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Investor Day

21 May 2013

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GraemeHuntMD & CEO

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Resources | Energy | Industrial | Infrastructure | Property | Defence Transfield Services (Australia) Pty. Limited

This presentation is for information purposes only and is a summary only. It should be read in conjunction with the most recent financial report. The content

of this presentation is provided as at the date of this presentation (unless otherwise stated) and remains subject to change without notice. Reliance should

not be placed on information or opinions contained in this presentation and, subject only to any legal obligation to do so the Company does not have any

obligation to correct or update content.

This presentation does not and does not purport to contain all information necessary to an investment decision, is not intended as investment or financial

advice and must not be relied upon as such. Any decision to buy or sell securities or other products should be made only after seeking appropriate financial

advice.

This presentation is of a general nature and does not take into consideration the investment objectives, financial situation or particular needs of any particular

investor. Any investment decision should be made solely on the basis of your own enquiries. Before making an investment in Transfield Services, you should

consider whether such an investment is appropriate to your particular investment objectives, financial situation or needs.

To the maximum extent permitted by law, the Company disclaims all liability (including, without limitation, any liability arising from fault, negligence ornegligent misstatement) for any loss arising from this presentation or reliance on anything contained in or omitted from it or otherwise arising in connection

with this.

All amounts are in Australian Dollars, unless otherwise stated. Certain statements in this presentation relate to the future, including forward looking

statements relating to Transfield Services financial position and strategy. These forward looking statements involve known and unknown risks, uncertainties,

assumptions and other important factors that could cause the actual results, performance or achievements of Transfield Services to be materially different

from the future results, performance or achievements expressed or implied by such statements.

Throughout this document non-IFRS financial indicators are included to assist with understanding the Groups performance. The primary non-IFRS information

is proportionately consolidated financial information; net profit after tax; pre-amortisation (NPAT pre-amortisation); earnings before interest, tax,depreciation and amortisation (EBITDA); earnings before interest and tax (EBIT); and cash conversion (operating cash flow excluding interest and tax divided

by EBITDA). Management believe proportionately consolidated information is a more accurate reflection of operational results due to the magnitude of joint

venture arrangements in place. Proportionately consolidated results reflect the Groups entitlement to the joint venture revenues and earnings. Management

deems

NPAT pre-amortisation to be an appropriate measure of underlying cash NPAT after adjusting for amortisation of acquired intangibles. EBITDA, EBIT and cash

conversion measures are useful in understanding the Groups core operational performance. A reconciliation of non-IFRS to IFRS information is provided in

this document. This document has not been subject to review or audit by the Groups external auditors. All comparisons are to the previous corresponding

period of FY12, the 12 months ended 30 June 2012, unless otherwise indicated.

Disclaimer

3

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Format for the morning

Breakfast: 7.45 8.15am

Plenary sessions: 8.15 9.15am Graeme Hunt, Introduction & overview

Nick Yates, Infrastructure

Site tour: 9.15 9.45am

Morning tea: 9.45 10.15am

Group sessions: 10.15 12.15p

Split into 3 groups and presenters will rotate through stations :

Resources and Energy (Joe Sofra)

Business Development Case Studies (Ian Maxted)

Risk and Process (Kate Munnings, Jim McGreevy and Elizabeth Hunter)

Lunch: 12.15 1.30p

Ferry to Circular Quay 1.30 - 1.45p

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Introduction

TSE a well positioned business with a sound strategy

Integrated with clients operations and production Provides critical services if we stop, they stop

Enables clients to operate more productively and optimise assets

We have favourable exposures in the current market

Hydrocarbons: CSG, LNG, Cooper basin

Government outsourcing / infrastructure

O&M focus

Key focus for our management team is improving execution of the strategy

Changing and up-skilling people

Improving processes, taking out costs and improving effectiveness

Refining the portfolio, non-core assets being divested

Focus on cash generation

Responding proactively to opportunities in the current market environment catalyst for change

5

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Market environment

Growth and strong activity in sectors including: Coal seam gas, upstream oil & gas,defence,

Infrastructure operations and maintenance seeing some weakness but only at the

margins as these are essential services power, road and rail

Mining and process industries slowdown continues

Customers showing increasing cost and capital discipline across all sectors andgeographies

