The decision by the US Federal Reserve to undertake another round of quantitative easing through the purchase of mortgage-backed securities, continue its program of buying of long-dated Treasuries and selling shorter-term paper already on its balance sheet and extend its promise to keep rates low until 2015 was well received if you base your judgment exclusively on the action in global equities markets on Friday, Sept. 14.

For the Reserve Bank of Australia (RBA), however, the consequences of these decisions are difficult to weigh. The Australian dollar spiked shortly after the Fed’s Sept. 13 announcement and continued to rally through Friday, ending the session at USD1.0551, up from last Friday’s close of USD1.0385. The aussie closed as low as USD1.0193 last week, as concern about slowing Chinese growth and its impact on the resource-driven Australian economy reached a peak.

All that changed with QE3, more “Operation Twist,” commitment to three more years of a near-zero-bound benchmark US interest rate and the Federal Open Market Committee’s statement, “To support continued progress toward maximum employment and price stability, the Committee expects that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the economic recovery strengthens.”

This puts a lot of upward pressure on an already strong Australian dollar, and it could make it hard for domestic manufacturers to sell their goods abroad, it could continue to push up labor costs and it could increase pressure on the RBA to trim its benchmark cash rate from 3.5 percent, the highest in the developed world.

At the same time, however, the Fed’s expansion of its balance sheet should also push commodity prices higher, which is a positive for Australia in general.

Last week the RBA and Governor Glenn Stevens held the cash rate steady for the second straight month after cutting a total of 75 basis points (0.75 percent) in May and June. Mr. Stevens noted in his statement announcing the most recent decision that the full impact of the May and June cuts has yet to be felt.

“The board judged that, with inflation expected to be consistent with the target and growth close to trend, but with a more subdued international outlook than was the case a few months ago, the stance of monetary policy remained appropriate,” read Mr. Stevens’ official statement. He also noted that the Australian dollar-US dollar exchange rate had declined over the past month or two, “though it has remained higher than might have been expected, given the observed decline in export prices and the weaker global outlook.”

In early August the RBA raised its 2012 gross domestic product (GDP) growth forecast for Australia to 3.5 percent from 3 percent. Resource investment and a pick-up in household consumption were behind the GDP upgrade. The pick-up in growth is expected to be temporary, with growth likely to fall back to around trend pace in the second half of 2012, amid moderating domestic demand, according to RBA forecasts.

By contrast “current assessments are that global GDP will grow at no more than average pace in 2012, with risks to the outlook still on the downside,” said Mr. Stevens in his cash rate statement on Sept. 4.

“Around Asia generally, growth is being dampened by the more moderate Chinese expansion and the weakness in Europe,” he added. “Financial markets have responded positively over the past couple of months to signs of progress in addressing Europe’s financial problems, but expectations for further progress are high,” the RBA Governor added.

The RBA on China, Australia and Iron Ore

In a Research Discussion Paper published Sept. 4, Chinese Urban Residential Construction to 2040, the RBA set out a compelling case for the continuation of Australia’s resource boom for decades.

A key conclusion: The urban population of China will reach almost one billion by 2030 from its current level of 691 million and then stabilize. This has profound implications for the demand for steel and iron ore. The authors of the study argue that although growth rates of recent years won’t continue, construction will stabilize at a high level, a good omen for steel demand, especially as steel intensity is forecast to increase.

Residential construction is a key driver of Chinese economic growth. Steel is a key part of this construction, and iron ore is a key component of steel. Iron ore, of course, is Australia’s No. 1 commodity export.

Construction is expected to peak in 2017 and fall back below current levels sometime around 2030.

In 2011 1.9 billion square meters of residential floor space was built in China. This volume is more floor space than the entire residential building stock in Australia.

This pace of construction is necessary, in part, to accommodate the 20 million Chinese migrating to urban centers on an annual basis.

At a basic level the construction boom is the result of extraordinary economic growth and urbanization, which are intertwined in complex ways. The RBA estimates that residential construction uses about 14 percent of China’s crude steel output. More intense use of steel, due to taller buildings and other amenities such as underground car parks, means that steel use by residential construction will grow at a faster rate than the volume of floor space built.

