5G NETWORKS LIMITED. - AGM Information 2012

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Annual General Meeting
Melbourne, Australia
22 May 2012
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Board of Directors

Simon Jones, Chairman

Theo Hnarakis, CEO & MD
 Tom Kiing, Non‐Executive Director

Prof Iain Morrison, Non‐Executive Director

Naseema Sparks, Non‐Executive Director

Rob Stewart, Non‐Executive Director

Andrew Walsh, Non‐Executive Director
Slide 2
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Auditors
Slide 3
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Agenda
 Chairman’s Address
 CEO’s Address
 Q&A
 Formal Business
 Q&A
 Tea & Coffee
Slide 4
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Chairman’s Address

Simon Jones

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2011 Overview011 Overview11 OverviewOverviewverviewerviewrvieweww

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2011 Overview011 Overview11 OverviewOverviewverviewerviewrvieweww
Year ended 31 December (A$) FY 11 FY 10  %
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ide 6
Revenue
$189.9m
Operating Cash
‐5%
$22.9m
‐4%
$18.7m
Final Dividend
8.0¢
(Fullyfranked)
Deferred Gross Margin
$31.6m
‐8%
NPAT
$16.1m
‐16%
Basic EPS
20.21¢
‐17%
$179.8m
$21.9m
$19.1m
8.0¢
$29.1m
$13.5m
16.77¢
Unchanged
2%
EBIT(Pre‐Transformation costs)
EBIT
$21.2m
‐11%
$18.9m
NB Figures may not total exactly due to rounding
_Non‐IFRS, unaudited accounting measure_
EBITDA
$28.6m
‐13%
$25.0m

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Constant Currency Performance – 2011 Revenue
$120 FY 10 Revenue $189.9m
FY 11 Revenue (-5%) $179.8m
FY 11 Revenue restated at 2010 FX (-1%) * $187.6m
$100 $93.0m
‐6%
2011 FX Adjusted
Actual
$80
$58.7m
$60 +15%
$98.6m
$89.4m
$40 ‐9%
$55.3m
$51.1m 8%
$20
$31.6m $26.8m‐15% $8.7m+10%
$‐ $7.9m $7.8m‐2%
2010 2011 2010 2011 2010 2011 2010 2011
SMB / GPS DBS ES FTR
Non‐IFRS, unaudited accounting measure
Slide 7
Millions
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Full Year Overview

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Deferred revenue down 10% Y‐o‐Y to $47.1m primarily due to decline in SMB/GPS domain and shared hosting pricing, and FX impact
On constant currency basis using 2010 FX rates, FY11 deferred revenue down 8% to $48.6m
Net debt remains low at $21.2m  $5.9m debt retired in 2011; effective interest rate 3.16%
Transformation project entering final year of implementation – substantial benefits expected to flow once fully implemented
IT services revenue continues to grow – services & consulting represented 63% of revenue in FY11 compared to 61% in FY10
Strong second half performance  H2 2011 EBIT of $11.9m up 70% from H1 2011 EBIT of $7.0m
Board confidence in future earnings, declare final dividend at 8¢ – unchanged from FY 2010
Slide 8

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Melbourne IT – Total Shareholder Return Performanceelbourne IT – Total Shareholder Return Performancelbourne IT – Total Shareholder Return Performancebourne IT – Total Shareholder Return Performancerne IT – Total Shareholder Return Performancee IT – Total Shareholder Return Performance IT – Total Shareholder Return Performanceotal Shareholder Return Performancel Shareholder Return PerformanceShareholder Return Performancehareholder Return Performanceareholder Return Performancereholder Return Performanceeholder Return Performanceholder Return Performanceolder Return Performancelder Return Performanceder Return Performancer Return Performanceeturn Performancern Performanceerformancerformanceormancermanceancencece

