DATADOT TECHNOLOGY LIMITED

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Financial Report for half year ended 31 December 2012

Consolidated Financial Statements For Half

ABN 54 091 908 726 Year Ended 31 December 20

For Half Year Ended 31 December 2012

CONTENTS Consolidated Financial Statements Corporate Information Directors' Report Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001 Consolidated Statement of Financial Position Consolidated Statement of Comprehensive Income Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows Notes to the Financial Statements Directors' Declaration Independent Auditor’s Report	Page
	1 2 5 6 7 9 10 11 19 20

CONTENTS
Consolidated Financial Statements
Corporate Information
Directors' Report
Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001
Consolidated Statement of Financial Position
Consolidated Statement of Comprehensive Income
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors' Declaration
Independent Auditor’s Report

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Corporate Information

ABN 54 091 908 726

This half-year report covers the consolidated entity comprising DataDot Technology Limited (the "Company" or the "Parent entity") and its subsidiaries (“DataDot” or the "Consolidated entity"). DataDot’s functional and presentation currency is AUD ($).

A description of DataDot’s operations and of its principal activities is included in the review of operations and activities in the directors’ report. The directors’ report is not part of the financial report.

Directors Company Secretary Registered Office Mr B. Rathie (Executive Chairman) Mr G. Loughlin Unit 9 Mr G. Flowers 19 Rodborough Road Ms A. Coutts Frenchs Forest NSW 2086 Phone +61 2 8977 4900 Fax +61 2 9975 4700 Auditors Bankers BDO East Coast Partnership Commonwealth Bank Level 10 Forestway Shopping Centre 1 Margaret Street Forestway, Frenchs Forest Sydney NSW 2000 Sydney NSW 2086 Share Register Stock Exchange Other Information Boardroom Pty Limited DataDot Technology Limited DataDot Technology Limited, Level 7 is listed on the Australian incorporated and domiciled in 207 Kent Street Securities Exchange. The Australia, is a publicly listed Sydney NSW 2000 Home Exchange is Sydney. company limited by shares. Phone +61 2 9290 9600 Fax +61 2 9279 0664 Company website www.datadotdna.com

DataDot Technology Limited - Half Year Report

Directors' Report

For the Half Year Ended 31 December 2012

Your directors submit their report, together with the financial statements of the consolidated entity (referred to hereafter as DataDot) consisting of DataDot Technology Limited and the entities it controlled at the end of, or during the half year ended 31 December 2012.

1. Directors

The directors of the Company at any time during or since the end of the half-year are as follows:

Directors were in office for this entire period unless otherwise stated.

Mr B Rathie (Executive Chairman) Mr G Flowers Ms A Coutts

2. Principal activities

The principal activities of DataDot during the period were to manufacture and distribute asset identification and authentication solutions that include:

(a) DataDotDNA[®] - polymer and metallic microdots containing etched data that is unique to the assets to which the microdots are attached. This product has two primary applications being the automotive and industrial sectors. In the automotive sector, DataDotDNA is marketed in over 20 countries through subsidiary companies and distributors. In the industrial sector, DataDotDNA is bundled with data base services where the assets are registered with law enforcement support and access and marketed under the National Metal Register and National Equipment Register brands in Australia, the US and Europe; and
(b) DataTraceDNA® – covert authentication technology applying unique spectral fingerprints to industrial products or product packaging..

There has been no significant change in the nature of these activities during the period.

3. Review of results and operations

The first six months of the financial year has been a period of stable trading and continued strong focus on costs reduction, resulting in a material improvement to profitability reflected in positive EBITDA of $15,452 as against an EBITDA loss of $1,022,350 when compared to the prior corresponding period.

Total revenues were $3,399,286 (2% increase compared to the 2011 corresponding period).

Gross profit was $2,051,927 (9% increase compared to the 2011 corresponding period).

EBITDA increase of $1,037,802 (102% increase compared to the 2011 corresponding period).

Total expenses were $2,304,705 (26% decrease compared to the 2011 corresponding period).

Net loss after income tax was $277,615 (76% decrease compared to the 2011 corresponding period).

Operating cashflow improvement of $1,368,770 compared to the 2011 comparative period.

DataDot Technology Limited - Half Year Report

Directors' Report

For the Half Year Ended 31 December 2012

3. Review of results and operations (continued)

Cash outflow from investing activities was $432,273 and included an amount of $225,530 (£150,000) being paid for the acquisition of the remaining shares in DataDot Technology (UK) Limited in accordance with share sale agreement entered into on 15 August 2012.

Cash outflow from financing activities was $224,858 and included an amount of $161,910 (£105,000) of loan repaid by DataDot Technology (UK) Limited to other parties in accordance with the sale share agreement.

As at 31 December 2012, cash balances held by the company amounted to $1,073,310.

Asia Pacific

Product sales in Asia Pacific were $2,104,683 compared to the 2011 comparative period of $2,345,094, the decrease of 10% is attributable to lower sales to the automotive OEM customers. Net profit increased to $552,484 compared to the 2011 comparative period, an increase of $109,658 (25%), primarily reflecting the efforts of costs management.

Americas

Revenues in the Americas were $604,899 compared to the 2011 comparative period of $431,923, the increase of 40% is due mainly to sales to new customers in Canada. Net profit was $114,566, an increase of $180,885 from a net loss of $66,319 in the same period last year. This result is due mainly to increased sales and improved utilization of current production capacity.

