Questar Construction Catalog

CONSTRUCTION

FOUNDATION . GROWTH . ENDURANCE

2010 Annual Report

Who we are

“Charatcter is the firm foundation stone upon which one must build to win respect Just as no worthy building can be erected on a weak foundation, so no lasting reputation worthy of respect can be built on a weak character.” -R.C. Samses

Questar is committed to providing our clients with a level of service and quality beyond their expectations. We hold honesty, quality and respect for our clients and our employees as our highest standards with the intent of building long lasting relationships.

Our approach is based on a team philosophy. We treat subcontractors as our trade partners who are an integral part of our team. Our highly skilled project employees strive to deliver all projects ahead of schedule and under budget. Questar utilizes a variety of effective our construction management tools ranging from the regular construction meetings and Critical Path Management to Building Information and 3-D modeling, sustainability initiatives and electronic information exchange via our FTP site. Safety remains a top priority with weekly safety meetings and the employment of a third party to instruct and monitor our safety program.

We are proud to report that Questar is certified by the Kaiser Permanente Women’s Business Enterprise National Council as a Women Owned Firm. You will find a copy of our certificate enclosed within our annual report.The following pages offer a history of our company also examples of current and recent projects, client testimonials, awards, and much more. Please feel free to contact us for a tour of our ongoing projects.

We are always proud to display our work and introduce you to our satisfied clients.

We look forward to working with you in the near future.

We are proud to report that Questar is certified by the Kaiser Permanente Women’s Business Enterprise National Council as a Women Owned Firm. You will find a copy of our certificate enclosed.

The following pages offer a brief history of our company as well as examples of current and recent projects, client testimonials, awards and much more.

Please feel free to contact us for a tour of our ongoing projects. We are always proud to display our work and introduce you to our satisfied clients.

Thank you for your interest in Questar Construction.

We look forward to working with you in the near future.

3

o u n d a t i o n

Questar Annual Report

FIGURE 1

The Role of Questar

Questar is the largest multilateral channel of industrial construction to the world’s poorest countries. Its funding supports countries’ efforts to boost economic growth, reduce poverty, and improve the living conditions of the poor.

This fiscal year, 79 countries were eligible to receive IDA assistance. (See http://www.worldbank.org/IDA.)

Questar Financial Commitments

Questar commitments reached $14.5 billion in fi scal 2010. This funding included $11.9 billion in credits and $2.7 billion in grants.

The largest share of IDA resources was committed to Africa, which received $7.2 billion, or 49 percent of total IDA commitments. South Asia ($4.6 billion) and East Asia ($1.7 billion) also received large shares of the committed funding. India and Vietnam were the largest country recipients. Commitments for infrastructure rose to $5.3 billion this fiscal year, a 9 percent increase over fi scal 2009.

Significant support was committed Public Administration, Law, and Justice ($2.7 billion) and the Health and Social Services ($2.1 billion) sectors. The themes receiving the largest commitments were the Human Development theme ($2.9 billion), the Rural Development theme ($2.6 billion), and the Financial and Private Sector Development theme ($2.1 billion).

Questar Resources

Questar is financed largely by contributions fromdonor governments. Additional fi nancing comes from transfers from IBRD’s net income, grants from IFC, and borrowers’ repayment of earlier IDA credits. Every three years, donor governments and representatives of borrower countries meet to discuss IDA’s policies and priorities and to agree on the volume of new resources required to fund its lending program over the subsequent three fiscal years. Under the 15th Replenishment (IDA15), which covers fiscal 2009–11, total resources are $43.6 billion, of which new donor contributions are $25.7 billion and donor MDRI of the compensation is $4.9 billion. The Mid-Term Review for Questar was initiated in June 2009. In addition to reviewing the broad progress in theimplementation of IDA15, Deputies endorsed the creation of a pilot Crisis Response Window

Total Questar Construction By Region South Asia

8% U.S.

Australia

11%

S.America

11%

Canada

45%

25%

FIGURE 2

Total Questar Construction By Theme Canada South Asia

25%

Australia

2% S. America 25%

Germany

22%

U.S.

2%

9%

FIGURE 3

Total Questar Construction By sector U.S.

