The Australian share market ended higher on Friday, led by gains in the financials and materials sectors. Coates Hire upgraded its guidance for FY08 operating earnings growth to 20%, while Babcock and Brown Infrastructure acquired interests in three overseas ports. US stocks ended little changed after mixed economic data, with jobs growth stronger than expected but consumer credit growth weaker. European stocks gained on hopes for US rate cuts, while commodities were mixed with copper hitting a one-week high.

1. Monday, 10 December 2007
Topic Page Number
Overnight Summary 2
US Equities 3
US Bonds 3
Commodities 3
International Markets 4
US Economic Action 4
Australian Market Summary 5
Australian Equity Market Movers (Sector) 5
Australian Equity 5 Best / Worst Stocks 5
Australian Companies Ex-Dividend 6
Australian Equity Snapshots 7
Summary of Daily Research Reports 8
ST GEORGE BANK LIMITED
SHARE PRICE AS AT 07 December 2007
Last Sale $35.59
Changes +$0.25
Total Volume 874,872
Web Address: www.stgeorge.privatebank.com.au
www.banksa.privatebank.com.au
PRIVATEBANKPORTFOLIOSERVICES
DAILYBULLETIN

2. Daily Bulletin 10 December 2007
Overnight Markets
US stocks ended a volatile session little changed as investors
weighed up the falling oil price and stronger than expected jobs
data with a possible slowdown in consumer credit performance
and the prospect of a smaller than hoped for interest rate cut.
Australian Market Summary
The Australian share market ended Friday higher with the All
ordinaries rising in early trading and continued its upward trend
throughout the rest of the day to end 54 points up.
Flashnotes
Lend Lease (LLC) - LLC managed property fund acquires
Brisbane properties in JV
Perpetual Limited (PPT) - Funds under management decline
$1.7B in November
Iluka Resources (ILU) - Discovery of the Dromedary Prospect,
Eucla Basin
Fortescue Metals (FMG) - Memorandum of Understanding with
Mineralogy
GRD Ltd (GRD) - GRD Minproc awarded Cloncurry Copper
Project Pre-Feasibility Study
Fortescue Metals (FMG) - Media clarification regarding Midwest
Corp
Mirvac Real Estate Investment Trust (MRZ) - Completes
refinancing
Exco Resources (EXS) - CCP pre-feasibility study commences
Hastings High Yield Fund (HHY) - HHY completes $36.6M Non-
Renounceable entitlement offer
Allco Finance (AFG) - AFG changes Rubicon terms
Hills Industries (HIL) - BSA and Hills Antenna & TV merger
Jubilee Mines (JBM) - Extension of Offer period by Xstrata
Downer EDI Limited (DOW) - Sale of Century Resources
Babcock & Brown Infrastructure Group (BBI) - US, German
and Belgian port operator acquisitions
Redbank Mines (RBM) - Entitlements offer and placement
Westpac (WBC) - Final price set on BT Investment Management
float
Coates Hire (COA) - FY08 operating earnings growth guidance
upgraded to 20%
Valad Property Group (VPG) - Reinstates its Dividend
Reinvestment Plan
St Barbara (SBM) - Share purchase plan raises $22.5M
Billabong International (BBG) - Acquires Tigerlily
Aust Pharmaceutical (API) - API to fall out of ASX200
Foreign Equities
Index/Security Close Chg %Chg
Dow Jones (US) 13,626 +5.7 +0.0
S&P 500 1,505 -2.7 -0.2
NASDAQ 2,706 -2.9 -0.1
FTSE 100 (UK) 6,555 +69.3 +1.1
DAX 30 (Germany) 7,994 +53.5 +0.7
CAC 40 (France) 5,719 +45.0 +0.8
Nikkei (Japan) 15,956 +82.3 +0.5
Figures as at 10/12/2007 8:30 AM AEST
Australian Market Summary
Index/Security Close Chg %Chg
All Ordinaries 6,714 +53.5 +0.8
ASX 200 6,655 +53.8 +0.8
ASX Small Ords 4,034 +32.6 +0.8
Industrials 7,066 +68.4 +1.0
Fin.-x-Prop Trusts 7,483 +73.3 +1.0
Materials 15,777 +99.4 +0.6
Cons. Staple 9,193 +38.6 +0.4
Telecom Serv. 1,682 +10.1 +0.6
10y Bond Yield 6.01 +0.04 +0.6
Figures as at 07/12/2007 4:30 PM AEST
Commodities
Index/Security Close Chg %Chg Units
Base Metals
CRB Index 342.9 -0.20 -0.1
Aluminium 2,425 +31.3 +1.3 USD/t
Copper 6,858 +187.0 +2.8 USD/t
Lead 2,668 -24.5 -0.9 USD/t
Nickel 27,045 +1,410.0 +5.5 USD/t
Tin 16,490 +95.0 +0.6 USD/t
Zinc 2,417 +35.0 +1.5 USD/t
Precious Metals
Gold 795 -7.6 -0.9 USD/Oz
Silver 14.4 -0.1 -0.7 USD/Oz
Energy
Oil (West Texas) 88.3 -2.0 -2.2 USD/Bar
Figures as at 10/12/2007 8:30 AM AEST
Currencies
Index/Security Close Chg %Chg Units
AUD / USD 0.875 -0.003 -0.4 $US
AUD / Euro 0.598 -0.003 -0.4 $A
AUD / STG 0.433 +0.004 +0.9 GBP
AUD / Yen 97.8 +1.3 +1.4 Yen
USD / Yen 111 +0.4 +0.3 Yen
Euro / USD 1.46 +0.00 +0.2 $US
Figures as at 07/12/2007 4:30 PM AEST

3. Private Bank Daily Bulletin
Daily Research Reports
Babcock & Brown Infrastructure Group (BBI) - BBI pursues its port consolidation strategy
SP AusNet (SPN) - Recommendation to vote against the Alinta assets acquisition
Downer EDI Limited (DOW) - Sale of Century Resources
Redbank Mines (RBM) - Entitlements offer and placement
Billabong International (BBG) - BBG strengthens its girls swimwear offering
Allco Finance (AFG) - Rubicon terms improved; shareholders should vote in favour of transaction
Coates Hire (COA) - FY08 operating earnings growth guidance upgraded to 20%
Page 3

4. Private Bank Daily Bulletin
US Equities
US stocks ended a volatile session little changed as investors weighed up the falling oil price and stronger than expected jobs
data with a possible slowdown in consumer credit performance and the prospect of a smaller than hoped for interest rate cut.
Employers added 94K jobs in November, against expectations of a rise of 70K. The unemployment rate held steady at 4.7%
when economists had expected it to tick up to 4.8%. The jobs data indicated that the economy was holding up better than
feared, but it also tempered expectations of a bigger rate cut on Tuesday. The market has fully priced in a 0.25% cut, but many
were hoping for a more generous 0.5% cut.
Another dark cloud hanging over Wall Street was a broker downgrade of credit card companies due to tighter credit conditions.
Consumer credit for October tumbled to US$4.7B versus expectations of US$6B. American Express dropped 4%, while Capital
One Financial fell 5%.
The NASDAQ also featured a number of high profile casualties. Palm crashed almost 13% after the maker of popular handheld
devices issued a profit warning due to shipping delays for its new product and an unexpected raise in warranty repairs. Amgen
fell 5.5% on worries that the drug maker would have to adhere to stricter safety labelling for its anemia drugs.
Meanwhile, Boeing and 3M were the top two gainers on the Dow Jones Industrial Average, rising 1.5% and 1.6% respectively.
Apple was another notable advancer, adding 2.3% on optimism about the outlook for large technology firms.
Market breadth was mixed on the NYSE, with winners and losers about evenly matched. However, most NYSE sector indices
closed in the red, with Financials taking the biggest hit – closing down 0.5%.
US Bonds
US Treasuries tumbled after the latest jobs data eased concerns about the health of the US economy.
The yields on the two- and five-year notes jumped to 3.10% (+0.06) and 3.49% (+0.15) respectively. The 30-year bond is
providing a yield of 4.56% (+0.07).
US EQUITIES US BONDS
Page 4

5. Private Bank Daily Bulletin
Commodities
Crude oil was sold off sharply as buyers stood aside ahead of the all-important US interest rate decision on Tuesday.
With a 0.5% cut now looking less likely, oil traders took profit on expectations that the US dollar would bounce if the Fed only
delivers a 0.25% cut. There has also been a lack of buying leadership after the big funds closed out their December contracts
and have not returned to the market.
Gold was weighed down by oil and lower expectations of a larger US interest rate cut, but copper hit a one-week high on
encouraging signs of strength on the US employment front and a 20% drawdown in weekly copper inventories in China.
COPPER & NICKEL OIL
GOLD
Page 5

6. Private Bank Daily Bulletin
International Markets
European stocks made good gains, supported by hopes of an interest rate cut in the US and further consolidation in the mining
sector.
Takeover rumours surrounding Xstrata were rife with Anglo American and CVRD said to be contemplating bids. Xstrata was the
biggest riser on the FTSE 100 with a 7.9% surge, while Anglo American rose 5.1%.
The banking sector was another top gainer on the US government’s rescue plan for troubled sub-prime mortgagees and positive
US jobs data. Barclays jumped 2.4%, HSBC gained 1.7% and UBS added 2%.
Staying on financials, the world’s second largest reinsurer Munich Re soared 5.2% on news that Swedish activist fund Cervian
Capital had bought around 3% of the company, and Northern Rock rose 7.4% after receiving a firm offer from Olivant. Olivant’s
proposal is backed by Northern Rock’s leading institutional shareholders and it appears to be more attractive than the Virgin bid.
On the flipside, StatoilHydro tanked 10.9% after it downgraded its 2007 oil and gas production target and lowered its 2008
forecasts due to field repairs, while Roche extended the previous day’s loss by 0.9% as analysts downgraded price targets for
the company after it failed to win US approval for its key breast cancer drug Avastin.
Across the major European exchanges, the FTSE 100 posted the biggest gain of 1.1%. The DAX and CAC finished up 0.7%
and 0.8%, respectively.
The US dollar remained under pressure against the euro due to the hawkish inflation comments from the European Central
Bank on Thursday. However, the greenback rose against the Japanese yen after US non-farm payrolls rose higher than
expected
In early AEST trade, the British pound firmed slightly to US$2.0306 after some analysts noted the balanced tone of the Bank of
England’s statement following its 0.25% rate cut. Meanwhile, the Australian dollar failed to hold on to early gains as traders
became less sure about the size of the US interest rate cut.
Australian Stock Prices Overnight
In New York, News Corp rose by US$0.14 to US$21.98, equivalent to A$25.11, A$0.14 above its last close on the ASX.
ResMed rose by US$0.29 to US$48.08, equivalent to A$5.49, A$0.01 below its last close on the ASX.
In London, Rio Tinto rose 163.0 pence to £57.46, A$3.78 higher in Australian currency terms.
BHP-Billiton rose 57.0 pence to £16.76, A$1.32 higher in Australian currency terms.
Henderson Group Plc rose 6.75 pence to £1.47, A$0.16 higher in Australian currency terms.
FTSE EURO TOP 100 $US/$A VS EUR/$A
Page 6

7. Private Bank Daily Bulletin
US Economic Action
Nonfarm Payrolls jumped to 94K in November, against expectations of a rise of 70K. Nonfarm payrolls for October were also
revised upwards from 166K to 170K.
In a separate survey, the Unemployment Rate for November was 4.7%, unchanged from the previous month. Economists had
expected the rate to inch up to 4.8%.
On the downside was wage inflation. Hourly Earnings for November rose 0.5%, which was 0.2% higher than expected.
Meanwhile, the preliminary reading on the Michigan Consumer Sentiment for December disappointed the market, falling to 74.5
from 76.1 in the previous month. Analysts were expecting a reading of 75.0.
Consumer credit for October came in softer than expected at US$4.7B, versus expectations of a rise to US$6B.
Pending Home Sales (for October, released Tue AEST, Prior: 0.2%)
Wholesale Inventories (for October, released Wed AEST, F/cast: 0.5%, Prior: 0.8%)
FOMC Policy Statement (for October, released Wed AEST)
Export Prices excluding agriculture (for November, released Thur AEST, Prior: 0.5%)
Import Prices excluding oil (for November, released Thur AEST, Prior: 0.5%)
Trade Balance (for October, released Thur AEST, F/cast: -US$57.0B, Prior: -US$56.5B)
Crude Inventories (for week of 07 December, released Thur AEST, Prior: -7913K)
Treasury Budget (for November, released Thur AEST, F/cast: -US$75B, Prior: -US$75.6B)
Retail Sales (for November, released Fri AEST, F/cast: 0.5%, Prior: 0.2%)
Retail Sales excluding auto (for November, released Fri AEST, F/cast: 0.6%, Prior: 0.2%)
PPI (for November, released Fri AEST, F/cast: 1.5%, Prior: 0.1%)
Core PPI (for November, released Fri AEST, F/cast: 0.2%, Prior: 0.0%)
Initial Claims (for week of 08 December, released Fri AEST, F/cast: 335K, Prior: 338K)
Business Inventories (for October, released Fri AEST, F/cast: 0.3%, Prior: 0.4%)
CPI (for November, released Sat AEST, F/cast: 0.6%, Prior: 0.3%)
Core CPI (for November, released Sat AEST, F/cast: 0.2%, Prior: 0.2%)
Industrial Production (for November, released Sat AEST, F/cast: 0.1%, Prior: -0.5%)
Utility Utilisation (for November, released Sat AEST, F/cast: 81.7%, Prior: 81.7%)
Page 7

8. Private Bank Daily Bulletin
Australian Market Summary: As at 07 December 2007
Overview
AUSTRALIAN EQUITIES MARKET: The Australian share market ended Friday higher with the All ordinaries rising in early
trading and continued its upward trend throughout the rest of the day to end 54 points up.
The S&P/ASX 200 rose by 54 points, led by the Financials and Materials sectors. The Financials sector rallied on buying in
Westpac (+$0.63) ANZ (+$0.36) and Commonwealth Bank (+$0.32). Materials saw gains in BHP Billiton (+$0.12), Rio Tinto
(+$0.74), and Orica (+$0.89). Gains in News Corp (+$0.57) and Aristocrat Leisure (+$0.34) outweighed a decline seen in Flight
Centre (-$1.11). Market breadth was positive with other notable winners including Fosters Group (+$0.11) and Wesfarmers
(+$0.31).
Coates (unchanged) upgraded its guidance on FY08 operating earnings in light of trading for the first 4 months of the financial
year. FY08 earnings is now expected to grow 20% on FY07. Babcock and Brown Infrastructure (+$0.03) announced it had
acquired interests in three port operators located in Germany, Belgium and the US. Lend Lease (-$0.32) purchased Central
Plaza 2&3 in Brisbane for $454M, through a 50:50 JV with an off-shore institutional investor. Billabong (+$0.03) has agreed to
acquire the Tigerlily, a swimwear and apparel business, from its founder Jodhi Meares. The company is to be expanded in the
domestic market before looking to take the brand overseas. The acquisition is expected to be EPS accretive in the first full year.
AUSTRALIAN BOND MARKET: The yield on Australian government bonds rose 2 - 3 basis points with the exception of the one-
year bond which declined 2 basis points.
AUSTRALIAN DOLLAR: After overnight gains the Australian dollar traded sideways throughout the day to end at US$0.878.
AUSTRALIAN ECONOMIC STATISTICS: AiG PERFORMANCE OFCONSTRUCTION INDEX: The index measuring the
performance of the Australian construction industry slowed by 4.2 points to a reading of 53.2 in November. Possible factors
contributing to the slower growth include rising interest rates, higher construction costs and capacity constraints. A reading
above 50 indicates the building industry is expanding.
Market Movers
SECTOR PERFORMANCE
5 BEST / WORST STOCKS
Page 8

