Austal : Aulong JV secures contracts for four new high speed ferries

COMPANY ANNOUNCEMENT

22 JANUARY 2018

AULONG JOINT VENTURE SECURES CONTRACTS FOR

FOUR NEW HIGH SPEED FERRIES IN CHINA

Austal Limited (ASX:ASB) is pleased to announce Aulong Shipbuilding, a joint venture company between Austal and Guandong Jianglong Shipbuilding of China, has secured contracts for four new high speed ferries.

Aulong has been awarded contracts totaling A$20 million to design and build four 42 metre high speed catamarans for Xidao Dazhou Tourism Co Ltd.

Announcing the contracts in Australia, Austal Chief Executive Officer David Singleton said the Aulong joint venture has successfully rejuvenated Austal's sales in mainland China - with 6 new high speed ferries ordered in just 18 months.

"This A$20 million order is a great start to 2018, following our record sales in 2017 when we added eight commercial vessel orders wordwide, worth over A$380 million," Mr Singleton said.

"Our strategic objective in China is to establish our joint venture, Aulong, as a highly credible brand leader in the very large, mainland Chinese market. While the current vessels under construction and on order are relatively small by Austal standards, our work to date has been of the highest quality and we expect over the next few years that larger, more complex vessels will be required in this market.

"Our growing ship building presence in China will also allow Austal to progressively identify and manage quality Chinese suppliers that can enter our global supply chain and so create additional benefits to the

Company," he added.

With the benefit of Austal's extensive portfolio of high speed aluminium ferries, Aulong is attracting new and existing customers and anticipates additional orders from mainland China in the following months.

The 42 metre aluminium ferries will carry up to 399 passengers each, at speeds in excess of 20 knots andwill operate from Xideo, a tourist island off Sanya City, in the Hainan Province.

Construction will commence from Aulong's Zhongshan shipyard in Guandong Province in March 2018, with delivery scheduled for early 2019.

Four 42 metre ferries will be constructed by Aulong for Xidao Dazhou Tourism Co Ltd of China from

March 2018 (Image: Aulong)

About Aulong

Aulong Shipbuilding Co. Ltd (Aulong) is a joint venture between Guangdong Jianglong Shipbuilding Company (Jianglong Shipbuilding) of Zhuhai, China and Austal Limited, established in June 2016 with the aim of pursuing commercial passenger and non-military vessel opportunities in mainland China.

Austal (with 40% ownership) has licensed a number of its proven, commercial aluminium vessel designs for marketing throughout mainland China and construction at Jianglong Shipbuilding's established facilities in Guangdong province. Jianglong Shipbuilding (with 60% ownership) brings local shipbuilding infrastructure, experience and expertise, with close to 1,000 employees across two shipyards supporting the joint venture.

-ENDS-

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About Austal

Austal is the Australian shipbuilder, global defence prime contractor and maritime technology partner of choice, designing, constructing and sustaining the world's most advanced commercial and defence vessels.

As the only shipbuilder in the world that successfully balances commercial and defence projects, Austal celebrates 30 years of success in 2018, and has delivered and continues to construct more than 300 commercial and defence vessels for more than 100 operators in 54 countries worldwide.

Austal is Australia's largest defence exporter and only ASX-listed shipbuilder, with industry leading shipyards in Australia, the United States of America and Philippines - and service centres worldwide.

Delivering iconic monohull, catamaran and trimaran commercial vessel platforms - including the world's largest trimaran ferry and multiple defence programs such as the Littoral Combat Ship (LCS) and Expeditionary Fast Transport (EPF) for the United States Navy - Austal has grown to become the world's largest aluminium shipbuilder.

With relentless determination, Austal continues to pursue and win commercial and defence projects throughout the world, playing a leadership role in developing Australia's sovereign shipbuilding capability.