AUSDRILL LIMITED

HALF-YEAR FINANCIAL REPORT

Ausdrill is pleased to report for the sixth consecutive period a record net profit after tax of $25.055 million for the half year to 31 December, 2008, up 52% on the profit recorded for the same period last year.  The board has elected to maintain the interim dividend at the same level of the previous corresponding period, and has declared an interim dividend of 5.0 cents per share, fully franked, payable on the 8th April, 2009.  In light of the current uncertain market conditions the board will review this position again at the end of the financial year.

The result includes pre-tax unrealised foreign exchange gains of $6.351 million, and costs associated with the defence of the hostile MacMahon takeover bid of $2.040 million.

On a comparative basis for the half year ending December 2007 to December 2008, excluding the aforementioned unrealised foreign exchange gains and takeover defence costs, the Company has achieved the following:

?        Profit after tax is up 33% from $16.50m to $22.0m

?        Revenue is up 46% from $187.2m to $273.0m

?        EBITDA is up 59% from $41.5m to $66.1m

?        Interim Dividend has been retained at 5.0 cents per share, fully franked

The result was achieved in spite of the global economic crisis that has seen a marked slowdown in activities from the levels seen only a few months ago, and it is unrealistic to expect that Ausdrill will not be affected by these factors.

Whilst tendering activity remains high, the Company is seeing increased pressure from Clients to reduce operating costs and is experiencing increased competitor pressure in some sectors.  To date we have had one contract suspended, and one mine closure directly affecting our operations that being Norilsk Nickels Black Swan operation that closed on the 17th February, 2009 resulting in 4 blasthole drills being stood down.  In addition we have seen a slowdown in the demand for exploration rigs in line with current market conditions.  At the early stage of the crisis we did see reduced production on some sites in Africa, most of which have since returned to full production.

Importantly our balance sheet remains strong with a net debt to equity ratio of 54%, cash of $53.9 million, and interest cover (adjusted EBIT/Interest) of 5.6 times.  The Company?s net tangible asset position has increased 14% to $314 million, or $1.81 per share.

The increase in net debt to $168 million is in part due to the depreciation of the Australian Dollar against the US Dollar, and the foreign exchange impact on borrowings is $26 million.  All USD borrowings relate to contracts denominated in USD or equivalent.

Moving forward, the Company?s exposure to gold operations augers well as a result of increased gold prices, particularly in Australian Dollar terms.  Africa remains a key growth area with a number of gold projects that are due to be tendered in the near future, or are currently under consideration in both the open pit (African Mining Services) and underground (50% JV African Underground Mining Services) operations.  In addition, Diamond Communications is well placed to participate in the Federal Government?s proposed open access, high-speed, fibre-based broadband network currently under consideration.

The Board believes that the Company will continue to operate profitably in the period ahead. However in the current uncertain environment we do not believe it is possible to provide any firm guidance as to the level of that profitability.

                Please follow the link below to view Ausdrill?s half-year financial report:

                http://www.ausdrill.com.au/default.aspx?MenuID=463

For further information, please contact:

Mr Ron Sayers                                       Mr Andrew Broad

Managing Director                              General Manager Operations

Ausdrill Limited                                   Ausdrill Limited

Tel: +61 8 9311 5666                            Tel: +61 8 9311 5666

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