AMBERTECH LIMITED — Annual Report 2008

Aug 28, 2008

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AMBERTECH LIMITED AND CONTROLLED ENTITIES

ACN 079 080 158

APPENDIX 4E ‐ PRELIMINARY FINAL REPORT

Year Ended 30 June 2008.

FULL YEAR RESULTS ANNOUNCEMENT

For immediate release 29 August 2008.

HIGHLIGHTS

Revenue up by 16.6% to $69.9M EBIT up by 16.0% to $5.0M NPAT up by 23.5% to $3.2M Final Dividend of 2 cents per share fully franked.

CONTENTS

Results for Announcement to the Market Preliminary Final Report Notes to the Preliminary Final Report Commentary on the Results Outlook

Ambertech Limited ACN 079 080 158 Unit B, 5 Skyline Place, Frenchs Forest NSW 2086

Tel: 02 9452 8600 Fax 02 9975 1368 email: rglasson@ambertech.com.au web: www.ambertech.com.au

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

Results For Announcement to the Market

Key Information Revenue from ordinary activities Profit after income tax for the period attributable to members Dividends Final dividend declared Record date for final dividend Payment date for final dividend	2008 2007 $'000 $'000 69,876 59,923 3,179 2,575 Amount per security 2 cents	$'000 % 9,953 16.6% 604 23.5% Movement Franking % 100%
		15September 2008
		30 September 2008

The Board has established a dividend reinvestment plan, whereby Shareholders may elect (subject to the rules of the plan) to reinvest dividends payable by Ambertech Limited to the shareholder. The Board has determined not to invoke the plan for the final dividend in respect of the 30 June 2008 financial year.

Dividend History

Interim dividend paid 31 March 08 Final dividend payable 30 September 2008 Total Key Ratios Net tangible assets per security	6 cents 2 cents 4 cents	100% 100%	100% 100%
		100%
		2008 ¢ 54.0	2007 ¢ 51.0

Further explanation of the results follows in the attached commentary.

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

0 Consolidated Income Statement Revenues Cost of sales Gross profit Other income Employee benefits expense Distribution costs Marketing costs Premises costs Depreciation and amortisation expenses Finance costs Travel costs Restructure costs Other expenses Profit before income tax Income tax expense Profit attributable to the members of the parent entity Earnings per share Basic earnings per share Diluted earnings per share	2008 2007 $'000 $'000 69,876 59,923 (45,109) (41,041) 24,767 18,882 141 498 (10,503) (9,466) (1,234) (714) (2,637) (1,480) (1,410) (1,161) (306) (334) (537) (513) (654) (573) (1,721) ‐ (1,169) (1,777) 4,737 3,362 (1,558) (787) 3,179 2,575 10.4 8.4 10.4 8.4 Economic Entity	2008 2007 $'000 $'000 69,876 59,923 (45,109) (41,041) 24,767 18,882 141 498 (10,503) (9,466) (1,234) (714) (2,637) (1,480) (1,410) (1,161) (306) (334) (537) (513) (654) (573) (1,721) ‐ (1,169) (1,777) 4,737 3,362 (1,558) (787) 3,179 2,575 10.4 8.4 10.4 8.4 Economic Entity
		18,882 498 (9,466) (714) (1,480) (1,161) (334) (513) (573) ‐ (1,777)
		3,362 (787)
		2,575
		8.4
		8.4