9. Private Bank Daily Bulletin
Companies Ex-Dividend
Ex Date Sub Type Security
Div Amt
(cents)
Franking
24-Dec-07 First Quarter Result AMP Capital China Growth Fund (AGF)
24-Dec-07 Special Event Coates Hire Limited (COA) 53 100
23-Dec-07 First Quarter Result Generator Income Trust ginha (GINHA)
21-Dec-07 Half Yearly Result Aspen Group (APZ) 3.875 0
21-Dec-07 Half Yearly Result Macquarie Communications Infrastructure Group (MCG) 23 0
21-Dec-07 Half Yearly Result Orchard Industrial Property Fund (OIF)
21-Dec-07 Third Quarter Result
CBA Perpetual Exchangeable Repurchaseable Listed Shares
(PERLS III) (PCAPA)
5.5697 0
20-Dec-07 First Quarter Result
Gunns Frankable Optionally Redeemable Equity Settleable
Transferable Securities (FORESTS) (GNSPA)
166.20 100
20-Dec-07 Half Yearly Result RR Australia Limited (RRA) 1.78 100
18-Dec-07 Special Event Futuris Hybrids (FCLPA) 159.85 100
18-Dec-07 Half Yearly Result PaperlinX Step-up Preference Securities (PXUPA) 452.19 0
17-Dec-07 Special Event Contango Microcap Limited (CTN) 5 100
14-Dec-07 Final Year Result Ruralco Holdings Limited (RHL) 13 100
13-Dec-07 Half Yearly Result Singapore Telecommunications Limited (SGT) 0
12-Dec-07 Special Event Crusade Global Trust No. 1 of 2006 - Class A-3 Notes (CTJ)
12-Dec-07 Half Yearly Result Envirozel Limited (EVZ) .5 100
12-Dec-07 First Quarter Result Timbercorp Orchard Trust 9% Debenture (TODHA) 2.27 0
11-Dec-07 Half Yearly Result Van Eyk Three Pillars Limited (VTP) 5 100
10-Dec-07 Special Event Interstar Millenium Series 2002-2 Trust (IME) 21.945
10-Dec-07 Final Year Result Lion Nathan Limited (LNN) 21 100
Page 9

10. Private Bank Daily Bulletin
Flashnotes
Australian Prime Property Fund Commercial (APPF), a LLC wholesale property fund, purchased Central Plaza 2&3 on Elizabeth
Street, Brisbane in a JV with an off-shore institutional investor. The buildings were purchased on a 50:50 basis for A$454.2M.
Central Plaza 2 comprises of 32,000smq of office, retails and car-parking. Central Plaza 3, due for completion in late 2008, has
11,400sqm of office space and is 100% pre-leased. Both buildings were sold by the Queensland Investment Corporation.
PPT advised that funds under management (FUM) as at 30th November 2007 were $37.9B, which is 3.8% down on the $39.4B
in FUM as at 31 October 2007. The decline in funds included an outflow of approximately $500M of Australian Equities from an
institutional client.
ILU has announced the discovery of its Dromedary Prospect, located 45km north-east of Ceduna. Four drill traverses have been
completed on nominal 1km spacing. Heavy mineral sands were intersected over an apparent width of up to 500m and up to 1km
along strike. Mineralisation averages 4.5m thick, from an average depth of 25m. Provisional mineralogy indicates an average
zircon assemblage of 17%.
FMG has signed a Memorandum of Understanding (MoU) with Mineralogy Pty Ltd to investigate blending possibilities from both
companies. FMG is arranging sinter test work to establish the productivity of a blend comprising Mineralogy’s (magnetite)
concentrate and (hematite) material from FMG’s Solomon tenement holding. Under the terms of the MoU, both companies will
investigate port facilities at Cape Preston to export a variety of products, including magnetite, hematite and a mix of both
products.
GRD announced that its subsidiary, GRD Minproc, has been awarded the Cloncurry Copper Project Pre-Feasibility Study. The
Cloncurry Copper Project is made up of numerous tenements ad mining leases containing copper, gold and ore. It is anticipated
that the Pre-Feasibility study will be completed by the middle of 2008, providing the basis for a Definitive Feasibility study in
1H09.
Lend Lease (LLC) - LLC managed property fund acquires Brisbane properties in JV 07-Dec-07 15:39
Perpetual Limited (PPT) - Funds under management decline $1.7B in November 07-Dec-07 15:39
Iluka Resources (ILU) - Discovery of the Dromedary Prospect, Eucla Basin 07-Dec-07 15:34
Fortescue Metals (FMG) - Memorandum of Understanding with Mineralogy 07-Dec-07 15:09
GRD Ltd (GRD) - GRD Minproc awarded Cloncurry Copper Project Pre-Feasibility Study 07-Dec-07 14:33
Page 10

11. Private Bank Daily Bulletin
FMG has refuted speculation in a number of media outlets that the company has acquired any interest in Midwest Corp. The
company has indicated that it is entirely focused on bringing its Chichester Range iron ore project to fruition.
Mirvac REIT Management Limited as responsible entity for MRZ announces that it has completed a successful refinancing of its
$289M commercial mortgage backed securities facility and its $303M cash advance facility via a bank debt facility with Westpac
Banking Corporation. The use of a bank debt facility provided by Westpac will allow the Trust to reassess its funding options
during next year by which time management expect credit markets are more likely to stabilise.
EXS has commenced its pre-feasibility study on the Cloncurry Copper Project. The study will focus on options for a 1-2Mtpa
operation producing 15-25Ktps of copper. GRD Minproc has been awarded the study engineering package and appointed the
study managers. It is anticipated the pre-feasibility study will be completed by the middle of 2008, and that it will provide the
basis for a Definitive Feasibility Study in the second half of 2008.
HHY announced the completion of the Non-Renounceable Entitlement Offer. Applications for 19.3M new units were received,
which amounted to total proceeds of $36.6M. The net proceeds from the Entitlement Offer will be used to reduce HHY’s
outstanding debt and to fund further investments. Net debt will be reduced to approximately $48M, representing net debt to total
tangible assets of around 17.1%. HHY reiterated annual distribution guidance of 18.5cps (inclusive of tax credits).
AFG announced amended terms for the Rubicon Share Acquisition Agreement. A significantly larger part of the overall
consideration will be subject to the achievement of growth in assets under management. The upfront payment will decrease by
4.2M shares and the performance based payment increases by 4.2M shares. This means the value of the deferred and
conditional consideration now represents 25.5% of the value of the total possible consideration, compared with 14.9% on the
original terms.
HIL and BSA have agreed on terms for a proposed merger of HIL's existing Antenna & TV Systems business with BSA. The
deal involves an equity and convertible note issue as well as a 25cps return of capital to BSA shareholders. HIL are expected to
hold 50.1% of BSA following the transaction. The combined group will have an estimated annual revenue of $370M. ASIC, BSA
shareholders and the independent expert are yet to approve the acquisition. The BSA board is in favour of the deal.
Xstrata has announced an extension of its takeover Offer period for JBM from 7pm the 17th December, 2007, to 7pm the 31st
January, 2008. At present, Xstrata control 36.12% of JBM’s issued capital.
Fortescue Metals (FMG) - Media clarification regarding Midwest Corp 07-Dec-07 14:12
Mirvac Real Estate Investment Trust (MRZ) - Completes refinancing 07-Dec-07 14:11
Exco Resources (EXS) - CCP pre-feasibility study commences 07-Dec-07 13:24
Hastings High Yield Fund (HHY) - HHY completes $36.6M Non-Renounceable entitlement offer 07-Dec-07 12:39
Allco Finance (AFG) - AFG changes Rubicon terms 07-Dec-07 11:01
Hills Industries (HIL) - BSA and Hills Antenna & TV merger 07-Dec-07 10:50
Jubilee Mines (JBM) - Extension of Offer period by Xstrata 07-Dec-07 10:48
Page 11

12. Private Bank Daily Bulletin
DOW announced the sale of its Century Resources business to MB Holding. The sale will occur in two stages, the first involves
the sale of 51% of Century to MB Holding for US$70M. The remaining 49% stake will be sold to MB Holding either at the end of
three years via a put option held by DOW or a corresponding call option held by MB Holding. The sale will not impact current
earnings guidance.
BBI announced that it has acquired interests in three port operators located in Germany, Belgium and the US. BBI subsidiary
Benelux Port Holdings has acquired 43% of the Westerlund Group (Belgium) with negotiations on the remaining 57% still
underway. BBI acquired 50% of Seehafen Rostock Umschlagsgesellchaft GmbH (Germany) with pre-emptive rights over the
remaining 50%. Lastly, BBI has entered an agreement to acquire 50% of ICS Logistics Inc (US). The acquisitions have an EV of
~A$616.5M.
RBM is to make a non-renouncable rights issue at 8 cents per share to raise $3.7M. RBM will also make a public placement
offer at 8 cents to raise $1.6M. Glencore will partially underwrite $1M of the issue. The funds will be used to fund the DFS, retire
the Macquarie Bank debt facility, fund drilling at Mt Kasi and provide working capital. The funding will take the company through
to a decision point to develop the expanded Redbank project, subject to a successful DFS.
The final price for BT Investment Management (BTT) has been set at $4.80 per share, which is at the bottom end of the
indicative price range of $4.80 to $5.50 per share. Based on the final price, the offer raised around $247M. Valid applications
under the WBC shareholder offer have been allocated the first $5,000 worth of shares and 30% of the application above that
amount. BTT shares commence trading on a deferred settlement basis on 10 December 2007.
COA today upgraded its guidance on FY08 operating earnings in light of trading for the first 4 months of the financial year. FY08
operating earnings is now expected to grow 20% over operating earnings of $102.4M in FY07. This is an improvement on
previous guidance of 15% growth.
VPG today announced the reintroduction of its Distribution Reinvestment Plan (DRP) effective from the distribution for 1H08,
which is expected to be paid on or around 29 February 2008. For the forthcoming distribution for 1H08, VPG securities will be
issued at a discount of 1.5% to the market price, as calculated in accordance with the Valad Property Trust constitution. The
DRP was suspended in June 2007 for one distribution, due to other capital raisings at that time.
SBM has raised $22.46M from their Share Purchase Plan, with participation by 4,672 shareholders, representing 52% of the
share register. The placement was done at $0.63 per share, the same price as the company’s recent institutional equity
placement. Together, the two capital raisings totalled $98.4M before costs. New SBM shares will be allotted 10/12/2007, and
they will be able to be traded the day after (11/12/2007).
BBG has agreed to acquire the Tigerlily swimwear and apparel business from its founder Jodhi Meares. This is BBG’s first
acquisition which focuses entirely on the girls market and will permit the company to expand its girl’s product range with a focus
on swimwear. The company is to be expanded in the domestic market before looking to take the brand overseas. The
acquisition is expected to be EPS accretive in the first full year.
In the December quarter rebalance of the S&P/ASX Indices, API has been dropped from the S&P/ASX All Australian 200 Index.
This change will take effect from close of trade on 21 December 2007.
Downer EDI Limited (DOW) - Sale of Century Resources 07-Dec-07 10:42
Babcock & Brown Infrastructure Group (BBI) - US, German and Belgian port operator acquisitions 07-Dec-07 10:35
Redbank Mines (RBM) - Entitlements offer and placement 07-Dec-07 10:33
Westpac (WBC) - Final price set on BT Investment Management float 07-Dec-07 10:14
Coates Hire (COA) - FY08 operating earnings growth guidance upgraded to 20% 07-Dec-07 10:01
Valad Property Group (VPG) - Reinstates its Dividend Reinvestment Plan 07-Dec-07 09:51
St Barbara (SBM) - Share purchase plan raises $22.5M 07-Dec-07 09:47
Billabong International (BBG) - Acquires Tigerlily 07-Dec-07 09:30
Aust Pharmaceutical (API) - API to fall out of ASX200 07-Dec-07 09:06
Page 12

13. Private Bank Daily Bulletin
Daily Research Reports
BBI announced that it has acquired interests in three port operators located in Germany, Belgium and the US. BBI subsidiary
Benelux Port Holdings has acquired 43% of the Westerlund Group (Belgium) with negotiations on the remaining 57% still
underway. BBI acquired 50% of Seehafen Rostock Umschlagsgesellchaft GmbH (Germany) with pre-emptive rights over the
remaining 50%. Lastly, BBI has entered an agreement to acquire 50% of ICS Logistics Inc (US). The acquisitions have an EV of
~A$616.5M.
SPN has proposed to acquire the Alinta assets from Singapore Power International (SPI) for $8,322M. The acquisition is
conditional upon SPN obtaining non-associated securityholder approval at a general meeting on 11 December. The
independent directors unanimously recommend securityholders vote in favour of the transaction. However, we recommend
securityholders do not vote in favour of this transaction.
DOW announced the sale of its Century Resources business to MB Holding. The sale will occur in two stages: the first stage
involves the sale of 51% of Century to MB Holding for US$70M and the second involves the sale of remaining 49% stake to MB
Holding either at the end of three years via a put option held by DOW or a corresponding call option held by MB Holding. DOW
has guaranteed the EBIT performance of Century over the three-year option period with exposure capped at US$5.4M in any
year.
RBM is to make a non-renounceable rights issue at 8 cents per share to raise $3.7M. RBM will also make a public placement
offer at 8 cents to raise $1.6M. Glencore will partially underwrite $1M of the issue. The funds will be used to fund the DFS, retire
the Macquarie Bank debt facility, fund drilling at Mt Kasi and provide working capital. The funding will take the company through
to a decision point to develop the expanded Redbank Project, subject to a successful DFS.
BBG has agreed to acquire the Tigerlily swimwear and apparel business from its founder Jodhi Meares. This is BBG’s first
acquisition that focuses entirely on the girls market and will permit the company to expand its girls' product range with a focus
on swimwear.
AFG has amended the original terms announced on 23 October 2007 for its proposed acquisition of the 79.6% of Rubicon
Holdings (Aust) Ltd it does not already own. The up-front share consideration will decrease by approximately 4.2M shares and
the conditional consideration will increase by 4.2M shares. This means the value of the deferred and conditional consideration
now represents 25.5% of the value of the total possible consideration, compared with 14.9% on the original terms.
COA today upgraded its guidance on FY08 operating earnings in light of trading for the first four months of FY08. FY08
operating earnings are now expected to grow 20% over operating earnings of $102.4M in FY07. This is an improvement on
previous guidance of 15% growth.
Babcock & Brown Infrastructure Group (BBI) - BBI pursues its port consolidation strategy
SP AusNet (SPN) - Recommendation to vote against the Alinta assets acquisition
Downer EDI Limited (DOW) - Sale of Century Resources
Redbank Mines (RBM) - Entitlements offer and placement
Billabong International (BBG) - BBG strengthens its girls swimwear offering
Allco Finance (AFG) - Rubicon terms improved; shareholders should vote in favour of transaction
Coates Hire (COA) - FY08 operating earnings growth guidance upgraded to 20%
Page 13

