Ezion

Ezion: to develop a marine supply base at a 15 ha site in NW Australia, to support the offshore industry in the area, which includes the Gorgon and Barrow Island projects. Tight supply of such bases ensures that Ezion is well positioned to secure more marine supply contracts, especially from Chevron. Ezion expects to invest A$37m in total over two phases, which will be financed internally. While we do not expect any significant contribution from the base until FY13, we expect it to be extremely profitable henceforth, with estimated annual turnover of around A$50m and margins of 50%. We continue to hold an extremely positive view on Ezion's prospects for more projects in offshore NW Australia, following its involvement in its initial supply contract for Gorgon. Maintain Buy with $0.99 target.