6

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Guidance

Net profit after tax before amortisation FY13 $62-65m

7

Previous guidance $85-90m

Restructuring costs increase to initial estimate (post-tax) ($3.1m)1

Restructuring costs further savings (post-tax) ($2.8m)2

Reduced NPAT noncore businesses (to be divested)3 ($3.4m)

Reduced NPAT core business units due to market conditions ($8.5m)

Reduced NPATcore business units due to other factors ($2.6m)

Revised guidance $62-65m

1 Initial estimate of restructuring costs in previous guidance was $9.2m, updated estimate of $12.3m2 Restructuring costs associated with accelerated cost savings3 Includes Easternwell Minerals Exploration and Middle East/Asia business4 The range of $62-65m is pre amortisation and pre $263.3m of post-tax impairment charges included in the 1H FY13 results

4

Cost savings of $26.1m brought forward

Further reduction of 113 positionsIntegration of Easternwell into ANZ R&E business

Centralisation of procurement and asset management

Operational support functions reorganised

Further back office outsourcing

Key focus for FY14 is reduction in ANZ site overheads and reducing bid value leakage

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Debt reduction Plan Update

Specific action plans and strategies in place by Region

Analysis of excess Debtors and WIP identified key customer accounts

20% reduction in Debtors days targeted over 2 years on track

Surplus assets identified to be sold, asset management centralised

Exit of non-core businesses at measured pace through FY14 15

Engagement with interested parties commenced

Discussions with JV parties ongoing (ME&A)

Gearing reduction & capital management plan

8

Capital expenditure FY14 vs FY13

1H FY13 2H FY13 FY13 FY14A$m A$m

Group maintenance capex 42.0 12.6 54.6 50*

Easternwell growth 12.8 14.7 27.5 0

Other growth capex 9.6 6.2 15.8 15

ERP system 25.6 26.5 52.1 15

$90m $60m $150m $80m

Share buy back 19.8 - 19.8 -

Cash dividends paid 46.3 15.4 61.7 TBN

Capex on-track for significant reduction in

FY14

Future Easternwell growth to be funded off

balance sheet and non-recourse, legal documents

being finalised, expect by 30 June

Capex to be brought back to historical levels

* Under review

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Business performance - execution & accountability

Changing people

Direct reports and key hires

Changing the culture, strengthening accountability

Improving talent across the board

Changing processes & enhanced systems

Risk management processes strengthened

Improved reporting internally, client facing (working capital benefits), external

Procurement centralisation to control and reduce costs

Focus on cash generation

Opportunities to assist customers in the current market

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Score card of business initiatives

Feb. 2013 Line of sight to an additional $25m in cost savings

Focus area

Integrate Easternwell

Procurement and asset management centralisation

Back office outsourcing

New models for operational supports functions and BD

Outcomes

Avoided hiring new positions staff releases to

operational roles

Implementation underway

$26.1m in cost savings

113 head count reduction

Look ahead

Sharpening bid execution

Stream line contract overhead

Value leakage reduction, with benefit

scope ~$20m EBITDA

Site level overheads in ANZ of $465m

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Technology Project Quantum

Quantum is replacing multiple fragmented processes and systems with

simplified/standardised processes and a single global technology platform Completed scope of rollout in US, 3 businesses migrated , focus now on ANZ with deployments

already underway

Progressing to overall schedule with completion due 2nd quarter 2014

Tracking materially to planned spend, benefits baked in forward forecasts/budget

Benefits relate to Speed of implementing new contracts/change to existing : Steier implementation less than 50% of

time taken previously

Significant improvement of underlying business dynamics : invoicing quicker than payment to

employees/sub-contractors (Steier)

Prevention of revenue leakage : R&E (US) equipment billing

Reduction of rework : Payroll off cycle payments in US reduced from up to 10% to less than 1%

Earlier visibility of information for commercial management

Foundation for value-add smarts for clients : in-field mobility for Gippsland Water (Infrastructure)

Direct reduction of roles previously compensating for fragmented information flows/platforms

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Resources | Energy | Industrial | Infrastructure | Property | Defence Transfield Services (Australia) Pty. Limited 12