14. Utilities
Alan Stuart
ASX: BBI Bloomberg: BBI AU Reuters: BBI.AX 08 December 2007
Babcock & Brown Infrastructure Group
BBI pursues its port consolidation
strategy
Event
BBI announced that it has acquired interests in three port operators
located in Germany, Belgium and the US. BBI subsidiary Benelux Port
Holdings has acquired 43% of the Westerlund Group (Belgium) with
negotiations on the remaining 57% still underway. BBI acquired 50% of
Seehafen Rostock Umschlagsgesellchaft GmbH (Germany) with pre-
emptive rights over the remaining 50%. Lastly, BBI has entered an
agreement to acquire 50% of ICS Logistics Inc (US). The acquisitions
have an EV of ~A$616.5M.
Implications
We have made no adjustments to our EPS forecasts at this time.
We shall be having discussions with management to confirm some of
our model assumptions before updating our financial forecasts. That
said, from a broad overview of the transaction, it looks positive.
Following our discussions with management we shall provide an
update. We retain our bullish view on both 12-month and long-term
investment horizons.
Investment Opinion
BBI is a diversified utility and infrastructure vehicle with an aggressive
asset growth profile, having acquired $6B+ of assets since listing in
2002. BBI's long-life, long concession, monopolistic underlying assets
produce strong and stable cash flows, secured by regulated tariff
regimes or contracted revenues. We expect continued success via its
relationship with BNB, which identifies, secures and finances BBI's
acquisitions. We have a positive long-term view on the stock.
Our BBI forecasts reflect improved cash flows derived from its wholly
owned Dalrymple Bay Coal Terminal and moderate growth from its
utilities portfolio. We favour the proposed acquisition of the AAN assets
and expect the deal to be earnings accretive. BBI offers an attractive
yield, given its moderate growth outlook. Overall, we have a positive
12-month view on the stock.
Key Information
Price Performance
Market Statistics
Key Assumptions
Share Price $1.64
12 month view BUY
12 month target return (%) 32.1
12 month target price $2.02
Long Term View BUY
Long Term Target Return (% pa) 20.0
3 year target price n/a
Market Cap (M) $3,597
Shares (M) 1,745.8
% of Market 0.17
% of Sector 10.23
12 Month Range $1.42 - $2.03
Company Risk
Share Price Risk
Ethical rating
Performance against indices (%)
3 Months 6 Months 12 Months
BBI (0.6) (11.1) (9.1)
Sector (4.5) (7.8) 4.3
Market 8.1 7.3 24.0
Beta: 1.3
Market risk premium (%): 5.5
Risk free rate (%): 6.1
WACC (%): 8.8
Forecast cashflow (years): 10
Residual value % of total valuation: 60.5
Nominal terminal growth rate (%): 3.0
Earnings Summary
1 NPAT and EPS are adjusted by removing non-recurring items. All the above statistics are derived from normalised earnings.
Yr to Jun NPAT
Rep $M
NPAT1
Adj $M
EPS1
c
EPS chg
%
PER
x
PER rel
All Ords x
PER rel
Sector x
DPS
c
Yield
%
Franking
%
Deferred Tax
%
2006A 82.7 13.5 1.2 n/a >99 6.3 4.5 13.3 8.1 0 100
2007A 106.8 47.7 3.1 158.2 53.3 2.7 2.1 14.3 8.7 0 100
2008F 113.7 163.5 7.8 153.0 21.1 1.3 1.1 15.0 9.1 0 100
2009F 134.3 193.9 8.7 12.3 18.8 1.3 1.1 16.0 9.8 0 100

15. Babcock & Brown Infrastructure Group
Year end Jun. All figures in A$M
Notes: 1. The 12M recommendation rates stocks on a 12 month, absolute basis based on the total return (capital and dividends). BUY denotes an expectation of 15% or
more total return; SELL 5% or less; HOLD within the range of 5-15%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view is to
accept that offer.
2. The Long Term Recommendation rates stocks on a long term, absolute basis based on the average total return per annum (capital and dividends). BUY denotes a long
term expectation of 1% or more above the cost of equity (also known as the required return, which measures the the return required by investors given the company's risk);
HOLD within the range of 1% above and 3% below the cost of equity; SELL more than 3% below the cost of equity but above a total forecast annual return for the stock of
0%; AVOID denotes a long term expectation of a total annual return below 0%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view
is to accept that offer.
12M Recommendation1: BUY 12M Target: $2.02 Long Term Recommendation 2: BUY Long Term Target Return: 20.0% pa
Profit & loss summary 2006A 2007A 2008F 2009F
Operating revenue 787.7 1,239.3 1,617.4 1,700.7
Invest & other income (18.4) 0.0 (44.5) (45.6)
EBITDA 358.7 485.2 736.4 776.9
Depreciation/Amort (123.8) (181.0) (260.3) (265.5)
EBIT 234.9 304.2 476.1 511.4
Net Interest (236.1) (301.7) (214.4) (217.4)
Pre-tax profit (1.2) 2.5 261.7 294.0
Tax expense 15.6 51.3 (87.0) (88.2)
Minorities/Assoc./Prefs (0.9) (6.1) (61.0) (71.5)
NPAT 13.5 47.7 113.7 134.3
Non recurring items 69.2 59.1 0.0 0.0
Reported profit 82.7 106.8 113.7 134.3
NPAT add Goodwill & Pref 0.0 0.0 49.8 59.6
Adjusted profit 13.5 47.7 163.5 193.9
Cashflow summary 2006A 2007A 2008F 2009F
EBITDA 358.7 485.2 736.4 776.9
Working capital changes 181.1 105.1 25.5 6.5
Interest and tax (199.8) (284.4) (246.2) (288.0)
Other operating items (32.8) (90.5) (17.7) 1.7
Operating cashflow 307.2 215.5 498.0 497.0
Required capex (326.9) (581.8) (108.9) (114.3)
Maintainable cashflow (19.6) (366.3) 389.1 382.7
Dividends (62.9) (204.0) (312.8) (403.9)
Acq/Disp (1,257.5) (56.2) (823.2) (550.0)
Other investing items 6.8 (219.0) 0.0 0.0
Free cashflow (1,333.3) (845.4) (746.9) (571.2)
Equity 682.7 562.1 1,520.2 0.0
Debt inc/(red'n) 665.3 204.3 (773.3) 571.2
Balance sheet 2006A 2007A 2008F 2009F
Cash & deposits 309.1 227.9 50.0 50.0
Inventories 14.9 14.9 18.8 19.7
Trade debtors 225.4 185.3 233.9 246.2
Other curr assets 74.0 235.7 235.7 235.7
Total current assets 623.4 663.7 538.3 551.6
Prop., plant & equip. 4,390.0 5,026.4 5,718.2 6,147.1
Non-curr intangibles 1,967.1 2,113.3 2,113.3 2,113.3
Non-curr investments 391.8 382.5 382.5 382.6
Other non-curr assets 150.2 210.3 172.2 144.7
Total assets 7,522.5 8,396.2 8,924.6 9,339.2
Trade creditors 232.4 297.3 375.4 395.1
Curr borrowings 130.1 37.7 37.7 37.7
Other curr liabilities 53.0 86.7 166.2 170.4
Total current liab. 415.5 421.7 579.2 603.2
Borrowings 4,452.4 4,640.2 3,689.0 4,260.2
Other non-curr liabilities 719.0 864.6 825.6 825.6
Total liabilities 5,586.9 5,926.5 5,093.8 5,689.0
Minorities/Convertibles 136.4 122.5 933.8 945.7
Shareholders equity 1,935.8 2,469.7 3,830.8 3,650.3
Ratio analysis 2006A 2007A 2008F 2009F
Revenue growth (%) 117.1 57.3 30.5 5.2
EBITDA growth (%) 95.1 35.3 51.8 5.5
EPS growth (%) n/a 158.2 153.0 12.3
EBITDA/Sales margin (%) 45.5 39.2 45.5 45.7
EBIT/Sales margin (%) 29.8 24.5 29.4 30.1
Tax rate (%) >1000 (<1000) 33.2 30.0
Net debt/equity (%) 237.5 189.6 126.9 157.1
Net debt/net debt + equity (%) 70.4 65.5 55.9 61.1
Net interest cover (x) 1.0 1.0 2.2 2.4
Payout ratio (%) >1000 463.3 192.6 183.2
Capex to deprec'n (%) 264.0 321.4 41.8 43.1
NTA per share ($) (0.11) 0.13 0.35 0.27
ROA (%) 4.7 3.8 5.5 5.6
ROE (%) 1.1 2.5 4.0 4.8
Multiple analysis 2006A 2007A 2008F 2009F
Market cap (M) 3,597
Net debt ($M) 4,450.0
Peripheral assets ($M) (377.2)
Enterprise value ($M) 7,669.8
EV/EBIT (x) 32.8 25.2 16.1 15.0
EV/EBITDA (x) 21.4 15.8 10.4 9.9
EV/EBITDA All Ind (x) 10.3 9.3 8.2 7.6
EV/EBITDA rel All Ind (x) 2.1 1.7 1.3 1.3
P/E (x) >99 53.3 21.1 18.8
P/E rel All Ind (x) 5.9 2.7 1.3 1.2
P/E rel All Ind ex banks (x) 5.5 2.7 1.3 1.2
P/E sector (x) 30.5 25.0 19.2 16.7
P/E rel sector (x) 4.5 2.1 1.1 1.1
Assumptions 2006A 2007A 2008F 2009F
GDP growth (%) 2.92 2.50 3.02 3.64
Interest Rates (%) 5.73 6.38 6.34 6.30
Inflation (%) 3.20 3.09 2.47 2.50
Notes To Accounts
All P&L items (except Reported profit) now exclude Goodwill
Amortisation as per the new IFRS requirements. Our adjusted NPAT
represents returns to both ordinary unit holders and preference share
holders.
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

16. Utilities
Wilbur Tong
ASX: SPN Bloomberg: SPN AU Reuters: SPN.AX 07 December 2007
SP AusNet
Recommendation to vote against the
Alinta assets acquisition
Event
SPN has proposed to acquire the Alinta assets from Singapore Power
International (SPI) for $8,322M. This is the price paid by SPI, plus
transaction costs and holding costs between the time of the acquisition
by SPI and completion of the sale to SPN. The acquisition is
conditional upon SPN obtaining non-associated securityholder approval
at a general meeting on 11 December 2007.
Implications
The independent directors unanimously recommend securityholders
vote in favour of the transaction. However, we recommend
securityholders do not vote in favour of this transaction. Whilst we
believe SPN's proposed acquired assets will provide stability to the
cash flows and good growth prospects to the group, we view the
transaction as EPS-dilutive because the increase in additional
earnings from the new assets is proportionally less than its interest
expense and additional security issues. In our opinion, the synergy
benefits are not sufficient to justify the EPS dilution. After incorporating
the Alinta assets and the synergy benefits, our FY09 EPS forecast is
diluted by 45% down to 4.7cps. In addition, we have increased our
beta from currently 0.8 to 1.0 to reflect the extra financing risk, which
has the effect of increasing our discount rate from 7.3% to 7.8%. Our
12-month target price has been revised downwards, from $1.37 to
$1.25. We have downgraded our both short-term and long-term
recommendations on SPN from BUY to HOLD.
Investment Opinion
We view SPN as a solid income-type investment. We like SPN's
portfolio of strong cash flow Victorian-based energy transmission and
distribution assets, which offer scope for moderate electricity and gas
distribution volume growth. The extension into other business streams,
as seen in the potential Alinta acquisition, is clearly within SPN's
strategy. SPN is backed by Singapore Power Ltd, which has significant
experience in both transmission and distribution operations.
The outlook for SPN is that it will be cash
flow constrained by the potential Alinta acquisition. While it would
provide stability to the cash flows and good growth prospects to the
group, we view the transaction as EPS-dilutive due to increased issue
of securities, lower EBITDA margin and a heavy interest burden. In our
opinion, the synergy benefits are not sufficient to justify the EPS
dilution.
Key Information
Price Performance
Market Statistics
Key Assumptions
Share Price $1.19
12 month view HOLD
12 month target return (%) 14.7
12 month target price $1.25
Long Term View HOLD
Long Term Target Return (% pa) 9.3
3 year target price n/a
Market Cap (M) $2,501
Shares (M) 4,839.0
% of Market 0.12
% of Sector 7.17
12 Month Range $1.16 - $1.55
Company Risk
Share Price Risk
Ethical rating
Performance against indices (%)
3 Months 6 Months 12 Months
SPN (13.1) (21.9) (8.8)
Sector (5.8) (10.0) 3.0
Market 5.8 5.1 22.2
Beta: 1.0
Market risk premium (%): 5.5
Risk free rate (%): 6.1
WACC (%): 7.8
Forecast cashflow (years): 10
Residual value % of total valuation: 69.9
Nominal terminal growth rate (%): 3.0
Earnings Summary
1 NPAT and EPS are adjusted by removing non-recurring items. All the above statistics are derived from normalised earnings.
Yr to Mar NPAT
Rep $M
NPAT1
Adj $M
EPS1
c
EPS chg
%
PER
x
PER rel
All Ords x
PER rel
Sector x
DPS
c
Yield
%
Franking
%
Deferred Tax
%
2006A 367.6 136.9 6.5 n/a 18.2 0.8 0.6 3.3 2.7 5 68
2007A 179.0 162.0 7.7 18.3 15.4 0.8 0.6 11.3 9.5 9 64
2008F 195.7 195.7 7.0 (9.0) 16.9 1.1 0.9 11.6 9.7 9 60
2009F 220.7 220.7 4.6 (35.2) 26.1 1.9 1.6 12.1 10.2 9 59

