BETMAKERS TECHNOLOGY GROUP LTD — Interim / Quarterly Report 2017

Feb 23, 2017

TopBetta Holdings Limited Appendix 4D Half-year report

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1. Company details

Name of entity: TopBetta Holdings Limited ABN: 21 164 521 395 Reporting period: For the half-year ended 31 December 2016 Previous period: For the half-year ended 31 December 2015

2. Results for announcement to the market

				$
Revenues from ordinary activities	up	120.6%	to	2,248,852
Loss from ordinary activities after tax attributable to the owners of
TopBetta Holdings Limited	up	91.2%	to	(4,455,081)
Loss for the half-year attributable to the owners of TopBetta Holdings
Limited	up	91.2%	to	(4,455,081)

Dividends

There were no dividends paid, recommended or declared during the current financial period.

Comments

The loss for the group after providing for income tax amounted to $4,455,081 (31 December 2015: $2,330,073).

Further information on the 'Review of operations' is detailed in the Directors' report which is part of the Interim Report.

3. Net tangible assets

Net tangible assets per ordinary security	Reporting period Cents 5.53	Previous period Cents 6.51

4. Control gained over entities

Not applicable.

5. Loss of control over entities

Not applicable.

6. Dividend reinvestment plans

Not applicable.

TopBetta Holdings Limited Appendix 4D Half-year report

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7. Details of associates and joint venture entities

	Reporting	entity's	Contribution to	profit/(loss)
	percentage	holding	(where material)
	Reporting	Previous	Reporting	Previous
	period	period	period	period
Name of associate / joint venture	%	%	$	$
Modern Wagering Systems Pty. Ltd.	12.50%	-	(19,293)	-
Group's aggregate share of associates and joint venture
entities' profit/(loss) (where material)
Profit/(loss) from ordinary activities before income tax			(19,293)	-
Income tax on operating activities			-	-

8. Foreign entities

Details of origin of accounting standards used in compiling the report:

Not applicable.

9. Audit qualification or review

Details of audit/review dispute or qualification (if any):

The financial statements were subject to a review by the auditors and the review report is attached as part of the Interim Report.

10. Attachments

Details of attachments (if any):

The Interim Report of TopBetta Holdings Limited for the half-year ended 31 December 2016 is attached.

11. Signed

Signed _________

Date: 23 February 2017

Todd Buckingham Director Newcastle

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TopBetta Holdings Limited ABN 21 164 521 395

Interim Report - 31 December 2016

TopBetta Holdings Limited
Contents
31 December 2016
Directors' report	2
Auditor's independence declaration	3
Statement of profit or loss and other comprehensive income	4
Statement of financial position	5
Statement of changes in equity	6
Statement of cash flows	7
Notes to the financial statements	8
Directors' declaration	14
Independent auditor's review report to the members of TopBetta Holdings Limited	15

1

TopBetta Holdings Limited Directors' report 31 December 2016

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The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'group') consisting of TopBetta Holdings Limited (referred to hereafter as the 'company', 'TopBetta' or 'parent entity') and the entities it controlled at the end of, or during, the half-year ended 31 December 2016.

Directors

The following persons were directors of TopBetta Holdings Limited during the whole of the financial half-year and up to the date of this report, unless otherwise stated:

Nicholas Chan - Chairman Todd Buckingham Matthew Cain Simon Dulhunty

Principal activities

The group's principal activities during the financial half-year were digital fantasy wagering, wagering and content services.

Review of operations

The loss for the group after income tax of $4,455,081 (31 December 2015: $2,330,073) included a non-recurring goodwill impairment expense of $1,802,453. Accordingly, the loss from recurring operations for the period was $2,652,628.

On 3 November 2016, the Company announced its UK incorporated subsidiary, The Global Tote Limited ('TGT'), had been granted an eGambling licence out of Alderney, UK for its wholesale tote product, The Global Tote. On 30 November 2016, the Company completed the issue and allotment of 15,000,000 fully paid ordinary shares to raise $3,000,000 (before costs) at 20 cents per share from sophisticated and institutional investors. The placement was completed at a share price which was at an 11% premium to the last traded share price. This placement strengthened the Company's balance sheet and positioned it to fast track the launch of The Global Tote product.

The emergence of The Global Tote business opportunity provides the Company with a global product that has the potential to increase shareholder returns. In pursuing this opportunity, the Board have made strategic decisions to reduce the execution risk, including effecting an internal restructure of the Company's businesses and business segments in December 2016 and reallocating available resources and capital as required. As a result of these initiatives, the Company's revised forecasts suggest that insufficient cash flows will be generated from the content business operated by 12Follow to justify the goodwill previously attributed to it and, accordingly, the goodwill on this content business has been impaired by $1,802,453.