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

Consolidated Balance Sheet ASSETS CURRENT ASSETS Cash and cash equivalents Trade and other receivables Tax receivable Inventories TOTAL CURRENT ASSETS NON‐CURRENT ASSETS Plant and equipment Intangible assets Deferred tax assets TOTAL NON‐CURRENT ASSETS TOTAL ASSETS LIABILITIES CURRENT LIABILITIES Trade and other payables Other financial liabilities Income tax payable Provisions TOTAL CURRENT LIABILITIES NON‐CURRENT LIABILITIES Other financial liabilities Provisions TOTAL NON‐CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Share Capital Reserves Retained earnings TOTAL EQUITY	2008 2007 $'000 $'000 4,634 2,058 12,334 8,135 283 1,071 11,512 14,073 28,763 25,337 770 730 2,970 2,970 471 473 4,211 4,173 32,974 29,510 7,036 6,396 4,502 3,002 435 ‐ 827 821 12,800 10,219 ‐ 4 620 666 620 670 13,420 10,889 19,554 18,621 11,190 11,190 102 198 8,262 7,233 19,554 18,621 Economic Entity	2008 2007 $'000 $'000 4,634 2,058 12,334 8,135 283 1,071 11,512 14,073 28,763 25,337 770 730 2,970 2,970 471 473 4,211 4,173 32,974 29,510 7,036 6,396 4,502 3,002 435 ‐ 827 821 12,800 10,219 ‐ 4 620 666 620 670 13,420 10,889 19,554 18,621 11,190 11,190 102 198 8,262 7,233 19,554 18,621 Economic Entity
		25,337
		730 2,970 473
		4,173
		29,510
		6,396 3,002 ‐ 821
		10,219
		4 666
		670
		10,889
		18,621
		11,190 198 7,233
		18,621

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

Consolidated Statement of Cash Flows CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers and employees Interest received Interest and other costs of finance paid Income taxes paid Income taxes refunded Goods and services tax remitted Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Payments for plant and equipment Net cash (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to shareholders Proceeds from borrowings Payments for shares bought back Repayment of borrowings Net cash (used in) financing activities Net increase in cash and cash equivalents held Cash and cash equivalents at beginning of year Effect of exchange rate changes on the balance of cash and cash equivalents held in foreign currencies at the beginning of the financial year. Cash and cash equivalents at end of year	2008 2007 $'000 $'000 71,243 67,249 (61,761) (57,472) 234 81 (537) (509) (1,291) (1,455) 937 ‐ (5,217) (4,636) 3,608 3,258 (351) (113) (351) (113) (2,150) (921) 1,500 ‐ ‐ (75) (4) (1,696) (654) (2,692) 2,603 453 2,058 1,586 (27) 19 4,634 2,058 Economic Entity	2008 2007 $'000 $'000 71,243 67,249 (61,761) (57,472) 234 81 (537) (509) (1,291) (1,455) 937 ‐ (5,217) (4,636) 3,608 3,258 (351) (113) (351) (113) (2,150) (921) 1,500 ‐ ‐ (75) (4) (1,696) (654) (2,692) 2,603 453 2,058 1,586 (27) 19 4,634 2,058 Economic Entity
		3,258
		(113)
		(113)
		(921) ‐ (75) (1,696)
		(2,692)
		453 1,586 19
		2,058

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

Consolidated Notes to the Statement of Cash Flows Cash and cash equivalents Cash and cash equivalents included in the Cash Flow Statement comprise the following amounts: Cash on hand At call deposits with financial institutions Reconciliation of net cash provided by/(used in) operating activities to profit or loss after income tax Profit for the year Depreciation and amortisation Net (gain) on disposal of plant and equipment Borrowing expenses Net exchange differences Non‐cash share based payments Changes in operating assets and liabilities (Increase)/Decrease in accounts receivable (Increase)/Decrease in prepayments Decrease in inventories Decrease/(Increase) in tax receivable Increase/(Decrease) in payables (Decrease)/Increase in provisions (Increase)/Decrease in deferred taxes Net cash provided by operating activities	2008 2007 $'000 $'000 3 4 4,631 2,054 4,634 2,058 3,179 2,575 306 334 ‐ (5) 1 4 (140) (350) 66 74 (4,370) 1,852 96 (177) 2,428 186 1,213 (259) 862 (1,189) (24) 188 (9) 25 3,608 3,258 Economic Entity	2008 2007 $'000 $'000 3 4 4,631 2,054 4,634 2,058 3,179 2,575 306 334 ‐ (5) 1 4 (140) (350) 66 74 (4,370) 1,852 96 (177) 2,428 186 1,213 (259) 862 (1,189) (24) 188 (9) 25 3,608 3,258 Economic Entity
		2,058
		2,575 334 (5) 4 (350) 74 1,852 (177) 186 (259) (1,189) 188 25
		3,258

Non Cash Financing and Investing Activities

There were no non‐cash financing or investing activities during the financial year.