Nick YatesChief Executive,Infrastructure

Global Sponsor HSE

Joe SofraChief Executive,

Resources & Energy TSANZ

Global Sponsor OE&Q

Phil WrattPresident, Americas

Tiernan ORourkeChief Financial Officer

Chief Executive ME & A

Kate MunningsChief Risk, Legal Officer& Company Secretary

Elizabeth HunterChief Executive,

Human Resources

Stephen PhillipsChief InformationOfficer & Business

Services

Steven MacDonaldProject Director,

Portfolio & Investments

Graeme Hunt

Transfield ServicesManaging Director andChief Executive Officer

TSE Board of DirectorsAnthony ShepherdGraeme Hunt

Roy McKelvie

Steven CraneDoug Snedden

Diane Smith-Gander

Ian MaxtedChief Development

Officer

Organisational structure
http://localhost/var/www/apps/conversion/tmp/2000/TMD-2000-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/2000/TMD-2000-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/2000/TMD-2000-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/2000/TMD-2000-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/2000/TMD-2000-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/8020/TMD-8020-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/8020/TMD-8020-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/8020/TMD-8020-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/8020/TMD-8020-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/8020/TMD-8020-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/8200/TMD-8200-HR-0005.ppshttp://localhost/var/www/apps/conversion/tmp/8200/TMD-8200-HR-0005.ppshttp://localhost/var/www/apps/conversion/tmp/8200/TMD-8200-HR-0005.ppshttp://localhost/var/www/apps/conversion/tmp/8200/TMD-8200-HR-0005.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9008.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9008.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9008.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9008.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9004.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9004.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9004.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9004.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9012.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9012.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9012.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9012.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9016.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9016.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9016.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9016.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9016.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9037.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9016.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9012.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9004.ppshttp://localhost/var/www/apps/conversion/tmp/scratch_15/TMD-0000-HR-9008.ppshttp://localhost/var/www/apps/conversion/tmp/8200/TMD-8200-HR-0005.ppshttp://localhost/var/www/apps/conversion/tmp/8020/TMD-8020-HR-9001.ppshttp://localhost/var/www/apps/conversion/tmp/2000/TMD-2000-HR-9001.pps

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The TSE Operating Model

Enhancing shareholder value1. Shareholder Value creation Pursuing and Winning the rightopportunities

Proactive / Pre-Market Business Development

Customer needs focussed

Getting the proposal right(Solution and Price)

Potential Shareholder value destruction issues identified and

mitigated

Right people/capability and sound understanding of assumptions

and value drivers

Deliver to Planby operating with discipline, and Continually optimiseperformance

Operating Safely, strive for zero incidents

Deliver planned performance as a minimum

Incremental optimisation as part of how we operate (e.g.

Procurement)

Do it Better, Deliver More: Constantly ask "Is there a better solution or

more we can do for Customers"

Turn Win-Lose into Win-Win (renegotiate scope/model)

What else can we do for our customers (step out, leverage,

adjacent services) Enabling Systems and Behaviours

Reliable business Information (Quantum)

Safety and accountability culture

13

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Revenue and earnings by key sectors

FY12 Revenue, $3,859m by region

78%

19%

3%

ANZ

Americas

MEA

FY12 ANZ Revenue by Sector

FY12 Revenue, $3,859m by sector

FY12 EBITDA, $236m by sector

60%

30%

10% Infrastructure & property

Hydrocarbons

Mining

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$9.2bn of Group contracted revenue as at 31/12/12, plus

$2.4bn of potential contract extensions $0.9bn of new contracts announced since 31/12/12

$1.4bn of new work currently preferred or under negotiation

Dec-12 $ Dec-12 %

Alliance/cost plus/KPI based 2.0bn 22%

Schedule of Rates 4.0bn 43%Fixed Fee 3.1bn 34%

Lump Sum (D&C) 0.1bn 1%

$9.2bn 100%

Contracted revenue

15

$0.8bn

$0.6bn$0.5bn

$0.5bn

$1.2bn

$0.3bn $0.3bn$0.2bn

$0.1bn

$0.0bn

$0.5bn

$0.2bn$0.1bn

$0.0bn $0.0bn$0.0bn

$0.2bn

$0.4bn

$0.6bn

$0.8bn

$1.0bn

$1.2bn

$1.4bn

FY14 FY15 FY16 FY17 FY18+

ANZ Contracted Revenue - Dec 2012

Infrastructure Services Resources & Energy Property & Facilities Management

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Nicholas YatesChief Executive Infrastructure ANZ

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Overview

Who are we, what do we do

What is the market doing?