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Melbourne IT – Total Shareholder Return Performanceelbourne IT – Total Shareholder Return Performancelbourne IT – Total Shareholder Return Performancebourne IT – Total Shareholder Return Performancerne IT – Total Shareholder Return Performancee IT – Total Shareholder Return Performance IT – Total Shareholder Return Performanceotal Shareholder Return Performancel Shareholder Return PerformanceShareholder Return Performancehareholder Return Performanceareholder Return Performancereholder Return Performanceeholder Return Performanceholder Return Performanceolder Return Performancelder Return Performanceder Return Performancer Return Performanceeturn Performancern Performanceerformancerformanceormancermanceancencece
200%
150%
100%
75 [th] Percentile
50%
0%
‐50%
75 [th] Percentile
Period: Jan 2010 - Dec 2011
‐100%
Slide 9
RIVERCITY MOTORWAY GROUP HASTIE GROUP PHOTON GROUP PAPERLINX GUNNS ELDERS GEODYNAMICS INFIGEN ENERGY COFFEY INTERNATIONAL AJ LUCAS GROUP ALESCO CSG BIOTA HOLDINGS WDS APN NEWS & MEDIA SPECIALTY FASHION GROUP CUSTOMERS SILEX SYSTEMS PHARMAXIS OAKTON AUSTRALIAN PHARM.INDS. CERAMIC FUEL CELLS VIRGIN AUSTRALIA HDG. PACIFIC BRANDS AUSENCO WOTIF COM HOLDINGS TEN NETWORK HOLDINGS UXC MCPHERSON'S PROGRAMMED MAINT.SVS. HILLS HOLDINGS PMP FKP PROPERTY GROUP SALMAT PREMIER INVESTMENT SOUTHERN CROSS MEDIA GP. TRANSPACIFIC INDS.GP. PLATINUM ASSET MAN. HENDERSON GROUP CDI. CHALLENGER INFR.FUND GWA GROUP IMF (AUSTRALIA) CLOUGH INDUSTREA THE REJECT SHOP SERVCORP WATPAC SUNLAND GROUP SIGMA PHARMS. RESMED CDI. CABCHARGE AUSTRALIA AUSTAR UNITED COMMS. TPG TELECOM TASSAL GROUP SKILLED GROUP TOX FREE SOLUTIONS IRESS MARKET TECH. SMS MAN.& TECH. KATHMANDU HOLDINGS (ASX) AUSTRALIAN AGRICULTURAL SPOTLESS GROUP GUD HOLDINGS CASH CONVERTERS INTL. NAVITAS FLIGHT CENTRE IOOF HOLDINGS MACMAHON HOLDINGS CONSOLIDATED MEDIA HDG. CARSALES.COM AUSTAL VITERRA CDI. MERMAID MARINE AUS. MELBOURNE IT AUSTRALAND PR.GP. SINGAPORE TELECOM CDI. (ASX) PRIMEAG AUSTRALIA SUPER RETAIL GROUP BRADKEN ADELAIDE BRIGHTON SAI GLOBAL AUSTRALIAN INFR.FUND SP AUSNET STW COMMUNICATIONS GROUP FLEXIGROUP INVOCARE EMECO HOLDINGS NRW HOLDINGS GRAINCORP MONADELPHOUS GROUP ACRUX MINERAL RESOURCES ENVESTRA FLEETWOOD ENERGY WORLD RAMSAY HEALTH CARE HASTINGS DIVR.UTILS.FUND RHG
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2011 Divisional Performance

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Digital Brand Services (DBS)

Number 1 global digital brand manager

	FY 11	FY 10	Change
Revenue	$55.3m	$51.1m	8%
EBIT Contribution	$9.0m	$6.4m	41%

Strong second half performance boosted full year result despite strong AUD headwind
H2 2011 revenue $30.5m up 23% on H1 2011 revenue of $24.8m

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H2 2011 EBIT $6.2m up 121% on H1 2011 EBIT of $2.8m
First half investment in .brand TLD leadership pays off in H2
FY11 revenue grew 15% Y‐o‐Y on constant currency basis using 2010 exchange rates
New .brand opportunity expected to deliver further significant revenue growth in 2012 and beyond
Global brands engaging with DBS for more than 120
Slide 11 new TLD applications

► 3,800+ customers ► 99.9% client retention

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Digital Brand Services (DBS)

