Update on legal proceedings against Karara Mining Limited

The Board of Directors ("

The Supreme Court of Western Australia has today ordered AGC and KML to submit the dispute on a confidential basis to a Court supervised mediation. This follows the recent receipt of a progress payment against an outstanding invoice for AU$13 million and the return of a bank guarantee in the amount of AU$10.9 million. Notwithstanding the legal action, both AGC and KML continue to work through outstanding issues.

AusGroup Managing Director and CEO Laurie Barlow said: " AGC is pleased that KML has agreed to make payment on an outstanding invoice and believe that a successful outcome is achievable." Board" ) of AusGroup Limited (" Company" ) wishes to provide an update on the dispute with Karara Mining Limited (a company incorporated in Perth, Western Australia) (" KML" ) in regards to the contract for structural, mechanical and piping installation works carried out by the Company’s wholly-owned subsidiary, AGC Industries Pty Ltd (" AGC" ) at KML’s Karara Iron Ore Project in Western Australia.