The outsourcing lifecycle and what are we doing to maximise profitability and market share

How are we different and why is this good

The buildings blocks for delivery and growth

Case study Harbour City Ferries

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Infrastructure ANZ financial overview

18

INFRASTRUCTURE BUSINESS 2012 PERCENTAGE OF REVENUE

Total Revenue = $1,934m(proportionately consolidated basis)

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Asset Life Cycle Infrastructure ANZ

19

We have a presence across all areas of the asset life cycle

Ability to provide end to end asset management solutions

Good service portfolio mix

Source: internal analysis (based on FY13 forecasted performance)

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Profit & Loss FY2011 to FY2013

20

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Outsource market alive & well & likely to prosper

21

1st generation government outsourcing

Ferries Railcorp

Queensland response to audit

Roads east coast

Industrial 1st generation driven by cost pressures

Example - Aurizon

Cost pressure and competition in mature markets but room for innovation in productivity

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66% 63%

46%

37% 38%

100%

82%

67%62%

44%39%

43%

18%

34%33%38%

56%61%

37%

54%57%

63% 62%

440 6,406

593

1,969

1,028

2,660 2,611

431

3,660 5,655 5,856 3,581

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Source: BIS Shrapnel Maintenance Report 2012, internal analysis, AER (PTRMs), Annual Reports

Roads

Non-residential buildings

Mining

Heavy manufacturing

Light manufacturing

Electricity (T&D)

Rail infrastructure

Ports

Water & wastewater

Gas pipelines supply

Telecommunications

Defence

Contract

In House

Transfield Infrastructure presence

Transfield already has a presence in key markets

22

100% =$ 33bn

MAINTENANCE EXPENDITURE 2012-13 $ MILLIONS (2009/10 PRICES); PERCENT

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Generational Outsourcing

1st Generation

understanding cost base and operation model

2nd Generation

innovation and cost reduction

3rd Generation can go two ways

(a)

maturity of relationship, target mutually aligned incentives

KPI focus and flexibility to respond to business needs broadening of input across asset lifecycle

removal of check the checkers

focus on monitoring of relationship

(b)

asset and cost position clear and under control

push for cost reduction leads to price, margin pressure and increased risk transfer

commoditisation wins out over value add (seen as a nice to have)

the Oscar Wilde factor

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Margin pressure addressed through innovation &productivity

Commodity hell

Productivity

Solutions NirvanaHigh

Low

Margin

Cost focus Value focused

What leads the buying?

Innovation

Technology

Work methodologies

Preparedness to engage

Whole of business outlook

Qualitative skills e.g. IR

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What makes us different

25

Qualitative as well as technical skills

Technical skills a must but only table stakes

Good up front skills in advisory, project management, design foot in the door servicing

Exceptional project management and complex labour and logistical skills, example - HISP, NBN, Nauru

Strong focus on qualitative skills:

Commercial

Stakeholder Management / Political understanding

Focus on innovative labour and technology solutions to minimise cost not margin

Going out of our way to understand how the clients business works rather than just how ourcontract works

Example Boral

Agility and structure to deliver non-siloed packaged services

So What

These are the skills and attributes which will allow us to maximise the potential of the market that isemerging

These are the skills and attributes that position us well to deal with the commoditised slippery slope

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Infrastructure ANZ

26

End to End

Asset

Management

Revenue

Leakage/

Cross Sell

TechnologyPartners

New Service

Markets

People

Cost

Reduction

Discipline -

Implementation

Delivery Growth

Building Blocks for Delivery Certainty & Growth

We have a plan

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Infrastructure ANZ

27

People Upgrade gene pool

80% of everything in business is to do with people

Example E&C New leader

New management team

Direct financial result turnaround and growth

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Infrastructure ANZ

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Discipline - Implementation

Bidding / Estimating

Commercial

Financial Management Reporting / Forecasting

Performance Improvement Flying Squad

On the ground Supervision

Example FMG Diesel Terminal, Pilbara

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Infrastructure ANZ

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Cost Reduction

Business overhead review layer removal

Site overhead review E&Y

Example HSEQ restructure, business line to geographic

More effective model

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Infrastructure ANZ

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End to End Asset Management Lack of silos allows bundling of service provision