Indeed, the RBA projects that steel used in residential construction will peak around 2024, at a level that is 30 percent higher than in 2011.

The Chinese urbanization rate has been rising rapidly over the past two decades, but the RBA expects it to continue to do so for some time. In 1990 just over a quarter of the Chinese population lived in urban areas; today more than half do. Large flows of rural immigrants to urban areas and large-scale land reclassification have driven this trend.

The RBA projects an urbanization rate of almost 70 percent by 2030 and around 73 percent by 2040.

The RBA predicts that steel use in residential construction is likely to continue to grow rapidly for a few more years. Beyond the middle of the current decade growth is projected to moderate, with steel use reaching its peak in 2023, at a level that is 30 percent higher than consumption in 2011.

Although residential construction accounts for around 9 percent of GDP and 14 percent of steel use, it has broader implications for steel demand. Appliances are required to fill the new homes.

Commercial buildings and infrastructure are needed to service the new urbanites. These products and amenities will be positively correlated with residential construction.

Dividend Watch List

Because Australian companies typically report official earnings and declare dividends only twice a year, changes–additions to and subtractions from–the Dividend Watch List will be rarer than, for example, the Dividend Watch List compiled for AE’s sister letter Canadian Edge.

Reporting season Down Under is well underway, however, which means we’re in the heat of dividend announcements too.

It’s important to note that Australian companies customarily maintain policies of paying out a specified percentage based on particular earnings metrics, whether that metric is statutory net profit after tax (NPAT), underlying NPAT or earnings before interest, taxation, depreciation and amortization (EBITDA).

What this means is that dividend rates will often vary more than they do for Canadian or US companies, which are almost universally pledged to maintaining dividend rates, often at the cost of tapping balance sheets in the absence of sufficient cash flow to cover obligations to shareholders.

This latter is fine in the short term, and it can be manageable in the longer term as well. But Australian firms are traditionally more debt-averse than their North American counterparts.

It’s important to note, too, that the CE Watch List is based on the monthly distribution scheme established during the income trust era, which, to the benefit of investors everywhere, persists even after the forced conversion to traditional corporations for many of these stocks.

Australia’s twice-yearly rhythm varies as well from the quarterly dividend arrangement to which most US companies adhere.

With recent dividend reductions, changes to guidance or policies that suggest non-regular payment the following companies have declared their worthiness for inclusion on the Dividend Watch List.

The List includes all companies that reduced payouts during the recently concluded earnings reporting season Down Under.

Basic Materials

Aditya Birla Minerals Ltd’s (ASX: ABY, OTC: ABWAF) board approved and management declared a AUD0.05 dividend on May 30, finally getting back to a paying basis after “omitting” a mid-year payment. It appears the company pays an annual dividend, but policy remains “to seek to maximise cash returns to Shareholders whilst having regard to ensuring a sound financial structure for the Company and providing for value accretive development and exploration activities and targeted growth opportunities.” Because there’s no clarity on the payment interval this stock will probably be an emeritus member of the Dividend Watch List. It is, however, a speculative buy under USD0.50 for aggressive investors only.

Alumina Ltd (ASX: AWC, NYSE: AWC) didn’t declare an interim dividend when it reported 2012 first-half results on Aug. 16. Management had reduced its final dividend for 2011 by 25 percent, in step with guidance issued late in the year.

The company recorded a net loss of USD14.6 million, compared with a profit of USD67.7 million a year ago, although revenue from continuing operations was flat. Alumina received USD70.4 million in dividends and distributions from its joint venture with Alcoa (NYSE: AA), in line with the previous six-month period but down from USD170 million the year before.

Although the company has undrawn credit facilities to help it through what is an increasingly difficult operating environment for global aluminum companies, absence of any cash flow guidance and rising overall debt levels suggested a dividend cut was highly likely. Hold.

Aquarius Platinum Ltd (ASX: AQP, OTC: AQPBF) halted operations at its Everest mine, the second such move in recent weeks, as its partners in the Marikana mine in South Africa had previously mothballed the No. 4 shaft due to the continuing weakness for platinum-group metals (PGM) prices.