Number 1 global digital brand manager

	FY 11	FY 10	Change
Revenue	$55.3m	$51.1m	8%
EBIT Contribution	$9.0m	$6.4m	41%

Brand & Reputation Protection Services revenue up 16% Y‐o‐Y to $9.5m from $8.2m*
Web Traffic Services revenue up 74% Y‐o‐Y to $1.6m from $919k

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► 3,800+ customers
► 99.9% client retention
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Digital brands under management rose 6% to 620k from 583k Y‐o‐Y
268 new customers added in 2011 including Dow Corning, StarHub, Virgin Enterprises Limited, George Weston Foods

Slide 12 *FY10 BPRS revenues restated (previously reported gross sales in error)

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Enterprise Services

	FY 11	FY 10	Change
Revenue	$26.8m	$31.6m	‐15%
EBIT Contribution	$1.7m	$3.5m	‐51%

Absence of larger project contracts in 2011 contributed to revenue shortfall
One off project revenue down 74% Y‐o‐Y to $1.6m from $6.2m
Refocused effort on annuity revenue delivered stronger second half
H2 2011 EBIT of $1.3m up 325% from H1 2011 EBIT of $0.4m
New monthly recurring revenue wins grew 15% Y‐o‐Y from $441,000 to $507,000
H1 hosting churn arrested – down 69% in H2 to $15k per month and now at historically low levels
Division benefitting from significant leadership, sales and account management re‐organisation
Significant opportunities emerging as traditional businesses begin seriously investing in online strategies
ISO 9001 certification achieved
182 contracts signed in 2011 with new customers including CUA, Essential Services Commission (Victoria)
Slide 13

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► 3 enterprise-class data centres ► 99.979% platform stability

SMB / GPS

SMB/ GPS	SMB/ GPS
Australia’s #1 SMB hosting		company and the	world’s #1 domain reseller provider
		FY 11	FY 10 Change
	Revenue	$89.4m	$98.6m ‐9%
	EBIT Contribution	$15.4m	$17.7m ‐13%
	SMB FY2011 EBIT	down 12% to	$8.3m Y‐o‐Y from $9.4m

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GPS FY2011 EBIT down 14% to $7.1m Y‐o‐Y from $8.3m

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SMB/GPS revenue impacted by strong Australian Dollar
FY2011 revenue down 6% to $93m on constant currency performance using 2010 rates

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Domain registration revenue down 13% to $54.0m from $61.8m
Partner domain names under management down 12% to 3.6m from 4.1m following slowdown in major reseller activity

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Slide 14
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► 400,000+ customers
► 6,900+ resellers
► 45+ countries
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SMB / GPS

SMB/ GPS	SMB/ GPS	SMB/ GPS
Australia’s #1 SMB hosting company and the world’s #1 domain reseller provider
	FY 11 FY 10	Change
	Revenue $89.4m $98.6m	‐9%
	EBIT Contribution $15.4m $17.7m	‐13%
	SMB ARPU remained steady Y‐o‐Y at $301 despite commoditisation
	of domains and base hosting – offset by growth in higher‐margin
	SMB online marketing services
	 Search Engine Marketing (SEM) sales up 9% Y‐o‐Y to $2.1m
	 SEM, SaaS and premium email sales up 2% Y‐o‐Y to $7.7m
	SMB hosting revenue rebounded in second half
	 H2 2011 $4.7m up 7% on H1 2011 $4.4m

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Expanding in emerging markets with new partners signed in Philippines and India
Successful H2 pilot of outsourced Level 1 SMB support to Manila ► 400,000+ customers helped improve service and reduce support overhead  By end H1 2012, 35 FTE will be based offshore to cover Level 1 Support ► 6,900+ resellers
Slide 15 ► 45+ countries

ForTheRecord (FTR)

Number 1 courtroom digital recording company

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FY 11 FY 10 Change
Revenue $7.8m $7.9m ‐1% EBIT Contribution $1.2m $0m N/A  EBIT contribution returned to 2009 levels following difficult 2010  Improved margin due to higher software sales mix in 2011
On constant currency basis using 2010 rates, revenues up 10% Y‐o‐Y to $8.7m
Investments in reseller network boosted revenue in 2011  Large contracts signed with U.S. government agencies and international customers
Continued international expansion with Slovenia’s Ministry of Justice rolling out FTR across 352 court rooms