Example QGC

BP

Asset management planning Harbour City Ferries

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Infrastructure ANZ

31

Revenue Leakage / Cross Sell Restructuring along industry and services lines

Example Electrical Contracting Services into:

FM

QGCWater

Example Traffic management

Water

Rail

Telco

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Infrastructure ANZ

32

Telco Water Transport

Project Management/IV

Electrical

E&C

Project Electrical E&C Telco Water Transport

Management

Now

Then

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Infrastructure ANZ

33

Technology Partners

Use of data streams

WIPRO

CSIRO

NICTA

Example Water Industry failure data, predictive maintenance algorithm development WA Watercorp

Example Development and rollout of new field mobility solutions Gippsland Water

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Infrastructure ANZ

34

New Service Markets

Core skills large workforce management

logistics

innovative delivery models

IR management skills

Example Railcorp - cleaners

LMM new labour model

Example land management advisory

Mornington Shire

Department of Housing NSW

Asset management advisory Boral

Health outsourcing

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Summary

Division Infrastructure

Client NSW Government

Partner Veolia Transdev 50/50 JV

Contract duration 7 yrs to 2019, plus extensions

Total revenue $800m over life, plus extensions

Maintenance and operation of Sydneys ferries under a

7 year $800m contract with potential for extensions

1st generation contract where Transfield Services has a

strong track record of managing multiple stakeholder needs

Government Relations, Industrial relations, customer

delivery while delivering operationally

JV offering delivers client a compelling set of local and

international skills and knowledge

Reductions in - Sick Leave

- LTIFR

- Asset Management / Maintenance Costs

Increases in - On time running

- Patronage

- Fleet reliability

- Efficiency

Qualitative - No bad press

- Stakeholders happy

- Winner of IPA National award for Operator

& Service Provide Excellence

Case study: Harbour City Ferries

S

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Summary

We are a strong stable business

Market tight but hard going for our clients does not necessarily mean the same downside for us

We have the capability

We have the market knowledge and understanding

We are well positioned

We have a plan that specifically addresses the current market dynamics

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Joe SofraChief Executive, Resources & Energy

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Hydrocarbons

64%

Mining

17%

Other

19%

Revenue (prop cons.)

Hydrocarbons

72%

Mining

18%

Other

10%

Operating EBITDA

Strategy

High aggregation of service per client

Service delivery integral to client operations

Value through improved productivity & asset

optimisation

Two operational engines

End markets/sectors with sustainable returns & growth

Well development and service O&M, asset and production support

O&G, CSG, LNG, lesser extent iron ore and coal

Key Metrics

Revenue $1.1b

Backlog $2.1b

5,000+ staff

Overview Resources & Energy ANZ

Asset Support Services (FY12 to FY13E)

35% YoY growth across portfolio

40% YoY growth in hydrocarbons

Easternwell(FY12 to FY13E)

85 - 90% EBITDA contribution hydrocarbons

25% YoY growth in hydrocarbons

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Common customers, two operational engines

2 service engines, different operating model,common customers

100% commonality in focus sectors

60% of customer portfolio common, 75% byEBITDA

Immediate cost out, integrated CSG

10% OH reduction recognised, more to come

Increasing delivery efficiency

Characteristics Asset Support Services Easternwell

Service Type Labour Based Specialist

Operating Margins 5 to 15% 20 to 30%

Capital Intensity Low Medium

Revenue split 70% 30%

Margin split 45% 55%

IntegratedService

CommonCustomer

EasternwellAsset

SupportServices

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Established presence in growth regions

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Fit for a cost constrained environment