Marikana accounts for approximately 18 percent of Aquarius’s annual production. This comes after the company reported that fiscal 2012 third-quarter earnings slid 137 percent to a AUD9.4 million loss, as production declined 18 percent and prices for PGMs dove 14 percent. Cash costs, meanwhile, surged by 26 percent.

The company didn’t pay an interim dividend on its fiscal 2012 first-half results. Sell.

Arrium Ltd (ASX: ARI, OTC: OSTLF, ADR: OSTLY) posted fiscal 2012 underlying net profit after tax of AUD195 million, down 17 percent from the prior corresponding period but in line with management guidance. Unfortunately, the final dividend was 25 percent lower than it paid a year ago, at AUD0.03 per share.

Positives include a 2 percent increase in cash flow to AUD470 million and a 4 percent reduction in net debt. Arrium, formerly OneSteel Ltd, paid a AUD0.03 per share interim dividend, down 50 percent from the AUD0.06 it paid for the first half of fiscal 2011. This one is for speculators ready for a double turnaround play, for the company as it continues to reorient itself as an iron ore producer and for the price of the relevant commodity. Buy under USD0.80.

BlueScope Steel Ltd (ASX: BSL, OTC: BLSFF) posted a fiscal 2012 net loss after tax of AUD1.044 billion, better than the AUD1.054 billion loss for fiscal 2011.

A joint venture with Japan’s Nippon Steel Corp (Japan: 5401, OTC: NISTF) that generated about AUD540 million for the company helped it shave AUD580 million in debt.

Management had already “omitted” the interim dividend and didn’t declare a final dividend either. But the balance sheet repair job merits an upgrade. Hold.

Fortescue Metals Group (ASX: FMG, OTC: FSUMF, ADR: FSUGY) is new to the List this month. The company held its final dividend steady, but recent events, described in this month’s In Focus feature, suggest “steady” may be as good as it gets from a dividend perspective for this company going forward.

An onerous debt burden of AUD10 billion, sliding iron ore prices, the announcement that it’s scaling back its expansion aspiration to 115 million metric tons from 155 million and the sale of a power station to raise AUD300 million are signs of desperate times.

The next dividend declaration should come around the second week of February 2013. The company paid an interim dividend of AUD0.04 for fiscal 2012, up from AUD0.03 in fiscal 2011. Look for that to be reversed, at least. Hold.

Grange Resources Ltd (ASX: GRR, OTC: GRRLF), which enjoyed a short membership in the AE Portfolio Aggressive Holdings, cut its 2012 interim dividend from AUD0.02 a year ago to AUD0.01. That move on top of an abrupt change in leadership, prompted its removal from the Portfolio via an Aug. 31 Flash Alert, after just joining the Aggressive Holdings as of the July issue. Sell.

Independence Group NL (ASX: IGO, OTC: IPGDF) reduced its final dividend for fiscal 2012 from AUD0.07 to AUD0.05. The company is showing improved production metrics at its key nickel mine, and its efforts to diversify what it produces–including the development of the Tropicana gold mine–will help it in the long run.

Revenue was up 32 percent to AUD216.6 million. Nevertheless, Independence reported a full-year net loss after tax of AUD285.3 million, reversing a year-ago profit of AUD5.5 million. Hold.

Medusa Mining Ltd (ASX: MML, OTC: MDSMF), an un-hedged, low-cost gold producer, saw a steep decline in fiscal 2012 gold sales, from 96,217 ounces to 55,446 ounces. Costs remained on the extremely low side, and management reiterated its target of 400,000 ounces of production per year by 2015.

We like the company. But it did cut its final dividend by 60 percent to AUD0.02 per share. This remains, however, a great way to gain gold exposure and get paid at the same time. Buy under USD6.50.

Mount Gibson Iron Ltd (ASX: MGX, OTC: MTGRF) reported a slide in fiscal 2012 sales of 3.6 percent, and net profit after tax declined 27.8 percent. That led to a 50 percent reduction in its final dividend, to AUD0.02 per share.

