Capital Raising Presentation 4 July 2012 1 Vocus Communications - - PowerPoint PPT Presentation

Capital Raising Presentation 4 July 2012

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Vocus Communications Overview



Leading independent provider of wholesale and corporate telecommunications services in Australia and New Zealand, including:

• International internet (45% of Group revenue)(1)
• Voice (21% of Group revenue)(1)
• Data Centre and Cloud Services (18% of Group revenue)(1)
• Fibre and Ethernet (14% of Group revenue)(1)



Strong industry fundamentals and continued investment in network and sales force driving organic growth



Growth from successful acquisition and integration of 3 businesses since listing

• Acquisitions of E3 Networks (Sydney and Melbourne) and PerthIX (Perth) created a successful national data

centre business

• Acquisition of Digital River Networks’ dark fibre assets formed base for rapidly expanding fibre services
• Recently completed acquisition of Maxnet Limited, New Zealand based data centre operator and cloud provider



Focus on differentiated customer service proposition and expanded product offering, along with strategic acquisitions, has resulted in customer growth from 103 in March 2010 to 363 in March 2012



Underlying EBITDA growth of ~132% from June 2010 to $16 – 16.5 million in June 2012 (based on low-end of guidance) 2

(1) Estimated contribution for FY12

Capital Raising Overview

• Vocus is launching an underwritten institutional placement of 9.15 million shares (15% of issued

capital) to raise approximately $14.9m (“placement”)

• The placement is being offered at a fixed price of $1.63 per share

− 15.5 % discount to the share price on 3 July 2012 ($1.93) − 14.7% discount to Vocus’ 5 day VWAP ($1.91)

• Vocus is also announcing a non-underwritten share purchase plan at the placement price, offering

$15,000 of shares per eligible shareholder to raise up to $7.5m

• Vocus is undertaking the capital raising to fund existing capital expenditure requirements and

provide financial flexibility for future growth − Vocus continues to consider potential acquisitions that would expand or complement its existing product set

• Further detail, including timetable, can be found in the Appendix

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Key Business Highlights

History of strong financial growth delivering shareholder returns supported by recurring annuity style revenue

− Revenue growth of ~158% and underlying EBITDA growth of ~132% from FY10 to FY12(1) − Combination of organic and acquisition growth, with organic new product growth accelerating in FY12 − Total shareholder return of ~286% since listing(2)

Well positioned to benefit from positive industry trends

− Growth of all divisions underpinned by continuing data consumption by consumers and corporates − Exposure to trend of increasing outsourcing and well positioned to capitalise on growth of cloud market

Strong customer growth momentum underpinned by differentiated customer service proposition

− Increased number of customers by 252% over the last two years (to March 2012) − Weighted average customer contract length increased from ~24 to ~26 months since 1Q11

Carrier neutral operator

− Dark fibre only actively provided by two other operators − One of very few ‘independent wholesalers’ of IP traffic

Continued execution on clearly developed growth strategy

− Considerable operating leverage from fixed cost base in IP transit and Fibre − Significant cross selling opportunities from broader product offering − Proven acquisition track record, and expanding fibre network and data centre offering based on customer demand − Well positioned to capitalise on NBN opportunities

Experienced board and management team overseeing growth

− Balance of telecommunications industry, M&A and listed company experience

(1) Using low-end of guidance (2) As at 3 July 2012

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David Spence Chairman

• More than 20 years Telco experience
• Experience in over 20 internet businesses
• Former CEO of Unwired Ltd
• Managing Director and CEO of OzEmail
• Chairman of the Board of the Internet Industry Association
• Currently a Director of AWA Ltd and ASX listed Hills Holding Ltd

5 Mark de Kock Executive Director, Strategy

• More than 20 years industry experience
• Previously employed in Technical Management roles at Optus,

Vodafone, Access Devices, HP (Tandem/Compaq) and Andersen Consulting

Jon Brett Non-Executive Director

• Experience as Director of a number of ASX listed companies,

including Techway, Kids Campus, Iocom, amongst others

• Formerly the Non Executive Deputy President of the NRMA
• Currently on the Board of several unlisted companies and a

Director of Investec Wentworth Private Equity (IWPE)