Significant changes in the state of affairs

On 11 August 2016, the group was granted a licence by the Northern Territory Racing Commission to conduct business as a sports bookmaker. This will enable the group to progress its tournaments and wagering business under this new jurisdiction. This licence is valid until 10 August 2021.

There were no other significant changes in the state of affairs of the group during the financial half-year.

Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this directors' report.

This report is made in accordance with a resolution of directors, pursuant to section 306(3)(a) of the Corporations Act 2001.

On behalf of the directors

_________ Nicholas Chan Chairman 23 February 2017 Newcastle

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_________
Todd Buckingham
Director
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2

AUDITOR’S INDEPENDENCE DECLARATION TO THE DIRECTORS OF TOPBETTA HOLDINGS LIMITED

In accordance with section 307C of the Corporations Act 2001 , I am pleased to provide the following declaration of independence to the directors of TopBetta Holdings Limited.

As lead audit partner for the review of the financial statements of TopBetta Holdings Limited for the half-year ended 31 December 2016, I declare that to the best of my knowledge and belief, there have been no contraventions of:

• (i) the auditor independence requirements of the Corporations Act 2001 in relation to the review; and

• (ii) any applicable code of professional conduct in relation to the review.

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PKF Chartered Accountants Newcastle, NSW

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Martin Matthews Partner

Dated: 23 February 2017

PKF(NS) Audit & Assurance Limited Sydney Newcastle Partnership Level 8, 1 O’Connell Street 755 Hunter Street ABN 91 850 861 839 Sydney NSW 2000 Australia Newcastle West NSW 2302 Australia GPO Box 5446 Sydney NSW 2001 PO Box 2368 Dangar NSW 2309 Liability limited by a scheme approved under Professional p +61 2 8346 6000 p +61 2 4962 2688 f +61 2 8346 6099 f +61 2 4962 3245

Liability limited by a scheme approved under Professional p +61 2 8346 6000 p +61 2 4962 2688 Standards Legislation f +61 2 8346 6099 f +61 2 4962 3245 PKF(NS) Audit & Assurance Limited Partnership is a member firm of the PKF International Limited family of legally independent firms and does not accept any responsibility or liability for the actions or inactions of any individual member or correspondent firm or firms. For office locations visit www.pkf.com.au 3

TopBetta Holdings Limited

Statement of profit or loss and other comprehensive income For the half-year ended 31 December 2016

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Note Revenue 3 Cost of sales Gross profit Other income 4 Expenses Employee benefits expense Professional fees Marketing expenses Administration expenses IT expenses Occupancy expenses Depreciation and amortisation expense Impairment of goodwill 9 Share of losses of associates accounted for using the equity method Non-recurring expenses 5 Other expenses Finance costs Loss before income tax benefit Income tax benefit Loss after income tax benefit for the half-year attributable to the owners of TopBetta Holdings Limited Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year attributable to the owners of TopBetta Holdings Limited Basic earnings per share 15 Diluted earnings per share 15	Consolidated 31/12/2016 31/12/2015 $ $ 2,248,852 1,019,279 (886,905) (678,205)	Consolidated 31/12/2016 31/12/2015 $ $ 2,248,852 1,019,279 (886,905) (678,205)
	1,361,947	341,074
	650,216 (1,973,800) (877,833) (1,525,391) (378,613) (363,701) (87,183) (43,316) (1,802,453) (19,293) (29,000) (78,899) (83,402)	209,608 (903,875) (213,793) (211,328) (164,854) (123,198) (33,553) (3,320) - - (1,513,064) (6,737) (64,666)
	(5,250,721) 795,640	(2,687,706) 357,633
	(4,455,081) -	(2,330,073) -
	(4,455,081)	(2,330,073)
	Cents (4.08) (4.08)	Cents (3.61) (3.61)