Iron ore tons mined increased by 29 percent, though tons sold declined by 0.5 percent. Costs were up, selling prices down. Hold.

Oz Minerals Ltd (ASX: OZL, OTC: OZMLF, ADR: OZMLY) reported an 18.6 percent decline in first-half revenue and a 32 percent decline in earnings before interest, taxation, depreciation and amortization (EBITDA). It also raised its full-year cash cost guidance to USD1.10 to USD1.20 per ounce from USD1 to USD1.10.

That, on top if the fact that it reduced its interim dividend to AUD0.10 from AUD0.30 a year ago, is a bad sign for the final dividend. Hold.

Panoramic Resources Ltd (ASX: PAN, OTC: PANRF) didn’t declare a final dividend for fiscal 2012 after paying AUD0.02 per share a year ago. It paid 50 percent less for its fiscal 2012 interim dividend than it for fiscal 2011.

Fiscal 2012 net revenue was down 7 percent, and the company posted a net loss after tax of AUD18.2 million. Average realized nickel prices declined by 23 percent, the source of all its dividend trouble. Cash costs, however, were down 4 percent, and management continues to put up solid production numbers. This is for speculators on a stimulus-driven global economic turnaround. Buy under USD1.00.

Western Areas NL (ASX: WSA, OTC: WNARF) cut its final dividend from AUD0.15 a year ago to AUD0.06, as fiscal 2012 revenue was down 29.4 percent on a 29 percent decline for nickel prices. With production flat, sales volumes down and cash costs up, the thing to hold onto is a return of more normal growth for the global economy.

Production trends have been solid, and sales hit a record for the March quarter. Buy under USD4.60.

Whitehaven Coal Ltd (ASX: WHC, OTC: WHITF) declared a final dividend of AUD0.03, down from AUD0.041 a year ago, as underlying net profit after tax slid 13 percent. Revenue from coals sales actually grew by 2.6 percent, however. Buy under USD6.

Consumer Goods

Billabong International Ltd (ASX: BBG, OTC: BLLAF) cut its interim distribution by 81 percent, which we said was likely an interim step on the way to zero. And that’s where we are after management didn’t declare a final dividend in August.

Billabong posted a fiscal 2012 net loss of AUD275.6 million, as sales declined 7.9 percent. There are now competing AUD1.45 per share offers to buy the company. Sell.

Goodman Fielder Ltd (ASX: GFF, OTC: GDFLF) didn’t pay an interim dividend nor did it pay a final dividend for fiscal 2012. Fiscal 2012 revenue was down 1.7 percent, while normalized earnings before interest, taxation, depreciation and amortization (EBITDA) slid 16.6 percent. The company did reduce net debt by 23.8 percent, and the sale of its edible oils business to Aggressive Holding GrainCorp Ltd (ASX: GNC, OTC: GRCLF) for AUD472 million will help the balance sheet. Hold.

Consumer Services

APN News & Media Holdings Ltd (ASX: APN, OTC: APNDF) cut its 2012 interim dividend to AUD0.015 from the AUD0.035 it paid a year ago.

APN reported a net loss of AUD319.4 million for the six months to Jun. 30, which included a AUD485 million writedown on its New Zealand assets. Revenue fell 6 percent to AUD477 million, and earnings before interest, taxation, depreciation and amortization (EBITDA) slid 12 percent to AUD74.9 million. Debt remains a concern. Sell.

David Jones Ltd (ASX: DJS, ADR: DJNSY) reported that fiscal 2012 sales declined 4.6 percent, as like-for-like sales were off 4.3 percent. The company will report full fiscal-year results on Sept. 19. Management guidance is for a 35 percent to 40 percent decline in net profit after tax.

Fourth-quarter sales fell just 1.3 percent to AUD455.8 million, while second-half sales were off by 2.1 percent, better than first-half numbers.

DJs already slashed its interim dividend by 19 percent, and it appears another reduction may be in the offing as it continues to roll out a new sales strategy built around finally building out a world-class Internet presence. Hold.

