DATA#3 LIMITED — Interim / Quarterly Report 2009

Mar 8, 2009

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Results and outlook presentation 1H 2009 performance and outlook for full year

John Grant MANAGING DIRECTOR -------------------------------- Brem Hill CHIEF FINANCIAL OFFICER

March 2009

Content

• Quick refresher on Data[#] 3

• 1H performance

• Financial

• Operational

• Full year outlook

Quick refresher on Data[#] 3

• Commenced operations in 1977

• Listed on ASX in 1997

• National ICT solutions company

• $364M revenue in 2007/08

• 460 staff / 360 contractors

• Mid to large corporate and government customers

Quick refresher on Data[#] 3

Software Optimise acquisition & Licensing management of software Solutions licensed in volume

contract & permanent recruitment; performance management systems

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Infrastructure
Solutions
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People Solutions

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Design, procure & deploy network & data centre hardware and software

Outsourced on-premises Managed and remote support Services services

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1H financial performance

1H - Chairman’s comment

“We are delighted to extend the run of ‘best ever’ performances to six years. The interim dividend of 20 cents share is an 11% increase on the per in an previous corresponding period and, increasingly challenging market, indicative of the inherent resilience of our diverse and customer focussed business”

Richard Anderson – Chairman

1H – Income Statement

	Half-Year	Half-Year	Change
Consolidated Income Statement	2008/09 $’000	2007/08 $’000	2007/08 to 2008/09
Sales revenue	116,502	62,371	+ 87%
− Software Solutions	91,918	73,575	+ 25%
− Infrastructure Solutions	21,055	20,779	+ 1%
− People Solutions
Other revenue	537	583
Total revenue	230,012	157,308	+ 46%
Total gross margin	40,017	32,010	+ 25%
Gross margin percentage	17.4%	20.4%
EBITDA [Earnings before interest (net), tax,
depreciation and amortisation]	5,880	5,054	+ 16%
Profit from ordinary activities before income	5,856	5,314	+ 10%
tax expense
Net profit after income tax	4,040	3,713	+ 9%
Earnings per share	26.16 cents	23.92 cents	+ 9%
Dividends per share	20.0 cents	18.0 cents	+ 11%
Payout ratio	76%	75%	+ 1%

1H - Balance Sheet

	December 2008	June 2008	December 2007
	$’000	$’000	$’000
Current assets
Cash and cash equivalents	8,822	17,014	6,973
Trade and other receivables	65,925	68,238	41,797
Inventories	5,805	6,601	3,620
Other	2,152	1,379	1,157
Totalcurrent assets	82,704	93,232	53,547
Non-current assets
Property and equipment	1,715	1,730	1,143
Deferred tax assets	1,499	1,223	1,194
Intangible assets	5,341	5,279	4,408
Total non-current assets	8,555	8,232	6,745
Total assets	91,259	101,464	60,292
Current liabilities
Trade and other payables	63,168	71,212	35,798
Current tax liabilities	952	1,423	920
Provisions	952	849	791
Other	4,659	5,773	3,169
Totalcurrentliabilities	69,731	79,257	40,678
Non-current liabilities
Total non-currentliabilities	889	881	807
Total liabilities	70,620	80,138	41,483
Net assets	20,639	21,326	18,807
Equity
Contributed equity	8,296	8,694	8,813
Retained profits	12,343	12,632	9,994
Total equity	20,639	21,326	18,807

1H - Cash

	Half-Year	Half-Year
Consolidated Cash Flow	2008/09	2007/08
Statement	$’000	$’000
Net cash outflow from operating activities*	(2,887)	(6,089)
Net cash outflow from investing activities**	(578)	(322)
Net cash outflow from financing activities***	(4,727)	(3,983)
Net decrease in cash	(8,192)	(10,394)
Cash at end of reporting period	8,822	6,973

• typically outflow in 1H and inflow in 2H

• ** plant, equipment and software assets

*** dividends and share buyback

1H – Consolidated revenue

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$M
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250
200
150
100
50
0
1H
1H
2004/05 1H
2005/06
1H
2006/07
1H
2007/08
2008/09
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Total revenue grew by 46% to $230 million

1H – Areas of specialisation

$M

120 100 80 60 40 20 0

1H 2005/06 1H 2006/07 1H 2007/08 1H 2008/09

Software Infrastructure People

Software Solutions …………… up 87%, Infrastructure Solutions …….. up 25% People Solutions ……………… up 1%

