ADSLOT LTD. — Interim / Quarterly Report 2017

Apr 27, 2017

Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

Appendix 4C - Quarterly report

Commentary for the quarter ending 31 March 2017

Cash receipts from customers for the March 2017 quarter were $2.93m, slightly down on the previous quarter’s receipts of $3.16m. The March quarter is seasonally impacted by a very low January, which we observed again this year. We were also affected by quarter end timing, as we received $0.44m from customers in the US on 1 April which is not included in this Appendix 4C. If this had been received one day earlier, Receipts from Customers would have been up on last quarter.

Payments during the quarter at $5.90m were higher than the previous quarter of $4.59m. This is in line with our ramping of expenditure in staff and R&D product development as outlined in our Use of Funds disclosed as part of our capital raising late last year.

Payments of $5.90m during the quarter were lower than forecasted payments of $6.26m as a result of lower payments to publishers and lower than forecast ramp in staff and R&D costs.

As anticipated, during the quarter the Company received $2.36m from R&D Tax Incentive relating to its R&D activities for the year ended June 2016.

As a result net cash used in operating activities for the quarter was $0.455m.

In the nine months to March 2017 the business has used $3.99m of cash in operating activities.

The Company is forecasting $6.31m of outflows for the June 2017 quarter compared to $5.90m paid in the March quarter. Whilst staff and R&D expenditure is forecast to increase next quarter, we forecast lower publisher payments.

Cash at the end of the March 2017 quarter was $17.41m.

Lastly, based on R&D expenditure incurred between July 2016 and March 2017, an additional $2.0m will be collected later this year.

More information on the Company’s progress is available via the Company’s Trading Update also released today.

• See chapter 19 for defined terms 1 September 2016

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Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

Appendix 4C

Quarterly report for entities subject to Listing Rule 4.7B

Name of entity

ADSLOT LTD

ABN Quarter ended (“current quarter”) 70 001 287 510 31 March 2017

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(9 months)
			$A’000
1.	Cash flows from operating activities
1.1	Receipts from customers	2,934	8,432
1.2	Payments for
	(a) staff costs	(2,174)	(5,655)
	(b) research and development	(1,160)	(3,219)
	(c) publishers	(1,429)	(2,667)
	(d) other cost of sales	(205)	(751)
	(e) advertising and marketing	(27)	(102)
	(f) leased assets	(1)	(3)
	(g) other working capital/overheads	(903)	(2,584)
1.3	Dividends received (see note 3)	-	-
1.4	Interest received	152	200
1.5	Interest and other costs of finance paid	0	0
1.6	Income taxes paid	-	-
1.7	Government grants and tax incentives	2,358	2,358
1.8	Other (provide details if material)	-	-
1.9	Net cash from / (used in) operating	(455)	(3,991)
	activities

• See chapter 19 for defined terms 1 September 2016

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Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(9 months)
			$A’000
2.	Cash flows from investing activities
2.1	Payments to acquire:
	(a) property, plant and equipment	-	-
	(b) businesses (see item 10)	-	-
	(c) investments	-	-
	(d) intellectual property	-	-
	(e) other non-current assets	(67)	(149)
2.2	Proceeds from disposal of:
	(a) property, plant and equipment	-	-
	(b) businesses (see item 10)	-	-
	(c) investments	-	-
	(d) intellectual property	-	-
	(e) other non-current assets	-	-
2.3	Cash flows from loans to other entities	-	-
2.4	Dividends received (see note 3)	-	-
2.5	Other (provide details if material)	-	-
2.6	Net cash from / (used in) investing	(67)	(149)
	activities
3.	Cash flows from financing activities
3.1	Proceeds from issues of shares	-	18,055
3.2	Proceeds from issue of convertible notes	-	-
3.3	Proceeds from exercise of share options	-	-
3.4	Transaction costs related to issues of	-	(1,219)
	shares, convertible notes or options
3.5	Proceeds from borrowings	-	-
3.6	Repayment of borrowings	-	-
3.7	Transaction costs related to loans and	-	-
	borrowings
3.8	Dividends paid	-	-
3.9	Other (provide details if material)	-	-
3.10	Net cash from / (used in) financing	-	16,836
	activities

• See chapter 19 for defined terms

1 September 2016

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Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(9 months)
			$A’000
4.	Net increase / (decrease) in cash and
	cash equivalents for the period
4.1	Cash and cash equivalents at beginning of
	quarter/year to date	17,977	4,746
4.2	Net cash from / (used in) operating	(455)	(3,991)
	activities (item 1.9 above)
4.3	Net cash from / (used in) investing activities	(67)	(149)
	(item 2.6 above)
4.4	Net cash from / (used in) financing activities	-	16,836
	(item 3.10 above)
4.5	Effect of movement in exchange rates on	45	(32)
	cash held
4.6	Cash and cash equivalents at end of	17,410	17,410
	quarter

5. Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts Current quarter $A’000 5.1 Bank balances 2,917 5.2 Call deposits 14,493 5.3 Bank overdrafts - 5.4 Other (provide details) - 5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above) 17,410	Previous quarter $A’000 1,399 16,578 - - 17,977
6. Payments to directors of the entity and their associates Current quarter $A'000 6.1 Aggregate amount of payments to these parties included in item 1.2 47 6.2 Aggregate amount of cash flow from loans to these parties included in item 2.3 - 6.3 Include below any explanation necessary to understand the transactions included in items 6.1 and 6.2
	Current quarter $A'000 47 -

Directors Fees

• See chapter 19 for defined terms 1 September 2016

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Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

7.	Payments to related entities of the entity and their	Current quarter
	associates	$A'000
7.1	Aggregate amount of payments to these parties included in item 1.2		-
7.2	Aggregate amount of cash flow from loans to these parties included		-
	in item 2.3
7.3	Include below any explanation necessary to understand the transactions included in
	items 7.1 and 7.2

8.	Financing facilities available	Total facility amount	Amount drawn at
	Add notes as necessary for an	at quarter end	quarter end
	understanding of the position	$A’000	$A’000
8.1	Loan facilities	-		-
8.2	Credit standby arrangements	-		-
8.3	Other (please specify)
8.4	Include below a description of each facility above, including the lender, interest rate and
	whether it is secured or unsecured. If any additional facilities have been entered into or are
	proposed to be entered into after quarter end, include details of those		facilities as well.

9.	Estimated cash outflows for next quarter	$A’000
9.1	staff costs	2,449
9.2	research and development	1,496
9.3	Publishers	1,038
9.4	other cost of sales	205
9.5	advertising and marketing	48
9.6	leased assets	1
9.7	other working capital/overheads	1,083
9.8	Total estimated cash outflows from operating activities	6,319

• See chapter 19 for defined terms 1 September 2016

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Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

10.	Acquisitions and disposals of	Acquisitions	Disposals
	business entities
	(items 2.1(b) and 2.2(b) above)
10.1	Name of entity
10.2	Place of incorporation or
	registration
10.3	Consideration for acquisition or
	disposal
10.4	Total net assets
10.5	Nature of business

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

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

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Sign here: ............................................................ Date: 28 April 2017 (Company secretary)

Print name: Brendan Maher

Notes

1. The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity that wishes to disclose additional information is encouraged to do so, in a note or notes included in or attached to this report.

2. If this quarterly report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 107: Statement of Cash Flows apply to this report. If this quarterly report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standard applies to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. See chapter 19 for defined terms 1 September 2016

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