Harvey Norman Holdings Ltd (ASX: HVN, OTC: None) declared a final dividend of AUD0.04 per share, down from AUD0.06 a year ago, as fiscal 2012 sales revenue slid 9.6 percent, earnings before interest and taxation (EBIT) declined 24.8 percent and net profit after tax (NPAT) fell 31.6 percent. Sell.

JB Hi-Fi Ltd (ASX: JBH, OTC: JBHIF) reduced its final dividend to AUD0.16 per share from AUD0.29 a year ago. Total dividends for fiscal 2012 were AUD0.65 per share, down from AUD0.77 for fiscal 2011.

Management noted during its fiscal 2012 earnings call that July margin trends have started to rebound. Though the environment for discretionary retail purchases isn’t great this company competes hard and is expanding its offerings to meet the new digital age. Buy under USD9.75.

Myer Holdings Ltd (ASX: MYR, OTC: MYGSF) cut its fiscal 2012 final distribution to AUD0.09 from AUD0.115 a year ago. The company posted a 1.3 percent decline in sales to AUD3.12 billion, though fourth-quarter comparable sales were up 3 percent and operating profit increased by 1.3 percent to AUD1.29 billion. Hold.

Navitas Ltd (ASX: NVT) reduced its fiscal 2012 final dividend to AUD0.101 from AUD0.12 in fiscal 2011. Total dividends for fiscal 2012 were AUD0.195 per share, down from AUD0.207 per share in fiscal 2011. The company continues to build its global education franchise, however, and will benefit from changes to Australia’s visa system. Buy under USD4.

Seven West Media Ltd (ASX: SWM, OTC: WANHF) cut its final dividend to AUD0.06 from AUD0.24 a year ago, though earnings before interest and taxation came in right at revised guidance at AUD473.4 million. Management forecast low single-digit advertising growth for fiscal 2013, suggesting this difficult period for media companies will continue. Hold.

Southern Cross Media Group Ltd (ASX: SXL, OTC: SOUTF) paid a AUD0.05 final dividend, which was actually up from the AUD0.03 it paid as a final dividend for fiscal 2011. It’s off a List it made its way onto with a fiscal 2012 interim distribution cut.

Fiscal 2012 revenue was up 39.5 percent to AUD687.3 million, while earnings before interest, taxation, depreciation and amortization (EBITDA) grew by 40.2 percent and net profit after tax (NPAT) surged 48.2 percent to AUD95 million. Buy under USD1.25.

Financials

QBE Insurance Ltd (ASX: QBE, OTC: QBEIF) reduced its 2012 interim distribution to AUD0.40 from the AUD0.62 it paid as an interim distribution in 2011. Operating results were actually solid, as net profit after tax (NPAT) was up 13 percent on lower claims. Insurance profit was up 26 percent, and management reiterated its “positive” full-year outlook for underlying insurance margin and profitability. Hold.

Industrials

Boral Ltd (ASX: BLD, OTC: BOALF) reduced its fiscal 2012 final dividend by 50 percent to AUD0.035 per share, though statutory net profit after tax (NPAT) was up 5.3 percent. Hold.

GWA Group Ltd (ASX: GWA, OTC: GWAXF, ADR: GWAXY) has adjusted its payout policy. The company now plans to pay 80 percent to 95 percent of net profit after tax (NPAT), up from 70 percent to 80 percent, but management has also removed the AUD0.18 per share “floor” that had underpinned the policy. Buy under USD2.

Leighton Holdings Ltd (ASX: LEI, OTC: LGTHF) slashed its interim distribution from AUD0.59 per share to AUD0.20 per share.

The company reported 2012 first-half statutory net profit after tax (NPAT) of AUD114.6 million, at the low end of its AUD100 million to AUD150 million guidance. Management, however, maintained full-year NPAT guidance of AUD400 million to AUD450 million, which is a reduction from previous guidance for 2012 NPAT of AUD600 million to AUD650 million. Sell.