John Murphy Non-Executive Director

• Founder and Managing Director of IWPE
• Director of Investec Bank (Australia) Limited and Chairman of

the bank’s Investment Committee

• Director of ASX listed Clearview Wealth
• Former Director of ASX listed companies, Southcorp, Invocare,

Specialty Fashion, Fonezone, amongst others

• Previously spent 26 years with an international accounting firm

James Spenceley CEO

• More than 14 years experience in ISP/Telco industry
• Previously designed and deployed the $300m COMindico

network (later to be known as Soul, now owned by TPG Telecom)

• Elected Board Member of the Asia Pacific Network Information

Centre

Stephen Baxter Independent Director

• More than 18 years industry experience
• Co-founded PIPE Networks (now owned by TPG Telecom) and

was an Executive Director and Chief Technical Officer on listing

• Started Adelaide ISP, SE Net (sold to OzEmail/UUNET)
• Previously worked at Google Inc in California as a Technical

Program Manager in the Network Deployment department

Nick McNaughton Independent Director

• Established Blue Cove Ventures in 2007
• Member of the start-up teams of software companies Allaire,

Soulmates Technology and Wily Technology

• Non-Executive Director & Chairman at Simmersion Holdings Pty

Ltd, Consultant at Brightcove and Board Observer at Windlab Systems

Experienced Board and Management

Richard Correll CFO

• Extensive experience in finance, media and communications

industries in the U.S., China, Europe and Australia

• Previously held senior financial and general executive roles

including CFO at Fox Sports Australia, Assistant to Managing Director at Austar, CFO at PocketMail Australia, Treasurer and Special Projects Manager at News Limited and Group Senior Manager at Ernst & Young

Product Overview

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What We Provide and Where

Extensive network reach, connecting Australia and New Zealand to the world

Perth Adelaide Melbourne Sydney Brisbane Auckland Singapore Canberra Vocus Data Centres Vocus Fibre Vocus Internet and Voice Vocus Domestic Ethernet Network San Jose Hawaii Fiji Christchurch DR L.A.

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International Internet

• Operates Australia’s largest wholesale IP

backbone after Telstra and Optus

• Provides internet access to ISPs and Telcos

in Australia, New Zealand and the US

• Provides an internet offering to the Australian

corporate sector

• Indefeasible Right of Use (“IRU”) on Southern

Cross Cable

• Doubled capacity in September 2011 to

meet increased demand

• 31 Points of Presence (“POPs”)
• Internet products include:
• Wholesale Internet
• Corporate Internet
• Delivery of DSL, Fibre and Ethernet
• Weighted average contract duration is ~24

months

5 10 15 20 25 FY10A FY11A FY12E 35.9% CAGR

Internet Revenue ($m)

FY11 FY12E Traffic Growth 128% 80% Total Customers 94 212 Number of Internet POPs 23 31 New Corporate Customers 30

Key Internet Statistics 8

Internet 45%

% Group Revenue (FY12E)

Voice

• Provides several services, including:
• Call termination services
• Porting traditional Voice numbers to VoIP for

ISPs

• Provision of wholesale phone numbers to

ISPs

• Voice network combined with the Fibre and IP

network should provide a strong value proposition and cost structure going forward

• Capitalising on this opportunity will be a

focus in FY13

Voice Revenue ($m) 9

Voice 21%

% Group Revenue (FY12E)

2 4 6 8 10 12 FY10A FY11A FY12E 42.3% CAGR

Data Centre and Cloud Services

• Operates 7 data centres across five cities,

including two in New Zealand(1)

• Offers leases on individual rack units or

private suites

• Sells bundled connectivity, Data Centre and

Could services

• Contracts typically 24 – 36 months, though

can be up to 10 years

• Customers charged monthly, either:
• Per rack of equipment (including power)
• By caged floor area for large customers

(power billed separately)

• Recently secured lease and additional power

required to expand Sydney capacity by 453m2 (SYD3)(2)

• Also secured option for additional

1,000m2 of space (SYD4) which would increased existing capacity by 174%

(1) New Zealand (Auckland and Christchurch) data centres acquired as part of the purchase of Maxnet Limited (2) Initial Stage Expansion of 98m2 of the Sydney facility (S3a) expected to be complete by 30 June 2012