1H - Expenses

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88
87
86
%
85
84
83
82
1H
1H
2004/05 1H
2005/06
1H
2006/007
1H
2007/08
2008/09
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Cost ratio

(Internal staff costs & operating expenses as a percentage of gross margin) increased from 85.2% to 87.5%

(additional expense in People Solutions of $1M cf pcp)

1H - NPAT

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5
4
3
$M
2
1
0
1H
1H
2004/05 1H
2005/06 1H
2006/07 1H
2007/08
2008/09
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Net profit after tax ………… up 9% to $4.0M (People Solutions profit contribution declined by $800K cf pcp)

1H - Earnings and dividends

30 25 20 Cents 15 10 5 0 1H 1H 2004/05 1H 2005/06 1H 2006/07 1H 2007/08 2008/09

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EPS
DPS
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Earnings to 26.16 cents ………… up 9% Dividends to 20.0 cents ………… up 11% Payout ratio ………………………. up to 76%

Share price

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Solid investor support has seen the share price remain relatively strong in a difficult investment market

Difficult market effected….

• People Solutions

• Flat revenues – strong Q1 then ‘collapse’

• $1M extra expense over pcp

• $800K reduction in profit contribution over pcp

• Parts of Infrastructure Solutions

• ‘Business as usual’ technology refresh

• Projects

Offset by….

• Software Licensing Solutions

• Revenues + 87%

• NSW Department of Health

• Whole of Federal Government

• Parts of Infrastructure Solutions

• Datacentre solutions

• Contract product procurement

• Managed Services

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1H operational performance

Strategy

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Performance…

Legend

STATUS CODE achieved; on or ahead of plan work in progress; mainly on plan more work needed; behind plan

Remarkable people…

INITIATIVE

im lementin ro rams in our Peo le Plan p g p g p effective performance and career planning align individual & organisational cultures expand leadership development increase individual ex ertise p OVERALL

STATUS

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solutions Outstanding

INITIATIVE STATUS solutions framework & (pdo)[2] offerings on technology adoption trend increase revenue under contract increase win rates leverage vendors OVERALL

Organisational excellence

INITIATIVE	STATUS
increase business efficiency
improve individual productivity
use more online to improve customer service
minimise risk
enhance CSR
OVERALL

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Full year outlook

Full year outlook

“The outlook is difficult to predict as shareholders would understand however it remains our intention to do all that we can to at least equal the earnings result of the previous year and to remain strongly positioned for an improving market”

Richard Anderson – Chairman

Full year outlook

• Most indicators point to an increasingly difficult market

• Why should we be immune?

• Demonstrated we can win in the market

• Skilled and engaged team

• Our solutions appeal to very large proportion of ICT spend

• Vendor investment in creating demand

• Strong balance sheet and cashflows

• Seeing ‘flight to quality’

• Can gain marketshare and deliver revenue growth

• Reluctant to reduce our capability

Full year outlook

– Software Licensing Solutions

• Revenues flow from whole of Federal Government

• Slowing of commercial sector

• Solid revenue growth at lower margins

• Infrastructure Solutions

• Continued pressure on pricing

• Opportunity to leverage general industry ‘stress’

• Revenue flow from new Managed Services contracts

• People Solutions

• Limited growth in ‘traditional’ recruitment

• New offerings

• More candidates in market

Full year outlook

• Course to chart

• Keep short term returns ahead of like alternative investments

• Position strongly for any upswing

• Full year objectives

• Dividends to shareholders of at least 46 cents per share

• NPAT at least equal to pcp

• Confirmed by 1H and forward estimates

• Will advise of any change

Summary

• Strong first half

• Revenue growth of 46% demonstrates marketshare gain

• Difficulties in People Solutions business impacted cost ratio and profit

• Dividends of 20 cents ahead of expectations

– Market conditions

• Unpredictable but have much in our favour

• Full year objectives

• Dividends to shareholders of at least 46 cents per share

• NPAT at least equal to pcp

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© 2008 Data[#] 3 Limited ABN 31 010 545 267 The material contained in this document, including all attachments, is confidential and the copyright Data[#] 3 Limited. No part may be reproduced, used or distributed for any purpose other than the purpose for which it is issued, without the prior written consent of Data[#] 3 Limited.