Toll Holdings Ltd (ASX: TOL, OTC: THKUF) maintained its final distribution at AUD0.135 per share, despite chopping its guidance for fiscal 2012 underlying earnings before interest and taxation (EBIT) to AUD400 million to AUD420 million from a prior target of AUD450 million. Fiscal 2011 underlying EBIT was AUD436 million.

The company posted actual EBIT of AUD410.8 million, right in the middle of the revised forecast.

Australia’s largest trucking company and freight handler has a relatively strong balance sheet, and its operating performance remains sound. But external pressures in the form of a weakening Chinese economy and a still-recovering Japanese economy suggest an overabundance of caution is in order. Hold.

Oil & Gas

Caltex Australia Ltd (ASX: CTX, OTC: CTXAF) maintained its interim distribution at AUD0.17 per share and posted solid operating results for the first half of 2012. Management also forecast a continuation of strong refiner margins for the short term, though it also noted the longer-term view was murkier. Hold.

Utilities

DUET Group (ASX: DUE, OTC: DUETF) has negotiated the internalization of its management, a move that will lead to long-term cost savings and provides a lot more dividend certainty. Management also reiterated fiscal 2013 payout guidance of AUD0.165 per stapled security, which would constitute a 3.1 percent increase over fiscal 2012 and merits removal from the List. Buy under USD2.

Spark Infrastructure Group (ASX: SKI, OTC: SFDPF) boosted its interim distribution by 10.5 percent and confirmed its forecast for 3 percent to 5 percent annual growth through 2015. That’s enough to get it off the list. Buy under USD1.60.

The ADR List

We continue to track the How They Rate coverage universe and beyond for Australia-based companies that afford US investors the convenience of ADR investing, either on their initiative or via the effort of an interested financial institution.

Here again is our primer on Australian stocks, US OTC symbols and ADRs.

The great majority of the companies under How They Rate coverage have US symbols, many because they actively seek to raise capital here on their own accord. That means they comply, to varying degrees, with US Securities and Exchange Commission filing requirements for foreign companies and with US accounting principles. Others trade here because a sponsoring institution has effectively created a secondary market for the shares, without the underlying company’s active participation.

Shares traded on US OTC markets bearing a final “F” in their five-letter symbols are basically home-listed shares trading in a market created by and for US institutions. Individuals can buy and sell here, too. Prices basically reflect ASX prices and also reflect changes in the relationship between the US dollar and the Australian dollar. One “F” share represents one ASX-listed share. The dividend you receive in respect of an “F” share is the dividend paid in respect of the ASX-listed share, adjusted for currency effects.

An ADR is a certificate that represents stock of a foreign company. ADRs are listed on US stock exchanges or the OTC Bulletin Board or Pink Sheets. Those that trade OTC have five-letter symbols ending with the letter “Y.” All transactions, including dividend payments, are conducted in US dollars.

One ADR certificate may represent one or more shares of the foreign stock; it can also represent a fraction of a share. For example, one Telstra Corp Ltd (ASX: TLS, OTC: TTRAF, ADR: TLSYY) ADR, which trades under the symbol TLSYY, is worth five ordinary shares that trade on the Australian Securities Exchange under the symbol TLS. Australia & New Zealand Banking Group Ltd’s (ASX: ANZ, OTC: ANEWF, ADR: ANZBY) ADR, ANZBY, is worth one Australia-listed ANZ share.

Because many ADRs don’t have a one-to-one ratio between the depositary receipts and the shares of stock, financial ratios are often not included in stock listings. Data in Australian Edge Portfolio tables and How They Rate is derived based on Australian Securities Exchange symbols so is as complete as you’ll find anywhere.

Foreign companies themselves often “sponsor” the creation of their own ADRs. These are called “sponsored ADRs.” There are three levels of sponsorship.

A Level I sponsored ADR is created by a company because it wants to extend the market for its securities to the US. It does not, however, want to register with the Securities and Exchange Commission (SEC) or conform to generally accepted accounting principles (GAAP). Level I ADRs trade on the OTC Bulletin Board or Pink Sheets trading systems, usually but not exclusively by institutional investors. Australia & New Zealand Banking Group’s is a Level I ADR.

