1H13: $102.3 million). The Division contributed 62% of the company’s combined 1H14 revenue.

Key operational highlights

• Industry acceptance of SRU’s increased the number of units on hire before the seasonal holiday shutdown;

• Development of Imdex’s underground SRUs – units to be deployed in 3Q14;

• Ongoing development of Imdex’s heli-portable SRUs to meet customer demand – these units are currently in prototype;

• Broadening of REFLEX’s product offering to incorporate ioGlobal technologies;

• Increased throughput and continuing positive feedback with the marketing of REFLEX HUB;

• Completion of three new value adding REFLEX technologies, which will be officially launched during 2H14;

• Commercialisation of new fluid products and the ongoing success of AMC’s innovative Corewell and Clay Doctor products;

• Continued product development during the minerals sector downturn producing an exciting pipeline of AMC fluids and REFLEX technologies;;

• Expansion of the Division’s customer base, together with greater exposure to resource companies and the production phase of the mining cycle; and

• Commissioning of a new REFLEX repair centre in Ghana, West Africa to enhance customer service in this growth area.

Mr Ridgeway said while the downturn within the minerals industry is challenging in the short-term, these challenges also present additional opportunities for Imdex.

“Large resource companies and drilling companies are continuing to reduce expenditure, cut costs and increase the efficiencies of their operations. Our technologies can assist those companies achieve their objectives.”

Mr Ridgeway also highlighted growth opportunities were available for the company’s minerals business and were being actively pursued.

“Cyclical downturns are characteristic of the minerals sector and activity levels will normalise. In the meantime, growth opportunities have been identified in underpenetrated mining regions including Europe, USA and Peru, non-mining sectors, together with the introduction of new technologies to the market over the second half of this financial year.

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“This is an exciting and pivotal time for RELFEX, as we now have the platform via our new technologies to provide substantial industry change and significantly enhance the efficiency of our customers operations,” added Mr Ridgeway.

Imdex is continuing to progress the company’s product development pipeline and is committed to becoming the Minerals Industry standard in the provision of innovative, simple to use technologies, which improve the effectiveness and efficiency of customers’ day to day operations.

OIL & GAS DIVISION

Imdex’s Oil & Gas Division includes AMC Oil & Gas and a 30% share of Vaughn Energy Services (VES). The VES joint venture is the third largest provider of downhole survey services to the oil and gas market, operating primarily in the USA, Middle East and Latin America.

The AMC Oil & Gas and VES businesses provide drilling fluids, production and completion chemicals, and downhole survey services to the conventional and unconventional oil and gas markets.

Financial performance

Imdex’s Oil & Gas Division generated record revenue, up 14% to $38.2 million (1H13: $33.5 million) and contributed 38% of the company’s combined 1H14 revenue.

Key operational highlights

• Record half-yearly revenue, reflecting ongoing investment in the development of the Division;

• Continuing strong revenues and EBITDA performance by Imdex’s VES joint venture;

• Further investment in equipment, working capital and personnel to support ongoing growth in the business; and

• Continuing growth from the coal bed methane industry in Australia with an increased demand for equipment solutions to ensure environmental disturbance by drilling activities is minimised.

“Our Oil & Gas Division’s revenue growth aligns with Imdex’s diversification strategies to off-set cyclical downturns in the minerals business. While such strategies do not offset cyclical lows in the short-term, our continued investment in equipment, working capital and personnel with extensive oil and gas industry experience is developing a strong Division with the management depth to support future growth in the business.

“We expect our Oil & Gas Division to gain further momentum as a result of increasing organic growth by AMC Oil & Gas and a focus on opportunities in the East African/Middle Eastern, European and Asia/Pacific markets with Drilling Fluids, Solids Control Equipment and Drilled Waste Management,” said Mr Ridgeway.

Outlook

The fundamentals affecting Imdex’s minerals business suggest this market will remain subdued for the balance of FY14. Global rig utilisation is estimated to be between 20% - 30%. Conversely,

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activity within the energy sector remains high and offers substantial growth opportunities for the company’s Oil & Gas Division.

These opportunities can be quantified by reference to data taken from Spears & Associates – Oilfield Market Report (October 2013), which forecasts the global drilling and completion fluids market will increase by >20% to US$13.5bn in 2014. The Oilfield Market Report also suggests the solids control and waste management market will grow by >15% to US$4.3bn in 2014.

The company has responded to market conditions by:

• Taking costs out of the Minerals Division;

• Investing in the development of a strong Oil & Gas Division with the products, infrastructure and personnel in place to capitalise on growth opportunities;

• Successfully developing new value adding products and technologies that will be released early in 2H14 to generate additional revenue and expand the company’s customer base;

• Continuing to invest in the pipeline of development projects for the Minerals and Oil & Gas Divisions, with a keen focus on meeting customer demand for greater operational efficiencies; and

• Continuing to diversify the company’s revenue streams – non-traditional markets and growing oil and gas business.

“Over the past six months we have substantially reduced the company’s debt. Maintaining comfortable gearing levels, together with our commitment to invest in the business through the cycle, has proven to be of significant benefit in the past. We are positioning the company for the medium to long-term, providing products and services to increase revenue in current trading conditions and be at the forefront when any upswing in the minerals industry occurs.”

Key priorities

In 2H14 the key priorities for Imdex include:

• Increasing AMC Minerals’ market share in previously underpenetrated mining regions;

• Expanding the company’s non-mining business including HDD, civil and construction;

• Increasing the global utilisation of SRUs and new REFLEX technologies;

• Continuing to grow the company’s oil and gas business in key markets including Europe, East Africa / the Middle East and Asia Pacific; and

• Aggressively advancing the company’s development of innovative products and leading technologies for both the minerals and oil and gas industries.

For further information please contact:

Mr Bernie Ridgeway Managing Director T: +61 (0)8 9445 4010

Mr Paul Evans Chief Financial Officer & Company Secretary T: +61 (0)8 9445 4010

imdex@imdexlimited.com

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