DATA#3 LIMITED — Annual Report 2010

Aug 22, 2010

2010 resu lt s r e b i fi ng or oar f B d room a R di o

Yet another ‘best ever’ result

Full year dividends up 12% to 56 cents per share

“Our key strategy for organic growth continues to be well-executed by the management team. Our offerings position us competitively to win and ongoing investment in new internal systems has seen some improvements in operational efficiency through the 2010 financial year. We are delighted to once again report solid growth in earnings and dividends. This growth, combined with a 33% gain in the company’s share price over the year, has delivered an excellent result for shareholders”

Chairman - Richard Anderson

Highlights

Financial performance

• Revenues of $599.2 million up 13% with growth in all geographic regions

• Segment analysis

• Product revenues up 14% to $513.6M

• Services revenues up 7% to $85M

• Services revenues up 33% ex recruitment and contracting which was down 22%

  • Professional Services revenues up 28%

  • Managed Services up 34%

• Contribution to profit

  • Product up 5%

  • Services up 95%

• EBITDA of $16.3 million - up 12%

• EBIT of $15.2 million - up 13%

• NPAT of $10.9 million - up 11%

Highlights

Financial performance

• Basic earnings per share of 70.9 cents - up 11%

• Full year fully franked dividends of 56.0 cents per share - up 12%

• Total Shareholder Return of 42.8%

• Cash flow

• Very strong net operating cash inflows of $44.9M up from $19.5M

• $ 8.1M cash outflow from financing activities for dividend payments

• DSOS 36.5 days down from 38.5 days

• Balance sheet

• Cash on hand $64M (timing differences between receipts and payables)

• Receivables $86M down from $96.2M

• Inventories $9M up from $6.1M

• Trade creditors $110M up from $107M

• Debt $0

• Net assets $26M up from $23.3M

Highlights

Operational performance

• Further acknowledgement of our market leading expertise with numerous awards from the world’s leading technology manufacturers including Microsoft, HP, Cisco, Symantec and Adobe

• Other industry recognition included winning the ARN Enterprise Reseller of the Year award

• Continued investment in the learning environment for our people

• Continued investment in new internal systems to provide a platform for increasing efficiency and productivity in the future

Outlook

Market conditions

• Improving but subject to global conditions and potential consequences of a change in federal government

Revenue and margins

• Opportunity to grow revenue faster than market

• Pricing and hence margins to remain under pressure

People and operating expense

• After restraint of 2010, pressure increasing on people expenses

• Operating expenses to be impacted by higher costs of occupancy

Summary

Driving marketshare growth

“2010 was a year marked by improving business confidence but continued constraint in ICT expenditure. Strong growth both in revenue and profit is testimony to the confidence of our customers, the capability of our people and the support of our partners. With our national footprint and the broad appeal of our offerings, we are targeting to once again deliver organic growth ahead of the market in all areas of the business in 2011. In addition we will remain watchful for partnering and acquisition opportunities mindful of the cultural and financial issues that accompany them. Our overall financial objective is to improve on the performance of 2010.”

Managing Director - John Grant