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US public sector spending continues to be restrained

Slide 16

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► 22,500+ installed solutions
► 200+ global resellers
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Final Year of Transformation Rollout

2011 Progress

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New Oracle financial system implemented into all global locations
Pilot of billing and CRM solution live in NZ for 160+ products – fully integrated with Oracle financial system

2012 Deliverables

New Partner Portal allowing resellers to sell new products, automated provisioning, and improved ease of use
Complete billing and CRM rollout into SMB with all products
2012 transformation opex budget $3.9m

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Slide 17
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In appreciation

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Thanks to my Board colleagues for their valuable advice and support
Thanks to all the staff of Melbourne IT for their efforts
Thanks to CEO and Managing Director, Theo Hnarakis, and the Melbourne IT executive team
Thanks to our shareholders for your continued support of Melbourne IT

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Slide 18
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CEO’s Address
Theo Hnarakis
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An Online World of Change…
World Population reached 7 Around 50% is under 30 years
billion in March 2012 old
3 Billion will be Internet users 1 trillion devices connected to
by 2016 the Internet by 2015
Slide 20 Sources: Boston Consulting Group, The Digital Manifesto, Jan 2012
US Census Bureau, World Population, 2012
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Daily Online Growth…
140 million users
340 million tweets sent per day
901 million users and
growing...
605,479 new Facebook
accounts per day
300 million photos
uploaded per day
More video is uploaded to YouTube
every month than the 3 major US TV
networks created in 60 years Sources: Twitter, Twitter Blog, March 2012
YouTube, Statistics, April 2012
Slide 21 Facebook, S‐1 Filing, April2012
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And spending online…
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Australia’s online shopping market
$13.6 billion in 2011; $6 billion was
spent on overseas sites
Australia’s online shopping worth
$21.7bn by 2015: 12.6% CAGR
61% US consumers shop online at
least once a month
74% likely to go online to get a
better deal on a product seen in a
store
Slide 22 Sources: PwC, Digital Media Research, June 2011
Melbourne IT DBS, Entering a new Domain, Oct 2011
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Globally in the next 60 seconds…

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416 attempts will be made to hack websites 12 websites will be hacked 210 pieces of new malware will be released 232 computers infected with malware

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Slide 23 Sources: Trend Micro, Security SpotlightGo‐Gulf, Blog, Dec 2010, Dec 2011

New TLDs are coming…

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2,305
1,268 applicants
applications
.category: .music .shop
.bank .rugby
.place: .nyc .berlin
.london .melbourne
.brand: .afl .google
.canon .deloitte
Slide 24
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Melbourne IT makes online interactions successful
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Manages 4.6 million Shut down 9,800+ phishing
domains sites each year
Brings game stats to thousands
Serves 400,000+ customers
of online rugby league fans
Protects 500,000 school kids Helped 200,000+ small
from inappropriate content businesses build a website
Manages online brands for Recover 200+ digital brands per
3,800+ customers year from cybersquatters
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Melbourne IT’s Opportunity Pillars

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Online Brand
Brand & Information
From Bricks to Clicks Management &
Protection
Optimisation
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From Bricks to Clicks: Small Business Online