The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes

4

TopBetta Holdings Limited Statement of financial position As at 31 December 2016

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Note Assets Current assets Cash and cash equivalents 6 Trade and other receivables 7 Prepayments Total current assets Non-current assets Investments accounted for using the equity method Property, plant and equipment 8 Goodwill 9 Deferred tax Total non-current assets Total assets Liabilities Current liabilities Trade and other payables 10 Employee benefits Deferred revenue Total current liabilities Non-current liabilities Employee benefits Total non-current liabilities Total liabilities Net assets Equity Issued capital 11 Reserves Accumulated losses Total equity	Consolidated 31/12/2016 30/06/2016 $ $ 3,744,686 2,435,693 1,815,247 1,229,370 79,338 59,005	Consolidated 31/12/2016 30/06/2016 $ $ 3,744,686 2,435,693 1,815,247 1,229,370 79,338 59,005
	5,639,271	3,724,068
	220,454 397,312 2,473,074 3,013,146	239,747 271,330 4,275,527 2,178,618
	6,103,986	6,965,222
	11,743,257	10,689,290
	1,978,436 274,137 1,520	2,065,557 219,795 18,045
	2,254,093	2,303,397
	61,410	43,163
	61,410	43,163
	2,315,503	2,346,560
	9,427,754	8,342,730
	20,038,872 1,451,240 (12,062,358)	14,696,667 1,253,340 (7,607,277)
	9,427,754	8,342,730

The above statement of financial position should be read in conjunction with the accompanying notes

5

TopBetta Holdings Limited Statement of changes in equity For the half-year ended 31 December 2016

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Consolidated Balance at 1 July 2015 Loss after income tax benefit for the half-year Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs Share-based payments Balance at 31 December 2015 Consolidated Balance at 1 July 2016 Loss after income tax benefit for the half-year Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs (note 11) Share-based payments Balance at 31 December 2016	Issued capital $ 8,059,683 - -	Reserves $ - - -	Accumulated losses $ (3,069,752) (2,330,073) -	Total equity $ 4,989,931 (2,330,073) -
	- 6,634,803 -	- - 1,253,340	(2,330,073) - -	(2,330,073) 6,634,803 1,253,340
	14,694,486	1,253,340	(5,399,825)	10,548,001
	Issued capital $ 14,696,667 - -	Reserves $ 1,253,340 - -	Accumulated losses $ (7,607,277) (4,455,081) -	Total equity $ 8,342,730 (4,455,081) -
	- 5,342,205 -	- - 197,900	(4,455,081) - -	(4,455,081) 5,342,205 197,900
	20,038,872	1,451,240	(12,062,358)	9,427,754

The above statement of changes in equity should be read in conjunction with the accompanying notes

6

TopBetta Holdings Limited Statement of cash flows For the half-year ended 31 December 2016

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Note Cash flows from operating activities Receipts from customers - net Payments to suppliers and employees Interest received Interest and other finance costs paid Research and development tax rebate received Net cash used in operating activities Cash flows from investing activities Payments for investments Payments for property, plant and equipment Net cash used in investing activities Cash flows from financing activities Proceeds from issue of shares 11 Share issue transaction costs Repayment of loans to related parties Net cash from financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the financial half-year Cash and cash equivalents at the end of the financial half-year	Consolidated 31/12/2016 31/12/2015 $ $ 2,572,643 1,091,808 (6,584,837) (2,672,347) 5,988 685 (83,402) (32,496) - 415,595	Consolidated 31/12/2016 31/12/2015 $ $ 2,572,643 1,091,808 (6,584,837) (2,672,347) 5,988 685 (83,402) (32,496) - 415,595
	(4,089,608)	(1,196,755)
	(50,000) (22,861)	- (6,811)
	(72,861)	(6,811)
	5,601,842 (130,380) -	7,258,694 (790,272) (435,585)
	5,471,462	6,032,837
	1,308,993 2,435,693	4,829,271 432,387
	3,744,686	5,261,658

The above statement of cash flows should be read in conjunction with the accompanying notes

7

TopBetta Holdings Limited Notes to the financial statements 31 December 2016

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Note 1. General information

The financial statements cover TopBetta Holdings Limited as a group consisting of TopBetta Holdings Limited (the 'company' or 'parent entity') and the entities it controlled at the end of, or during, the half-year (the 'group'). The financial statements are presented in Australian dollars, which is TopBetta Holdings Limited's functional and presentation currency.

TopBetta Holdings Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is:

22 Lambton Road Broadmeadow, NSW 2292

A description of the nature of the group's operations and its principal activities are included in the directors' report, which is not part of the financial statements.

The financial statements were authorised for issue, in accordance with a resolution of directors, on 23 February 2017.

Note 2. Significant accounting policies

These general purpose financial statements for the interim half-year reporting period ended 31 December 2016 have been prepared in accordance with Australian Accounting Standard AASB 134 'Interim Financial Reporting' and the Corporations Act 2001, as appropriate for for-profit oriented entities. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 'Interim Financial Reporting'.