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

Notes to the Preliminary Final Report

Economic	Entity
2008	2007
$'000	$'000

NOTE 1: Basis of Preparation

The Preliminary Final Report has been prepared in accordance with ASX Listing Rule 4.3A and is based on accounts which are in the process of being audited.

NOTE 2: Revenue

Revenue ‐ Sale of goods and services ‐ Interest received Other income ‐ Net gain on disposal of plant and equipment ‐ Net foreign currency gains	69,642 234 69,876 ‐ 141 141	59,842 81
		59,923
		5 493
		498

NOTE 3: Items Included in Profit

Additional information on the nature of expenses Inventories Cost of sales Write down of inventories to net realisable value Employee benefits expense Salaries and wages Employee termination expense Depreciation Plant and equipment Furniture and fittings Leasehold improvements Amortisation Leased plant and equipment Bad and doubtful debts Rental expense on operating leases: Minimum lease payments	45,109 517 10,288 215 10,503 164 33 106 303 3 21 972	41,041
		181
		9,380 86
		9,466
		177 38 95
		310
		24
		41
		912

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

Notes to the Financial Statements (continued) NOTE 4: Earnings Per Share Basic earnings per share (cents) Weighted average number of ordinary shares (number) Earnings used to calculate basic earnings per share ($) Diluted earnings per share (cents) Weighted average number of ordinary shares (number) Earnings used to calculate diluted earnings per share ($)	2008 2007 $'000 $'000 10.4 8.4 30,708,305 30,713,896 3,179,000 2,575,000 10.4 8.4 30,708,305 30,713,896 3,179,000 2,575,000 Economic Entity	2008 2007 $'000 $'000 10.4 8.4 30,708,305 30,713,896 3,179,000 2,575,000 10.4 8.4 30,708,305 30,713,896 3,179,000 2,575,000 Economic Entity
		30,713,896
		2,575,000
		8.4
		30,713,896
		2,575,000

(a) The effect of the Executive Share Option Plan options on issue is not considered dilutionary because based on conditions at the date of this report, it is considered unlikely that these options would be converted into ordinary shares

NOTE 5: Retained Earnings

NOTE 5: Retained Earnings
Retained profits at the beginning of the year Net profit for the year Dividends paid Retained profits at the end of the year	7,233 3,179 (2,150) 8,262	5,579 2,575 (921)
		7,233

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

Commentary on the Results

The Directors of Ambertech Limited today announced a net profit after tax for the financial year ended 30 June 2008 of $3,179,000, an increase of 23.5% on the previous financial year. The result was driven by an overall increase in revenue from ordinary activities for the year of 16.6% to $69,876,000.

As as result, the directors have announced a final dividend of 2 cents per share, fully franked, to be paid on 30 September 2008. This brings the total dividend payout in respect of the financial year ended 30 June 2008 to 6 cents per share fully franked, or 57.9% of net profit after tax. The Board maintains a policy of returning at least 50% of earnings to shareholders.

Key financial indicators of the business continue to improve. EBIT for the financial year of $5,040,000 was up by 16.0% on the previous year (2007: $3,794,000) , and our EBIT to sales margin was 7.2%, up from 6.3% the previous financial year. EBIT to sales margin, adjusted for restructure costs was 9.7%. The strong result also provided operating cash flows of $3,608,000 for the financial year (2007: $3,258,000)

The result for the year included restructure costs of $1,721,000, incurred as a result of the changes made by Avid Technology Inc to their distribution model in Australia. The changes included the loss of exclusive rights to the distribution of Avid products in Australia. At the time of announcing of half year results to December 2007, these costs totalled $692,000. Further staff loss and inventory redundancy contributed to the total restructure costs for the financial year.