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SMBs continue to embrace the
Internet to reach more customers,
drive increased revenue and
compete with larger businesses
Melbourne IT delivers:
 One‐stop‐shop to help SMBs establish their website
– domain name, hosting and web design
 SMB e‐commerce platform
 Online marketing – email and web (SEO/PPC)
 Social media accelerator
 SMB solutions to partners worldwide
Slide 27
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From Bricks to Clicks: Small Business Online
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SMBs continue to embrace the
Internet to reach more customers,
drive increased revenue and
compete with larger businesses
In future we will deliver:
Melbourne IT delivers:
 Enhanced mobile development services to help
 One‐stop‐shop to help SMBs establish their website
customers fully exploit mobile browsing
– domain name, hosting and web design
 Expanded SMB social media services
 SMB e‐commerce platform
 Integrated SMB product bundles targeted across
 Online marketing – email and web (SEO/PPC)
entire customer base
 Social media accelerator
 Enhanced customer experience & product
 SMB solutions to partners worldwide
integration – one customer view
Slide 28
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From Bricks to Clicks: Enterprise Rush to Online
Major Australian businesses are
playing catch up in establishing their
online commerce presence to protect
and grow revenue
Melbourne IT delivers:
 High‐performance, mission critical hosting
 Agile platforms which can scale to meet marketing
demands
 Stable, predictable user experience in an unpredictable
online world
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From Bricks to Clicks: Enterprise Rush to Online
Major Australian businesses are
playing catch up in establishing their
online commerce presence to protect
and grow revenue
In future we will deliver:
Melbourne IT delivers:
 Complete end‐to‐end ecommerce platform management
 High‐performance, mission critical hosting
–
infrastructure + application
 Agile platforms which can scale to meet marketing
 Advanced performance testing to allow customers to
demands
design their platforms to meet the next generation of
 Stable, predictable user experience in an unpredictable
online initiatives
online world
 Ecommerce platform analytics to better inform customer
marketing and marketing innovation
Slide 30
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From Bricks to Clicks: Connected Generation
Education continues to embrace
online tools enhance the learning
experience and satisfy the demands
of the ‘Connected Generation’
Melbourne IT delivers: In future we will deliver:
 Secure, content‐filtered access to meet stringent
 education guidelines Analytics services to help educators assess online
 Scalable digital platforms to cater for very large student content demands and improve learning
user bases experience
  Ag Buil e platforms which can handle the most ding virtual classrooms regardless of
d geographic manding new online services location – linked to NBN
Slide 32
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Bricks to Clicks: Woolworths
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“We have ambitious plans to hit the $1 billion mark in online
sales in 2014. Giving customers multiple options isn't a threat
‐
it's a huge opportunity, probably the biggest opportunity in
retail for 100 years.”
Woolworths CEO
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Online Brand Management: Digital Optimisation
Companies need to manage online
brand portfolios and sharpen online
insights to guide digital strategy
Melbourne IT delivers:
 Domain strategy consulting and portfolio
optimisation services
 Digital optimisation services to help brands
understand their web audience and improve
online interactions to increase revenues
Slide 34
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Online Brand Management: Digital Optimisation
Companies need to manage online
brand portfolios and sharpen online
insights to guide digital strategy
In future we will deliver:
Melbourne IT delivers:
  Domain strategy consulting and portfolio New optimisation analytics engine to further
optimisation services
enhance online revenue capture
  Digital optimisation services to help brands Scaling best‐practice digital optimisation
understand their web audience and improve
consultancy services to benefit US & APAC
online interactions to increase revenues
customers
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Online Brand Management: New Top Level Domains (TLDs)
New TLDs represent the biggest
change to the internet in 27 years –
posing both brand opportunities and
risks
Melbourne IT delivers:
 New TLD application services
 New TLD risk review and objection services
 New TLD registration strategy and domain policy
consulting
Slide 36
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Online Brand Management: New Top Level Domains (TLDs)
New TLDs represent the biggest
change to the internet in 27 years –
posing both brand opportunities and
risks
In future we will deliver:
Melbourne IT delivers:  Policy management to ensure customers avoid
 New TLD application services intellectual property disputes
  New TLD risk review and objection services Registry services to support second level .brand
 New TLD registration strategy and domain policy names
 consulting Defensive registrations to protect core brands
across new TLD environment
Slide 37
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Online Brand Management: AFL
“We think ‘dot AFL' could be a key asset to support our major
strategies around national expansion, fan development,
strengthening the AFL clubs, supporting community
participation and growing our presence in digital media.
Ultimately, ‘dot AFL' will make it easier for our audience to
access trusted online content that is endorsed by the AFL
brand.”
AFL GM Strategy & Marketing
Slide 38
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Brand & Information Protection: Fraud Prevention
Protecting the integrity and value of
digital brands is of vital importance
to all organisations operating online
Melbourne IT delivers: In future we will deliver:
 Rapid phishing detection and takedown services
 Domain name recovery to frustrate Expanded monitoring to identify malicious
cybersquatters, fraudsters and counterfeiters activity in social media, video and new
 Powerful detection tools to identify and pinpoint geographic regions
 brand misuse Mobile MalApp detection, analysis and takedown
 Defensive registrations in new TLDs
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Brand & Information Protection: Staying Online

