ADSLOT LTD. — Interim / Quarterly Report 2014

Oct 30, 2013

Appendix 4C - Quarterly report for entities admitted on the basis of commitments

Appendix 4C

Quarterly report for entities admitted

on the basis of commitments

Commentary on activities during the quarter ending 30 September 2013

• Cash
  outflow
  for
  the
  quarter
  was $1.6m ,
  which
  was
  at
  the
  lower
  end
  of
  our
  guidance
  range of
  $1.5M
  to
  $1.8M.

• Cash
  at
  bank
  as
  at
  30
  September
  2013
  is
  $7.5M.

• Cash
  receipts
  from Adslot products
  were
  up
  5%
  over
  the
  previous
  quarter,
  with
  increases
  in Adslot
  Publisher
  and
  Adslot
  Create
  receipts
  being
  offset
  by
  reductions
  in
  Adslot
  Enterprise receipts.

• Adslot’s
  strategy
  to
  build
  liquidity
  by
  growing
  a
  diverse
  catalogue
  of
  publishers
  (supply),
  then making
  this
  available
  to
  demand
  at
  scale
  (media
  agencies),
  remains
  on
  track.

• In
  September
  2013
  the
  company
  made
  a
  beta
  release
  of
  its
  marketplace
  product, Adslot Media ,
  followed
  by
  a
  global
  launch
  on
  22
  October

• Sales
  and
  marketing
  of Adslot Media to
  media
  agencies
  has
  now
  commenced.

• The
  company
  re-­‐iterates
  that
  it
  anticipates
  it
  will
  take
  a
  further
  1
  to
  2
  quarters
  to
  drive
  initial adoption
  of
  the
  platform
  by
  media
  agency
  buyers.

• Cash
  receipts
  for
  the Webfirm division
  were
  down
  5%
  quarter-­‐on-­‐quarter.

• Total
  Group
  costs
  were
  in
  line
  with
  management
  expectations,
  with
  increases
  in
  marketing and
  sales
  costs
  in
  support
  of
  the
  launch
  of
  Adslot
  Media,
  albeit
  at
  the
  bottom
  end
  of
  the range
  reflecting
  a
  conservative
  management
  of
  expenditure.

• We
  anticipate
  underlying
  net
  cash
  outflows
  to
  remain
  for
  the
  next
  few
  quarters,
  with
  the underlying
  net
  operating
  cash
  outflows
  for
  the
  next
  two
  quarters
  to
  be
  in
  the
  vicinity
  of $1.6M
  to
  $1.8M
  per
  quarter.

• The
  $1.6M
  to
  $1.8M
  per
  quarter
  excludes
  a
  cash
  receipt
  of
  approximately
  $1.1M
  from
  the Research
  &
  Development
  Tax
  Incentive
  relating
  to
  FY
  2013,
  which
  we
  expect
  to
  receive
  by January
  2014,
  and
  also
  excludes
  transaction
  costs
  that
  would
  arise
  if
  the
  Scheme
  of Arrangement
  with
  Facilitate
  Digital
  Holdings
  Limited
  is
  completed
  at
  the
  end
  of
  the
  calendar year.

• See chapter 19 for defined terms.

24/10/2005

Appendix 4C Page 1

Appendix 4C - Quarterly report for entities admitted on the basis of commitments

Appendix 4C

Quarterly report for entities admitted on the basis of commitments

Name of entity
ADSLOT LTD
ABN 70 001 287 510	Quarter ended (“current quarter”)
70 001 287 510	30 SEPTEMBER 2013

Consolidated statement of cash flows

Cash flows related to operating activities 1.1 Receipts from customers 1.2 Payments for: (a) staff costs (Note 3) (b) advertising and marketing (c) research and development (Note 4) (d) leased assets (e) website publisher payments (f) other cost of sales (g) other working capital/overheads 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income and Other taxes paid 1.7 Other – R&D Tax Incentive	Current quarter $A’000	Year to date (3 months) $A’000
	865 (1,545) (133) (388) (1) (7) (195) (483) - 104 - (4) -	865 (1,545) (133) (388) (1) (7) (195) (483) - 104 - (4) -
Net operating cash flows	(1,787)	(1,787)

• See chapter 19 for defined terms.