A summary of the results by business segment is as follows:

Sales to external customers Segment EBIT Restructure costs Segment Result Unallocated expense EBIT Interest Net profit before tax Income tax expense Net profit after tax	$'000 38,780 4,872 ‐ 4,872 Lifestyle Entertainment	Professional $'000 26,333 1,828 (1,721) 107	New Zealand $'000 4,529 551 ‐ 551	Total $'000 69,642
				7,251 (1,721)
				5,530 (490)
				5,040 (303)
				4,737 (1,558)
				3,179

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

Commentary on the Results (continued) Lifestyle Entertainment Segment Sales to external customers Segment EBIT	2008 $'000 38,780 4,872	2007 $'000 27565 873	$'000 % 11,215 40.7% 3,999 458.1% Movement	$'000 % 11,215 40.7% 3,999 458.1% Movement
				458.1%

Ambertech’s lifestyle entertainment business segment is a leader in the distribution of home theatre products to dealers, distribution and supply of custom installation components for home theatre and commercial installations to dealers and consumers, and the distribution of projection and display products with business and domestic applications.

The result for the year ended 30 June 2008 reflects our success in working with our manufacturers to deliver products to market that meet our clients needs. Our product offering, coupled with some new marketing initiatives has enabled us to improve our market share into a retail sector than remained strong throughout the majority of the financial year.

Professional Segment Sales to external customers Segment EBIT	26,333 1,828	29511 2820	(3,178) (992)	‐10.8%
				‐35.2%

Ambertech’s professional business segment supplies product and services to television stations, radio stations, cinemas, post‐production facilities, as well as military and education establishments. Being entirely business‐to‐business in nature, these divisions are unaffected by the potential volatility of consumer sentiment or retail sales trends.

The result for the year ended 30 June 2008 was impacted by a difficult period for products in our traditional broadcast and post production markets. This result was underpinned by strong sales of professional products, and we believe the restructure of this segment of the business has it well placed to take advantage of opportunities that may arise, and to improve our capacity to service current and future customers.

New Zealand Segment

Sales to external customers Segment EBIT	4,529 551	2766 5	1,763 546	63.7%
				10920.0%

Ambertech’s New Zealand business segment distributes of a wide range of quality products for both professional and consumer markets in New Zealand. The result for the year ended 30 June 2008 is an excellent result as we continue to invest in growing the range of consumer product offerings to complement our strong track records of sales in the broadcast and post production markets.

Ambertech Limited ACN 079 080 158 Preliminary Final Report ‐ Year Ended 30 June 2008

Outlook

Early trading results for the 2009 financial year have been encouraging. Our lifestlye entertainment segment continues to evaluate ways of improving market share in a market that continues to offer challenges and has softened over the last 3‐6 months. Our professional and broadcast markets have good clarity of project work over the coming 12 months and remain positive about our strong product offering. In New Zealand we are continuing to invest in broadening our areas of expertise.

Our forecasts for the year ending 30 June 2009 are for continued growth in revenue and profits. The capital nature of our professional segment and the uncertainty of timing of these major projects creates difficulty in accurately forecasting the results for any accounting period. However, Ambertech’s management believes the company is well positioned to achieve medium term growth targets of 5%‐10% per annum, with a target EBIT ratio of 8%‐10%, noting that there may be period‐to‐period fluctuation in results due to the level of sales in the professional segment.

To assist in achieving our goals we are constantly evaluating potential new agencies and or acquisitions.

On behalf of the Board of Ambertech Limited

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Peter Wallace Chairman Sydney 29 August 2008.