SERVICE STREAM LIMITED — AGM Information 2008

Nov 12, 2008

Annual General Meeting

Agenda – Chairman’s Presentation – Meeting Resolutions – CEO’s Presentation

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Chairman’s Presentation
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Highlights

– Operating revenue up 82.3% to $450.6M

– EBITDA up 75.6% to $37.2M

– Reported NPAT up 61.1% to $18.1M

– $1B Telstra AAS contract performing to expectations

– Annualised revenues approaching $650M

– $2B work-in-hand for next 4 years

Highlights

– All business units performing profitably

– Material organic growth opportunities in core infrastructure business streams

– Strong balance sheet and capacity to fund growth

– Full year DPS maintained at 7.5 cents

– Positive FY09 outlook

The story so far…

– Consolidation of nine major acquisitions over 4 years

– Growth turnover from $60.6M to $450.6M

– Growth in net profit after tax from $0.6M to $18.1M – Growth in workforce from 1,500 to over 4,000 people – Growth in national footprint from 11 to 52 sites

Business of the Meeting

Resolution 1

“That the Remuneration Report for the year ended 30 June 2008 be adopted.”

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Resolution 2

“That Adrian James Field who retires by rotation in accordance with rule 7.1(f) of the Company’s constitution and, being eligible, stands for re-election, be re-elected as a director of the Company.”

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Resolution 3

“That Rodney Allen Stanton who retires by rotation in accordance with rule 7.1(f) of the Company’s constitution and, being eligible, stands for re-election, be re-elected as a director of the Company.”

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Resolution 4

“That the issue of 4,110,576 fully paid ordinary shares in the Company on the terms set out in the explanatory statement accompanying the notice of this meeting, be approved for the purpose of rule 7.4 of the ASX Listing Rules.”

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Managing Director & CEO’s Presentation

• Agenda

• – Year in Review - Financial Overview

• • Group Milestones and Overview

• 2009 Business Overview – Drivers for Growth – Future Outlook

Year in Review A Record Performance

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Revenue ($M) EBITDA ($M) EPS (cents)
500 60 12
450
50 10
400
350
40 8
300
250 30 6
200
20 4
150
100
10 2
50
0 0 0
FY05 FY06 FY07 FY08 FY05 FY06 FY07 FY08 FY05 FY06 FY07 FY08
1HY 2HY
10.66 10.98
$450.6M
$37.2M
6.97
$247.1M
$171.0M $21.2M
2.58
$60.6M $8.7M
$2.3M
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Year in Review Financial highlights to June 2008

$450.6M Revenue up 82.3%

• Full Year Dividend maintained at 7.5cps

• Business portfolio enhanced and market leading positions strengthened

• Positioned for continued strong growth in 2009

$37.2M EBITDA up 75.6%

$18.1M NPAT up 61.1%

• Well positioned to capitalise on the roll-out of large scale Government infrastructure initiatives

• Record order book approaching $2Billion as at 30 June 2008

• Participating in growth infrastructure sectors

Year in Review Financial Summary Reported Result

		FY 2008	FY 2007	% change
	Revenue	$450.6M	$247.1M	82.3%
	EBITDA	$37.2M	$21.2M	75.6%
	EBIT	$30.6M	$18.5M	65.0%
	NPAT	$18.1M	$11.2M	61.1%
	Earningsper share	10.98cps	10.66cps	3%
	Fullyear dividend	7.5cps	7.5cps	-

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Year in Review Balance Sheet A solid platform for growth

30 June 2008 30 June 2007

$ million

	$ million
	Receivables and WIP	136.5	80.3
	Plant and equipment	20.2	5.2
	Other	17.2	7.7
	Goodwill	206.4	155.7
	Total Assets	380.3	248.9
	Payables	79.9	70.0
	Net debt	93.5	30.2
	Provisions and other	9.5	9.4
	Total Liabilities	182.9	109.6
	Net Assets	197.4	139.3
	Issued capital	183.9	130.8
	Retained earnings and reserves	13.5	8.5
	Equity	197.4	139.3

Source: Company data

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Year in Review Capital Structure

	30 June 2008	30 June 2007
$ million
Net debt	93.5	30.2
Equity	197.4	139.3
Net debt to equity ratio	47.3%	21.7%

Equity

– $40M capital raising completed in Sept 07

Debt

– Funding secured for the next 2 years

• New terms more favourable than previous

• Unused facilities of $57M

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Year in Review Contract & Group Milestones – $1BN Telstra Access and Associated Services $1BN contract tracking well Telstra Access and Associated Services contract awarded Sept 07 –

• $1BN Telstra Access and Associated Services contract tracking well

• AMRS contract renewals extend Service Stream’s presence in utilities sector

$23M AMRS contract renewal with APA

• -SA Water: 5 year contract

• -Sydney Water: 2 year contract + up to 6 year option

ESO Plan First Employee Share Ownership plan offer – Oct 08

• -APA Group: 5 year contract

– First issue of Employee Share Ownership Plan

• -Rewarding/acknowledging our greatest asset

Year in Review Group Overview

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52 locations

Workforce of over 4000

Market leader in telecommunications

• copper, wireless, fibre

Achieving diversification strategy Strong order book

Strong pipeline

Balance sheet capacity

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2009 Operational Overview

Field Services - TOW AAS Contract Payphones Contract Labour Services Source: Company Budget	21 Contact Centre Vodafone Optus DNCR Infrastructure Services - Utilities McCourt Dando Recoverable Works AMRS Metering Services Infrastructure Services - Telco TCI GPG Fibercom

