SRG GLOBAL LIMITED — Capital/Financing Update 2011

Apr 19, 2011

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ASX / MEDIA ANNOUNCEMENT 20 April 2011

GCS ACQUIRES MAJOR WA LABOUR HIRE GROUP, INCREASES FY11 FORECAST TO $19m NPAT

Highlights

• Agreement to acquire leading WA labour hire group Global Industrial Services for approximately $42 million

• Acquisition funded by mix of cash ($16.4 million) and scrip (14.3 million shares)

• EPS accretive in FY12

• Cash component funded by institutional placement of 10 million shares at $1.80 which was strongly oversubscribed

• GCS upgrades its FY11 forecast NPAT to $19 million, up 67% on prior year, excluding the impact of the acquisition of GIS

Construction services group Global Construction Services Limited ( ASX: GCS, “GCS Group” ) is pleased to announce an agreement to acquire Global Industrial Services ( GIS ), a leading provider of specialised labour hire in Western Australia.

The purchase consideration is a cash payment of $16.4 million and the issue to the GIS vendors of 14.3 million shares in GCS. At a price of $1.80 per GCS share, the total consideration for the GIS acquisition is approximately $42 million.

In FY11, GIS is expected to generate revenue of approximately $60 million and normalised EBITDA of approximately $8.2 million.

Mr Gullotti said the acquisition is expected to be EPS accretive in FY12 and will deliver strong margins and strong positive cash flow.

The cash component of the consideration has been funded via a placement to institutional and sophisticated investors at $1.80, a premium to the closing price of $1.78 on 15 April, the last day the shares traded prior to the placement. The placement was strongly oversubscribed. Bell Potter Securities was Lead Manager to the Placement and Argonaut Securities was CoManager.

The vendor placement of 14.3 million shares is subject to shareholder approval at a general meeting to be held in May.

Founded in 2007, GIS has grown significantly and now employs approximately 400 full-time, casual and contract staff. GIS provides a high level of customer service and support for its customers’ diverse labour requirements and has quickly secured its position as a sector leader in the booming WA market.

GIS and GCS have had an extensive working relationship, with GCS currently a major supplier of hire equipment to GIS.

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GCS Managing Director Enzo Gullotti said the acquisition represented a major boost for the group, delivering significant revenue and earnings growth.

“The acquisition also brings good balance to GCS in that GIS is a low capital intensive business compared to our core existing services which have higher capital demands,” said Mr Gullotti.

“GIS is exposed to a broad number of sectors that are complementary to the GCS business, including commercial construction, civil construction, oil and gas, industrial services and energy.

“The key principals of GIS each have more than twenty years of experience in the West Australian labour hire industry.

“In addition, GIS services a range of blue-chip construction companies, some of which are also GCS clients. So there are rich synergies and great opportunities for further cross-selling of services.”

The transaction is a strategic fit with the existing GCS business, providing access to a significantly expanded pool of labour in a tightening market, expanding the service offering to key clients in addition to GCS’ own labour hire services, and provides access to new markets for both GCS and GIS.

It also fits the GCS growth model, delivering synergies with existing operations and earnings accretion in its first full year within the GCS group.

Profit Guidance

GCS has upgraded its FY11 forecast NPAT to $19.0m, up 67% on prior year, excluding the impact of the acquisition of GIS.

Mr Gullotti said the additional 11% increase in the forecast earnings for GCS in FY11 excluded the impact of the acquisition of GIS and would be delivered through continuing improvement in the group’s core business units, especially from the Commercial Division, and increased contributions from the equipment hire operations.

He said GCS would seek to capture significant new contract revenue on the back of the acquisition of GIS and exposure to the increased activity in civil construction, local infrastructure projects and demand for services to support expansion in the Oil & Gas sector.

The Residential Division has exceeded its first half sales targets and the sector is experiencing an increased level of activity.

The GCS Resource & Industrial division is expanding its footprint in the north west of Western Australia with the opening of a new GCS Hire branch in Newman. The branch is now operational, offering the full suite of GCS products and services. GCS is planning to open additional branches in the Northwest to service the strong demand from the resource industry.

The Board believes GCS is well placed to capture a significant slice of service revenue from the $100 billion in committed projects now being developed in the region, onshore and offshore.

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“We will continue to grow GCS, allowing us to take greater advantage of the major scale business opportunities that WA has to offer over the coming decade from already committed projects,” said Mr Gullotti.

“We will continue to approach this on a disciplined basis, applying a strict focus to all aspects of the business, and will build size in the group through organic and acquisitive growth, nationally and internationally.

-ENDS-

About GCS Group

GCS Group (ASX: GCS) is a diversified construction services company that supplies equipment to the construction and maintenance industries including hire and sales of scaffolding, formwork, material hoists, temporary accommodation, temporary fencing and general plant hire together with a range of related labour and design services.

GCS Group’s strategy for growth is to focus primarily on servicing the West Australian construction industry. In addition, the Company intends to explore opportunities in new markets, diversify into related industries and industry sectors and acquire selected new businesses that create value for shareholders.

Further Information

Enzo Gullotti Managing Director 08 9479 7990

Or visit: http://www.gcs-group.com.au