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Website uptime is critical in the
online economy. Companies need to
remain online 24/7 in a hostile
environment
Melbourne IT delivers:
 Services to mitigate malicious website attacks
including Distributed Denial of Service and
malware
 Business continuity services to maintain uptime
during times of crisis
 DNS Assurance and SSL certificates
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Brand & Information Protection: Staying Online

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Website uptime is critical in the
online economy. Companies need to
remain online 24/7 in a hostile
environment
In future we will deliver:
Melbourne IT delivers:
 Services to mitigate malicious website attacks
 Continued enhancements to security portfolio to
including Distributed Denial of Service and
protect customers’ online investment
malware
 ISO 27001 to ratify existing security management
 Business continuity services to maintain uptime
processes
during times of crisis
 Complete defence‐in‐depth security as we manage
 DNS Assurance and SSL certificates
the entire ecommerce platform end‐to‐end
Slide 42
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Brand & Information Protection: Managing Information
Judicial & law enforcement sector
under increasing pressure to improve
efficiency while maintaining
information integrity
Melbourne IT delivers:
 Complete end‐to‐end recording solutions to
digitally capture and manage audio & video
proceedings in courtrooms and law enforcement
agencies
 State of the art touch screen recording hardware
 Best practice courts consultancy services
Slide 43
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Brand & Information Protection: Managing Information
Judicial & law enforcement sector
under increasing pressure to improve
efficiency while maintaining
information integrity
Melbourne IT delivers: In future we will deliver:
 Complete end‐to‐end recording solutions to
 digitally capture and manage audio & video FTR Notes – information record management
proceedings in courtrooms and law enforcement application for mobile / iPad
 agencies Expanded consultancy services
 State of the art touch screen recording hardware
 Best practice courts consultancy services
Slide 44
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Brand & Information Protection: Swedbank
“Swedbank recently started collaborating with
Melbourne IT in order to be able to act faster and
more effectively against phishing attempts. The
most recent phishing website was shut down only
two hours after it had been detected.”
Swedbank Executive
Slide 45
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Brand & Information Protection: DETE
“Melbourne IT is playing a vital partnership role
with the Department of Education and Training to
allow us to continue delivering online services to all
state schools throughout Queensland to enhance
the learning experience for students.”
DET Assistant Director‐General and CIO
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Melbourne IT’s Opportunity Pillars
Online Brand
Brand & Information
From Bricks to Clicks Management &
Protection
Optimisation
Providing trusted services to our customers in an
online world
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Digital Brands Are About to Change Forever
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Online will be the primary route to
Explosion in mobile web browsing
market
New digital brand business models
2,000+ new Top Level Domains
emerging
Faster networks creating new web
Digital brand threats continuing to rise
experiences
Expansion into non‐English speaking Brands need to adapt to online… or go
markets out of business
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Digital Brands Are About to Change Forever

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Melbourne IT will benefit
from these trends by
helping customers adapt to
the digital economy
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Risks
European Economic
Aussie Dollar Strength
Problems
US Economy still slow Major Partner slowdown
Commoditisation pressures Increasing competition
Further ICANN new TLD Slower Transformation
delays benefit realisation
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Preparing to Take Full Advantage
Final year of Melbourne IT’s
Transformation Program…
However our business will continue to
evolve
Improve Improve
Improve Improve Increase
Product Dev. Skills &
Processes Structures Marketing
& Mgmt. Abilities
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2012 Full Year Outlook Update H1 2012 Update