Data Centre and Cloud Services Revenue ($m)

2 4 6 8 10 FY10A FY11A FY12E 198.5%

Location Size Utilisation Sydney (SYD1, SYD2, SYD3a) 897m2 81% Melbourne 490m2 100% Perth 536m2 93% Auckland 420m2 72% Christchurch 128m2 33%

Summary of Data Centres 10

Data Centre and Cloud 18%

% Group Revenue (FY12E)

Fibre and Ethernet

Fibre and Ethernet Revenue ($m)

2 4 6 FY10A FY11A FY12E 83.4% CAGR

• Owns and operates fibre optic networks in

CBD and metro

• Sydney
• Melbourne
• Brisbane
• Purchased the fibre assets of Digital River

Networks in May 2011

• Expansion of the network is a result of

robust customer demand

• In-house network design and

construction capabilities provide for low cost expansion

• Customer contracts are typically 36 – 60

months in duration

• Significant operating leverage given fixed

cost base and current low utilisation

At Acquisition(1) (April 2011) June 2012 Fibre length 59km 176km(2) Number of Dark Fibre services 27 219 Data Centres connected 9 43 On-net buildings 60 166 Utilisation <2% <5%

Key Operating Metrics

(1) Acquisition of Digital River Networks assets, announced 8 April 2011 (2) Expected to increase to 275km by December 2012

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Fibre / Ethernet 14%

% Group Revenue (FY12E)

• Demonstrates Vocus’

immediate success in sales

• Vocus expects capex required

to sell new contracted revenue to continue to decrease

• Network utilisation remains

<5% with large potential to sell more services on existing infrastructure

Increasing Returns on Fibre Capex

3.29 1.23 1.04

• 0.50

1.00 1.50 2.00 2.50 3.00 3.50 Digital River* 1H12 2H12E

Fibre capex $x for each $1 of contracted revenue

Growing Efficiency

* Digital River capex efficiency is calculated using the purchase price of Digital River Networks and contracted revenue arising from the acquisition

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Putting it All Together

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• Continued increase in internet traffic and

importance of internet access, dark fibre links and data centre space

• Move to the cloud will also increase the need

for these products and services

• Vocus has competitive infrastructure based

products in each of these 3 areas

• International connectivity – to access data

internationally

• Dark Fibre – to connect to the data /

cloud

• Data Centre – to host the data / cloud
• More reliance on dark fibre and data centres

creates more opportunity for Vocus Fibre

• Integrated Internet / Fibre / Data Centre offering

attractive to corporate customers

• Dark Fibre and a High Speed Internet

Backbone differentiates Data Centre proposition

Evolving Sales Mix Creating a More Balanced Portfolio

100%

Q3 2010

31% 51% 18%

Q3 2012

60% 18% 22%

Q3 2011

Internet Fibre/Ethernet Data Centre 14

• Vocus continues to see increasing diversity in composition of new sales

Continued Investment in Sales

• Significant Investment in Sales and Marketing Teams
• Australia / NZ sales footprint – Sydney, Melbourne, Perth, Brisbane and Auckland

At Listing – FY10 FY12E Number of Sales Offices 1 5 Sales & Marketing Team (FTEs) 3.5 16 Marketing Events 9 19 Marketing Budget $172k $425k

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• Vocus is experiencing strong organic

customer growth

• Exciting growth from international

carrier customers

• Integrated Internet / Fibre / Data Centre
• ffering attractive to corporate

customers

• Increasing number of new sales are

bundled

• Continued low churn rate

Resulting in Strong Customer Growth

Customer Growth

Source: Billing Data Notes: Customer numbers at Q3 Mar 12 excludes customers from the Maxnet acquisition

13 28 45 54 67 81 96 103 111 112 133 145 301 309 337 363

Jun 08 Sep 08 Dec 08 Mar 09 Jun 09 Sep 09 Dec 09 Mar 10 Jun 10 Sep 10 Dec 10 Mar 11 Jun 11 Sep 11 Dec 11 Mar 12

Perth data centre and dark fibre acquisition E3 data centre acquisition Organic Growth

