AUSTRALIA AU Price (at 08:17, 03 Sep 2012 GMT) Underperform A$10.52 Volatility index Low 12-month target A$ 11.08 12-month TSR % +12.0 Valuation A$ - DCF (beta 1.1, ERP 5.0%, RFR 6.0%, TGR 2.5%) 15.09 GICS sector Capital Goods Market cap A$m 1,749 30-day avg turnover A$m 13.0 Number shares on issue m 166.3 Investment fundamentals Year end 30 Jun 2012A 2013E 2014E 2015E Revenue m 4,454.4 4,613.2 4,800.3 4,977.5 EBIT m 235.4 241.4 258.5 270.0 Reported profit m 134.3 148.6 172.8 182.7 Adjusted profit m 168.3 168.2 182.3 192.2 Gross cashflow m 221.7 228.4 241.4 251.2 CFPS 134.0 137.9 145.8 151.7 CFPS growth % 3.2 2.9 5.7 4.1 PGCFPS x 7.9 7.6 7.2 6.9 PGCFPS rel x 0.95 1.00 1.04 1.06 EPS adj 101.7 101.6 110.1 116.1 EPS adj growth % 2.2-0.1 8.4 5.4 PER adj x 10.3 10.4 9.6 9.1 PER rel x 0.78 0.83 0.85 0.84 Total DPS 70.0 69.7 72.3 72.3 Total div yield % 6.7 6.6 6.9 6.9 Franking % 100 100 100 100 ROA % 9.1 8.9 9.5 9.6 ROE % 14.4 14.2 14.8 14.9 EV/EBITDA x 7.3 6.9 6.6 6.4 Net debt/equity % 37.0 37.2 31.8 23.8 P/BV x 1.5 1.4 1.4 1.3 AU vs ASX 100, & rec history Note: Recommendation timeline - if not a continuous line, then there was no Macquarie coverage at the time or there was an embargo period. Source: FactSet, Macquarie Research, September 2012 (all figures in AUD unless noted) 3 September 2012 Macquarie Securities (Australia) Limited Driving growth in DTZ Event Asian analyst tour showcasing Property Services business and recent DTZ acquisition ($148m purchase price in Dec 2011). 's Property Services business is $2b revenue division and represented 33% of FY12 group revenue The DTZ acquisition has propelled to Top 3 status in the global property services market. This forms part of s over-arching strategy to build a greater level of long term recurring and stable earnings. Impact Management came across well and energised by the ownership stability provides and the enhanced integrated services offering post merger (facilities management and transaction services across a global platform). is targeting 10% pa organic growth driven by a large property services outsourcing trend. Customers have also re-engaged with the "new" DTZ with >50% win rate in last 8 months. Pre DTZ, 's property revenue was 92% recurring (facilities management), 8% corporate real estate transactions and now is 72% recurring, 28% transactional. There is a 30-40% long term target for the latter (more cyclical but higher margin) with opportunities to extend 's position in the US property transaction market building on Equis. The Top 4 players have 22% market share of the $60b outsourced property services market; is one of these at ~3-4%. The market is gravitating to the larger players who have the scale, breadth of coverage and systems investment to meet the increasingly global property needs of major clients. There is another $140b of property services which is currently in-house or self-performed ($200b total market) which is subject to outsourcing trend driven by lower cost and improved efficiencies which sector specialists can provide. DTZ made a good start in its first 6 months with $15m EBIT 2H12 contribution (5% EBIT margin) albeit partly assisted by some large transaction profits. We forecast DTZ EBIT of $27.5m and $35m in FY13 and FY14 at 5.0% and 6.0% EBIT margins vs long term target of 8%. There is some reinvestment required to hire new teams to grow the revenue line which is reflected in our 5.0% forecast margin in FY13. Earnings and target price revision No change. Price catalyst 12-month price target: A$11.08 based on a EV/EBITA methodology. Catalyst: Contract wins Action and recommendation Our current recommendation is Underperform with $11.08 TP. trades on 9.6x FY13 PER which is a premium to 9.1x engineering construction sector average. However this is a discount to its major property peers in CBRE and JLL which are trading on 13-14x FY12 PER and 11-12x in 13 on FactSet estimates. In part this reflects higher 15-22% earnings growth expectations vs at flat in FY13 and 8% growth forecast in FY14. In FY13, a full year positive impact of DTZ is offset by expected declines in Resources and Infrastructure earnings due to lower revenue and problem power projects respectively. Please refer to the important disclosures and analyst certification on inside back cover of this document, or on our website www.macquarie.com/disclosures.