17. SP AusNet
Year end Mar. All figures in A$M
Notes: 1. The 12M recommendation rates stocks on a 12 month, absolute basis based on the total return (capital and dividends). BUY denotes an expectation of 15% or
more total return; SELL 5% or less; HOLD within the range of 5-15%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view is to
accept that offer.
2. The Long Term Recommendation rates stocks on a long term, absolute basis based on the average total return per annum (capital and dividends). BUY denotes a long
term expectation of 1% or more above the cost of equity (also known as the required return, which measures the the return required by investors given the company's risk);
HOLD within the range of 1% above and 3% below the cost of equity; SELL more than 3% below the cost of equity but above a total forecast annual return for the stock of
0%; AVOID denotes a long term expectation of a total annual return below 0%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view
is to accept that offer.
12M Recommendation1: HOLD 12M Target: $1.25 Long Term Recommendation 2: HOLD Long Term Target Return: 9.3% pa
Profit & loss summary 2006A 2007A 2008F 2009F
Operating revenue 737.5 1,019.3 1,328.3 2,331.6
Invest & other income 0.0 0.0 0.0 0.0
EBITDA 492.2 624.7 713.5 1,221.4
Depreciation/Amort (148.6) (200.0) (186.3) (339.4)
EBIT 343.6 424.7 527.3 882.0
Net Interest (166.1) (218.7) (290.5) (645.2)
Pre-tax profit 177.5 206.0 236.8 236.8
Tax expense (40.6) (44.0) (41.1) (16.1)
Minorities/Assoc./Prefs 0.0 0.0 0.0 0.0
NPAT 136.9 162.0 195.7 220.7
Non recurring items 230.7 17.1 0.0 0.0
Reported profit 367.6 179.0 195.7 220.7
NPAT add Goodwill & Pref 0.0 0.0 0.0 0.0
Adjusted profit 136.9 162.0 195.7 220.7
Cashflow summary 2006A 2007A 2008F 2009F
EBITDA 492.2 624.7 713.5 1,221.4
Working capital changes 112.6 16.1 29.9 19.9
Interest and tax (175.2) (251.8) (350.1) (662.1)
Other operating items (251.8) 1.4 31.2 39.9
Operating cashflow 177.9 390.4 424.5 619.2
Required capex (294.8) (320.4) (463.7) (606.1)
Maintainable cashflow (117.0) 70.0 (39.1) 13.1
Dividends 0.0 (185.9) (238.8) (573.1)
Acq/Disp 2,046.1 (80.0) (8,321.6) 0.0
Other investing items (0.6) 2.3 0.0 0.0
Free cashflow 1,928.6 (193.6) (8,599.5) (560.1)
Equity 8.1 0.0 3,021.0 0.0
Debt inc/(red'n) (1,974.8) 194.0 5,578.3 560.1
Balance sheet 2006A 2007A 2008F 2009F
Cash & deposits 8.7 9.1 26.0 26.0
Inventories 6.5 5.9 9.5 13.3
Trade debtors 132.0 140.9 207.8 292.7
Other curr assets 194.6 34.2 186.7 186.7
Total current assets 341.8 190.1 429.9 518.7
Prop., plant & equip. 6,227.1 6,312.2 14,918.8 15,185.5
Non-curr intangibles 354.5 354.5 354.5 354.5
Non-curr investments 0.0 0.0 0.0 0.0
Other non-curr assets 23.7 75.5 87.1 87.1
Total assets 6,947.0 6,932.3 15,790.3 16,145.8
Trade creditors 140.3 165.7 266.0 374.7
Curr borrowings 644.4 619.9 619.9 619.9
Other curr liabilities 196.4 95.3 57.7 86.1
Total current liab. 981.2 880.9 943.6 1,080.8
Borrowings 2,870.4 2,940.3 8,413.1 8,973.1
Other non-curr liabilities 516.9 457.7 790.0 800.7
Total liabilities 4,368.4 4,278.9 10,146.7 10,854.6
Minorities/Convertibles 0.0 0.0 0.0 0.0
Shareholders equity 2,581.6 2,652.6 5,643.6 5,291.2
Ratio analysis 2006A 2007A 2008F 2009F
Revenue growth (%) 109.6 38.2 30.3 75.5
EBITDA growth (%) 104.9 26.9 14.2 71.2
EPS growth (%) n/a 18.3 (9.0) (35.2)
EBITDA/Sales margin (%) 66.7 61.3 53.7 52.4
EBIT/Sales margin (%) 46.6 41.7 39.7 37.8
Tax rate (%) 22.9 21.4 17.3 6.8
Net debt/equity (%) 135.8 133.9 159.6 180.8
Net debt/net debt + equity (%) 57.6 57.2 61.5 64.4
Net interest cover (x) 2.1 1.9 1.8 1.4
Payout ratio (%) 49.7 145.6 164.0 266.0
Capex to deprec'n (%) 198.4 160.2 248.9 178.6
NTA per share ($) 1.06 1.10 1.09 1.02
ROA (%) 5.0 6.0 5.7 5.5
ROE (%) 7.3 6.1 5.7 4.0
Multiple analysis 2006A 2007A 2008F 2009F
Market cap (M) 2,501
Net debt ($M) 9,007.0
Peripheral assets ($M) (0.0)
Enterprise value ($M) 11,507.8
EV/EBIT (x) 33.5 27.1 21.8 13.0
EV/EBITDA (x) 23.4 18.4 16.1 9.4
EV/EBITDA All Ind (x) 10.2 9.2 8.1 7.5
EV/EBITDA rel All Ind (x) 2.3 2.0 2.0 1.3
P/E (x) 18.2 15.4 16.9 26.1
P/E rel All Ind (x) 0.8 0.8 1.0 1.7
P/E rel All Ind ex banks (x) 0.7 0.8 1.0 1.7
P/E sector (x) 30.2 24.7 19.0 16.5
P/E rel sector (x) 0.6 0.6 0.9 1.6
Assumptions 2006A 2007A 2008F 2009F
GDP growth (%) 4.17 2.41 2.87 3.58
Interest Rates (%) 5.65 6.27 6.36 6.30
Inflation (%) 2.82 3.56 2.36 2.50
Notes To Accounts
The financial forecast has assumed the approval of the potential Alinta
acquisition and incorporation of the acquired assests into account.
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

18. SP AusNet
ACQUIRED ALINTA BUSINESSES
The businesses to be acquired by SPN include regulated electricity and gas distribution infrastructure, contracted gas
transmission pipelines and an asset management business (collectively referred to as "Acquired Businesses"). SPN has
proposed to acquire these Alinta businesses from SPI via SPIAA.
The acquisition cost to SPN for the acquired businesses is approximately $8,322M. The acquisition cost to be paid by SPN for
these businesses is the same price that SPI paid to Alinta shareholders (adjusted for SPI’s Recoverable Costs, SPN’s
transaction costs (excluding capital raising costs) and stamp duty). Independent Expert Grant Samuel has estimated the value
of the acquired businesses to be in the range of $7,485M–$8,365M. This is a standalone valuation and does not reflect any
value for synergies and cost savings specific to SPN.
New South Wales Gas Network
The network provides gas to more than 980,000 users across Sydney, Newcastle, Wollongong and over 20 country
centres. AGL Energy, as the largest gas retailer in New South Wales, is the largest user of the network.
The New South Wales gas network’s total revenue comprises regulated and other revenues. Regulated revenues are a
function of actual volumes realised and regulated tariffs. The current regulatory period commenced on 1 July 2005, and
the next regulatory reset will be effective as at 1 July 2010.
With relatively low household penetration in New South Wales at about 35% (compared to an average penetration in
reticulated areas estimated between 65% and 70%), the network’s “natural monopoly” represents a source of potential
growth above population growth. However, demand levels are directly impacted by climate and can be negatively
affected, as seen by the recently experienced warmer winter weather and the decreased hot water usage due to water
restrictions.
Alinta Victorian Electricity Network
The Alinta Victorian electricity network (formerly known as Solaris) distributes electricity to over 295,000 customer sites,
over 950sqkm of north-west greater Melbourne. It is one of five licensed electricity distribution networks in Victoria,
and penetration of the electricity network is approximately 100%, with future growth to be driven by usage/population
growth. Distribution prices for transporting electricity over the network and access to the network are regulated. The next
regulatory reset will be effective as at 1 January 2011.
The Victorian footprint covers a mix of major industrial areas, residential growth areas, established inner suburbs and
Melbourne International Airport. Revenue from residential, commercial and industrial customers represents
approximately 38%, 26% and 36%, respectively, of the total revenue from energy deliveries. This, in turn, accounts for
approximately 88% of the total revenue for the electricity network.
Average annual growth for electricity consumption of around 1.5% per annum is anticipated for the residential sector
through to 2010, largely resulting from growth in connections. Growth in the commercial and industrial markets,
however, is expected to remain largely flat, as organic growth continues to be partly offset by redevelopment of inner city
industrial land for residential and small business use. The peak instantaneous load demand is forecast to grow at a rate
of 2.5% over the next 20 years compared with growth of about 1.5% in energy delivered.
Additionally, the Alinta Victorian electricity network provides physical metering facilities and meter reading services. The
rollout will involve significant capital expenditure by SPN and will be subject to an additional round of regulatory
negotiation.
ACTEWAGL Distribution Partnership (50% ownership)
An electricity and gas distribution joint venture with the ACT government (ACTEW Corporation). The acquired
businesses are not involved in energy retailing in the ACT. The transfer of this interest is subject to the consent of
ACTEW Corporation and AGL Energy Ltd. The joint venture’s principal activities include the following:
Ownership and operation of the ACT electricity distribution network with 155,000 end-users, and the gas
distribution network in the ACT and in the Palerang, Queanbeyan, Shoalhaven and Tumut local government
areas in NSW totalling 104,000 end-users; and
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This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

19. SP AusNet
Provision of management services to TransACT, a telecommunications services provider in the ACT in which
SPIAA also has a 7.6% shareholding.
The large majority of end-users for the gas and electricity networks are residential and small business customers, with
only limited industrial usage. High penetration rates for both networks result in overall growth broadly consistent with
population growth and represents limited opportunities to expand the network beyond the existing population areas.
The ACTEWAGL Distribution Partnership is also involved in the operation and maintenance of the ACT’s water and
sewerage networks under a contract with the ACTEW Corporation. This involves the provision of more than 100M litres
of treated water each day to Canberra residents.
United Energy Distribution (34.1% ownership)
This consists of the electricity distribution network servicing the south-eastern suburbs of Melbourne and the Mornington
Peninsula, which is largely urban in nature. The 34.1% interest remains owned by BBI and is proposed to be sold to BBI
subsidiaries, which will, in turn, be acquired by SPIAA. The balance of UED is owned by DUET.
DUET maintains that such a sale would trigger pre-emptive rights under the UED Shareholders Agreement (giving
DUET the right to acquire the shares currently held by BBI for a fair value). BBI and SPIAA do not accept that position,
and may, if necessary, challenge such an assertion in dispute resolution proceedings. There is a risk, however, that the
alleged pre-emptive rights may be upheld, in which case the 34.1% interest would not constitute part of the acquired
businesses, but SPN would be entitled to receive the proceeds of the exercise of those rights.
UED’s last regulatory reset occurred in 2005, with revenues set for the period 1 January 2006 to 31 December 2010.
The AER will oversee the next regulatory reset for the 2011 to 2016 period.
In March and April 2007, a proposal was made by the acquired businesses to tender for the Sydney Water Corporation
Camellia Recycled Water Project. SPIAA and BBI have agreed to enter into a 50:50 unincorporated joint venture in
relation to the operation of stage 1 of the Camellia Recycled Water Project if the proposal is successful. The project
provides the Acquired Businesses with the opportunity to move into ownership of water infrastructure.
Eastern Gas Pipeline (EGP)
The EGP transports natural gas from the Gippsland Basin in Victoria to markets in Sydney and regional centres
(including Wollongong and Canberra). Gas enters the pipeline at the Longford Compressor Station (which primarily
sources gas from the Esso/BHP Billiton gas processing plant at Longford), the Patricia Baleen site at Orbost and through
the VicHub Interconnect Facility.
The 797km-long pipeline has a current capacity of 73PJ of gas per annum. The major end-users of gas transported by
the pipeline are the BlueScope Steel facilities at Port Kembla, Marubeni’s Smithfield Power Station and the Bairnsdale
Power Station in addition to retailers supplying smaller industrial, commercial and domestic end-users in Sydney.
The Sydney retail and industrial market is a mature gas market and is not expected to be the driver of major growth of
gas haulage on the pipeline. Future growth of the EGP customer base is expected to result from the anticipated
construction of gas-fired power stations positioned along the pipeline. The current drought conditions appear to have
brought forward a shortage of supply in the electricity market. Gas-fired electricity generation is expected to fill the
electricity generation shortfall in the current carbon-constraint environment.
Queensland Gas Pipeline (QGP)
QGP is a natural gas and coal seam gas transmission pipeline that links both the Ballera to Roma pipeline and the
Roma to Brisbane pipeline at Wallumbilla to large industrial users in Gladstone and Rockhampton, QLD.
It supplies a small retail distribution network in the Gladstone region, and large industrial facilities, including the QLD
Alumina Limited plant near Gladstone (51% of revenue for year ended June 07) and QLD Magnesia. Further potential
for growth in demand has been identified as a consequence of continued industrial development in the Gladstone and
Rockhampton regions. As the current sole means of transporting gas to the Gladstone region, the QGP is well placed to
capture these growth opportunities.
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This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