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Significant improvement in DBS performance year‐on‐year and continued progress by ES
Estimated negative foreign exchange EBIT impact for H1 of $1 million year‐on‐year
SMB performance slowed by website disruptions due to external issues  GPS performance impacted by major reseller slowdown  We expect our H1 EBIT 2012 to be in line with H1 EBIT 2011
On a full year basis, we expect:  DBS performance to continue to improve with further new TLD consulting and brand protection opportunities
ES performance continue to strengthen due to sales growth  Transformation project benefits accruing to all divisions particularly SMB/GPS albeit slightly later than expected
H2 2012 performance will be an improvement on H2 2011 result Melbourne IT expects to meet full year guidance with 2012 EBIT up 10% on 2011 full year EBIT result
Slide 52

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Q&A

Any Questions?
Slide 53
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Business of the Meeting

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Item 1: Financial Statements & Report

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To receive and consider the Annual Financial Report and the Reports of the Directors and Auditor for the financial year ended 31 December 2011

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Slide 55
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Item 2: Election of Directors

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a) Mr Tom Kiing retires by rotation in accordance with rule 9.3 of the Company’s Constitution and, being eligible, offers himself for re‐election
b) Mr Rob Stewart retires by rotation in accordance with rule 9.3 of the Company’s Constitution and, being eligible, offers himself for re‐election
c) Ms Naseema Sparks was appointed by the Board as a Director of the Company in accordance with rule 9.9 of the Company’s Constitution to hold office until the next shareholder meeting. Ms Naseema Sparks, being eligible, now offers herself for election

Slide 56

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Item 3: Adoption of Remuneration Report

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To adopt the Remuneration Report for the year ended 31 December 2011

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Slide 57
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Remuneration Report

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Philosophy
Company performance depends on the quality of its Directors, Executives and Staff
– The company must therefore attract, motivate and retain highly skilled people
The Human Resources, Remuneration and Nomination Committee (HRRNC) is responsible for determining and reviewing remuneration for Directors, Executives and Staff
Structure
The company’s remuneration policy complies with the AICD guidelines for listed company executive remuneration
– In accordance with best practice corporate governance, the structure of Non‐ Executive Director and Executive remuneration is separate and distinct

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Slide 58
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Remuneration for Executives and Key Senior Employees

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The objective is to reward executives and senior managers with a level and mix of remuneration commensurate with their position and responsibilities to:
Provide competitive rewards to attract high calibre executives
Link rewards to shareholder value
Have a significant portion of remuneration “at risk”, dependent upon meeting pre‐determined financial and operational performance benchmarks (KPIs)
Establish appropriate, demanding performance hurdles for variable remuneration

Slide 59

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Remuneration for Executives and Key Senior Employees

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Remuneration consists of two key elements:

Fixed remuneration (salary)
Variable remuneration
Short‐Term Incentive (STI) – based on performance against company, business unit and personal performance KPIs
Long‐Term Incentive (LTI) – select group of key employees granted performance rights to acquire shares in the company, with an Earnings Per Share and a Total Shareholder Return vesting hurdle

Slide 60

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General Staff Remuneration

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Remuneration consists of two key elements:

Fixed remuneration (salary)
Variable remuneration for selected employees
Short‐Term Incentive (STI) – based on performance against company, business unit and personal performance KPIs

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Slide 61
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Non‐Executive Director Remuneration

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Objective
The board seeks to set aggregate remuneration at an appropriate level to attract & retain Directors of the highest calibre at an acceptable cost
Structure
Each NED receives a fixed fee and sits on at least one Board committee
- Audit & Risk Management Committee or
- Human Resources Remuneration & Nomination Committee
An additional fee is paid for chairing a Board committee, in recognition of the additional time commitment and responsibility required
NEDs are encouraged to hold shares in the Company (purchased by them on market). One of the NEDs is a substantial shareholder in the company – Tom Kiing
NED fees are generally reviewed every two years (last review was 1 Jan 2011)

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Non‐Executive Director Remuneration

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NED Deferred Share Plan was suspended at end of 2009 due to government legislation changes on the taxation of share plans
NED received a 2.5% base fee increase in 2011; no increase in 2012
For 2012, the NED base fee is $76,875 with an additional $10,000 for Board Committee Chairs
The Board Chairman’s fee is set at 2.3 x NED base fee

