Triyards

Triyards: Group entered into a contract of sale to purchase an industrial property for ~A$6.74m from Henderson Supply Base Pty Ltd. Property is located at Fremantle, Perth, Australia, and is currently leased to a shipbuilding and o&g-related firm for a term of three years (till 2016), at a rent of A$20k/ month (3.6% yield). Purchase price is at current market valuation of the property, and the amount will be payable in cash, and the issue of shares in Triyards to the seller- Triyards will issue 8.9m shares (3% of share capital) at $0.7873 (3% below last closing price of $0.7650), and the remaining A$1.3m in cash (A$65m on hand as at 28 Feb 2013). Current rental yield of 3.6% from the property should assist to increase recurring cash flow of ~A$240k each year for the Group, with the volatile earnings on Triyards' core operations. Share price likely to trade slightly lower towards the issue price of $0.7873, and not likely to cause a big impact to the Group's FY13 results.