Analysis Fig 1 Services and DTZ the highlights of s recent FY12 result 1H11A 2H11A FY11A 1H12A 2H12A FY12A FY13E Sales Resources 474.0 473.4 947.3 517.1 327.3 844.4 717.7 % ch 54% 2% 23% 9% -31% -11% -15% Infrastructure 494.6 565.3 1,060.0 592.5 566.1 1,158.5 1,100.6 % ch -11% 6% -3% 20% 0% 9% -5% Rail 638.3 610.7 1,249.0 593.3 605.2 1,198.5 1,210.5 % ch 19% 2% 10% -7% -1% -4% 1% Services 666.8 661.8 1,327.3 677.0 652.6 1,325.6 1,383.8 % ch -1% -4% -2% 2% -1% 0% 4% DTZ 276.1 276.1 549.2 Elimination/Other -135.6-162.9-298.5-167.6-181.0-348.6-348.6 Total sales revenue 2138.1 2148.3 4285.1 2212.3 2246.2 4454.4 4613.2 % ch 3% 2% 2% 3% 5% 4% 4% EBITA Resources 11.6 32.4 44.0 30.1 14.9 45.0 38.8 % ch -51% -9% -26% 160% -54% 2% -14% Infrastructure 40.3 43.1 83.3 37.7 20.2 58.0 52.8 % ch 3% 8% 6% -6% -53% -30% -9% Rail 38.5 46.2 84.8 36.4 48.7 85.1 85.9 % ch 182% 11% 53% -6% 5% 0% 1% Services 35.6 40.9 76.5 34.4 46.1 80.5 87.2 % ch 2% 11% 7% -3% 13% 5% 8% DTZ 14.9 14.9 27.5 85% Corporate/other -22.5-19.7-42.2-28.3-8.1-36.5-37.6 % ch 14% 11% 13% 33% -54% -7% 3% Total EBITA 103.5 142.9 246.4 110.3 136.6 247.0 254.6 Amortisation 5.1 4.7 9.8 4.7 6.8 11.5 13.3 Total EBIT 98.4 138.2 236.6 105.6 129.8 235.4 241.4 % ch 15% 6% 9% 6% -7% -2% 3% EBITA Margin Resources 2.4% 6.8% 4.6% 5.8% 4.6% 5.3% 5.4% Infrastructure 8.1% 7.6% 7.9% 6.4% 3.6% 5.0% 4.8% Rail 6.0% 7.6% 6.8% 6.1% 8.0% 7.1% 7.1% Services 5.3% 6.2% 5.8% 5.1% 7.1% 6.1% 6.3% DTZ 5.4% 5.4% 5.0% Total Margins 4.6% 6.4% 5.5% 4.8% 5.8% 5.3% 5.2% Source: Macquarie Research, September 2012 Overall delivered a much weaker than expected operating result from Resources and Infrastructure, but better from Services and DTZ. Resources EBITA of $45m (+2% on pcp) was well below our $66m forecast due to lower revenue and margin. 2H revenue fell 31% reflecting completion of major projects (Moranbah), while implied 2H EBIT of $15m was down 54% as s earnings mix shifted to lower margin asset maintenance work. We note that s 5.3% margin is well below historical 7-8% levels due to a greater contribution from maintenance contracts vs higher margin construction work. Asset maintenance revenue is now $600m pa out of c$700-750m divisional revenue. Outside the $99m SMP contract for BHP s Jimblebar mine, has not announced much new work in Resources in the past 12 months (order book is -16% to $800m). We expect a 14% drop in FY13 earnings with margins flattish on pcp at 5.4%. Infrastructure EBITA of $58m was also much weaker than expected (we forecast $83m). Result was -30% on pcp driven by lower margin (5.8% vs 7.8% in FY11) as faced high turnover and low productivity on 2 large power contracts. We estimate these projects are ~80% complete although we expect some ongoing margin impact in FY13 as these wash through. In addition, government spending is slowing (50% of revenue) and regulatory uncertainty is contributing to delays in new power projects. New contract wins such as Ichthys ($270m power project) will take time to ramp-up in FY13 with a greater positive impact in FY14. Our FY13 EBIT forecast of $53m is -9% on pcp. 3 September 2012 2
