AECON GROUP INC 3 1 The Company prepares its consolidated fnancial statements in accordance with Canadian generally accepted accounting principles GAAP as set out in the Handbook of the Canadian Institute of Chartered Accountants CICA Handbook In 2010 the CICA Handbook was revised to incorporate International Financial Reporting Standards IFRS and to require publicly accountable enterprises to apply such standards effective for years beginning on or after January 1 2011 Accordingly the Company commenced reporting on this basis in its consolidated fnancial statements at December 31 2011 The term Canadian GAAP refers to Canadian GAAP before the adoption of IFRS Amounts previously reported for 2010 have been restated to give effect to these changes in accordance with IFRS Amounts reported for 2008 to 2009 refect amounts reported previously in accordance with Canadian GAAP 2 EBITDA represents earnings or losses before net fnancing costs income taxes depreciation and amortization and noncontrolling interests Net fnancing costs exclude interest on project specifc debt which under IFRS is classifed as a direct cost in the calculation of gross proft 3 Adjusted earnings per share represent earnings per share calculated using adjusted proft attributable to shareholders 4 Operating proft represents the proft from operations before net fnancing costs income taxes and noncontrolling interests 5 Adjusted proft attributable to shareholders represents the proft attributable to shareholders adjusted to exclude the after tax fair value gain on the embedded derivative portion of the Company s convertible debentures 6 Backlog means the total value of work that has not yet been completed that a has a high certainty of being performed as a result of the existence of an executed contract or work order specifying job scope value and timing or b has been awarded to Aecon as evidenced by an executed binding letter of intent or agreement describing the general job scope value and timing of such work and where the fnalization of a formal contract respecting such work is reasonably assured 7 Return on Equity is calculated as proft attributable to the Company divided by the average of shareholders equity at the beginning and end of the fscal year 8 Return on Capital Employed is calculated as operating proft divided by the average of shareholders equity convertible debentures and longterm debt at the beginning and end of the fscal year 9 Book V alue Per Share diluted is calculated as shareholders equity plus the increase in shareholders equity if options and convertible debentures in the money are exercised andor converted plus offcer share purchase loans plus the book value of L TIP shares all divided by shares outstanding at year end diluted Shares outstanding at year end diluted represent the number of shares issued at the end of the year plus the number of shares issuable if options and convertible debentures in the money were exercised andor converted plus the number of L TIP shares NOTES 19 9 1 19 9 5 1 9 96 2 00 0 2 0 01 2 0 0 5 2 0 0 6 2 01 0 2 0 11 E a s t e r n C a n a d a W e s t e r n C a n a d a U S A a n d I n t e r n a ti ona l R e v e nu e by G eogr a ph y A N N U A L A V E R A G E M I L L I O N S 0 200 400 600 800 1000 1200 1400 2 0 12 R e s o u r c e D e v e l o p m e n t 3 4 T ra n s p o r t a t i o n I n f ra st ru c t u r e 2 4 P o w e r G e n e r a t i o n 1 6 S o c i a l I n f r a s t r u c t u r e 1 4 U r b a n I n f r a s t r u c t u r e 1 2 2 0 1 2 R e v e n u e b y S e c t o r U r b an R e s ou r ce S o ci a l P ower T r a n s p or t a t i on