Drivers for Growth 1 New Contracts

Service Stream has significant competitive advantages

– Telstra AAS

– Vodafone wireless build

– Telstra wireless build

– SA Water metering

– APA metering services

– Sydney desalination plant

Drivers for Growth 2 Acquisitions Service Stream has a track record of successfully integrating acquisitions

AMRS

Power, water, gas Australia’s leading metering services provider Strong position for roll-out of Smart Metering

Serviceworks Metering Alinta sub metering assets

Power

Power

McCourt Dando Group

Water, power, telco, civil construction

SEQUD assets

Power, water, trenching, drilling

Drivers for Growth 3 Major Opportunities SSM is well positioned to capitalise on major public and private sector infrastructure projects

			Est.
	Project	Description	Spend	Capabilities
	National Broadband Network (FTTN/FTTP)	–Rollout of the new open access, high speed fibre based broadband network –Providing speeds of at least 12mbps to 98%	$10B	�Existing capability through Fibercom and GPG �Logistic and design capability to handle scale of project
		of Australian homes and businesses		�AAS expertise provides infrastructure to deliver
	Advanced Metering Infrastructure	–Installation of 2.5 million ‘smart meters’ throughout Victoria, starting in late 2009	$1B	�Unique expertise through recently acquired AMRS �AMRS – one of 2 market leaders – 40% market share
	(“Smart Meter”)	–Other states expected to follow		�‘Pillar to house’ expertise in telecommunications is
	Rollout			readily transferable to utilities
	National Broadband Wireless Networks	–Significant increase in data content to 2015	$1B	�Expertise through TCI and GPG �Recent 3G roll-out experience through Vodafone and Ericsson contracts
				�Only one of two companies with full turn-key
				capabilities in wireless construction
	National Desalination Projects	–Victorian desalination plant – construction scheduled to commence mid 2009 –Water and gas pipelines	$3.1B	�Expertise through McCourt Dando �Already engaged in Gold Coast and Sydney desalination projects

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Drivers for Growth 4 Infrastructure Outsourcing

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Key Drivers Forecast Outsourced Expenditure – Construction & Maintenance
$B
$20
Lack of historical
investment
$15
Competitive efficiencies
ongoing trend
$10
Comm’s base line
Comm’s NBN
Ownership Changes
Gas
Electricity
$5
Water supply & storage
Environmental Issues
$0
2008/09 2009/10 2010/11
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Outlook

Management is excited by the growth prospects of all divisions – Ongoing focus on delivery of major contracts

– Strong organic growth to continue

– Continue to execute and integrate strategic acquisitions

– Drive organic growth in utilities sector

– Appropriate capital management

Investment Overview (Reminder)

– Long term business objectives

– Execution of consistent strategy focussing on essential infrastructure

• Establish strong capability in telecommunications

• Aim for Opex / Capex split of around 70% / 30%

• Grow business organically and through acquisition into other essential infrastructure: gas, electricity, water

– Leading provider of maintenance and build services to broader essential infrastructure sector

Customer Partnerships

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Important Notice - Disclaimer

This presentation has been prepared by the management of Service Stream Limited (the ‘Company’) for the benefit of our shareholders, brokers, analysts and investors and not as specific advice to any particular party or person.

Neither the Company, nor any of its officers, employees, servants, agents and advisers makes any recommendation as to whether you should acquire shares in the Company nor does any such person make any representation or warranty to you concerning the merits of any investment in the Company, the value of the shares, or the risks associated with the Company.

This presentation does not contain any invitation for applications or offers to subscribe for any shares in the Company and nothing in this presentation constitutes a securities recommendation or the provision of financial product advice. Before acquiring shares in the Company, you should consider, with the assistance of an independent financial adviser, whether the potential investment is appropriate in light of your particular investment needs, objectives and financial circumstances.

The information in this presentation is based on publicly available information, internally developed data and other sources. No independent verification of those sources has been undertaken and where any opinion is expressed in this document it is based on the assumptions and limitations mentioned herein and is an expression of present opinion only. No warranties or representations can be made as to the origin, validity, accuracy, completeness, currency or reliability of the information. The Company disclaims and excludes all liability (to the extent permitted by law), for losses, claims, damages, demands, costs and expenses of whatever nature arising in any way out of or in connection with the information, its accuracy, completeness or by reason of reliance by any person on any of it.

Where the Company expresses or implies an expectation or belief as to the success of its business model, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, such projections are subject to risks, uncertainties and other factors which could cause actual results to differ materially from future results expressed, projected or implied by such projections. Such risks include, but are not limited to changes to assumptions for capital and operating costs as well as political and operational risks and governmental regulation outcomes. The Company does not have any obligation to advise any person if it becomes aware of any inaccuracy in or omission from any projection or to update such projection.