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21.00 21.50 22.00 22.50 23.00 23.50 24.00 24.50 25.00 25.50 26.00 26.50 Q1/11 Q2/11 Q3/11 Q4/11 Q1/12 Q2/12 Q3/12 Months

• Vocus’ weighted

average remaining contract duration has increased in FY12 due to significant growth in Data Centre and Fibre

• Greater earnings

visibility from increasing recurring annuity style revenue

Positive Trends in Contract Duration

Contract Duration (Months)

Weighted average remaining contract duration

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• Channel manager hired to manage sales activity
• utside the primary Corporate and Wholesale

channels

Transitioning to a Corporate Focus

Channel Products Segments

Corporate

• Internet
• Data Centres
• Fibre & Ethernet

Corporates Wholesale

• Internet
• Voice
• Data Centres
• Fibre & Ethernet

Telcos Service Providers Hosting Providers

Corporat e 18%

FY12E Sales by Channel

Wholesale 82% Corporate 18% Corporat e 4%

FY11 Sales by Channel

Wholesale 96%

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Corporate 4%

Select Vocus Customers

19 Internet service providers Corporate

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Cross Selling

• Significant opportunity to cross

sell services

• 363 customers at the end of

3Q12

• ~45% only have one Vocus

product

• Such customers present a

source of strong sales leads

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Significant cross selling

• pportunity

363 163 132 59 9 Total number of customers 1 2 3 4

Number of Customers Across Services

Number of services

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Financial Overview

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Strong Historical Financial Performance

$- $5 $10 $15 $20 $25 FY10H1 FY10H2 FY11H1 FY11H2 FY12H1 Millions

Half Year Revenue

$- $1 $2 $3 $4 $5 $6 $7 $8 FY10H1 FY10H2 FY11H1 FY11H2 FY12H1 Millions

Half Year Underlying

(1) EBITDA (1) Excludes FX effects (predominantly unrealised on USD liability)

• 200% increase in revenue from FY10H1
• Continued demonstrated growth in core

business

• Expanding product balance with Data

Centre and Fibre & Ethernet products

• 180% increase in Underlying EBITDA

from FY10H1

• Margin growth from significant
• perating leverage, bundling
• pportunity and focus on corporate

market

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• Strong growth of organic business and

new organic products

• Continued focus on recurring annuity

style revenue model

• Acquisitions providing a strong platform

for future organic growth

Combination of Organic and Acquired Growth

Source: Management accounts (unaudited) (1) Using low-end of guidance

5 10 15 20 25 30 35 40 45 50 FY10A FY11A FY12E Acquired Revenue Organic Revenue

Revenue ($m)

FY10-12E CAGR FY11-12E Organic growth 42% 23% Acquired growth n.a. 301% Total growth 61% 46%

Revenue Growth(1)

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Summary Financials

FY10 FY11 FY12E Growth (FY11 – FY12E)(3) Revenue 17.5 30.7 45.0 – 47.0 46.0% EBITDA 8.1 13.2 n.a. Net foreign exchange loss / (gain) (1.2) (3.7) n.a. Underlying EBITDA 6.9 9.5 16.0 – 16.5 67.7% Reported NPAT(1) 3.8 8.1 n.a. Underlying NPAT(1)(2) 2.9 5.5 n.a.

($ in millions) (1) Excludes net movement on hedging transactions (net of tax) of ($0.3m) in FY11 (2) Excludes foreign exchange gain (net of tax) of $0.9m in FY10 and $2.6m in FY11 (3) Assumes low-end of guidance

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Balance Sheet Post-Capital Raising

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• Vocus has two facilities available to it totalling $9.9m,

provided by CBA

• Vocus has drawn $7.4m to fund the acquisition of

Maxnet

• Facility is 50% amortising with maturity June 2015
• Vocus has ample headroom under customary covenants
• The capital raising ensures conservative gearing is

maintained, as well as providing flexibility to fund growth initiatives including extension of fibre network

Pro-forma Total bank debt(2) $(7.4)m Total IRU liability $(28.1)m Total borrowings $(35.5)m Cash $25.3m Net debt $(10.2)m Net cash (excl. IRU liability) $17.9m

Pro-forma Balance Sheet(1)

