Forestry MIS write-downs

Directors have adopted a new valuation for our Managed Investment Scheme (MIS) forest investments. Both Great Southern and Timbercorp are in receivership, so there is some doubt as to the level of return we may receive on MIS investments with these organisations. At the same time, it would require exceptionally poor management or incompetence to produce no return at all to investors.

For these two organisations, our forestry contracts with them will be valued at 25 % of initial cost or 25% of the most recent valuation, whichever is the lower. Our investment in Macquarie forestry lots and land will remain valued at initial cost. These write downs at the end of May resulted in a decline in value per share of $7.67, or 3.2%.

We have no debt relating to these investments. Our forestry lots with Timbercorp were due for harvest this year.

We have never held shares in Timbercorp and our final shareholding in Great Southern was sold in 2008.