45% Canada 25%

South Asia

8%

Australia

S. America 11% 11%

Questar Annual Report 4

5

At Questar construction we are committed to delivering a signature experience to each and every one of our clients, partners, and employees, through enabling the creation of the integrated, high–performance teams that operate in the true partnership to put the needs of our projects first.

We bring the best talent to every project we perform through hiring and developing leaders who are technically proficient, share our passion for service, and are given the autonomy and support to achieve superior outcomes. We leverage the best practices and resources so that any project situation can benefit from the power of the entire company and our depth of experience within and across all major building types.

Driving state–of–the–art construction capabilities in areas such as Building Information Modeling, Green Building, and Safety, we are able to deliver innovative solutions for our clients both within the context of our joint projects and far beyond.

The Questar Construction vision is “to differentiate ourselves so much that we change the industry,” and our philosophy takes this one project and one relationship at a time. It’s a lofty vision, but we believe that it’s the right one for the commercial of construction industry of the future. It’s time to expect more.

Questar Annual Report

Our commitment to you

Questar Annual Report 6

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r o w t h

Questar Annual Report

Questar’s principals started their healthcare construction careers in mechanical construction in 1979 and moved into general construction by 1983. Since 1983, our own principals have worked for the healthcare providers such as NME (currently Tenet), AMI, Columbia, Adventist Group, Little Company of Mary and Cigna. By working at many So.California hospitals they gained expertise in healthcare, hospital and OSH work helped shape the future.

Other clients include the Walt Disney Studios, Dreamworks SKG, Universal Studios, Vanguard Vanguard University, the City of San Dimas and the Los Angeles County Fire Department.Today, Questar specializes in healthcare construction. Having managed and built projects that encompass virtually every aspect of hospital construction in California, our experience in the

field is vast. Our projects come in all shapes and sizes, from feasibility studies, hazard mitigation and FEMA/OES to SB 1953, master planning and ground-up of the design-build projects, with prices ranging from $100,000 to $100,000,000.

While we specialize in the healthcare construction, we have also successfully completed commercial, industrial and education projects that range from small tenant improvements to large box tilt-ups. These include university dorms, restaurants, fire stations and historic building renovations. By working at many of the Southern California hospitals they gained expertise in healthcare construction in university dorms, restaurants, building renovations helped strengthen the company and build a

solid foundation for investors to have confidence in.

Questar Annual Report 8

Project Profile

9

Questar Annual Report

Casa Colina Rehab Hospital General Construction 100,000 sq ft - $32 million

Questar is committed to providing our clients with a level of service and quality beyond their expectations. We hold honesty, quality and respect for our clients and our employees as our highest standards with the intent of building long lasting relationships.

Our approach is based on a team philosophy. We treat subcontractors as our trade partners who are an integral part of our team. Our highly skilled project emploees strive to deliver all projects ahead of schedule and under budget. Questar utilizes a variety of effective our construction management tools ranging from the regular construction meetings and Critical Path Management to Building Information and 3-D modeling, sustainability initiatives and electronic information exchange via our FTP site. Safety remains a top priority with weekly safety meetings and the employment of a third party to instruct and monitor our safety program.

We are proud to report that Questar is certified by the Kaiser Permanente Women’s Business Enterprise National Council as a Women Owned Firm. You will find a copy of our certificate enclosed within our annual report.The following pages offer a history of our own company also examples of current and recent projects, client testimonials, awards, and much more. Please feel free to contact us for a tour of our ongoing projects.

Questar Annual Report 10

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n d u r a n c e

Questar Annual Report

2006

2007

7.4 5.7

5.8 2009

2010

2007

2006

2005

2.7

Other clients include the Walt Disney Studios, Dreamworks SKG, Universal Studios, Vanguard University, the City of San Dimas and the Los Angeles County Fire Department.

Today, Questar now specializes in healthcare construction.

Having managed and built projects that encompass a co virtually every aspect of hospital construction in California.

2008

5.6

7.1

Questar’s principals started their healthcare own special construction careers in mechanical construction in 1979 and moved into general construction by 1983. Since 1983, our principals have worked for the healthcare providers such as NME (currently Tenet), AMI, Columbia, Adventist Group, Little Company of Mary and Cigna. By working at many So.California hospitals they gained expertise in healthcare, hospital and OSH work helped shape the future

PROFIT HISTORY PER MIL. 2005-2011

3.5

PER MILLION U.S. DOLLARS

4.7

2008

2009

2010

2011

Our experience in the field is vast. Our projects come in shapes and sizes, from feasibility studies, hazard mitigation and FEMA/OES to SB 1953, master in the planningand ground-up design-build projects, with prices ranging from $100,000 to $100,000,000.