These general purpose financial statements do not include all the notes of the type normally included in annual financial statements. Accordingly, these financial statements are to be read in conjunction with the annual report for the year ended 30 June 2016 and any public announcements made by the company during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

The principal accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period, unless otherwise stated.

New or amended Accounting Standards and Interpretations adopted

The group has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period. The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the group during the financial half-year ended 31 December 2016 and are not expected to have any significant impact for the full financial year ending 30 June 2017.

Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.

Note 3. Operating segments

Identification of reportable operating segments

The group operates in three segments being the fantasy wagering and general wagering, content services, and corporate. This is based on the internal reports that are reviewed and used by the Board of Directors (who are identified as the Chief Operating Decision Makers ('CODM')) in assessing performance and in determining the allocation of resources. There is no aggregation of operating segments.

The information reported to the CODM is on at least a monthly basis. The financial information presented in these financial statements are the same as that presented to the CODM.

8

TopBetta Holdings Limited Notes to the financial statements 31 December 2016

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Note 3. Operating segments (continued)

Types of products and services

The principal products and services of each of these operating segments are as follows:

Fantasy wagering and The group operates an online wagering platform which utilises proprietary technology general across risk management systems, odds management, content delivery and consumer wagering facing platforms. The online fantasy wagering tournaments platform is integrated into the group's general online wagering platforms and enable sports fans to compete against each other via fantasy wagering on real sports events, with the focus on social engagement. Content services The group operates a free and premium content platform, which enables customers to seamlessly access a range of sporting and racing content.

There are no intersegment transactions.

Major customers

There are no major customers that represented more than 10% of the total segment revenue.

Operating segment information

Consolidated - 31/12/2016 Revenue Sales to external customers Total revenue Segment results Depreciation and amortisation Impairment of goodwill Research and development tax rebate Interest revenue Finance costs Non-recurring expenses Share of losses of associates Loss before income tax benefit Income tax benefit Loss after income tax benefit Consolidated - 31/12/2015 Revenue Sales to external customers Total revenue Segment results Depreciation and amortisation Research and development tax rebate Interest revenue Finance costs Non-recurring expenses Loss before income tax benefit Income tax benefit Loss after income tax benefit	Fantasy wagering and wagering $ 1,922,834	Content services $ 326,018	Corporate $ -	Total $ 2,248,852
	1,922,834	326,018	-	2,248,852
	(1,145,270)	(11,272)	(2,751,476)	(3,908,018) (43,316) (1,802,453) 628,773 5,988 (83,402) (29,000) (19,293)
	Fantasy wagering and wagering $ 493,933	Content services $ 525,346	Corporate $ -
				(5,250,721) 795,640
				(4,455,081)
				Total $ 1,019,279
	493,933	525,346	-	1,019,279
	(364,346)	(112,232)	(835,141)	(1,311,719) (3,320) 204,378 685 (64,666) (1,513,064)
				(2,687,706) 357,633
				(2,330,073)

9

TopBetta Holdings Limited Notes to the financial statements 31 December 2016

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Note 4. Other income

Research and development tax rebate * Payroll tax rebate Interest received Other income	Consolidated 31/12/2016 31/12/2015 $ $ 628,773 204,378 15,455 4,545 5,988 685	Consolidated 31/12/2016 31/12/2015 $ $ 628,773 204,378 15,455 4,545 5,988 685
	650,216	209,608

• Research and development tax rebate income includes an amount of $225,000 representing a reversal of a liability originally recognised to reflect R&D rebate receipts for which the company believed it was no longer entitled to. The company has since received advice that it remains entitled to those proceeds.

Note 5. Non-recurring expenses

IPO and transaction costs Share-based payments expense Total non-recurring expenses Note 6. Current assets - cash and cash equivalents Cash on hand Cash at bank Cash on deposit Restricted cash	Consolidated 31/12/2016 31/12/2015 $ $ - 259,724 29,000 1,253,340	Consolidated 31/12/2016 31/12/2015 $ $ - 259,724 29,000 1,253,340
	29,000	1,513,064
	Consolidated 31/12/2016 30/06/2016 $ $ 711 711 2,770,631 1,771,083 200,000 - 773,344 663,899
	3,744,686	2,435,693

Note 6. Current assets - cash and cash equivalents

Note 7. Current assets - trade and other receivables

Trade receivables Other receivables Research and development tax receivable * Rental bonds Goods and services tax ('GST') receivable	Consolidated 31/12/2016 30/06/2016 $ $ 24,016 40,200	Consolidated 31/12/2016 30/06/2016 $ $ 24,016 40,200
	776,664 963,485 31,887 19,195	776,664 334,711 23,375 54,420
	1,791,231	1,189,170
	1,815,247	1,229,370

• Refer to note 4 for further details.