Rail EBITA of $85m was flat on pcp, with lower revenue (-4%) was offset by stronger margins (7.1% vs 6.8% in the pcp) due to ongoing demand in freight locos and a good performance across s passenger maintenance contracts. For FY13 we forecast $86m EBIT, +1% on pcp. Services EBITA of $81m was up 5% on pcp. Americas was the key driver with strong growth in revenue despite FX impacts and overall margins improving to 6.1%. DTZ was the standout with $15m EBIT contribution well up on prior $1-2m guidance. Key drivers were a re-build of the revenue line as ownership uncertainty was removed and customers re-engaged with the new DTZ. Overhead savings are also proceeding nicely which collectively resulted in a 5% EBIT margin. We forecast DTZ EBIT of $27.5m and $35m in FY13 and FY14 at 5.0% and 6.0% EBIT margins vs long term target of 8%. Corporate/other costs of -$37m were lower vs the pcp due to a decrease in STI s paid to management (largely in Resources and Infrastructure). Fig 2 Post the DTZ acquisition is a top 3 player in property services Source: Analyst & Investor Tour, September 2012 Following the acquisition of DTZ, is now a Top 3 player in the property services space vs the likes of CBRE and JLL. Americas is s largest geographic exposure (61%) of revenue followed by Asia Pacific (23%) and EMEA (12%). In Americas, expects strong growth in property investment volumes as economy recovers, and as confidence improves. Conditions in EMEA are tough but DTZ's earnings are driven by overhead cost savings and re-build of market share. In China, office leasing and property sales activity is stable with a good pipeline of new property projects. Government stimulus is seen as likely post October change of leadership which is expected to have a positive impact on the overall Chinese economy later in the year. 3 September 2012 3
Fig 3 trading at a premium to peers, but flatter earnings growth profile brings premium into question PER (x) EV/EBIT (x) EV/EBITDA EPS growth (%) FY12e FY13e FY14e FY12e FY13e FY14e FY12e FY13e FY14e FY13e FY14e CLO 11.3 9.0 8.3 8.2 5.6 4.9 6.8 5.3 4.6 25.7 8.3 DOW 8.3 7.6 7.0 7.0 5.1 4.8 3.1 2.9 2.7 9.5 8.7 LEI 12.8 8.7 7.5 8.5 6.4 5.3 3.9 3.2 2.8 47.3 15.3 LLC 9.5 9.2 8.7 9.0 8.1 7.9 8.0 7.3 7.3 4.1 5.8 MAH nmf 6.7 6.1 5.7 5.2 4.8 3.1 2.9 2.6 15.1 9.7 MND 14.1 12.2 11.1 8.7 8.2 7.4 8.2 7.0 6.2 15.4 9.9 NWH 6.9 6.0 5.7 4.8 4.1 3.8 3.8 3.3 3.0 16.4 5.2 TSE 9.0 7.5 7.0 11.2 9.3 8.7 6.5 5.6 5.2 19.5 8.0 10.4 9.6 9.1 9.0 8.4 8.1 6.9 6.6 6.4 8.4 5.4 WOR 17.1 14.7 12.8 12.8 10.4 8.9 10.9 9.0 7.8 16.5 15.2 Average ex 11.1 9.1 8.2 8.4 6.9 6.3 6.0 5.2 4.7 18.8 9.6 prem/(disc) -7% 5% 10% 7% 21% 28% 15% 28% 36% Source: Macquarie Research, September 2012 The above table show s s relative valuation vs domestic peers. At 9.6x FY13 PER is trading at a 5% premium the domestic peer group on 9.1x. trades at a more substantial premium to LEI and DOW on an EV/EBITDA basis, reflecting s lower capital intensity relative to DOW and LEI, whose contract mining operations have seen capex run well in excess of depreciation in recent years. s flat FY13 growth outlook compares to the sector average of 19%. Fig 4 FY13 and FY14 sum of parts valuation Valuation FY13 EBITA Multiple- Low Multiple - High Value - Low Value - High Resources 29.4 8.0 9.0 235 264 Rail 76.6 8.0 9.0 612 689 Services 77.8 9.0 10.0 700 778 Infrastructure 43.4 8.0 9.0 348 391 DTZ 27.5 9.0 10.0 247 275 Total 254.6 8.4 9.4 2142 2397 Less FY12e Net Debt 435 435 