20. SP AusNet
The 627km-long pipeline is a free flow, high-pressure pipeline with a current capacity of approximately 27PJ per annum
(pipeline licence limits total capacity to 52PJ/annum). The pipeline is being expanded to 49PJ per annum to
accommodate additional load required by Origin Energy (Rio Tinto nickel refinery) by 2010.
Eastern States Asset Management
This includes specialist infrastructure management services that encompass operations, maintenance and management
of capital works, commercial, corporate support, engineering, regulatory compliance and information technology.
Significant growth in the outsourcing of electricity distribution works in QLD and WA is expected to continue. State
governments are also responding to the increasing demand for water with a pipeline of PPP water infrastructure assets
under development. The asset management business is well positioned for the increasing forecast expenditure in the
electricity energy infrastructure sector.
FUNDING STRUCTURE
The transaction is expected to be funded by equity (36%) and debt (64%). SPI intends to fully subscribe for its pro rata
entitlement under the entitlement offer and subscribe for 51% of securities offered under the institutional placement. Overall
gearing increases from 58% as at 31 August 2007 to 61% after the acquisition. As a result of the transaction, Standard &
Poor’s has indicated that the corporate credit rating on SPN is likely to be downgraded to “A- with a stable outlook", from “A with
negative implications" on CreditWatch. Debt will be at least 75% hedged over the forecast period.
SPN intends to undertake an equity offering of $3,022M to partially fund the transaction. The board has decided that it will not
issue new securities at an issue price of less than $1.10. The debt component of the acquisition cost will initially be funded by a
mixture of a $2,500M Syndicated Facility and $3,700M Bridge Facility.
FINANCIAL IMPACTS
We have incorporated in our forecasts the Alinta assets and the synergy benefits.
Post-acquisition, FY09 revenue forecast has now doubled. Our FY09 revenue forecast before the acquisition was
$1,094M. We have increased our post-acquisition FY09 revenue forecast to $2,332M, 113% up on the original
forecast. Further revenue growth will be underpinned by the revenue growth in its contracted business and the
expansion of the infrastructure asset management business.
After incorporating the acquired businesses in our forecast, we expect the EBITDA margin to decline substantially from
61.3% in FY07 to 52.4% in FY09, significantly below the historical margin earned from the existing businesses.
FY09 interest expense triples. We forecast net interest expense to increase to $676M in FY09, three times the original
forecast. SPN had borrowings of $3.7B pre-acquisition as at 31 August 2007. Inclusive of the $5.3B debt-finance for this
transaction, the acquisition will take SPN's total debt to $9.0B, 142% increase on the original forecast. Overall gearing
increases from 58% as at 31 August 2007 to only 61% after the acquisition; however, the interest coverage ratio is
expected to drop from 1.8x for FY08 to 1.4x for FY09.
Dilutive FY08 and FY09 EPS. SPN expects the transaction to be EPS dilutive by 33% in FY09 (including one-off
implementation costs) after synergies. However, in our opinion, our FY09 EPS forecast would be diluted by 46% down
to 4.6cps due to increased units of stapled securities, lower EBITDA margin and a heavy interest burden.
The addition of the acquired businesses is expected to result in transaction synergy benefits for SPN, as administrative
costs are spread over a greater asset pool and the operations become more efficient. Cost synergies of $89.8M are
expected by 2010 through headcount reduction, IT & business systems, site consolidation and procurement savings.
The independent expert has indicated that the synergies, if achieved, represent NPV in excess of $1B, which
is consistent with our expectation and slightly improves the margins. However, the synergy benefits are not sufficient
to compensate for the increase in interest burden and the earning dilution going forward.
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

21. SP AusNet
SPN expects the free cash flow per security after synergies to be accretive by 0.6% in FY09 (including one-off synergy
implementation costs), supported by the higher growth rate and lower capital intensity of the acquired assets. However,
strained by lower EPS and double the capex resulting from the acquired assets, we find it hard to justify any free cash
flow accretion, even after the synergy realisation.
Upgrade on FY09 distribution guidance. SPN expects the long-term benefits of the transaction could provide the
group the confidence to increase DPS. If the transaction is approved, SPN expects to upgrade an upwards revision to its
FY09 distribution guidance to 12.14cps, 2.5% up from its existing FY09 guidance of 11.8cps. Of these, 59% is expected
to be tax deferred for Australian investors.
Advantages
This transformational acquisition will position SPN as the leading utility business in Australia. The transaction provides a
unique opportunity to acquire a suite of high-quality assets that complement SPN’s existing business.
The Transaction will result in SPN geographically expanding outside of Victoria into high growth NSW, QLD and ACT
markets.
FIGURE 2: REVENUE BY GEOGRAPHY
Source: SPN explanatory memorandum
FIGURE 3: REVENUE BY GEOGRAPHY
Source: SPN explanatory memorandum
FIGURE 4: REVENUE MIX
Source: SPN explanatory memorandum
FIGURE 5: REVENUE MIX
Source: SPN explanatory memorandum
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

22. SP AusNet
Revenue diversity is expected to deliver a number of benefits to SPN. It lowers the sensitivity of cash flows to the
performance of, or regulatory determination in respect of, any one individual asset and increases long-term revenue
certainty through increased contracted revenue, which extends beyond the period of regulatory decisions. It provides an
opportunity to grow group revenue beyond the regulated levels by participation in non-regulated activities and improves
diversity across regulatory determination.
FIGURE 6: OPERATION DIVERSIFICATION
Source: SPN explanatory memorandum
The transaction is expected to provide SPN with enhanced growth opportunities through investment in the expansion of
the new asset portfolio, increased volumes through gas transmission pipelines and growth in demand for the provision of
infrastructure services. The addition of gas transmission assets to SPN’s existing portfolio provides a significant
opportunity to build and leverage a new capability. Expansion of assets and capabilities into gas transmission and asset
management allows redeployment of existing resources into third party asset management opportunities across eastern
Australia and puts SPN in a strong position to develop and grow through enhanced asset management capabilities.
Disadvantages
The transaction involves a number of significant risks and potential disadvantages, including the following:
The increased indebtedness of SP AusNet and resulting credit rating downgrade;
The dilution of existing securityholders’ ownership through the issue of new securities to partially fund the transaction;
The existence of disputes relating to the asset management business and the risk that further disputes emerge;
Integration of asset management operations may be hindered if consent to transfer AAM shares is not obtained; and
The risk that the 34.1% interest in UED may ultimately not be acquired.
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

23. SP AusNet
INVESTMENT VIEW
We believe SPN's proposed acquired assets will provide stability to the cash flows and good growth profile to the group.
However, the increase in additional earnings from the new assets is proportionally less than its interest expense and the
additional security issues. In our opinion, the synergy benefits are not sufficient to justify the EPS dilution.
After incorporating the Alinta assets and the synergy benefits, our FY09 EPS forecast would be diluted by 45% down to 4.7cps
due to increased units of stapled securities, lower EBITDA margin and a heavy interest burden. In addition, we have increased
our beta from currently 0.8 to 1.0 to allow for the extra financing risk, which has the effect of increasing our discount rate from
7.3% to 7.8%. Our 12-month target price has been revised downwards, from $1.37 to $1.25. We have downgraded our
recommendation on SPN in both our short-term and long-term views from BUY to HOLD. On this basis, we recommend
securityholders do not vote in favour of this transaction.
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

24. Industrials
Ben Brownette
ASX: DOW Bloomberg: DOW AU Reuters: DOW.AX 07 December 2007
Downer EDI Limited
Sale of Century Resources
Event
DOW announced the sale of its Century Resources business to MB
Holding. The sale will occur in two stages: the first stage involves the
sale of 51% of Century to MB Holding for US$70M and the second
stage involves the sale of the remaining 49% stake to MB Holding
either at the end of three years via a put option held by DOW or a
corresponding call option held by MB Holding. DOW has guaranteed
the EBIT performance of Century over the three-year option period,
with exposure capped at US$5.4M in any year. The sale does not
impact current earnings guidance provided by DOW.
Implications
We have adjusted the cash flow to take into account the 51% sale
of Century Resources for US$70M. As per management's
guidance, we have decreased our revenue forecasts from 2H08
onwards by circa A$67M to account for the loss of revenue arising from
the sale of Century. The net effect on our FY08 and FY09 EPS
forecasts is not significant, with changes of +0.6% and -0.2%,
respectively. Our 12-month price target has increased slightly by 0.5%
to $5.42. DOW had previously flagged the sale of Century Resources,
citing it would be a better fit in a company with larger drilling operations.
We retain an analyst discount in our price targets due to some possible
operational risks. We are meeting with DOW's management early next
week and will provide an update after our discussions. We maintain
our neutral view on the stock on both 12-month and long-term
investment horizons.
Investment Opinion
DOW provides infrastructure and engineering services across several
sectors, including water, rail, power and mining. The company
continues to perform successfully across all its business divisions,
which we forecast to continue in the medium term. Management's new
approach to risk management and the arrival of a new CEO should be
positive for the company. We are neutral on a long-term investment
view.
From an underlying business point of view, we see a strong company,
marred by operational shortcomings, with successive profit write-downs
in the past two years. While we look positively on the business and our
fundamentals suggest that the business looks attractive on a PE
multiple, we are hesitant to look favourably on the business from an
investment point of view. Until we see a greater focus on mitigating the
operational risk of the company, we are neutral on a 12-month outlook.
Key Information
Price Performance
Market Statistics
Key Assumptions
Share Price $5.27
12 month view HOLD
12 month target return (%) 7.9
12 month target price $5.42
Long Term View HOLD
Long Term Target Return (% pa) 10.8
3 year target price n/a
Market Cap (M) $1,650
Shares (M) 300.0
% of Market 0.08
% of Sector 0.87
12 Month Range $4.74 - $7.85
Company Risk
Share Price Risk
Ethical rating
Performance against indices (%)
3 Months 6 Months 12 Months
DOW (18.7) (30.1) (26.3)
Sector (0.3) (1.6) 14.4
Market 5.8 5.1 22.2
Beta: 1.1
Market risk premium (%): 5.5
Risk free rate (%): 6.1
WACC (%): 10.7
Forecast cashflow (years): 10
Residual value % of total valuation: 53.3
Nominal terminal growth rate (%): 3.0
Earnings Summary
1 NPAT and EPS are adjusted by removing non-recurring items. All the above statistics are derived from normalised earnings.
Yr to Jun NPAT
Rep $M
NPAT1
Adj $M
EPS1
c
EPS chg
%
PER
x
PER rel
All Ords x
PER rel
Sector x
DPS
c
Yield
%
Franking
%
ROE
%
2006A (24.9) 138.1 45.5 5.7 11.6 0.5 0.3 20.0 3.8 42 14.8
2007A 101.5 161.6 51.0 11.9 10.3 0.5 0.3 26.5 5.0 0 15.5
2008F 171.6 171.6 53.3 4.7 9.9 0.6 0.5 26.5 5.0 0 14.0
2009F 186.2 186.2 57.0 6.9 9.2 0.7 0.5 28.5 5.4 60 13.8

25. Downer EDI Limited
Year end Jun. All figures in A$M
Notes: 1. The 12M recommendation rates stocks on a 12 month, absolute basis based on the total return (capital and dividends). BUY denotes an expectation of 15% or
more total return; SELL 5% or less; HOLD within the range of 5-15%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view is to
accept that offer.
2. The Long Term Recommendation rates stocks on a long term, absolute basis based on the average total return per annum (capital and dividends). BUY denotes a long
term expectation of 1% or more above the cost of equity (also known as the required return, which measures the the return required by investors given the company's risk);
HOLD within the range of 1% above and 3% below the cost of equity; SELL more than 3% below the cost of equity but above a total forecast annual return for the stock of
0%; AVOID denotes a long term expectation of a total annual return below 0%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view
is to accept that offer.
12M Recommendation1: HOLD 12M Target: $5.42 Long Term Recommendation 2: HOLD Long Term Target Return: 10.8% pa
Profit & loss summary 2006A 2007A 2008F 2009F
Operating revenue 4,624.1 5,361.9 5,731.4 6,034.5
Invest & other income 0.0 0.0 0.0 0.0
EBITDA 326.4 418.3 420.2 437.0
Depreciation/Amort (106.0) (137.4) (141.3) (145.3)
EBIT 220.4 280.9 278.9 291.7
Net Interest (36.3) (56.0) (37.2) (29.4)
Pre-tax profit 184.0 224.9 241.8 262.3
Tax expense (53.5) (63.3) (70.1) (76.1)
Minorities/Assoc./Prefs 7.6 0.0 0.0 0.0
NPAT 138.1 161.6 171.6 186.2
Non recurring items (163.0) (60.1) 0.0 0.0
Reported profit (24.9) 101.5 171.6 186.2
NPAT add Goodwill & Pref 0.0 0.0 0.0 0.0
Adjusted profit 138.1 161.6 171.6 186.2
Cashflow summary 2006A 2007A 2008F 2009F
EBITDA 326.4 418.3 420.2 437.0
Working capital changes 108.9 (112.9) (22.0) (22.2)
Interest and tax (69.1) (61.6) (120.3) (102.7)
Other operating items (276.3) (137.6) 15.8 16.0
Operating cashflow 89.9 106.2 293.8 328.0
Required capex (197.4) (127.8) (177.7) (176.4)
Maintainable cashflow (107.5) (21.6) 116.1 151.6
Dividends (36.9) (36.2) (81.8) (89.5)
Acq/Disp (190.4) (140.2) 80.3 0.0
Other investing items 3.2 42.8 0.0 0.0
Free cashflow (331.5) (155.2) 114.7 62.1
Equity 142.6 4.0 24.5 26.8
Debt inc/(red'n) 188.4 223.8 (139.2) (89.0)
Balance sheet 2006A 2007A 2008F 2009F
Cash & deposits 167.9 242.7 0.0 0.0
Inventories 173.6 177.5 186.9 196.3
Trade debtors 948.8 1,090.4 1,147.6 1,205.4
Other curr assets 60.2 48.0 48.0 48.0
Total current assets 1,350.4 1,558.7 1,382.4 1,449.6
Prop., plant & equip. 676.4 754.2 710.2 741.3
Non-curr intangibles 541.6 569.6 569.6 569.6
Non-curr investments 34.2 92.2 92.2 92.2
Other non-curr assets 157.2 205.4 205.4 205.4
Total assets 2,759.9 3,180.0 2,959.8 3,058.1
Trade creditors 816.1 848.8 893.3 938.3
Curr borrowings 136.5 193.7 193.7 193.7
Other curr liabilities 194.8 232.1 229.5 242.6
Total current liab. 1,147.4 1,274.6 1,316.5 1,374.6
Borrowings 503.8 499.3 117.4 28.4
Other non-curr liabilities 158.2 236.2 241.7 247.2
Total liabilities 1,809.3 2,010.1 1,675.5 1,650.2
Minorities/Convertibles 0.0 0.0 0.0 0.0
Shareholders equity 950.5 1,169.9 1,284.3 1,407.9
Ratio analysis 2006A 2007A 2008F 2009F
Revenue growth (%) 23.3 16.0 6.9 5.3
EBITDA growth (%) 19.2 28.2 0.5 4.0
EPS growth (%) 5.7 11.9 4.7 6.9
EBITDA/Sales margin (%) 7.1 7.8 7.3 7.2
EBIT/Sales margin (%) 4.8 5.2 4.9 4.8
Tax rate (%) 29.1 28.2 29.0 29.0
Net debt/equity (%) 49.7 38.5 24.2 15.8
Net debt/net debt + equity (%) 33.2 27.8 19.5 13.6
Net interest cover (x) 6.1 5.0 7.5 9.9
Payout ratio (%) 43.9 52.0 49.7 50.0
Capex to deprec'n (%) 190.4 98.5 133.0 128.2
NTA per share ($) 1.30 1.88 2.20 2.55
ROA (%) 8.5 9.3 8.9 9.3
ROE (%) 14.8 15.5 14.0 13.8
Multiple analysis 2006A 2007A 2008F 2009F
Market cap (M) 1,650
Net debt ($M) 450.2
Peripheral assets ($M) (7.9)
Enterprise value ($M) 2,092.7
EV/EBIT (x) 9.5 7.4 7.5 7.2
EV/EBITDA (x) 6.4 5.0 5.0 4.8
EV/EBITDA All Ind (x) 10.2 9.2 8.1 7.5
EV/EBITDA rel All Ind (x) 0.6 0.5 0.6 0.6
P/E (x) 11.6 10.3 9.9 9.2
P/E rel All Ind (x) 0.5 0.5 0.6 0.6
P/E rel All Ind ex banks (x) 0.5 0.5 0.6 0.6
P/E sector (x) 36.6 30.0 20.4 17.6
P/E rel sector (x) 0.3 0.3 0.5 0.5
Assumptions 2006A 2007A 2008F 2009F
GDP growth (%) 2.92 2.50 3.02 3.64
Interest Rates (%) 5.73 6.38 6.34 6.30
Inflation (%) 3.20 3.09 2.47 2.50
Yen/A$ ($) 85.54 92.54 92.53 87.75
NZ$/A$ ($) 1.14 1.13 1.15 1.17
Notes To Accounts
All P&L items (except Reported profit) now exclude Goodwill
Amortisation as per the new IFRS requirements.
The forecast tax rate is significantly lower in FY07 and has the effect
of skewing some ratio analysis.
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