10

TopBetta Holdings Limited Notes to the financial statements 31 December 2016

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Note 8. Non-current assets - property, plant and equipment

Leasehold improvements - at cost Less: Accumulated depreciation Plant and equipment - at cost Less: Accumulated depreciation Computer equipment - at cost Less: Accumulated depreciation Furniture and fittings - at cost Less: Accumulated depreciation	Consolidated 31/12/2016 30/06/2016 $ $ 104,036 104,036 (13,850) (3,448)	Consolidated 31/12/2016 30/06/2016 $ $ 104,036 104,036 (13,850) (3,448)
	90,186	100,588
	16,266 (11,738)	16,627 (11,738)
	4,528	4,889
	235,402 (36,343)	71,183 (15,716)
	199,059	55,467
	121,187 (17,648)	116,109 (5,723)
	103,539	110,386
	397,312	271,330

Reconciliations

Reconciliations of the written down values at the beginning and end of the current financial half-year are set out below:

Consolidated Balance at 1 July 2016 Additions Depreciation expense Balance at 31 December 2016	Leasehold improvements $ 100,588 - (10,402)	Plant and equipment $ 4,889 - (361)	Computer equipment $ 55,467 164,219 (20,627)	Furniture and fittings $ 110,386 5,079 (11,926)	Total $ 271,330 169,298 (43,316)
	90,186	4,528	199,059	103,539	397,312

Note 9. Non-current assets - goodwill

Goodwill - at cost Less: Impairment	Consolidated 31/12/2016 30/06/2016 $ $ 4,275,527 4,275,527 (1,802,453) -	Consolidated 31/12/2016 30/06/2016 $ $ 4,275,527 4,275,527 (1,802,453) -
	2,473,074	4,275,527

The company has impaired the goodwill on the content business by $1,802,453 due to insufficient cash flows being generated to support its carrying value.

11

TopBetta Holdings Limited Notes to the financial statements 31 December 2016

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Note 10. Current liabilities - trade and other payables

Trade payables Accrued expenses Other payables Note 11. Equity - issued capital 31/12/2016 Shares Ordinary shares - fully paid 125,819,227 Movements in ordinary share capital Details Date Balance 1 July 2016 Shares issued 24 August 2016 Shares issued 30 November 2016 Transaction costs Deferred tax credit recognised directly in equity Balance 31 December 2016	31/12/2016 Shares 125,819,227	Consolidated 31/12/2016 30/06/2016 $ $ 874,089 738,999 318,019 444,955 786,328 881,603 1,978,436 2,065,557 Consolidated 30/06/2016 31/12/2016 30/06/2016 Shares $ $ 96,364,546 20,038,872 14,696,667	Consolidated 31/12/2016 30/06/2016 $ $ 874,089 738,999 318,019 444,955 786,328 881,603	Consolidated 31/12/2016 30/06/2016 $ $ 874,089 738,999 318,019 444,955 786,328 881,603
			1,978,436	2,065,557
				30/06/2016 $ 14,696,667
		Shares 96,364,546 14,454,681 15,000,000 - - 125,819,227	$0.18 $0.20 $0.00 $0.00	$ 14,696,667 2,601,842 3,000,000 (298,525) 38,888 20,038,872

Note 12. Equity - dividends

There were no dividends paid, recommended or declared during the current or previous financial half-year.

Note 13. Contingent liabilities

The group had no contingent liabilities or assets as at 31 December 2016 and 30 June 2016.

Note 14. Related party transactions

Parent entity

TopBetta Holdings Limited is the parent entity.

Transactions with related parties

The following transactions occurred with related parties:

	Consolidated	Consolidated
	31/12/2016	31/12/2015
	$	$
Payment for other expenses:
Consulting fees paid to Ferghana Capital Pty Ltd ('Ferghana') (a company controlled by
director, Matthew Cain)	60,000		-
Consulting fees paid to Media Solutions Company Pty Ltd ('SDMSC') (a company controlled
by director Simon Dulhunty)	60,000		-

12

TopBetta Holdings Limited Notes to the financial statements 31 December 2016

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Note 14. Related party transactions (continued)

Receivable from and payable to related parties

The following balances are outstanding at the reporting date in relation to transactions with related parties:

	Consolidated	Consolidated
	31/12/2016	30/06/2016
	$	$
Current payables:
Trade payables to Ferghana for expenses on behalf of the company	11,289		-
Trade payables to SDMSC for consulting services	11,000		-

Loans to/from related parties

There were no loans to or from related parties at the current and previous reporting date.

