During the year we consolidated our capital base, strengthened our balance sheet through reducing debt and raising capital, made further in-roads into a majority of our key markets, and established a fourth business division, Industrea Gas Management.

The launch of this new division, and its transition as a fully integrated gas management offering, offers the decided advantage of creating new revenue streams from the services and human capital side of Industrea's business.

Our record adjusted NPAT of $51.5 million was a commendable achievement given the unanticipated slowing of sales into China of our diesel equipment during the first half of the year and the impact of floods in Queensland in the second half. As predicted, sales for this segment of our business rebounded to more historical levels following the Chinese New Year, and we are confident of a significant trading improvement for the Mining Equipment division in the current year.

While our reach into other emerging mining markets continued to grow in 2011, China, along with Australia, remain our two most dominant and prospective markets.

Industrea’s unswerving focus on providing products and services that enhance mine safety and productivity are clearly aligned with the Chinese government’s five year plan to significantly expand coal production, mechanisation, efficiency and safety. Indicative of the increased focus

on safety and efficiencies in China’s coal mines is the establishment by one of our largest Chinese customers, China Shenhua Energy Corporation Limited, of a safety production function at every level of the company and the implementation of an intrinsic Safety Management System to reduce injuries and fatalities.

We expect the major investment committed to new and extended mine projects in Australia will underpin strong revenue growth for all four of our business divisions in FY 2012.

Specifically, our China growth blueprint has been formulated to match the key priorities earmarked by China under its 12th five year plan (2011 – 2015):

• increase total coal output from 3.1 billion tonnes to 3.6 – 3.8 billion tonnes

• increase coal mechanisation rate to 75%

• reduce number of coal mining companies to 4,000 larger, more efficient companies.

Among the key initiatives undertaken by Industrea in 2011 to capitalise on opportunities this plan presents were an investment in researching and developing a new prototype underground vehicle, starting production in China of a high- volume personnel carrier and the establishment of a gas management business which we intend to further develop as a fully-integrated gas management offering for Australia’s, China’s and Russia’s underground coal mines.

I believe Industrea’s performance in Australia in 2011 is worth highlighting, as it reinforces the value of our strategy of continuing to diversify the business across different geographic, commodity and customer markets. The rebound of Australia’s booming commodity economy resulted in our Mining Services division extending existing contracts, while our Mining Technology division secured material sales of its collision avoidance system to BHP Group globally including Australia, South Africa and South America.

Our Mining Equipment division was also the beneficiary of robust demand from Australia’s mining sector for its specialised underground diesel equipment, ensuring that our Hunter Valley manufacturing and fabrication facility finished the year with an exceptionally strong forward order book.

We expect the major investment committed to new and extended mine projects in Australia will underpin strong revenue growth for all four of our business divisions in FY 2012.

Industrea's senior management team, and in particular our Managing Director and CEO, Robin Levison, again deserve a special recognition for their guidance and execution of the group's growth strategy.

The high calibre of management we have in place will ensure that we continue to fully capitalise on all future growth opportunities and open new markets, expand our existing ones, and roll-out new market offerings across the globe.

I would also like to convey my special thanks to my fellow directors for their insight, support and collective expertise throughout 2011.

Industrea enters FY 2012 with the people, resources and growth strategy in place to achieve yet another highly successful year from both an operational and financial perspective.

The Industrea board and senior management remain committed to delivering sustained growth in operations and profit through a strategy of aquisition and organic growth. The board is firmly committed to increasing shareholder value into the furure.

The Hon David Beddall

Chairman

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