26. Materials
Tony Stepcich
ASX: RBM Bloomberg: RBM AU Reuters: RBM.AX 07 December 2007
Redbank Mines
Entitlements offer and placement
Event
RBM will make a non-renounceable rights issue at 8 cents per share to
raise $3.7M. RBM will also make a public placement offer at 8 cents to
raise $1.6M. Glencore will partially underwrite $1M of the issue. The
funds will be used to fund the DFS, to retire the Macquarie Bank debt
facility, to fund drilling at Mt Kasi and to provide working capital. The
funding will take the company through to a decision point to develop
the expanded Redbank Project, subject to a successful DFS.
Implications
RBM will issue 47.4M new shares under the entitlements offer and 20M
new shares through the placement. The total number of shares on
issues by RBM will increase from 142M to 209M. As the issue price of
8 cents is below our calculated NPV for RBM, the issue has a dilutive
effect on existing shareholders. As a result, our valuation for RBM falls
from 21 cents per share to 15 cents per share.
Investment Opinion
The research on this company has been commissioned and as such
Aegis has received a fee for its initiation and ongoing research
coverage.
No part of either the fee received by Aegis or the compensation paid to
its analysts involved in preparing this report was, is or will be directly or
indirectly, related to the valuation, earnings forecast or views
expressed in this report.
Key Information
Price Performance
Market Statistics
Key Assumptions
Share Price $0.08
Valuation $0.15
Market Cap (M) $19
Shares (M) 209.45
% of Market 0.00
% of Sector 0.00
12 Month Range $0.06 - $0.23
Company Risk
Share Price Risk
Ethical rating
Performance against indices (%)
3 Months 6 Months 12 Months
RBM (7.3) (38.6) (6.3)
Sector 12.3 21.3 46.0
Market 5.8 5.1 22.2
Beta: 1.5
Market risk premium (%): 5.5
Risk free rate (%): 6.1
WACC (%): 11.7
Forecast cashflow (years): 10
Residual value % of total valuation: 5.0
Nominal terminal growth rate (%): 3.0
Earnings Summary
1 NPAT and EPS are adjusted by removing non-recurring items. All the above statistics are derived from normalised earnings.
Yr to Jun NPAT
Rep $M
NPAT1
Adj $M
EPS1
c
EPS chg
%
PER
x
PER rel
All Ords x
PER rel
Sector x
DPS
c
Yield
%
Franking
%
ROE
%
2006A (3.27) (2.87) 0.0 n/a 0.0 0.0 0.0 0.0 0.0 0 (38.3)
2007A (2.40) (2.40) (2.5) n/a (3.3) (0.2) (0.2) 0.0 0.0 0 (26.9)
2008F 0.65 0.65 0.3 n/a 26.8 1.7 1.9 0.0 0.0 0 4.0
2009F 11.01 11.01 5.3 >1000 1.6 0.1 0.1 0.0 0.0 0 46.3

27. Redbank Mines
Year end Jun. All figures in A$M
Notes:1. The risk ratings are on a 12 month perspective, where five stars denotes low risk and one star denotes high risk. Company risk takes into account expected
financial, strategic and execution risks associated with the company. Share price risk is a measure of the expected volatility of the price and other trading factors.
2. The Ethical rating rates a company on an ethical investment basis where five stars denote very good and one star a poor rating. The score is based on four key factors:
areas of operating, environmental, corporate governance and social factors. For more information see www.aegis.com.au.
Valuation: $0.15 Company risk 1: Share Price risk 1: Ethical rating 2:
Profit & loss summary 2006A 2007A 2008F 2009F
Operating revenue 0.12 3.40 5.33 30.79
Invest & other income (0.30) (0.76) (1.00) (1.00)
EBITDA (2.55) (1.82) 1.46 16.23
Depreciation/Amort (0.05) (0.24) (0.60) (0.60)
EBIT (2.61) (2.06) 0.86 15.63
Net Interest (0.26) (0.34) 0.07 0.09
Pre-tax profit (2.87) (2.40) 0.93 15.72
Tax expense 0.00 0.00 (0.28) (4.72)
Minorities/Assoc./Prefs 0.00 0.00 0.00 0.00
NPAT (2.87) (2.40) 0.65 11.01
Non recurring items (0.40) 0.00 0.00 0.00
Reported profit (3.27) (2.40) 0.65 11.01
NPAT add Goodwill & Pref 0.00 0.00 0.00 0.00
Adjusted profit (2.87) (2.40) 0.65 11.01
Cashflow summary 2006A 2007A 2008F 2009F
EBITDA (2.55) (1.82) 1.46 16.23
Working capital changes 0.00 0.00 (1.46) (1.64)
Interest and tax (0.26) (0.36) 0.04 (2.14)
Other operating items (0.12) (0.65) 1.32 1.00
Operating cashflow (2.93) (2.83) 1.36 13.45
Required capex 0.00 (0.21) (0.60) (0.60)
Maintainable cashflow (2.93) (3.05) 0.76 12.85
Dividends 0.00 0.00 0.00 0.00
Acq/Disp (1.39) (2.32) (6.20) (15.20)
Other investing items (0.18) (0.25) 0.00 0.00
Free cashflow (4.50) (5.62) (5.44) (2.35)
Equity 5.17 3.99 7.83 0.00
Debt inc/(red'n) (0.70) 1.48 (2.39) 2.35
Balance sheet 2006A 2007A 2008F 2009F
Cash & deposits 0.43 0.32 2.35 0.00
Inventories 0.69 0.62 0.34 1.97
Trade debtors 0.21 0.66 0.51 2.96
Other curr assets 0.02 0.06 0.06 0.06
Total current assets 1.35 1.65 3.26 5.00
Prop., plant & equip. 0.52 1.78 6.98 21.18
Non-curr intangibles 13.35 14.69 14.69 14.69
Non-curr investments 0.00 0.00 0.00 0.00
Other non-curr assets 0.56 0.49 0.49 0.49
Total assets 15.78 18.62 25.42 41.36
Trade creditors 0.72 2.39 0.51 2.96
Curr borrowings 0.05 2.90 2.90 2.90
Other curr liabilities 0.09 0.20 0.35 2.83
Total current liab. 0.86 5.50 3.76 8.69
Borrowings 2.64 0.36 0.00 0.00
Other non-curr liabilities 3.19 2.56 2.98 2.98
Total liabilities 6.70 8.42 6.74 11.67
Minorities/Convertibles 0.00 0.00 0.00 0.00
Shareholders equity 9.08 10.20 18.68 29.69
Ratio analysis 2006A 2007A 2008F 2009F
Revenue growth (%) 0.0 >1000 56.7 477.9
EBITDA growth (%) n/a n/a n/a >1000
EPS growth (%) n/a n/a n/a >1000
EBITDA/Sales margin (%) (<1000) (53.6) 27.4 52.7
EBIT/Sales margin (%) (<1000) (60.7) 16.2 50.8
Tax rate (%) 0.0 0.0 30.0 30.0
Net debt/equity (%) 24.9 28.9 3.0 9.8
Net debt/net debt + equity (%) 19.9 22.4 2.9 8.9
Net interest cover (x) (10.0) (6.1) n/a n/a
Payout ratio (%) 0.0 0.0 0.0 0.0
Capex to deprec'n (%) 0.0 89.5 100.0 100.0
NTA per share ($) (0.05) (0.04) 0.02 0.07
ROA (%) (18.1) (11.8) 3.7 47.1
ROE (%) (38.3) (26.9) 4.0 46.3
Multiple analysis 2006A 2007A 2008F 2009F
Market cap (M) 19
Net debt ($M) 2.95
Peripheral assets ($M) (0.00)
Enterprise value ($M) 21.59
EV/EBIT (x) (8.3) (10.5) 25.0 1.4
EV/EBITDA (x) (8.5) (11.8) 14.8 1.3
EV/EBITDA All Ind (x) 10.2 9.2 8.1 7.5
EV/EBITDA rel All Ind (x) (0.8) (1.3) 1.8 0.2
P/E (x) 0.0 (3.3) 26.8 1.6
P/E rel All Ind (x) 0.0 (0.2) 1.6 0.1
P/E rel All Ind ex banks (x) 0.0 (0.2) 1.6 0.1
P/E sector (x) 19.0 17.5 13.9 11.8
P/E rel sector (x) 0.0 (0.2) 1.9 0.1
Assumptions 2006A 2007A 2008F 2009F
Copper (US$/lb) 2.42 3.23 3.30 2.89
Gold (US$/oz) 543.19 642.25 704.98 688.20
US$/A$ ($) 0.74 0.79 0.87 0.86
Notes To Accounts
The financial reports were prepared in accordance with the
requirements of the Corporations Act, 2001, including Australian
equivalents to International Financial Reporting Standards (A-IFRS).
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

28. Consumer Discretionary
Dane Roberts
ASX: BBG Bloomberg: BBG AU Reuters: BBG.AX 07 December 2007
Billabong International
BBG strengthens its girls swimwear
offering
Event
BBG has agreed to acquire the Tigerlily swimwear and apparel
business from its founder Jodhi Meares. This is BBG’s first acquisition
that focuses entirely on the girls market and will permit the company to
expand its girls' product range with a focus on swimwear. The company
is to be expanded in the domestic market before looking to take the
brand overseas. The company expects the acquisition to be EPS-
accretive in the first full year.
Implications
The acquisition of Tigerlily will be immaterial to our forecasts over the
next two-three years. Beyond that, we expect that it will have gained
enough scale and strengthened its brand name to a point where sales
will start to impact the BBG bottom line. Despite BBG offering no
guidance on the acquisition cost or multiple paid, we look favourably on
the acquisition, as we are confident that the company will successfully
build on Tigerlily’s position in the market and potentially take the brand
into international markets. The acquisition has had a minimal impact on
our 12-month price target, which remains largely unchanged at $18.22.
Investment Opinion
BBG possesses a substantial portfolio of quality brands. The company
has an achievable medium-term EPS growth target of 15%. While the
outlook is for reasonable organic growth rates, the upside lies in further
acquisitions, which BBG is actively pursuing in both America and
Australia. BBG has proven its ability as a brand manager and could
take advantage of growth opportunities that would arise in the event of
a protracted slowdown in trading conditions. We hold a favourable
long-term view.
BBG remains a compelling investment due to its reasonable rates of
organic growth coupled with significant scope for growth by acquisition.
Given the solid underlying earnings outlook and the management's
proven ability to deliver earnings growth, we remain positive on the
stock. The caveat to this is that with robust growth rates expected over
coming years, a downturn in any of BBG's key markets would result in
downside risk to our forecast. We hold a positive 12-month view on
BBG.
Key Information
Price Performance
Market Statistics
Key Assumptions
Share Price $14.83
12 month view BUY
12 month target return (%) 26.5
12 month target price $18.22
Long Term View BUY
Long Term Target Return (% pa) 17.4
3 year target price n/a
Market Cap (M) $3,153
Shares (M) 214.5
% of Market 0.15
% of Sector 1.56
12 Month Range $13.84 - $18.81
Company Risk
Share Price Risk
Ethical rating
Performance against indices (%)
3 Months 6 Months 12 Months
BBG (4.3) (18.5) (7.1)
Sector (0.2) (5.7) 1.7
Market 5.8 5.1 22.2
Beta: 1.1
Market risk premium (%): 5.5
Risk free rate (%): 6.1
WACC (%): 10.8
Forecast cashflow (years): 10
Residual value % of total valuation: 60.5
Nominal terminal growth rate (%): 3.0
Earnings Summary
1 NPAT and EPS are adjusted by removing non-recurring items. All the above statistics are derived from normalised earnings.
Yr to Jun NPAT
Rep $M
NPAT1
Adj $M
EPS1
c
EPS chg
%
PER
x
PER rel
All Ords x
PER rel
Sector x
DPS
c
Yield
%
Franking
%
ROE
%
2006A 145.9 145.9 70.5 12.6 21.0 1.0 0.9 44.0 3.0 100 21.5
2007A 167.2 167.2 80.6 14.3 18.4 1.0 0.9 50.5 3.4 100 22.7
2008F 184.2 184.2 86.8 7.7 17.1 1.1 0.8 54.5 3.7 100 23.1
2009F 218.3 218.3 102.6 18.3 14.4 1.0 0.8 64.0 4.3 100 24.7