Value 1707 1962 Diluted Shares on Issue 165.6 165.6 Value per share $10.31 $11.85 Average $11.08 Valuation FY14e EBITA Multiple- Low Multiple - High Value - Low Value - High Resources 30.7 8.0 9.0 246 277 Rail 78.9 8.0 9.0 632 710 Services 81.9 9.0 10.0 737 819 Infrastructure 45.4 9.0 10.0 409 454 DTZ 34.8 9.0 10.0 313 348 Total 271.7 8.6 9.6 2336 2608 Less FY12e Net Debt 450 450 Value 1886 2158 Diluted Shares on Issue 165.6 165.6 Value per share $11.39 $13.03 Average $12.21 Source: Macquarie Research, September 2012 The average multiple we have applied is 8.4-9.4x EV/EBITA. In our view this represents a reasonable through the cycle multiple for a basic materials/contractor company. We have ascribed a slightly lower multiple of 8 9x EBITA for Resources, which historically has been a more volatile business. However asset maintenance is now 60% of Resources revenue. s traditional Services business tends to be more stable reflecting a greater proportion of facilities management revenue. We have assigned corporate overheads equally to each division (excl DTZ) in our valuation. Our implied DTZ valuation of $247-275m based on FY13e earnings is above $148m acquisition price. 3 September 2012 4
Our $11.08 target price is based on the mid point of our FY13e EV/EBITA valuation ($10.31- $11.85). This compares to prior $13.50 and has been negatively impacted by substantially lower earnings and slightly higher than expected net debt. Our FY14 SoP average is $12.21. Our DCF is $15.09 based on a 9.1% WACC, 1.1x beta, 5% market risk premium and 2.5% long term growth rate. 3 September 2012 5
Interim results 1H12(a) 2H12(a) 1H13(e) 2H13(e) Profit & Loss 2012A 2013E 2014E 2015E Revenue 2212.3 2242.1 2233.6 2379.6 Revenue $m 4454.4 4613.2 4800.3 4977.5 3.6% 4.1% 3.7% EBITDA $m 133.8 165.5 145.9 167.8 EBITDA $m 299.3 313.7 329.8 341.2 Depreciation $m 23.5 28.9 29.6 29.6 Depreciation $m 52.3 59.1 58.0 57.9 Amortisation of goodwill $m 4.7 6.8 6.6 6.6 Amortisation of intangibles $m 11.5 13.3 13.3 13.3 EBIT $m 105.6 129.8 109.7 131.6 EBIT $m 235.4 241.4 258.5 270.0 Net Interest expense $m 11.5 13.2 15.0 15.0 Net interest expense $m 24.8 30.0 28.8 27.4 Pre-Tax Profit $m 94.1 116.6 94.7 116.6 Pre-Tax Profit $m 210.7 211.4 229.7 242.6 Tax Expense $m 24.6 24.5 23.3 28.3 Tax Expense $m 49.1 51.7 55.9 58.8 Net Profit $m 69.5 92.1 71.4 88.3 Net Profit $m 161.5 159.7 173.8 183.7 Outside equity interests $m 0.1 0.9 0.5 0.5 Outside equity interests $m 1.1 1.1 1.1 1.1 Net Abn/Extra $m -14.0-12.2-5.0-5.0 Net Abnormals/Extra. $m -26.2-10.0 0.0 0.0 Reported Earnings $m 55.4 79.0 65.9 82.7 Reported Earnings $m 134.3 148.6 172.8 182.7 Adjusted Earnings $m 72.2 96.2 75.6 92.6 Adjusted Earnings $m 168.3 168.2 182.3 192.2 Gross Cashflow $m 89.7 126.4 106.4 129.5 Gross Cashflow $m 216.2 235.9 247.2 256.8 EPS (Adj/dil) c 43.6 58.1 45.7 55.9 EPS (adj/diluted) c 101.7 101.6 110.1 116.1 EPS growth % 5.9-0.4 4.7-3.7 EPS growth % 2% 0% 8% 5% CFPS c -3.6 70.6 30.0 63.7 PE (adj) x 10.3 10.4 9.6 9.1 CFPS Growth % nmf 37.7 nmf -9.8 CFPS c 67.1 93.7 135.4 159.6 EBITDA/Sales % 6.0 7.4 6.5 7.1 CFPS Growth % -26.4 39.7 44.5 17.8 EBIT/Sales % 4.8 5.8 4.9 5.5 PGCFPS x 15.7 11.2 7.8 6.6 Earnings Split % 42.9 57.1 45.0 55.0 DPS c 70.0 69.7 72.3 72.3 Revenue Growth % 3.5 4.4 1.0 6.1 Yield % 6.7 