• The metrics above are not forecasts but are

intended to show the pro forma illustrative financial effects of the placement and the SPP

• Excludes transaction fees and assumes the

maximum amount of $7.5m is raised under the SPP

(1) Balance sheet data as at 31 May 2012 (2) Bank debt drawn down upon the acquisition of Maxnet Limited in June 2012 (no drawn bank debt prior to the Maxnet acquisition), excludes finance equipment leases

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• Total IRU borrowing $45.1m (including initial IRU and additional

borrowings due to capacity increases in Jan and Sep 2011)

• Liability reduced by $17.0m since inception
• $28.1m remaining (43% hedged)
• Reduced liability by $2.4m in 5 months to May 2012

IRU and FX Hedging

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IRU Liability and Hedge Position

Source: Management accounts at May 2012 (unaudited)

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• Major investment made in

Fibre Network in FY12 based

• n customer demand
• Data Centre expansion of

Sydney Facility in both FY11 (SYD02) and FY12 (SYD03)

FY12 Has Been an Expansion Year

0.30 0.54 1.01

• 0.20

0.40 0.60 0.80 1.00 1.20 FY10 FY11 FY12E Millions

Overall Maintenance Capex Spend

Maintenance Capex 1.18 1.27 1.49 2.09 1.98 0.37 8.13

• 2

4 6 8 10 12 14 FY10 FY11 FY12E Millions

Growth Capex Spend by Product

Core Network Data Centre Fibre

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Note: Capital expenditure spend includes items acquired under finance lease which totals $0.6m in FY10, $1.2m in FY11 and $0.7m in FY12E

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Appendix Capital Raising Overview

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Overview of the Offer

Placement

• ffer size

Placement

• ffer price

Timing Ranking

• Placement of 9.15m shares
• 15% of issued share capital
• Placement will raise $14.9m at the offer price
• Fixed offer price of $1.63 per share
• 15.5% discount to Vocus’ share price on 3 July 2012 ($1.93)
• 14.7% discount to Vocus’ 5 day VWAP ($1.91)
• 1-day trading halt on 4 July 2012
• Books open on 4 July 2012 at 10:00am (Sydney time)
• Books close on 4 July 2012 at 4:00pm (Sydney time)(1)
• The new shares will be fully paid and will rank equally with Vocus’ existing issued shares

Underwriting

• Placement is fully underwritten by Credit Suisse (Australia) Limited

Share Purchase Plan (“SPP”)

• A non-underwritten share purchase plan of $15,000 per eligible shareholder will be offered following the

placement

• Share purchase plan to be capped at a maximum of $7.5m
• Eligible shareholders are those who are registered on the record date of 4 July 2012 (7.00pm, Sydney

time) with a registered address in Australia or New Zealand 29

(1) The underwriter reserves the right to close the book build earlier.

Timetable

Key Dates - Placement Bookbuild opens (10.00am) 4 July 2012 Bookbuild closes (4.00pm) 4 July 2012 Ordinary shares recommence trading 5 July 2012 Settlement of placement shares 11 July 2012 Allotment and trading of placement shares 12 July 2012 Key Dates - Share Purchase Plan Record Date (7.00pm) 4 July 2012 SPP materials despatched to eligible shareholders 12 July 2012 SPP opens 12 July 2012 SPP closes (5.00pm) 27 July 2012 SPP allotment date 7 August 2012 Despatch of Transaction Confirmation Statements 13 August 2012

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(1) All times refer to Sydney time. (2) The underwriter reserves the right to close the book build earlier. (2) (1) (1)

James Spenceley

CEO

Mark de Kock

Executive Director, Strategy

Rick Correll

CFO

Level 1, Vocus House 189 Miller Street North Sydney P: +61 2 8999 8999 F: +61 2 9959 4348 E: vocus@vocus.com.au www.vocus.com.au

Contacts

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Important Notices Regarding Foreign Jurisdictions

• This document does not constitute an offer of new ordinary shares (“New Shares”) of the Company in any jurisdictions in which it would be unlawful. New

