Securinvest Financial Planners

The below is an update from Great Southern in light of the recent Timbercorp administration announcement.

As you would be aware Timbercorp has entered voluntary administration. In an announcement to the market, its appointed administrators KordaMentha said Timbercorp had been hurt by the combined impact of declining global assets values, tightening credit, the economic downturn and drought.

In the wake of this news, it’s only natural for people to draw comparisons between Great Southern and Timbercorp. However, it’s important to note the assets and debt positions of the two companies are quite different. Great Southern remains confident that it will realise proceeds from various non core asset sales and in particular from its significant unencumbered cattle assets (book value approximately $200m) which will be used to meet the Company’s debt repayment obligations ($105m) due in October 2009.

As we have already stated in a number of public announcements, we have been working through a strategic process for more than 12 months which started with Project Transform. Through Transform we were able to successfully unencumber a significant proportion of our asset base – including our cattle assets which are now effectively freed up for sale. We are now making good progress through the company’s 5 point plan, as communicated in our ASX Announcement dated 8th April 2009 (attached).

There is no denying the current economic environment is challenging, particularly for the sale of MIS projects; with this in mind, cash flow management is the company’s primary focus and we are working closely with all relevant parties to carefully control this area of the business. With their continued support we believe we have a sound basis to continue to pursue our short and medium term strategy to fruition.

Kind regards

Cameron Rhodes
Chief Executive Officer
Great Southern Group of Companies

As always, should you have any questions in the meantime please contact Securinvest Financial Planners on 03 9574 8300 or Great Southern Client Services on 1800 258 348.