6.6 6.9 6.9 EBIT Growth % 6.2-7.3 3.9 1.4 Franking % 100.0 100.0 100.0 100.0 Profit and Loss ratios 2012A 2013E 2014E 2015E Cashflow Analysis 2012A 2013E 2014E 2015E Revenue Growth % 4.0 3.6 4.1 3.7 EBIT Growth % -1.7 2.5 7.1 4.5 Pre-tax Profit $m 210.7 211.4 229.7 242.6 EBITDA/Sales % 6.7 6.8 6.9 6.9 Depreciation & Amortisation $m 63.9 72.4 71.3 71.2 EBIT/Sales % 5.3 5.2 5.4 5.4 Tax Paid $m -58.4-47.8-53.8-56.9 Effective tax rate % 23.3 24.4 24.3 24.3 Gross cashflow $m 216.2 235.9 247.2 256.8 Payout ratio % 68.8 68.6 65.6 62.2 Changes in working capital $m -79.4-15.5-23.0 7.4 EV/EBIT x 9.2 9.1 8.3 7.6 Other $m -25.8-65.2 0.0 0.0 EV/EBITDA x 7.3 7.0 6.5 6.0 Operating Cashflow $m 111.0 155.2 224.2 264.2 EV/Sales x 0.5 0.5 0.4 0.4 Acquisitions $m -125.1 0.0 0.0 0.0 Capex - Plant & Equip. $m -55.5-55.1-57.3-59.4 Balance sheet ratios Asset Sales $m 1.1 0.8 0.8 0.8 ROE % 13.7 13.4 14.1 14.2 Other $m -22.4 0.0 0.0 0.0 ROA % 9.9 9.4 10.0 10.4 Investing cashflow $m -201.9-54.3-56.5-58.6 ROFE % 16.0 14.8 15.6 16.4 Dividend (ordinary) $m -124.3-115.4-119.7-119.7 Net Debt $m 435.4 449.8 401.8 315.9 Equity raised $m 2.9 0.0 0.0 0.0 Net Debt/Equity % 37.0 37.2 31.8 23.8 Other $m -23.4-14.8-1.4-16.2 Interest Cover x 9.5 8.0 9.0 9.8 Financing cashflow $m -144.8-130.2-121.1-135.9 Price/NTA x -12.3-18.4-61.3 36.4 Other (FX) $m NTA per share $ -0.85-0.57-0.17 0.29 Net Change in cash/debt $m -235.7-29.3 46.6 69.7 EFPOWA m 165.4 165.6 165.6 165.6 Historical performance 2009A 2010A 2011A 2012A Balance Sheet 2012A 2013E 2014E 2015E Cash $m 177.4 112.9 160.9 246.8 Revenue $m 4754.4 4186.9 4285.1 4454.4 Receivables $m 589.6 610.7 624.0 622.2 EBITDA $m 273.1 275.8 299.4 299.3 Inventories $m 359.7 372.6 387.7 402.0 Depreciation/Amortisation $m 53.9 59.2 59.8 63.9 Investments $m 67.5 67.5 67.5 67.5 EBIT $m 219.2 216.6 239.6 235.4 Property, plant & equipment $m 176.7 171.9 170.4 171.1 Net interest expense $m 30.5 20.3 20.8 24.8 Intangibles $m 1310.9 1297.7 1284.4 1271.2 Pre-Tax Profit $m 188.7 196.3 218.8 210.7 Other Assets $m 65.8 65.8 65.8 65.8 Tax Expense $m 45.0 52.3 60.2 49.1 Total Assets $m 2747.6 2698.9 2760.7 2846.6 Net Profit $m 143.7 144.0 158.7 161.5 Payables $m 513.8 532.1 537.6 557.5 Net Abn/Extra $m 0.0 0.0 0.0-26.2 Short Term Debt $m 6.4 6.4 6.4 6.4 Long Term Debt $m 606.4 556.4 556.4 556.4 EPS (adj/dil) c 91.7 91.6 99.5 101.7 Other Liabilities $m 445.7 394.4 396.5 398.4 EPS growth % 0.1 0.0 0.1 0.0 Total Liabilities $m 1572.3 1489.3 1496.9 1518.6 Ordinary DPS c 64.0 64.0 70.0 70.0 Shareholders Funds $m 1169.7 1202.9 1256.0 1319.0 EBITDA/Sales % 5.7 6.6 7.0 6.7 Minority Interests $m 5.7 6.8 7.8 8.9 EBIT/Sales % 4.6 5.2 5.6 5.3 Total Shareholders Equity $m 1175.4 1209.7 1263.9 1327.9 ROE % 13.1 12.7 13.6 13.7 ROFE % 15.8 15.3 17.5 16.0 Total Funds employed $m 2,747.6 2,698.9 2,760.7 2,846.6 EFPOWA m 163.8 164.9 165.2 165.4 Divisional Information 2012A 2013E 2014E 2015E Sales Revenue 4454.4 4613.2 4800.3 2400.2 Source: Company data, Macquarie Research, September 2012 EBITA Contribution Resources 45.0 38.8 40.3 41.5 Infrastructure 58.0 52.8 55.0 56.7 Rail 85.1 85.9 88.5 91.2 Services 80.5 87.2 91.5 95.0 DTZ 14.9 27.5 34.8 38.4 Corporate -36.5-37.6-38.3-39.5 Total 247.0 254.6 271.7 283.3 3 September 2012 6