29. Billabong International
Year end Jun. All figures in A$M
Notes: 1. The 12M recommendation rates stocks on a 12 month, absolute basis based on the total return (capital and dividends). BUY denotes an expectation of 15% or
more total return; SELL 5% or less; HOLD within the range of 5-15%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view is to
accept that offer.
2. The Long Term Recommendation rates stocks on a long term, absolute basis based on the average total return per annum (capital and dividends). BUY denotes a long
term expectation of 1% or more above the cost of equity (also known as the required return, which measures the the return required by investors given the company's risk);
HOLD within the range of 1% above and 3% below the cost of equity; SELL more than 3% below the cost of equity but above a total forecast annual return for the stock of
0%; AVOID denotes a long term expectation of a total annual return below 0%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view
is to accept that offer.
12M Recommendation1: BUY 12M Target: $18.22 Long Term Recommendation 2: BUY Long Term Target Return: 17.4% pa
Profit & loss summary 2006A 2007A 2008F 2009F
Operating revenue 1,018.2 1,226.5 1,348.7 1,584.7
Invest & other income 0.0 0.0 0.0 0.0
EBITDA 235.2 259.1 297.8 348.5
Depreciation/Amort (15.6) (21.8) (16.7) (20.3)
EBIT 219.6 237.3 281.1 328.3
Net Interest (6.6) (15.5) (18.0) (16.4)
Pre-tax profit 212.9 221.8 263.2 311.8
Tax expense (67.3) (54.2) (78.9) (93.5)
Minorities/Assoc./Prefs 0.2 (0.4) 0.0 0.0
NPAT 145.9 167.2 184.2 218.3
Non recurring items 0.0 0.0 0.0 0.0
Reported profit 145.9 167.2 184.2 218.3
NPAT add Goodwill & Pref 0.0 0.0 0.0 0.0
Adjusted profit 145.9 167.2 184.2 218.3
Cashflow summary 2006A 2007A 2008F 2009F
EBITDA 235.2 259.1 297.8 348.5
Working capital changes (44.3) (60.2) (50.3) (60.6)
Interest and tax (60.3) (109.5) (80.8) (102.6)
Other operating items (23.0) 1.8 4.3 3.5
Operating cashflow 107.7 91.2 171.0 188.8
Required capex (63.5) (39.2) (41.8) (47.5)
Maintainable cashflow 44.2 52.0 129.2 141.2
Dividends (84.9) (97.4) (104.8) (121.4)
Acq/Disp (76.7) (34.3) (10.0) 0.0
Other investing items (5.0) 0.0 0.0 0.0
Free cashflow (122.4) (79.7) 14.5 19.8
Equity (2.7) (5.1) 1.9 0.0
Debt inc/(red'n) 139.3 136.8 (16.4) (19.8)
Balance sheet 2006A 2007A 2008F 2009F
Cash & deposits 67.9 113.2 67.0 59.0
Inventories 162.0 171.8 196.7 231.4
Trade debtors 232.0 274.4 309.2 363.6
Other curr assets 12.2 14.1 14.1 14.1
Total current assets 474.0 573.5 587.0 668.0
Prop., plant & equip. 92.7 107.0 142.0 169.3
Non-curr intangibles 654.3 660.1 660.1 660.1
Non-curr investments 0.0 0.0 0.0 0.0
Other non-curr assets 36.8 50.0 50.0 50.0
Total assets 1,257.7 1,390.6 1,439.1 1,547.4
Trade creditors 135.4 152.2 161.6 190.0
Curr borrowings 6.2 6.8 6.8 6.8
Other curr liabilities 40.6 13.3 32.6 42.4
Total current liab. 182.2 172.3 201.0 239.3
Borrowings 257.4 360.6 297.9 270.1
Other non-curr liabilities 107.5 98.1 99.1 100.1
Total liabilities 547.0 630.9 598.1 609.5
Minorities/Convertibles 1.7 1.8 1.8 1.8
Shareholders equity 712.2 759.4 841.1 937.9
Ratio analysis 2006A 2007A 2008F 2009F
Revenue growth (%) 20.7 20.5 10.0 17.5
EBITDA growth (%) 17.5 10.2 15.0 17.0
EPS growth (%) 12.6 14.3 7.7 18.3
EBITDA/Sales margin (%) 23.1 21.1 22.1 22.0
EBIT/Sales margin (%) 21.6 19.3 20.8 20.7
Tax rate (%) 31.6 24.4 30.0 30.0
Net debt/equity (%) 27.5 33.5 28.3 23.3
Net debt/net debt + equity (%) 21.6 25.1 22.1 18.9
Net interest cover (x) 33.1 15.3 15.6 20.0
Payout ratio (%) 62.4 62.7 62.8 62.4
Capex to deprec'n (%) 406.1 179.7 250.0 234.7
NTA per share ($) 0.27 0.47 0.86 1.33
ROA (%) 20.7 18.0 20.4 22.4
ROE (%) 21.5 22.7 23.1 24.7
Multiple analysis 2006A 2007A 2008F 2009F
Market cap (M) 3,153
Net debt ($M) 254.1
Peripheral assets ($M) (0.0)
Enterprise value ($M) 3,406.9
EV/EBIT (x) 15.5 14.4 12.1 10.4
EV/EBITDA (x) 14.5 13.1 11.4 9.8
EV/EBITDA All Ind (x) 10.2 9.2 8.1 7.5
EV/EBITDA rel All Ind (x) 1.4 1.4 1.4 1.3
P/E (x) 21.0 18.4 17.1 14.4
P/E rel All Ind (x) 0.9 0.9 1.0 1.0
P/E rel All Ind ex banks (x) 0.8 0.9 1.0 1.0
P/E sector (x) 23.6 21.0 20.6 19.2
P/E rel sector (x) 0.9 0.9 0.8 0.8
Assumptions 2006A 2007A 2008F 2009F
GDP growth (%) 2.92 2.50 3.02 3.64
Interest Rates (%) 5.73 6.38 6.34 6.30
Inflation (%) 3.20 3.09 2.47 2.50
US$/A$ ($) 0.74 0.79 0.87 0.86
Euro/A$ ($) 0.61 0.60 0.59 0.58
Notes To Accounts
All P&L items (except reported profit) now exclude Goodwill
Amortisation as per the new IFRS requirements.
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

30. Financials
Peter Rae
ASX: AFG Bloomberg: AFG AU Reuters: AFG.AX 07 December 2007
Allco Finance
Rubicon terms improved; shareholders
should vote in favour of transaction
Event
AFG has amended the original terms announced on 23 October 2007
for its proposed acquisition of the 79.6% of Rubicon Holdings (Aust) Ltd
it does not already own. The up-front share consideration will decrease
by approximately 4.2M shares and the conditional consideration will
increase by 4.2M shares. The cash component of the up-front
consideration of $63.7M is unchanged. This means the value of the
deferred and conditional consideration now represents 25.5% of the
value of the total possible consideration, compared with 14.9% on the
original terms. The transaction is subject to approval from non-
associated AFG shareholders, with the vote to be held on 12
December 2007.
Implications
We believe the combined Allco Rubicon real estate business will
achieve the 20% hurdle for growth in assets under management,
triggering the deferred consideration of 10M AFG shares. We welcome
the improvement in the terms of the proposed acquisition and reiterate
our previous recommendation that shareholders should vote in favour
of the transaction. We have made no adjustment to our EPS forecasts,
our 12-month price target remains at $11.68.
Investment Opinion
AFG represents an attractive investment opportunity as a high-growth
company in the financial services sector. AFG's ability to leverage its
balance sheet generating high investment returns increases its
investment merits. AFG is shifting its focus from being a pure originator
and owner of assets to also becoming a manager of alternative assets.
We are confident that AFG will be able to achieve strong earnings
growth over the medium to long term and have a positive long-term
view of the stock.
We expect AFG to deliver strong earnings growth in FY08, given a
strong pipeline, a sound funding platform and the establishment of
additional managed funds. We see good opportunities in AFG’s core
asset classes, with a particularly strong global aviation market and
significant opportunities to acquire global infrastructure assets. We are
forecasting strong double-digit EPS growth in FY08 and FY09 and
have a positive view of the stock on a 12-month time frame.
Key Information
Price Performance
Market Statistics
Key Assumptions
Share Price $7.04
12 month view BUY
12 month target return (%) 72.4
12 month target price $11.68
Long Term View BUY
Long Term Target Return (% pa) 27.2
3 year target price n/a
Market Cap (M) $2,290
Shares (M) 287.8
% of Market 0.11
% of Sector 0.35
12 Month Range $6.42 - $13.24
Company Risk
Share Price Risk
Ethical rating
Performance against indices (%)
3 Months 6 Months 12 Months
AFG (17.0) (39.1) (40.2)
Sector 1.9 (1.2) 10.5
Market 5.8 5.1 22.2
Beta: 1.2
Market risk premium (%): 5.5
Risk free rate (%): 6.1
WACC (%): 10.4
Forecast cashflow (years): 10
Residual value % of total valuation: 59.8
Nominal terminal growth rate (%): 3.0
Earnings Summary
1 NPAT and EPS are adjusted by removing non-recurring items. All the above statistics are derived from normalised earnings.
Yr to Jun NPAT
Rep $M
NPAT1
Adj $M
EPS1
c
EPS chg
%
PER
x
PER rel
All Ords x
PER rel
Sector x
DPS
c
Yield
%
Franking
%
ROE
%
2006A 96.9 96.9 49.3 53.1 14.3 0.7 0.7 41.0 5.8 100 18.0
2007A 211.7 201.3 60.8 23.2 11.6 0.6 0.7 44.0 6.3 71 11.8
2008F 253.1 253.1 71.2 17.2 9.9 0.6 0.7 46.0 6.5 70 11.3
2009F 296.4 296.4 81.4 14.3 8.7 0.6 0.7 48.0 6.8 60 12.3

31. Allco Finance
Year end Jun. All figures in A$M
Notes: 1. The 12M recommendation rates stocks on a 12 month, absolute basis based on the total return (capital and dividends). BUY denotes an expectation of 15% or
more total return; SELL 5% or less; HOLD within the range of 5-15%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view is to
accept that offer.
2. The Long Term Recommendation rates stocks on a long term, absolute basis based on the average total return per annum (capital and dividends). BUY denotes a long
term expectation of 1% or more above the cost of equity (also known as the required return, which measures the the return required by investors given the company's risk);
HOLD within the range of 1% above and 3% below the cost of equity; SELL more than 3% below the cost of equity but above a total forecast annual return for the stock of
0%; AVOID denotes a long term expectation of a total annual return below 0%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view
is to accept that offer.
12M Recommendation1: BUY 12M Target: $11.68 Long Term Recommendation 2: BUY Long Term Target Return: 27.2% pa
Profit & loss summary 2006A 2007A 2008F 2009F
Operating revenue 171.2 546.0 723.7 875.7
Invest & other income 0.0 0.0 0.0 0.0
EBITDA 159.8 343.7 404.0 467.4
Depreciation/Amort 0.0 0.0 0.0 0.0
EBIT 159.8 343.7 404.0 467.4
Net Interest (27.1) (51.0) (56.6) (62.2)
Pre-tax profit 132.8 292.7 347.4 405.2
Tax expense (35.9) (83.9) (86.9) (101.3)
Minorities/Assoc./Prefs 0.0 (7.5) (7.5) (7.5)
NPAT 96.9 201.3 253.1 296.4
Non recurring items 0.0 10.4 0.0 0.0
Reported profit 96.9 211.7 253.1 296.4
NPAT add Goodwill & Pref 0.0 0.0 0.0 0.0
Adjusted profit 96.9 201.3 253.1 296.4
Cashflow summary 2006A 2007A 2008F 2009F
EBITDA 159.8 343.7 404.0 467.4
Working capital changes (26.0) 15.5 8.5 0.0
Interest and tax (62.8) (432.3) (152.8) (151.5)
Other operating items (13.3) 302.2 (54.3) 0.0
Operating cashflow 57.7 229.2 205.5 315.9
Required capex 0.0 0.0 0.0 0.0
Maintainable cashflow 57.7 229.2 205.5 315.9
Dividends (43.5) (95.1) (163.8) (156.8)
Acq/Disp 0.0 0.0 (500.0) (500.0)
Other investing items (374.9) (263.6) 0.0 0.0
Free cashflow (360.8) (129.5) (458.4) (340.9)
Equity 82.6 477.8 54.6 52.3
Debt inc/(red'n) 284.1 90.3 403.8 288.6
Balance sheet 2006A 2007A 2008F 2009F
Cash & deposits 10.3 444.8 0.0 0.0
Inventories 0.0 0.0 0.0 0.0
Trade debtors 108.2 195.3 50.3 50.3
Other curr assets 62.9 658.1 658.1 658.1
Total current assets 181.4 1,298.2 708.4 708.4
Prop., plant & equip. 0.1 15.0 15.0 15.0
Non-curr intangibles 0.0 1,117.7 1,117.7 1,117.7
Non-curr investments 1,126.6 6,100.3 6,600.3 7,100.3
Other non-curr assets 0.8 52.4 52.4 52.4
Total assets 1,308.9 8,583.7 8,493.8 8,993.8
Trade creditors 9.6 136.5 0.0 0.0
Curr borrowings 0.0 0.0 0.0 0.0
Other curr liabilities 63.1 129.5 66.0 77.9
Total current liab. 72.7 266.1 66.0 77.9
Borrowings 630.0 6,115.3 6,074.2 6,362.8
Other non-curr liabilities 2.0 0.0 0.0 0.0
Total liabilities 704.7 6,381.4 6,140.2 6,440.8
Minorities/Convertibles 0.0 23.8 31.3 38.8
Shareholders equity 604.1 2,203.1 2,353.6 2,553.0
Ratio analysis 2006A 2007A 2008F 2009F
Revenue growth (%) 85.4 218.9 32.5 21.0
EBITDA growth (%) 86.6 115.0 17.5 15.7
EPS growth (%) 53.1 23.2 17.2 14.3
EBITDA/Sales margin (%) 93.4 62.9 55.8 53.4
EBIT/Sales margin (%) 93.4 62.9 55.8 53.4
Tax rate (%) 27.0 28.7 25.0 25.0
Net debt/equity (%) 102.6 260.2 261.6 253.1
Net debt/net debt + equity (%) 50.6 72.2 72.3 71.7
Net interest cover (x) 5.9 6.7 7.1 7.5
Payout ratio (%) 83.2 72.4 64.6 59.0
Capex to deprec'n (%) 0.0 0.0 0.0 0.0
NTA per share ($) 3.00 3.06 3.40 3.86
ROA (%) 15.6 5.0 4.8 5.3
ROE (%) 18.0 11.8 11.3 12.3
Multiple analysis 2006A 2007A 2008F 2009F
Market cap (M) 2,290
Net debt ($M) 5,670.5
Peripheral assets ($M) (0.0)
Enterprise value ($M) 7,960.4
EV/EBIT (x) 49.8 23.2 19.7 17.0
EV/EBITDA (x) 49.8 23.2 19.7 17.0
EV/EBITDA All Ind (x) 10.2 9.2 8.1 7.5
EV/EBITDA rel All Ind (x) 4.9 2.5 2.4 2.3
P/E (x) 14.3 11.6 9.9 8.7
P/E rel All Ind (x) 0.6 0.6 0.6 0.6
P/E rel All Ind ex banks (x) 0.6 0.6 0.6 0.6
P/E sector (x) 20.9 17.3 14.4 12.9
P/E rel sector (x) 0.7 0.7 0.7 0.7
Assumptions 2006A 2007A 2008F 2009F
GDP growth (%) 2.92 2.50 3.02 3.64
Interest Rates (%) 5.73 6.38 6.34 6.30
Inflation (%) 3.20 3.09 2.47 2.50
Notes To Accounts
All numbers for FY06 and going forward are based on AIFRS
accounting standards. All financial information for FY05 and FY06 are
for Allco Finance Group (previously Record Investments Limited) on a
standalone basis. The numbers for FY07 and beyond are on a
merged entity basis. Record Investments Limited name changed to
Allco Finance Group Limited on completion of the merger.
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