People

Management capability 80% new to roles, 60% new to Transfield

Contract & business management level capability upgrade

Restructured to heighten customer focus, delivery clarity

Layer removed

Delivery focus - operational performance, risk management. & accelerate cost out

Customer sector focus improving customer selectivity & engagement

Cost constrained environment

Cost efficiency & productivity service aggregation

Focus on cash generation, profitability, capital utilisation

Non core asset/facility rationalisation

Improve returns

Maximise return from contracted, performance improvement Productivity gain share (revised commercial models)

Increased market share through adjacent services

New contracts in key growth sectors

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Service Delivery Configured to Client Critical

42

Supporting project development & setting up for operation contracted services for QGC

Well completions & servicing Construction of well site, field compression & flowlines

Upstream field maintenance

Camp management

Supply chain management & fabrication

Logistics human, equipment & material

1,850 Transfield personnel

(estimate at peak)

LNG A t S i O t iti t 4

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LNG Asset Service Opportunities next 4 yearsApproximately $200Bn of committed assets into Operation

43

Project Sector/Region Capacity First LNG Capex

Chevron Gorgon Conventional O&G / WA 15MTA (3 trains) 2015 $50B

Chevron Wheatstone Conventional O&G / WA 8.9MTA (2 trains) 2016 $30B

Shell Prelude Floating LNG / WA 3.6MTA (1 train) 2016 $12B

Inpex Ichthys Conventional O&G / NT 8.4MTA (2 trains) 2016 $34B

Queensland Curtis LNG

(QCLNG)

CSG / QLD 8.5MTA (2 trains with 3rd

expected to be sanctioned)

2014-2015 $20B

Gladstone LNG (GLNG) CSG / QLD 7.8MTA (2 trains) 2015-2016 $18B

Australian Pacific LNG

(APLNG)

CSG / QLD 9.0MTA (1 train) 2nd train will

be sanctioned 2Q 2012

2015 $ 20B

Arrow Energy LNG CSG / QLD 8.0MTA (2 trains with 3rdexpected to be sanctioned)

>2017 $15B

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Ian MaxtedChief Development Officer

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New Defence Contract

Land Materiel & Maintenance

Contract signed 3rd May 2013

CASE STUDY -

Growing Profitable Revenue

Through Early Client Engagement

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Background

What We Currently Do for Defence

Land Materiel Contract

Joint Logistics Units

Other Examples of Recent Wins

Key Themes of Wins and Our New Approach

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Background


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Goal:

Shareholder Value creation

How?Pursuing and Winning the rightopportunities

1. Proactive / Pre-Market Business Development

2. Customer needs focussed

Key Points

We want to market our services in value terms not as a

commodity cost item.

By engaging with clients (existing and new) prior to market

who recognise this value we can better influence and

help define the brief.

This makes the commission successful for clients as effective

and efficient with cost savings whilst making sustainable andprofitable for TSE.

The following will demonstrate where we have done this to

date. The plan is to broaden across all of TSE which will

demand a change of approach and personnel in some

instances.

Some of what we do

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Some of what we dofor the Defence Force - $200M per annum

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Refuel fighter jets

3 million meals/annum

Maintain aircraft arrestor systems that allowUS Navy F-16 fighter aircraft to land at RAAFWilliamtown

Maintain power supply and life supportsystems for ATC East & Afghanistan

Deploy fully-compliant airfield fire fightingand rescue teams to remote bases

Maintain Defence ranges and training areasacross a land area greater than the size ofEngland

Run a pub, TAB, bank, bowling alley, postoffice and general store

Conduct battle runs, remotely controllingtargets from the rear of an Abrams tank

Integrated management of security, stores,accommodation and services

Naval vessel maintenance

d l

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Land Materiel Maintenance Contract

The Department of Defence, Joint Logistics Command (JLC) entered into

a Land Materiel Maintenance (LMM) Services contract with TransfieldServices (Australia) on 3 May 2013

The contract is for an initial term of six years, expiring on 30 June 2019,

with options for five 1 year extensions. Approximate annual revenue

$40M per annum

It is a new model of delivery, splitting warehousing and distribution &

maintenance into two separate contracts

This new model was trialled with TSE on a small scale on the Singleton

site before Defence went to market

Joint Logistics Command is the capability part of Defence. A vital new

part of Defence for TSE

d i l i C

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Land Materiel Maintenance Contract