Important disclosures: Recommendation definitions Macquarie - Australia/New Zealand Outperform return >3% in excess of benchmark return Neutral return within 3% of benchmark return Underperform return >3% below benchmark return Benchmark return is determined by long term nominal GDP growth plus 12 month forward market dividend yield Macquarie Asia/Europe Outperform expected return >+10% Neutral expected return from -10% to +10% Underperform expected return <-10% Macquarie First South - South Africa Outperform expected return >+10% Neutral expected return from -10% to +10% Underperform expected return <-10% Macquarie - Canada Outperform return >5% in excess of benchmark return Neutral return within 5% of benchmark return Underperform return >5% below benchmark return Macquarie - USA Outperform (Buy) return >5% in excess of Russell 3000 index return Neutral (Hold) return within 5% of Russell 3000 index return Underperform (Sell) return >5% below Russell 3000 index return Volatility index definition* This is calculated from the volatility of historical price movements. Very high highest risk Stock should be expected to move up or down 60 100% in a year investors should be aware this stock is highly speculative. High stock should be expected to move up or down at least 40 60% in a year investors should be aware this stock could be speculative. Medium stock should be expected to move up or down at least 30 40% in a year. Low medium stock should be expected to move up or down at least 25 30% in a year. Low stock should be expected to move up or down at least 15 25% in a year. * Applicable to Australian/NZ/Canada stocks only Recommendations 12 months Note: Quant recommendations may differ from Fundamental Analyst recommendations Financial definitions All "Adjusted" data items have had the following adjustments made: Added back: goodwill amortisation, provision for catastrophe reserves, IFRS derivatives & hedging, IFRS impairments & IFRS interest expense Excluded: non recurring items, asset revals, property revals, appraisal value uplift, preference dividends & minority interests EPS = adjusted net profit / efpowa* ROA = adjusted ebit / average total assets ROA Banks/Insurance = adjusted net profit /average total assets ROE = adjusted net profit / average shareholders funds Gross cashflow = adjusted net profit + depreciation *equivalent fully paid ordinary weighted average number of shares All Reported numbers for Australian/NZ listed stocks are modelled under IFRS (International Financial Reporting Standards). Recommendation proportions For quarter ending 30 June 2012 AU/NZ Asia RSA USA CA EUR Outperform 55.67% 61.00% 53.43% 42.58% 69.23% 46.60% (for US coverage by MCUSA, 9.05% of stocks followed are investment banking clients) Neutral 30.50% 22.11% 36.99% 52.41% 28.02% 33.69% (for US coverage by MCUSA, 8.14% of stocks followed are investment banking clients) Underperform 13.83% 16.89% 9.59% 5.01% 2.75% 19.71% (for US coverage by MCUSA, 0.45% of stocks covered are investment banking clients) Company Specific Disclosures: Macquarie Bank Limited makes a market in the securities in respect of Limited. Important disclosure information regarding the subject companies covered in this report is available at www.macquarie.com/disclosures. 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