Terms and conditions

All transactions were made on normal commercial terms and conditions and at market rates.

Note 15. Earnings per share

Loss after income tax attributable to the owners of TopBetta Holdings Limited Weighted average number of ordinary shares used in calculating basic earnings per share Weighted average number of ordinary shares used in calculating diluted earnings per share Basic earnings per share Diluted earnings per share	Consolidated 31/12/2016 31/12/2015 $ $ (4,455,081) (2,330,073)	Consolidated 31/12/2016 31/12/2015 $ $ (4,455,081) (2,330,073)
	Number 109,185,788	Number 64,499,015
	109,185,788	64,499,015
	Cents (4.08) (4.08)	Cents (3.61) (3.61)

32,667,000 options over ordinary shares are not included in the calculation of diluted earnings per share because they are antidilutive for the half-year ended 31 December 2016. These options could potentially dilute basic earnings per share in the future.

Note 16. Events after the reporting period

On 13 January 2017, the group entered into a binding, conditional heads of agreement ('HOA') with Modern Wagering Systems Pty Ltd ('MWS') and Live Datacast Pty Limited ('Live Datacast') pursuant to which the rights to The Global Tote technology will be assigned, or exclusively licensed, to TopBetta's wholly owned subsidiary, The Global Tote Limited ('TGT').

No other matter or circumstance has arisen since 31 December 2016 that has significantly affected, or may significantly affect the group's operations, the results of those operations, or the group's state of affairs in future financial years.

13

TopBetta Holdings Limited Directors' declaration 31 December 2016

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In the directors' opinion:

• the attached financial statements and notes comply with the Corporations Act 2001, Australian Accounting Standard AASB 134 'Interim Financial Reporting', the Corporations Regulations 2001 and other mandatory professional reporting requirements;

• the attached financial statements and notes give a true and fair view of the group's financial position as at 31 December 2016 and of its performance for the financial half-year ended on that date; and

• there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

Signed in accordance with a resolution of directors made pursuant to section 303(5)(a) of the Corporations Act 2001.

On behalf of the directors

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_____ _______
Nicholas Chan Todd Buckingham
Chairman Director
23 February 2017
Newcastle
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14

INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS TOPBETTA HOLDINGS LIMITED

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of TopBetta Holdings Limited, which comprises the statement of financial position as at 31 December 2016, and the statement of profit or loss and other comprehensive income, statement of changes in equity and statement of cash flows for the half-year ended on that date, a summary of significant accounting policies, other explanatory notes and the directors’ declaration.

Directors’ responsibility for the financial report

The directors of the company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half-year financial report that is free from material misstatement, whether due to fraud or error.

Auditor’s responsibility

Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Australian Auditing Standard on Review Engagements ASRE 2410 Review of Interim Financial Report Performed by the Independent Auditor of the Entity, in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated entity’s financial position as at 31 December 2016 and its performance for the half-year ended on that date; and complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001 . As the auditor of TopBetta Holdings Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

PKF(NS) Audit & Assurance Limited Sydney Newcastle Partnership Level 8, 1 O’Connell Street 755 Hunter Street ABN 91 850 861 839 Sydney NSW 2000 Australia Newcastle West NSW 2302 Australia GPO Box 5446 Sydney NSW 2001 PO Box 2368 Dangar NSW 2309 Liability limited by a scheme approved under Professional p +61 2 8346 6000 p +61 2 4962 2688 Standards Legislation f +61 2 8346 6099 f +61 2 4962 3245 PKF(NS) Audit & Assurance Limited Partnership is a member firm of the PKF International Limited family of legally independent firms and does not accept any responsibility or liability for the actions or inactions of any individual member or correspondent firm or firms. For office locations visit www.pkf.com.au 15

INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS TOPBETTA HOLDINGS LIMITED

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 .

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of TopBetta Holdings Limited is not in accordance with the Corporations Act 2001 , including:

(i) giving a true and fair view of the of the consolidated entity’s financial position as at 31 December 2016 and of its performance for the half-year ended on that date; and

(ii) complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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PKF Chartered Accountants

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Martin Matthews Partner

Newcastle, NSW

Dated: 23 February 2017

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