The role is to work in collaboration with Defence to optimise themaintenance of key parts of Defence capability including:

Armoured vehicles; light, medium and

heavy general transport vehicles

Fire fighting vehicles and equipment

Engineering plant equipment

General equipment

Aerial delivery equipment

Weapons- including direct and indirect

fire weapons and small arms

Ground based air defence equipment

Electronic instrument, radio and test

equipment (EIR), and

Limited range of maritime materiel (i.e.Army watercraft and marine

equipment)

L i f J i L i i C d B f LMM

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Location of Joint Logistics Command Bases for LMM

OTHER EXAMPLES

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OTHER EXAMPLES

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Warmum (Indigenous Camp) - Rapid mobilisation in response to Natural Disaster

in a culturally sensitive and remote

location to operate a temporary camp facility

within ten days of notification (2500 NE Perth/

1200KM SW Darwin)

Boral/Amcor - Work with a new procurement department

to help develop a first generation outsourcingmodel. Improved risk, compliance and systems

in addition to a more cost effective delivery.

OTHER EXAMPLES

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OTHER EXAMPLES

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Nauru Processing Centre - Rapid response, proven logistic capability,

culturally sensitive, proven ability to interface

with Defence

Ferries - As presented today

Railcorp (NSW) Cleaning Contract - Assist in cultural change to upgrade quality of

stations and trains safety, large workforce,

environment

Mornington Peninsula Shire Council - Long term client where we upgraded services

levels and models

KEY THEMES

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KEY THEMES

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Prior to opportunities going to market defining our services with existing and potential clients in

value and risk mitigation terms and not as a commodity.

The value proposition exists within TSE. We need to better identify and market this to clients. Not

sell the task (commodity) but the value.

To focus on those clients that are mature enough to recognise the value proposition.

The models while clearly defining the contractors responsibilities are built on a collaborative joint

approach, recognising the clients business/policy objectives.

This demands a change of approach and personnel. Less reactive to tender and more proactive to

clients pre-market.

The plan is to build upon the recent successes that had higher yield and better client outcomes

across all of TSE.

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Elizabeth HunterChief Human Resources Officer

I i d li i bilit

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Improving and aligning capability

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To deliver our strategy & client requirements we have changed our

professional, management & leadership profile

Clear improvement in aptitude scores of new hires

relative to external benchmarks

2009 2010 2011 2012

Average

Percentile

We are shifting culture through an innovative

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program directly aligned to business imperatives

Top 200 change program +

Follow-up coaching and interventions

Phase 1: Build the foundation

Jul 2011 Oct 2012

Phase 2: Accelerate the change

Oct 2012 - ongoing

Expectations of leaders articulated

Common language and tools

Shifts in behaviours and mindsets

Aligned people management systems and processes

Technical

Outcomes Tackling real business challenges

Leaders accelerate shifting the limiting patterns,

mindsets and behaviours in the organisation

Systems and Processes e.g.

Adaptive

Key interventions to tackle must win business challenges

Revised incentive scheme

Quantum

Shared Services Performance expectations

Embed new capabilities, systems and processes e.g. Quantum

Governance and Assurance Targeted capability reviews and change outs

What we doand how

Mindset andbehaviour shifts

BusinessImperative

ChangeJourney

Commercial mindset:

Profitably efficient use of human

and physical assets

Risk management changed

customer demands

Discipline and accountability:

Clear roles and responsibilities

Consequence management

Customer and Shareholder delivery: Measures: Financial, Safety,

Customer, Development

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Our program is achieving results mindsets &

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We also extend this innovation to assist development of our client businesses

5959

p g gbehaviors are shifting

2013 Rating given by Senior Leaders2011 Rating given by Senior Leaders

Strategic Growth OrientationCommercial thinking, Profitable

growth, Higher margin, Customer focus,

Integrated solutions

DisciplineProcesses, systems,

procedures, right people, right role

Performance OrientationBusy work , urgency/speed,

Hard work, Expertise

Performance OrientationValue-add, Execution, Accountability,

Deliver on Promises , Smart work

(not busy work), Expertise

2011 2013

Low

Performance

High

PerformanceStrategic Growth Orientation

More of the same,

Customer only focus,

Top-line growth

DisciplineLoose processes,

some compliance with

systems, procedures,

manual process solutions

Low

Performance

Low

Performance

High

Performance

HighPerformance

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Jim McGreevyExecutive General ManagerEngineering and Construction