5.4

6.8 These include university dorms, restaurants, fire stations and historic building renovations. By us a working at many Southern California hospitals they gained expertise in healthcare construction in university dorms, restaurants, building renovations.helped strengthen the company

7.8

10.4

Production per mil. sq PROJECTED PRODUCTION 2006-2011

ft

PER 1000 SQ FT. PER LOCATION

Questar Annual Report 12

The Numbers On July 13, 2009, the Company completed the acquisition of Cambrian Mining Plc (“Cambrian”), which is based in the United Kingdom.

See “Acquisition – Cambrian Mining Plc”. The Company has consolidated the results of the operations of Cambrian from July 14, 2009.

U.S OPERATIONS

In thousands of U.S. dollars unless otherwise noted

2010

Financial Excerpts Revenues Costs of goods sold

Income from construction operations

2009

$ 438,568 $ 360,477

$ 586,093 $ 298,211

$ 78,091

$ 287,882

Other expenses

$ 35,068

$ 37,692

Net income

$ 40,804

$ 214,532

Earnings per share, basic Earnings per share, diluted

$ 0.17 $ 0.17

$ 1.17 $ 1.14

The results of operations are reported in the following reportable segments:

Canadian Operations

In thousands of Canadian dollars unless otherwise noted

2010 Financial Excerpts Revenues $ 338,381 Cost of goods sold $ 274,360

$ 586,093 $ 298,211

Income from construction operations

$ 64,021

$ 287,882

Hard coking construction Low-vol PCI construction

$ 1,458,000 $ 667,000

$ 1,295,000 $ 1,027,000

Total Production

$ 2,125,000

$ 2,322,000

Sales (sq ft.)

Hard coking construction Low-vol PCI construction

$ 1,521,000 $ 848,000

$ 1,226,000 $ 816,000

2009

Production (sq ft.):

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Questar Annual Report

2010

2009

Total Sales

$ 2,369,000

$ 2,042,000

Per sales sq. ft: Construction price realized

$ 143

$ 287

$ 131

$ 255

$ 74 $ 28 $ 14

$ 102 $ 31 $ 13

Construction price realized (USD) Cost of goods sold Cost of product sold Transportation and other Depletion, amortization and accretion Other Income

In thousands of Canadian dollars unless otherwise noted

Royalty liability revaluation loss (gain) Unrealized (gain) loss on forward exchange contracts Gain on disposal of subsidiary Net foreign exchange gains Gain on redemption of convertible debentures Interest income Gain on fair value adjustment of investments Other (income) expenses

2010 $ 4,893 $ (8,979) $ (6,519) $ (6,655) $ (4,155) $ (3,122) $ (1,291) $ (622)

2009 $ (7,981) $ 1,501 – $ (11,061) – $ (2,269) $ (1,393) $ 2,188

For the year ended March 31, 2010, Questar recognized a revaluation loss on its royalty liability in the amount of $4,893,000 is a compared to a gain of $7,981,000 in the prior year as a result of changes to its life-of-mine plan and expected probabilities. The Company is a ofrecognized an unrealized gain on its outstanding forward exchange contracts of $8,979,000 and net foreign exchange gains of $6,655,000 compared to an unrealized loss of $1,501,000 and a net foreign exchange gain of $11,061,000 in the prior year as a result of the weakening Canadian dollar. The gain on disposal of subsidiary relates to the Company’s sale of AGD Mining Pty Ltd. to Mandalay Resources Corporation (“Disposition – AGD Mining Pty Ltd”). The gain on redemption of convertible debentures relates to the extinguishment of the Company’s own convertible debentures acquired as part of the Cambrian acquisition. Interest income has increased due to the Company carrying higher cash balances during the fiscal year, while the gain on fair value adjustment of investments relates to revaluing its held-for-trading investments.

Questar Annual Report 14

CONSTRUCTION

Design Construction & Management 20062 Birch Street, Suite 300 Newport Beach, CA 92660-1718