Shares may not be offered or sold in any country outside Australia except to the extent permitted below The information in this document has been prepared on the basis that all offers of New Shares will be made pursuant to an exemption under the Directive 2003/71/EC ("Prospectus Directive"), as implemented in Member States of the European Economic Area (each, a "Relevant Member State"), from the requirement to produce a prospectus for offers of securities. An offer to the public of New Shares has not been made, and may not be made, in a Relevant Member State except pursuant to one of the following exemptions under the Prospectus Directive as implemented in that Relevant Member State: (a) to legal entities that are authorised or regulated to operate in the financial markets or, if not so authorised or regulated, whose corporate purpose is solely to invest in securities; (b) to any legal entity that has two or more of (i) an average of at least 250 employees during its last fiscal year; (ii) a total balance sheet of more than €43,000,000 (as shown on its last annual unconsolidated or consolidated financial statements) and (iii) an annual net turnover of more than €50,000,000 (as shown on its last annual unconsolidated or consolidated financial statements); (c) to fewer than 100 natural or legal persons (other than qualified investors within the meaning of Article 2(1)(e) of the Prospectus Directive) subject to obtaining the prior consent of the Company or any underwriter for any such offer; or (d) in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of New Shares shall result in a requirement for the publication by the Company of a prospectus pursuant to Article 3 of the Prospectus Directive. This document is not being distributed in the context of a public offering of financial securities (offre au public de titres financiers) in France within the meaning of Article L.411-1 of the French Monetary and Financial Code (Code monétaire et financier) and Articles 211-1 et seq. of the General Regulation of the French Autorité des marchés financiers ("AMF"). The New Shares have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in France. This document and any other offering material relating to the New Shares have not been, and will not be, submitted to the AMF for approval in France and, accordingly, may not be distributed or caused to distributed, directly or indirectly, to the public in France. Such offers, sales and distributions have been and shall only be made in France to (i) qualified investors (investisseurs qualifiés) acting for their own account, as defined in and in accordance with Articles L.411-2-II-2° and D.411-1 to D.411-3, D. 744-1, D.754-1 and D.764-1 of the French Monetary and Financial Code and any implementing regulation and/or (ii) a restricted number of nonqualified investors (cercle restreint d’investisseurs) acting for their own account, as defined in and in accordance with Articles L.411-2-II-2° and D.411-4, D.744-1, D.754-1 and D.764-1 of the French Monetary and Financial Code and any implementing regulation. Pursuant to Article 211-3 of the General Regulation of the AMF, investors in France are informed that the New Shares cannot be distributed (directly or indirectly) to the public by the investors otherwise than in accordance with Articles L.411-1, L.411-2, L.412-1 and L.621-8 to L.621-8-3 of the French Monetary and Financial Code.

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European Economic Area – Belgium, Denmark, Germany, Luxembourg and Netherlands France

Important Notices Regarding Foreign Jurisdictions

WARNING: This document has not been, and will not be, registered as a prospectus under the Companies Ordinance (Cap. 32) of Hong Kong (the "Companies Ordinance"), nor has it been authorised by the Securities and Futures Commission in Hong Kong pursuant to the Securities and Futures Ordinance (Cap. 571) of the Laws of Hong Kong (the "SFO"). No action has been taken in Hong Kong to authorise or register this document or to permit the distribution of this document or any documents issued in connection with it. Accordingly, the New Shares have not been and will not be offered or sold in Hong Kong by means of any document,

• ther than (i) to "professional investors" (as defined in the SFO) or (ii) in other circumstances that do not result in this document being a "prospectus" (as defined in

the Companies Ordinance) or that do not constitute an offer to the public within the meaning of that ordinance. No advertisement, invitation or document relating to the New Shares has been or will be issued, or has been or will be in the possession of any person for the purpose of issue, in Hong Kong or elsewhere that is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to New Shares that are or are intended to be disposed of only to persons outside Hong Kong or only to professional investors (as defined in the SFO and any rules made under that ordinance). No person allotted New Shares may sell, or offer to sell, such shares in circumstances that amount to an offer to the public in Hong Kong within six months following the date of issue of such shares. The contents of this document have not been reviewed by any Hong Kong regulatory authority. You are advised to exercise caution in relation to the offer. If you are in doubt about any contents of this document, you should obtain independent professional advice. The information in this document does not constitute a prospectus under any Irish laws or regulations and this document has not been filed with or approved by any Irish regulatory authority as the information has not been prepared in the context of a public offering of securities in Ireland within the meaning of the Irish Prospectus (Directive 2003/71/EC) Regulations 2005 (the "Prospectus Regulations"). The New Shares have not been offered or sold, and will not be offered, sold