Engineering & Construction turn around achieved

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Significant change in people, process and risk approach Business unit moved from loss to profit making in less than 18 months

Cash generation matching profit generation

People majority of senior team replaced Accountability

Relevant experience

Risk management allocation and pricing Understand the risk, its quantum and who is best placed to manage

Sub-contractors, e.g. for civils

JV partners, e.g. Clough for QGC upstream

Pricing and sensible discussions with clients

Sensible people

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Engineering & Construction turn around achieved

Case study QGC upstream in JV with Clough

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Case study QGC upstream in JV with Clough

Transfield Services in 50:50 JV with Clough LimitedRisk

Management

Commenced October 2012

$80m estimated value, with significant potential follow on work

Early site civil works and front end planning work for the construction phase of

compression facilities in central Queensland for QGCs Queensland Curtis Liquefied Natural

Gas (QCLNG) Project

Subject to mutual agreement work may extend to include construction and fabrication of 8field compression stations and 2 central processing plants.

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Kate MunningsChief Risk and Legal Officer

Shareholder Value Creation and Protection New OpportunityG

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Key Principles:

Focus :Ensure we focus our resources and energy to ensure we pursue the right opportunities and get thereally important stuff right.

Performance Accountability Culture: Visible and predictable performance management consequences forpatterns of out/underperformance.

Risk Based Financial modelling& pricing: Consider both the expectedfinancial outcomes and their certaintyby analysing the credible envelope of alternative financial outcomes.

Value Drivers: Deepened analysis and understanding of the Commercial Model of the opportunity andquantification of TSE exposure to key value drivers.

Capability: Objective assessment of our proposed team experience and TSE Group performance record withsimilar Scope, Commercial Model and Delivery Solution.

Quality/Consistency: Estimate builds based upon standardised inputs, methodologies and valid

benchmarking.

Assurance Review: Robust and ongoing independent review & challenge during proposaldevelopment/negotiation, and verification during Transition into operations.

Value Leakage: Track & report any leakage of Value or deterioration of commercial risk controls from bidapproval>signing>transition>operations.

Governance process

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Risk Based approach to Value Drivers &Financial Modelling

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What is the problem?

The commercial models have changed in markets that traditionally used cost reimbursablemodels.

Proposal P&L and Balance Sheet alone dont indicate how certain the expected financialperformance is.

Commercial Models are not always what they seem....

E.g. Schedule of Rates contracts butwith no fixed payments and no volume guarantees, or Contractorrequired to provide fixed price estimates for work packages based on unit rates.

E.g. Fixed price construction contracts butwith 80%+ of direct cost/schedule risk exposure passedthrough to competent subcontractors on back to back head contract terms.

What is the solution? Define / explain Commercial model in terms ofTSE exposures to key value drivers

Ensure Base Case, upside and downside assumptions underpinning the key value drivers arecredible and supported by data/benchmarking or contractual terms which limit exposure

Quantify impact of this uncertainty range on expected (Base Case) financial performance i.e.How wrong might our key assumptions credibly be and what is the financial impact of this?

> Tornado Chart

Financial Modelling

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Tornado Chart - How wrong might our assumptions be andwhat is the resulting financial impact

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what is the resulting financial impact

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New Assurance Function - Purpose

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With changing commercial models, a change in approach to the assessment oftenders is required.

The Assurance function will assist Managements decision making during thetender process by:

Providing an appropriately robust and independent review and analysis of newopportunities and ensuring material issues are referred to the Business Manager;

Ensuring that the information presented to the Business Manager is clear and concise,is supported by facts and provides a reasonable reflection of key material risk/rewardissues and value driver sensitivities;

Provide independent and unfiltered advice/opinion to Business Manager to assist withhis/her decision making;

Maintain traceability record of commercial & legal issues raised during RFP/contractreview, the assessment of the materiality of risks, and recommendedresponse/rationale.

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Thank you

Documents

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