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Appendix 4C - Quarterly report for entities admitted on the basis of commitments

	Current quarter $A’000	Year to date (3 months) $A’000
1.8 Net operating cash flows (carried forward)	(1,787)	(1,787)
Cash flows related to investing activities 1.9 Payment for acquisition of: (a) businesses (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets 1.10 Proceeds from disposal of: (a) businesses (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets 1.11 Loans to other entities 1.12 Loans repaid by other entities 1.13 Other (provide details if material) Net investing cash flows 1.14 Total operating and investing cash flows	- - - - (5) - - - - 1 - - -	- - - - (5) - - - - 1 - - -
	(4)	(4)
	(1,791)	(1,791)
Cash flows related to financing activities 1.15 Proceeds from issues of shares, options, etc. –Note 3 1.16 Proceeds from sale of forfeited shares 1.17 Proceeds from borrowings 1.18 Repayment of borrowings 1.19 Dividends paid 1.20 Other – Costs relating to issues of shares Net financing cash flows	226 - - - - -	226 - - - - -
	226	226
Net increase (decrease) in cash held 1.21 Cash at beginning of quarter/year to date 1.22 Exchange rate adjustments – Note 2	(1,565) 9,132 (23)	(1,565) 9,132 (23)
1.23 Cash at end of quarter	7,544	7,544

• See chapter 19 for defined terms.

24/10/2005

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Appendix 4C - Quarterly report for entities admitted on the basis of commitments

Payments to directors of the entity and associates of the directors

Payments to related entities of the entity and associates of the related entities

		Current quarter $A'000
1.24	Aggregate amount of payments to the parties included in item 1.2	56
1.25	Aggregate amount of loans to the parties included in item 1.11	-
1.26 Explanation necessary for an understanding of the transactions Directors Fees of $56k. In addition, item 1.1 includes receipts from trading with entities associated with Directors of $13k

Non-cash financing and investing activities

• 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

N/A

• 2.2 Details of outlays made by other entities to establish or increase their share in businesses in which the reporting entity has an interest

N/A

Financing facilities available

Add notes as necessary for an understanding of the position. (See AASB 1026 paragraph 12.2).

		Amount available $A’000	Amount used $A’000
3.1	Loan facilities	-	-
3.2	Credit standby arrangements	-	-

• See chapter 19 for defined terms.

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Appendix 4C - Quarterly report for entities admitted on the basis of commitments

Reconciliation of cash

Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter $A’000	Previous quarter $A’000
4.1 Cash on hand and at bank 4.2 Deposits at call 4.3 Bank overdraft 4.4 Other	457	525
	7,087	8,607
	-	-
	-	-
Total: cash at end of quarter(item 1.23)	7,544	9,132

Acquisitions and disposals of business entities

5.1 Name of entity 5.2 Place of incorporation or registration 5.3 Consideration for acquisition or disposal 5.4 Total net assets 5.5 Nature of business	Acquisitions (Item 1.9(a))	Disposals (Item 1.10(a))
	N/A	N/A
	-	-
	-	-
	-	-
	-	-

Compliance statement

• 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act (except to the extent that information is not required because of note 2) or other standards acceptable to ASX.

• 2 This statement does give a true and fair view of the matters disclosed.

==> picture [74 x 46] intentionally omitted <==

Sign here: ............................................................ Date: 31 October 2013 Company Secretary

Print name: Brendan Maher

• See chapter 19 for defined terms.

24/10/2005

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Appendix 4C - Quarterly report for entities admitted on the basis of commitments

Notes

1. The definitions in, and provisions of, AASB 1026: Statement of Cash Flows apply to this report except for the paragraphs of the Standard set out below.

2. 6.2 - reconciliation of cash flows arising from operating activities to operating profit or loss

4. • 9.2 - itemised disclosure relating to acquisitions

   • 9.4 - itemised disclosure relating to disposals

5. 12.1(a) - policy for classification of cash items

6. • 12.3 - disclosure of restrictions on use of cash • 13.1 - comparative information

7. Exchange Rate Adjustment (1.22): Represents accounting adjustment related to conversion of US dollar, GB pound and Euro bank account balances to local currency.

8. Proceeds from issue of shares (1.2a & 1.15) : Includes a payment of $226k in year to date Employment Costs (1.2a) paid to the Adslot Employee Share Trust who used those funds to procure new shares in the Company which is shown at 1.15. These shares are eliminated on consolidation as Treasury Shares in the accounts of the Company.

9. Research & Development (1.2c): Represents direct payroll and on-costs related to on-going technology development work compliant with R&D Grant regulations.

10. See chapter 19 for defined terms.

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