Investor Teleconference Transcript, Scott Charlton, 3 September 2007

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Leighton Holdings Investor Teleconference, September 2007Transcriptin surrounding areas. The merge entity Al Habtoor Leighton will have a total work inhand approximately $A4.4bn, incrementally for Leighton that is approximately $1.5bnand revenue for the June 08 year approximately $2.75bn and incremental to the LeightonGroup $800m. So if you look at the overall guidance that Wal gave the Group a coupleof weeks back, this should lead to over $14bn in revenue for 2008 and gives us over$22bn work in hand for the Group as we sit right now.Al Habtoor Bill will talk about in a bit more detail, obviously provides us a strong trackrecord in the major projects in the Gulf with a 30 year track record. A large ….. plantstrategic property assets and considerable commercial influence and reputation andrelationships in the region. And now what I’ll ask Bill is to provide a better detail to you onsome of the operational aspects.Speaker: Bill WildThank you Scott, good morning. Al Habtoor was established in Dubai in 1970, and it’snow one of the largest construction companies in the Gulf. It has a very broad trackrecord, not only in Dubai and throughout the rest of the UAE and Qatar, but over theyears it also has had experience outside those areas and while we’re not looking atthose at present it is a useful base to have that sort of experience. The company wasfounded by 2 gentlemen, Khalif Al Habtoor and Riaad Sadik, they own respectively 51%and 49% of the shares and they’ve owned the business since its founding. Scottindicated that it’s been responsible for some of the Gulf’s land mark building projects, ithas been essentially a building contractor, but because of its strong in-house resourcingit also does much civil engineering concrete work and that sort of thing, so it provides usa spring board for more than just building in the region and support for more than justbuilding, 25,000 staff including expatriates and workers throughout the region. In Dubaiitself it has a number of labour camps and is probably one of the best set up for importinglabour and supplying labour into its projects. Al Habtoor Engineering is part of the overallAl Habtoor Group which is one of the UAE’s most successful and diversified businesscorporations. They have interests in as well as construction, in hotels, real estate,education, automobiles, publishing and a number of other things, they’re pretty much ineverything. I think the point that Scott’s touched on and I stress is that this gives us theresource capability to address this massive market that we see in the Middle East and it’ssomething that we wouldn’t like to be trying to take on unless we understood that we hadan expansion capacity in terms of resources and Al Habtoor certainly supplies that.Just looking at some of their projects, they’ve certainly done some of the iconic projects,and everybody has heard of the Burj Al Arab hotel and if you can see the webcast you’llsee there a photo that includes the Burj Al Arab but also all that stuff in front of it theMadinat on the left hand side of the picture and the right hand side Jumeirah Resort wereall built by Al Habtoor, so virtually everything in that photo was done over the years by AlHabtoor, very high quality work as you know 6 star hotel in the Burge Al Arab and alsothe Madinat very high quality work and sort of great foundation to do the sort of workthat’s expected in the Gulf. Next photograph shows the Jumeirah Beach residencesthese are further along the coast in the marina area and the bundle of buildings, the lightcoloured ones on the left are all part of the Al Habtoor work.Leighton Holdings Limited ABN 57 004 482 982 Page 2 of 15
Leighton Holdings Investor Teleconference, September 2007TranscriptMoving onto Business Bay that’s a current project, that’s underway at present. Amassive project something like 700,000sqm of floor space, predominantly residential butI think one of the towers is office and there’s a fair bit of commercial in among it and ahotel but pretty typical of what these guys are doing over there, fairly high qualityaccommodation, big scale stuff, doing it with all their own resources which I think isextremely important in a market that’s as buoyant as the Middle East. I mean the bigissue in that market now is inflation and resourcing projects and Al Habtoor really bringthe right approach to that in that they have all their own people, they use their own staffand workers for all aspects of the job and they own an electrical/mechanical business aswell so they can do their own services fitout, they own a foundation company, so theycan manage their own foundations. So in a market where you struggle to getsubcontractors and other resources to have your own capacity is really the right way togo forward.Another project here that they’re doing in joint venture with the Murray and RobertsGroup is the fitout of the Dubai International Airport a big project, a very big project andimpressive progress that they’re making on it. Al Habtoor and Murray and Roberts havehad a fairly long standing joint venture on big projects and of course we know the Murray& Roberts Group very well, we’ve worked with them for something like 20 years in Asiaand a little bit in the old days even in Australia. So it’s an interesting joint venture that AlHabtoor brings to our acquisition.I mentioned their capability to do work themselves and on the next slide you can seethere the specialist subsidiaries they have Specon which is theirmechanical/electrical/plumbing business which they own 51% of, their foundationengineering company STFA again 51% ownership, they own a small interior fitoutcompany which gives them some capacity to control their destiny on fitout work and as Imentioned they’ve got this ongoing JV that they’ve used for undertaking these majorprojects.Just moving over to a couple of the Leighton jobs or at least on of them that we’vebought into the joint venture company, you see there Al Shaqab Equestrian Centre inQatar, a massive job that we’re doing there and that will become part of the new mergedgroup. As well as that we’ve recently been awarded work on Saadiyat Island in AbuDhabi this is an extremely exciting opportunity, a massive amount of work to beundertaken in Abu Dhabi something like $60bn. I guess this is very much behind thephilosophy of us forming this new group that to take on that sort of work without an abilityor the knowledge that you can put your own resourcing in there and you know how youcan get the resourcing I think would be too risky for us, but I think with the new group wehave it’s a fantastic opportunity now in a Greenfield market, in a Greenfield developmentof massive proportions. The current job we have if you can see the road running throughthere the bridge that’s in the foreground, the road that runs from that through the middleof the development if you like is freeway job that we’ve just picked up and that will beundertaken now by the new group and all along the front you’ll notice there the newmuseums they’re building, the Guggenheim, the Louvre and a number of other things.So fantastic opportunity.Leighton Holdings Limited ABN 57 004 482 982 Page 3 of 15
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Investor Teleconference Transcript, Scott Charlton, 3 September 2007

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