KORVEST LTD — Earnings Release 2011

Jul 27, 2011

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ABN 20 007 698 106

PRESS RELEASE

The Chairman, Mr Peter Stancliffe, today announced the following operating results for the 12 months ended 30[th] June 2011 for Korvest Ltd.

	12 MONTHS TO 30/06/11 $’000	12 MONTHS	% CHANGE
		TO 30/06/10 $’000
Revenues	67,384	55,774	+20.8%
Operating Profit After Tax	4,221	3,983	+6.0%
Earnings per share (cents)	48.9	46.3	+5.6%
Dividends per share (cents)	26.0	32.0	-18.8%

Mr Stancliffe said that the full year operating profit was in line with previous guidance. Mr Stancliffe noted that “it was pleasing to produce an improved result given that trading conditions remain inconsistent in a number of markets in which Korvest operates. Activity in the second half improved with the Industrial Products group in particular experiencing a significant improvement”.

In the Industrial Products group the EzyStrut cable and pipe support business supplies products to contractors for small industrial developments and also supplies products for major infrastructure developments. During the current year a number of projects have contributed positively to the improved performance for this business. On a state by state basis all branches achieved revenue growth in the F2011 year, however the magnitude of that growth did vary substantially between states where different levels of infrastructure investment were observed. Product innovation within the cable support business enabled EzyStrut to have a competitive advantage in some product lines and this underpinned the improved performance in F2011.

Included in the Industrial Products group is the Indax grating and stanchion business. The performance for this business was below expectations. During the year Indax suffered a decline in margins and profitability, despite a growth in sales, due to acceptance of larger scale projects carrying lower inherent margins, higher than anticipated material and distribution costs and additional costs resulting from capacity constraints and administrative processes. These projects were completed during F2011.

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In the Production group the Galvanising business had another difficult year. Volumes remained at similar levels to those experienced in F2010 with month to month tonnage tending to vary due to a lack of consistent project work in the South Australian market. The recent trend of increased pricing pressure due to surplus industry capacity continued throughout the F2011 year.

DIVIDEND

The Directors announced a fully franked final dividend of 15.0 cents per share. The full year dividend in relation to the 2011 year will be 26 cents per share compared to 32 cents per share for the previous year.

The final dividend will be paid on 8[th] September 2011. The record date for the dividend will be 25[th] August 2011. The dividend reinvestment plan remains suspended.

OUTLOOK

Korvest’s businesses operate across a range of markets within Australia. It is expected that these markets will be trending moderately upwards over the course of the 2012 year however the state by state and month by month inconsistencies that have been observed over the last few years are expected to continue. Korvest is well placed to take advantage of any improvements in market conditions as they occur and in light of this is expected to produce a satisfactory result in the 2012 year. An updated guidance will be provided at the Company’s Annual General Meeting.

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P.W. STANCLIFFE CHAIRMAN

28 July 2011

For further information contact: ALEXANDER KACHELLEK (Managing Director)

Mobile 0423 847 627

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