• r delivered directly or indirectly in Ireland by way of a public offering, except to (i) qualified investors as defined in Regulation 2(l) of the Prospectus Regulations

and (ii) fewer than 100 natural or legal persons who are not qualified investors. This document has not been registered, filed with or approved by any New Zealand regulatory authority under the Securities Act 1978 (New Zealand). The New Shares in the entitlement offer are not being offered to the public in New Zealand other than to existing shareholders of the Company with registered addresses in New Zealand to whom the offer of New Shares is being made in reliance on the Securities Act (Overseas Companies) Exemption Notice 2002 (New Zealand). Other than in the entitlement offer, New Shares may be offered and sold in New Zealand only to:

• persons whose principal business is the investment of money or who, in the course of and for the purposes of their business, habitually invest money; or
• persons who are each required to (i) pay a minimum subscription price of at least NZ$500,000 for the securities before allotment or (ii) have previously paid a

minimum subscription price of at least NZ$500,000 for securities of the Company ("initial securities") in a single transaction before the allotment of such initial securities and such allotment was not more than 18 months prior to the date of this document.

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Important Notices Regarding Foreign Jurisdictions

This document and any other materials relating to the New Shares have not been, and will not be, lodged or registered as a prospectus in Singapore with the Monetary Authority of Singapore. Accordingly, this document and any other document or materials in connection with the offer or sale, or invitation for subscription

• r purchase, of New Shares, may not be issued, circulated or distributed, nor may the New Shares be offered or sold, or be made the subject of an invitation for

subscription or purchase, whether directly or indirectly, to persons in Singapore except pursuant to and in accordance with exemptions in Subdivision (4) Division 1, Part XIII of the Securities and Futures Act, Chapter 289 of Singapore (the "SFA"), or as otherwise pursuant to, and in accordance with the conditions of any

• ther applicable provisions of the SFA.

This document has been given to you on the basis that you are (i) an existing holder of the Company’s shares, (ii) an "institutional investor" (as defined in the SFA)

• r (iii) a "relevant person" (as defined under section 275(2) of the SFA). In the event that you are not an investor falling within any of the categories set out above,

please return this document immediately. You may not forward or circulate this document to any other person in Singapore. Any offer is not made to you with a view to the New Shares being subsequently offered for sale to any other party. There are on-sale restrictions in Singapore that may be applicable to investors who acquire New Shares. As such, investors are advised to acquaint themselves with the SFA provisions relating to resale restrictions in Singapore and comply accordingly. Neither the information in this document nor any other document relating to the offer has been delivered for approval to the Financial Services Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Services and Markets Act 2000, as amended ("FSMA")) has been published

• r is intended to be published in respect of the New Shares. This document is issued on a confidential basis to "qualified investors" (within the meaning of section

86(7) of FSMA) in the United Kingdom, and the New Shares may not be offered or sold in the United Kingdom by means of this document, any accompanying letter or any other document, except in circumstances which do not require the publication of a prospectus pursuant to section 86(1) FSMA. This document should not be distributed, published or reproduced, in whole or in part, nor may its contents be disclosed by recipients to any other person in the United Kingdom. Any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) received in connection with the issue or sale of the New Shares has only been communicated or caused to be communicated and will only be communicated or caused to be communicated in the United Kingdom in circumstances in which section 21(1) of FSMA does not apply to the Company. In the United Kingdom, this document is being distributed only to, and is directed at, persons (i) who have professional experience in matters relating to investments falling within Article 19(5) (investment professionals) of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 ("FPO"), (ii) who fall within the categories of persons referred to in Article 49(2)(a) to (d) (high net worth companies, unincorporated associations, etc.) of the FPO or (iii) to whom it may otherwise be lawfully communicated (together "relevant persons"). The investments to which this document relates are available only to, and any invitation, offer or agreement to purchase will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

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