Level II and Level III sponsored ADRs must be registered with the SEC, and financial statements must be reconciled to generally accepted accounting principles. A Level II ADR requires partial compliance with GAAP, while a Level III ADR requires complete compliance. A Level III sponsorship is require if the ADR is a primary offering and is used to raise capital for the company. Only Level II and Level III sponsored ADRs can be listed on the New York Stock Exchange (NYSE), the American Stock Exchange or Nasdaq. Telstra Corp sponsors a Level III ADR in the US, meaning it’s actively seeking to raise capital here.

An unsponsored ADR is created by a US investment bank or brokerage that buys ordinary shares on the underlying company’s home market then deposits them in a local custodian bank. This depositary bank then issues shares that represent an interest in the stocks and handles most of the transactions with American investors, serving both as transfer agent and registrar for the ADR.

The shares of the foreign stock held in the custodian bank are called “American Depositary Shares,” although this term is sometimes used as a synonym for “American Depositary Receipts.” Unsponsored ADRs can’t be listed on the major American stock exchanges because they aren’t registered with the SEC and lack other necessary qualifications.

The price of an ADR is determined by supply and demand but will generally track the price of the underlying ordinary share. When dividends are paid, the custodian bank receives it and withholds any foreign taxes, exchanges it for US dollars and then sends it to the depositary bank, which then sends it to the investors.

The US depositary bank handles most of the interaction with US investors, including rights offerings, stock splits and stock dividends. Sponsored ADR investors may receive communications, including financial statements, directly from the company.

Here is a list of companies in the How They Rate coverage universe that have an ADR listing in the US, along with the number of ordinary ASX-listed shares the ADR represents.

Basic Materials          

• Alumina Ltd (ASX: AWC, NYSE: AWC)–One ADR is worth four ordinary shares.
• Aquarius Platinum Ltd (ASX: AQP, OTC: AQPBF, ADR: AQPTY)–One ADR is worth two ordinary shares.
• Arrium Ltd (ASX: ARI, OTC: OSTLF, ADR: OSTLY)–One ADR is worth 20 ordinary shares.
• BHP Billiton Ltd (ASX: BHP, NYSE: BHP)–One NYSE-listed ADR is worth two ordinary shares.
• BlueScope Steel Ltd (ASX: BSL, OTC: BLSFF, ADR: BLSFY)–One ADR is worth five ordinary shares.
• Fortescue Metals Group Ltd (ASX: FMG, OTC: FSUMF, ADR: FSUMY)–One ADR is worth five ordinary shares.
• Iluka Resources Ltd (ASX: ILU, OTC: ILKAF, ADR: ILKAY)–One ADR is worth five ordinary shares.
• Kingsgate Consolidated Ltd (ASX: KCN, OTC: KSKGF, ADR: KSKGY)–One ADR is worth one ordinary share.
• Newcrest Mining Ltd (ASX: NCM, OTC: NCMGF, ADR: NCMGY)–One ADR is worth one ordinary share.
• Oz Minerals Ltd (ASX: OZL, OTC: OZMLF, ADR: OZMLY)–One ADR is worth 0.5 ordinary shares.
• Rio Tinto Ltd (ASX: RIO, NYSE: RIO)–One ADR is worth one ordinary share.

Consumer Goods

• Billabong International Ltd (ASX: BBG, OTC: BLLAF, ADR: BLLAY)–One ADR is worth two ordinary shares.
• Goodman Fielder Ltd (ASX: GFF, OTC: GDFLF, ADR: GDFLY)–One ADR is worth 10 ordinary shares.

Consumer Services

• Crown Ltd (ASX: CWN, OTC: CWLDF, ADR: CWLDY)–One ADR is worth two ordinary shares.
• David Jones Ltd (ASX: DJS, ADR: DJNSY)–One ADR is worth one ordinary share.
• Metcash Ltd (ASX: MTS, OTC: MCSHF, ADR: MHTLY)–One ADR is worth six ordinary shares.
• TABCORP Holdings Ltd (ASX: TAH, OTC: TABCF, ADR: TACBY)–One ADR is worth two ordinary shares.
• Wesfarmers Ltd (ASX: WES, OTC: WFAFF, ADR: WFAFY)–One ADR is worth 0.5 ordinary share.