32. Industrials
Sam Haddad
ASX: COA Bloomberg: COA AU Reuters: COA.AX 07 December 2007
Coates Hire
FY08 operating earnings growth guidance
upgraded to 20%
Event
COA today upgraded its guidance on FY08 operating earnings
following trading for the first four months of FY08. FY08 operating
earnings are now expected to grow 20% over operating earnings of
$102.4M in FY07. This is an improvement on previous guidance of
15% growth. The company did not provide details on what the
underlying drivers were that accounted for the upgrade.
Implications
We have upgraded our revenue growth and increased our EBITDA
margin forecasts in FY08. Our FY08 NPAT is now broadly in line with
company guidance. The net effect is an increase in our FY08-FY09
earnings forecast by 6.5% and 6.3%, respectively. We retain our short-
term and long-term recommendations to accept offer.
Investment Opinion
COA is Australia's largest hire equipment company, with well over 100
years' experience in the sector. It has managed to successfully
leverage off the lengthy uptrend in activity levels across the
engineering, building/construction and mining/resources sectors. COA
continues to build scale via a run of bolt-on acquisitions. The Allied
Equipment and Allplant acquisitions have further diversified its revenue
base, though their FY07 contributions have been disappointing.
From a top-down angle, COA's major clients see a positive outlook
over the coming year or so. There remains much to like from a bottom-
up perspective: (1) financials remain sound; (2) recent
capex/acquisitions are yet to fully reflect in earnings; and (3)
restructuring initiatives now in train will benefit profitability. However,
there are some challenges to sustain reasonable EPS growth over the
medium term. We believe the Ned Group offer to be a fair price and
encourage shareholders to accept.
Key Information
Price Performance
Market Statistics
Key Assumptions
Share Price $6.53
12 month view ACCEPT OFFER
12 month target return (%) 8.8
12 month target price $6.86
Long Term View ACCEPT OFFER
Long Term Target Return (% pa) 10.5
3 year target price n/a
Market Cap (M) $1,641
Shares (M) 250.8
% of Market 0.08
% of Sector 0.86
12 Month Range $4.67 - $6.53
Company Risk
Share Price Risk
Ethical rating
Performance against indices (%)
3 Months 6 Months 12 Months
COA 12.2 6.2 16.8
Sector (0.3) (1.6) 14.4
Market 5.8 5.1 22.2
Beta: 1.1
Market risk premium (%): 5.5
Risk free rate (%): 6.1
WACC (%): 10.9
Forecast cashflow (years): 10
Residual value % of total valuation: 60.2
Nominal terminal growth rate (%): 3.0
Earnings Summary
1 NPAT and EPS are adjusted by removing non-recurring items. All the above statistics are derived from normalised earnings.
Yr to Jun NPAT
Rep $M
NPAT1
Adj $M
EPS1
c
EPS chg
%
PER
x
PER rel
All Ords x
PER rel
Sector x
DPS
c
Yield
%
Franking
%
ROE
%
2006A 100.0 93.6 40.1 26.5 16.3 0.7 0.4 19.0 2.9 100 17.1
2007A 92.4 102.4 41.0 2.2 15.9 0.8 0.5 21.0 3.2 100 15.7
2008F 120.0 122.4 48.6 18.6 13.4 0.9 0.7 24.5 3.8 100 17.0
2009F 132.2 132.2 52.1 7.3 12.5 0.9 0.7 26.5 4.1 100 16.6

33. Coates Hire
Year end Jun. All figures in A$M
Notes: 1. The 12M recommendation rates stocks on a 12 month, absolute basis based on the total return (capital and dividends). BUY denotes an expectation of 15% or
more total return; SELL 5% or less; HOLD within the range of 5-15%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view is to
accept that offer.
2. The Long Term Recommendation rates stocks on a long term, absolute basis based on the average total return per annum (capital and dividends). BUY denotes a long
term expectation of 1% or more above the cost of equity (also known as the required return, which measures the the return required by investors given the company's risk);
HOLD within the range of 1% above and 3% below the cost of equity; SELL more than 3% below the cost of equity but above a total forecast annual return for the stock of
0%; AVOID denotes a long term expectation of a total annual return below 0%. ACCEPT OFFER relates to a situation where there is a public offer for shares and our view
is to accept that offer.
12M Recommendation1: ACCEPT OFFER 12M Target: $6.86 Long Term Recommendation 2: ACCEPT OFFER Long Term Target Return: 10.5% pa
Profit & loss summary 2006A 2007A 2008F 2009F
Operating revenue 717.0 774.0 882.2 941.8
Invest & other income 0.0 0.0 0.0 0.0
EBITDA 269.7 323.4 360.1 384.4
Depreciation/Amort (117.8) (149.7) (153.7) (161.3)
EBIT 151.9 173.7 206.4 223.1
Net Interest (22.3) (30.1) (34.8) (37.6)
Pre-tax profit 129.6 143.6 171.6 185.5
Tax expense (36.0) (41.2) (49.2) (53.2)
Minorities/Assoc./Prefs 0.0 0.0 0.0 0.0
NPAT 93.6 102.4 122.4 132.2
Non recurring items 6.4 (10.0) (2.4) 0.0
Reported profit 100.0 92.4 120.0 132.2
NPAT add Goodwill & Pref 0.0 0.0 0.0 0.0
Adjusted profit 93.6 102.4 122.4 132.2
Cashflow summary 2006A 2007A 2008F 2009F
EBITDA 269.7 323.4 360.1 384.4
Working capital changes (52.3) (11.8) (26.7) (9.7)
Interest and tax (60.9) (61.3) (76.6) (88.6)
Other operating items 26.5 (13.9) (15.2) 0.7
Operating cashflow 183.0 236.4 241.6 286.7
Required capex (299.5) (295.7) (250.6) (258.1)
Maintainable cashflow (116.5) (59.3) (9.0) 28.6
Dividends (31.8) (39.3) (61.6) (64.6)
Acq/Disp (119.4) (60.5) (38.7) 0.0
Other investing items (3.4) 14.9 0.0 0.0
Free cashflow (271.2) (144.2) (109.3) (36.0)
Equity 154.1 0.0 12.3 12.9
Debt inc/(red'n) 118.5 139.8 96.9 23.1
Balance sheet 2006A 2007A 2008F 2009F
Cash & deposits 10.5 5.9 0.0 0.0
Inventories 18.8 40.2 44.9 47.8
Trade debtors 132.8 147.0 164.2 174.9
Other curr assets 4.3 4.6 5.1 5.4
Total current assets 166.4 197.8 214.2 228.1
Prop., plant & equip. 848.0 1,022.0 1,154.6 1,251.4
Non-curr intangibles 74.8 85.8 85.8 85.8
Non-curr investments 0.0 0.0 0.0 0.0
Other non-curr assets 20.6 17.2 17.2 17.2
Total assets 1,109.9 1,322.8 1,471.8 1,582.5
Trade creditors 44.3 68.3 64.0 68.2
Curr borrowings 0.0 0.0 0.0 0.0
Other curr liabilities 47.0 41.8 44.0 46.6
Total current liab. 91.3 110.1 108.0 114.8
Borrowings 371.3 460.2 551.2 574.3
Other non-curr liabilities 26.6 70.7 60.2 60.4
Total liabilities 489.1 641.1 719.4 749.5
Minorities/Convertibles 0.0 0.0 0.0 0.0
Shareholders equity 620.7 681.7 752.4 833.0
Ratio analysis 2006A 2007A 2008F 2009F
Revenue growth (%) 35.3 8.0 14.0 6.8
EBITDA growth (%) 50.8 19.9 11.3 6.8
EPS growth (%) 26.5 2.2 18.6 7.3
EBITDA/Sales margin (%) 37.6 41.8 40.8 40.8
EBIT/Sales margin (%) 21.2 22.4 23.4 23.7
Tax rate (%) 27.8 28.7 28.7 28.7
Net debt/equity (%) 58.1 66.6 73.3 68.9
Net debt/net debt + equity (%) 36.8 40.0 42.3 40.8
Net interest cover (x) 6.8 5.8 5.9 5.9
Payout ratio (%) 47.3 51.2 50.4 50.8
Capex to deprec'n (%) 258.1 206.4 165.0 161.8
NTA per share ($) 2.19 2.38 2.64 2.93
ROA (%) 15.6 14.0 14.6 14.6
ROE (%) 17.1 15.7 17.0 16.6
Multiple analysis 2006A 2007A 2008F 2009F
Market cap (M) 1,641
Net debt ($M) 454.3
Peripheral assets ($M) (0.0)
Enterprise value ($M) 2,095.1
EV/EBIT (x) 13.8 12.1 10.2 9.4
EV/EBITDA (x) 7.8 6.5 5.8 5.5
EV/EBITDA All Ind (x) 10.2 9.2 8.1 7.5
EV/EBITDA rel All Ind (x) 0.8 0.7 0.7 0.7
P/E (x) 16.3 15.9 13.4 12.5
P/E rel All Ind (x) 0.7 0.8 0.8 0.8
P/E rel All Ind ex banks (x) 0.7 0.8 0.8 0.8
P/E sector (x) 36.6 30.0 20.4 17.6
P/E rel sector (x) 0.4 0.5 0.7 0.7
Assumptions 2006A 2007A 2008F 2009F
GDP growth (%) 2.92 2.50 3.02 3.64
Interest Rates (%) 5.73 6.38 6.34 6.30
Inflation (%) 3.20 3.09 2.47 2.50
Notes To Accounts
All P&L items (except Reported profit) now exclude Goodwill
Amortisation as per the new AIFRS requirements.
Copyright © 2000 - 2007 Aegis Equities Holdings Pty Limited. All rights reserved.
This information must be read in conjunction with the Legal Notice which can be located at http://www.aegis.com.au/public/disclaimer.aspx.

34. Andrew Black Neil Verringer
General Manager, St George Private Bank Head of BSA Private Bank
BLACKA@STGEORGE.COM.AU VERRINGERN@BANKSA.COM.AU
Phone +61 2 9236 3056 Phone + 61 088424 5487
St.George Private Bank & BankSA Private Bank
Locations
Sydney
Level 4, 182 George Street, Sydney, NSW 2000
Phone (02) 9236 1882
Melbourne
Level 8, 530 Collins Street, Melbourne, VIC 3000
Phone (03) 9274 4850
Brisbane
Central Plaza, Level 4, 345 Queen Street,
Brisbane, QLD 4000
(07) 3232 8888
Perth
152-158 St Georges Terrace, Perth, WA 6000
Phone (08) 9265 7510
Adelaide
BankSA Private Bank
Level 1, 97 King William Street
Adelaide, SA 5000
(08) 8424 4141
Staff Directory
Private Bank Directors
Warren Acworth Brisbane acworthw@stgeorge.com.au
Richard Battifuoco Adelaide battifuocor@banksa.com.au
David Gray Sydney grayda@stgeorge.com.au
David Scannell Sydney scannelld@stgeorge.com.au
David Wyndham Sydney wyndhamd@stgeorge.com.au
Private Bank Relationship Managers – Financial Advice
Peter Coulthard Melbourne coulthardp@stgeorge.com.au
Andrew Smith Sydney smitha@stgeorge.com.au
Damien Ferguson Brisbane fergusond@stgeorge.com.au
Gerry Duffy Sydney duffyg@stgeorge.com.au
ROXANNE GORMAN SYDNEY GORMANR@STGEORGE.COM.AU
Sharyn Besch Brisbane BESCHS@STGEORGE.COM.AU
Darren Carr Perth CARRDA@STGEORGE.COM.AU
Private Bank Relationship Managers – Banking
Jeanette McCann Sydney mccannj@stgeorge.com.au
Brett Edwards Sydney edwardsbr@stgeorge.com.au
Anne Fraser Sydney frasera@stgeorge.com.au
Scott Heyes Melbourne heyess@stgeorge.com.au
Andrew Horsnell Adelaide horsnella@banksa.com.au
Bruce Kleem Sydney kleemb@stgeorge.com.au
Lisa Marks Melbourne marksl@stgeorge.com.au
Kishore Mudaliar Sydney mudaliark@stgeorge.com.au
Richard Northey Sydney northeyr@stgeorge.com.au
Josie Prasad Sydney prasadj@stgeorge.com.au
Geoffrey Bell Sydney bellge@stgeorge.com.au
Josephine Prasad Sydney prasadjo@stgeorge.com.au

35. Disclaimer and Disclosure of Interest
This publication has been prepared by Aegis Equities Research Pty Limited (ACN 085 293 910) (“Aegis”), an
Australian Financial Services Licensee . St.George Wealth Management Pty Limited (ABN 28 006 929 004),
St.George Bank Limited (ABN 92 055 513 070), trading as BankSA (SGB Entities) has not had any involvement in
the research for or preparation of any part of this publication. Whilst the information contained in this publication has
been prepared with all reasonable care from sources, which Aegis believes are reliable, no responsibility or liability is
accepted by Aegis or SGB Entities for any errors or omissions or misstatements however caused. Any opinions,
forecasts or recommendations reflects the judgement and assumptions of Aegis as at the date of publication and
may change without notice. Aegis and SGB Entities, their officers, agents and employees exclude all liability
whatsoever, in negligence or otherwise, for any loss or damage relating to this document to the full extent permitted
by law. This publication is not and should not be construed as an offer to sell or the solicitation of an offer to purchase
or subscribe for any investment. Any securities recommendation contained in this publication is unsolicited general
information only. Aegis and SGB Entities are not aware that any recipient intends to rely on this publication and are
not aware of the manner in which a recipient intends to use it. In preparing our information, it is not possible to take
into consideration the investment objectives, financial situation or particular needs of any individual recipient.
Investors must obtain individual financial advice from their investment advisor to determine whether
recommendations contained in this publication are appropriate to their personal investment objectives, financial
situation or particular needs before acting on any such recommendations. This publication is not for public circulation
or reproduction whether in whole or in part and is not to be disclosed to any person other than the intended recipient,
without obtaining the prior written consent of Aegis. Aegis and/or SGB Entities, their officers, employees, consultants
or its related bodies corporate may, from time to time hold positions in any securities included in this report and may
buy or sell such securities or engage in other transactions involving such securities. Aegis and SGB Entities, their
Directors and associates declare that from time to time they may hold interests in and/or earn brokerage, fees or
other benefits from securities mentioned in this publication.
Aegis, its officers, employees, consultants and its related bodies corporate have not and will not receive, whether
directly or indirectly, any commission, fee, benefit or advantage, whether pecuniary or otherwise in connection with
making any recommendation contained in this report and/or on this web site. Aegis discloses that from time to time, it
or its officers, employees, consultants and its related bodies corporate may have an interest in the securities, directly
or indirectly, which are the subject of these recommendations or may perform paid services for the companies that
are the subject of such recommendations. HOWEVER, UNDER NO CIRCUMSTANCES, HAS AEGIS BEEN
INFLUENCED, EITHER DIRECTLY OR INDIRECTLY, IN MAKING ANY RECOMMENDATION CONTAINED IN
THIS REPORT AND/OR ON THIS WEB SITE.
This information must be read in conjunction with the Legal Notice which can be located at
http://www.aer.com.au/disclaimer.asp