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Slide 63
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Item 3: Adoption of Remuneration Report

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Questions?
Resolution: To adopt the Remuneration Report for the year ended 31 December 2011

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Item 4(a) & 4(b): Approval of Potential Termination Benefits

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To approve, for the purpose of Part 2D.2 Division 2 of the Corporations Act, the giving of potential benefits to any present or future members of the Executive Team or the Managing Director & CEO, in connection with such person ceasing to hold a managerial or executive office or position of employment in the Company or a related body corporate

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Items 4(a) and 4(b) – In Summary

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Approval of these resolutions allow the company to meet contractual obligations to the Executive Team or Managing Director & CEO under certain circumstances when employment terminated
The Corporations Amendment (Improving Accountability on Termination Payments) Act 2009 introduced significant changes to the Corporations Act with effect from 24 November 2009. Under Part 2D.2 Division 2 of the Corporations Act, the Company, is prohibited from giving a person who holds a “managerial or executive office” a benefit in connection with their ceasing to hold an office or position of employment with the Group unless shareholders approve the giving of the benefit or an exemption applies.

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Items 4(a) and 4(b) – In Summary

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Shareholders are not being asked to approve any increase in the remuneration or benefits for the Executive Team or Managing Director & CEO, nor any variations to the existing discretions of the Board.
No change to the underlying employment arrangements or individual entitlements is being proposed.

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Item 4(a): Approval of Potential Termination Benefits to Executive Team

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To approve, for the purpose of Part 2D.2 Division 2 of the Corporations Act, the giving of potential benefits to any present or future members of the Executive Team, in connection with such person ceasing to hold a managerial or executive office or position of employment in the Company or a related body corporate

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Slide 68
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Item 4(b): Approval of Potential Termination Benefits to Managing Director & CEO

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To approve, for the purpose of Part 2D.2 Division 2 of the Corporations Act, the giving of potential benefits to the Managing Director & CEO, Mr Theo Hnarakis, in connection with him ceasing to hold a managerial or executive office or position of employment in the Company or a related body corporate

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Slide 69
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Questions

Any final questions?
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35

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Annual General Meeting Melbourne, Australia 22 May 2012

36

AI assistant

5G NETWORKS LIMITED. AGM Information 2012

64261_rns_2012-05-21_778c8ad5-8ef5-4912-835b-96272efd133e.pdf

Chairman’s Address

Full Year Overview

2011 Divisional Performance

Digital Brand Services (DBS)

Digital Brand Services (DBS)

Enterprise Services

SMB / GPS

SMB / GPS

ForTheRecord (FTR)

Final Year of Transformation Rollout

In appreciation

From Bricks to Clicks: Small Business Online

Brand & Information Protection: Staying Online

Brand & Information Protection: Staying Online

Digital Brands Are About to Change Forever

Item 2: Election of Directors

Remuneration Report

General Staff Remuneration

Remuneration consists of two key elements:

Non‐Executive Director Remuneration

Items 4(a) and 4(b) – In Summary

AI assistant

5G NETWORKS LIMITED. — AGM Information 2012

64261_rns_2012-05-21_778c8ad5-8ef5-4912-835b-96272efd133e.pdf

Chairman’s Address

Full Year Overview

2011 Divisional Performance

Digital Brand Services (DBS)

Digital Brand Services (DBS)

Enterprise Services

SMB / GPS

SMB / GPS

ForTheRecord (FTR)

Final Year of Transformation Rollout

In appreciation

From Bricks to Clicks: Small Business Online

Brand & Information Protection: Staying Online

Brand & Information Protection: Staying Online

Digital Brands Are About to Change Forever

Item 2: Election of Directors

Remuneration Report

General Staff Remuneration

Remuneration consists of two key elements:

Non‐Executive Director Remuneration

Items 4(a) and 4(b) – In Summary

More from 5G NETWORKS LIMITED.

5G NETWORKS LIMITED. AGM Information 2012