Financials

• Australia & New Zealand Banking Group Ltd (ASX: ANZ, OTC: ANEWF, ADR: ANZBY)–One ADR is worth one ordinary share.
• Commonwealth Bank of Australia Ltd (ASX: CBA, OTC: CBAUF, ADR: CMWAY)–One ADR is worth one ordinary share.
• National Australia Bank Ltd (ASX: NAB, OTC: NAUBF, ADR: NABZY)–One ADR is worth one ordinary share.
• QBE Insurance Ltd (ASX: QBE, OTC: QBEIF, ADR: QBIEY)–One ADR is worth one ordinary share.
• Westfield Group Ltd (ASX: WDC, OTC: WEFIF, ADR: WFGPY)–One ADR is worth two ordinary shares.
• Westpac Banking Corp Ltd (ASX: WBC, NYSE: WBK)–One ADR is worth five ordinary shares.

Health Care

• Cochlear Ltd (ASX: COH, OTC: CHEOF, ADR: CHEOY)–One ADR is worth 0.5 ordinary share.
• CSL Ltd (ASX: CSL, OTC: CMXHF, ADR: CMXHY)–One ADR is worth 0.5 ordinary share.
• Sonic Healthcare Ltd (ASX: SHL, OTC: SKHCF, ADR: SKHCY)–One ADR is worth one ordinary share.

Industrials

• Amcor Ltd (ASX: AMC, OTC: AMCRF, ADR: AMCRY)–One ADR is worth four ordinary shares.
• Boral Ltd (ASX: BLD, OTC: BOALF, ADR: BOALY)–One ADR is worth four ordinary shares.
• GWA Group Ltd (ASX: GWA, OTC: GWAXF, ADR: GWAXY)–One ADR is worth four ordinary shares.
• Toll Holdings Ltd (ASX: TOL, OTC: THKUF, ADR: THKUY)–One ADR is worth two ordinary shares.

Oil & Gas

• Beach Energy Ltd (ASX: BPT, OTC: BEPTF, ADR: BCHEY)–One ADR is worth 20 ordinary shares.
• Boart Longyear Ltd (ASX: BLY, OTC: BOARF, ADR: BLGPY)–One ADR is worth two ordinary shares.
• Caltex Australia Ltd (ASX: CTX, OTC: CTXAF, ADR: CTXAY)–One ADR is worth two ordinary shares.
• Oil Search Ltd (ASX: OSH, OTC: OISHF, ADR: OISHY)–One ADR is worth 10 ordinary shares.
• Santos Ltd (ASX: STO, OTC: STOSF, ADR: SSLTY)–One ADR is worth one ordinary share.
• Woodside Petroleum Ltd (ASX: WPL, OTC: WOPEF, ADR: WOPEY)–One ADR is worth one ordinary share.
• WorleyParsons Ltd (ASX: WOR, OTC: WYGPF, ADR: WYGPY)–One ADR represents one ordinary share.

Technology

• Redflex Holdings Ltd (ASX: RDF, OTC: RFLXF, ADR: RFLXY)–One ADR is worth eight ordinary shares.

Telecommunications  

• Singapore Telecommunications Ltd (Singapore: ST, ASX: SGT, OTC: SNGNF, ADR: SGAPY)–One ADR is worth 10 ordinary shares.
• Telecom Corp of New Zealand Ltd (ASX: TEL, NYSE: NZT)–One ADR is worth five ordinary shares.
• Telstra Corp Ltd (ASX: TLS, OTC: TTRAF, ADR: TLSYY)–One ADR is worth five ordinary shares.

Utilities

• AGL Energy Ltd (ASX: AGK, OTC: AGLNF, ADR: AGLNY)–One ADR is worth one ordinary share.
• Origin Energy Ltd (ASX: ORG, OTC: OGFGF, ADR: OGFGY)–One ADR is worth one ordinary share.