DataDot Security Solutions Inc (DDSS) was formed as a 50/50 joint venture between DataDot Technology USA Inc and DataDot Dealer Services LLC (our distributor in the US). DDSS has been established as the operating platform for the DataDot’s expansion into US industrial markets via the National Metal Register and retail market.

Europe

DataDot Technology (UK) Limited became a wholly-owned subsidiary during the half-year. Revenues in Europe were $847,811 compared to the 2011 comparative period of $562,651, the increase of 50% is due mainly to sales to new customers and improved trading conditions in Italy. Net profit was $46,129, an increase of $203,104 from a net loss of $156,975 in the same period last year. The significant improvement is due mainly to increased sales and reduced operating expenses.

AgTechnix Pty Limited

AgTechnix became a wholly-owned subsidiary at the end of the last financial year. It is currently conducting trials in China with a major agricultural company and undertaking other initiatives utilising existing DataDot resources.

DataTrace DNA Pty Limited

DataTrace revenues were $485,356, a decrease of 29% compared to the 2011 comparative period, reflecting long lead times and trials necessary to secure revenue. Net loss was $64,708 compared to a profit of $272,672 in the same period last year.

DataDot Technology Limited - Half Year Report

Directors' Report

For the Half Year Ended 31 December 2012

3. Review of results and operations (continued)

Outlook

During the half year just ended, the Company experienced stronger growth in North America and Europe, being our major market opportunities. Asia Pacific was marginally impacted by increased competition, particularly in the Taiwan market, and DataTrace has had slower growth than originally expected. The refocussing of the business and significant cost reduction initiatives during the period have positioned the business to benefit strongly from revenue growth going forward. Investments have also been made in growth opportunities during the period which should feed into revenue enhancement this current half year.

In particular, we expect to see growth in or from the following during the current half year:

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increased royalties from DataDot South Africa due to increasing volumes sold in that market;

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launches of the National Metal Register and a retail focussed program in the US by DDSS;

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improving trading conditions in Europe;

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new and previous announced program launches in the UK by DataDot UK; and

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new initiatives in Latin America and Asia.

4. Auditor's independence declaration

The lead auditor's independence declaration in accordance with section 307C of the Corporations Act 2001 , for the half year ended 31 December 2012 has been received and can be found on page 5 of the financial report.

Signed in accordance with a resolution of the Board of Directors, pursuant to section 306(3)(a) of the Corporation Act 2001.

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B Rathie Executive Chairman Sydney 25 February 2013

DataDot Technology Limited - Half Year Report

Level 10, 1 Margaret St Sydney NSW 2000 Australia

Tel: 61 2 9251 4100 Fax: 61 2 9240 9821 www.bdo.com.au

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DECLARATION OF INDEPENDENCE BY ARTHUR MILNER TO THE DIRECTORS OF DATADOT TECHNOLOGY LIMITED

As lead auditor for the review of DataDot Technology Limited for the half-year ended 31 December 2012, I declare that to the best of my knowledge and belief, there have been:

no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the review; and
no contraventions of any applicable code of professional conduct in relation to the review.

This declaration is in respect of DataDot Technology Limited and the entities it controlled during the period.

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Arthur Milner

Partner

BDO East Coast Partnership

Sydney, 25 February 2013

BDO East Coast Partnership ABN 83 236 985 726 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO East Coast Partnership and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation (other than for the acts or omissions of financial services licensees) in each State or Territory other than Tasmania.

Consolidated Statement of Financial Position

As at 31 December 2012

Note ASSETS CURRENT ASSETS Cash and cash equivalents 5 Trade and other receivables Inventories Current tax assets TOTAL CURRENT ASSETS NON-CURRENT ASSETS Plant and equipment 9 Intangible assets TOTAL NON-CURRENT ASSETS TOTAL ASSETS LIABILITIES CURRENT LIABILITIES Trade and other payables Interest bearing loans and borrowings Income tax payable Provisions Other current liabilities TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Interest bearing loans and borrowings Provisions TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Issued share capital 7 Accumulated losses 9 Reserves 9 Total equity attributable to equity holders of the company Non-controlling interest TOTAL EQUITY	31 Dec 2012 $ 30 Jun 2012 $ Restated 1,073,310 1,409,367 1,328,907 1,333,620 1,381,229 1,483,912 58,005 567,388
	3,841,451 4,794,287
	868,214 804,896 3,020,469 2,961,847
	3,888,683 3,766,743
	7,730,134 8,561,030
	868,311 1,061,917 237,051 60,082 29,404 20,148 376,058 455,573 315,151 688,822
	1,825,975 2,286,542
	144,005 - 3,026 4,407
	147,031 4,407
	1,973,006 2,290,949
	5,757,128 6,270,081
	33,376,382 33,102,482 (27,602,696) (27,331,024) (16,558) 544,772
	5,757,128 6,316,230 - (46,149)
	5,757,128 6,270,081

The accompanying notes form part of these financial statements.

DataDot Technology Limited - Half Year Report

Consolidated Statement of Comprehensive Income

For the Half Year Ended 31 December 2012

Note Sale of goods Rendering of services Licence fees Royalties Finance revenue 3 Revenue Cost of sales Gross profit Employee benefits expense Administrative expense Advertising & promotional expense Occupancy expense Travel expense Finance costs 3 Depreciation & amortisation 9 Bad and doubtful debts Gain/Loss on foreign currency Impairment losses Loss before income tax Income tax expense 3 Loss for the half year after income tax expense Other comprehensive income/(loss): Items that may be reclassified subsequently to profit or loss Exchange differences on translating foreign controlled entities Other comprehensive income/(loss) for the period, net of tax Total comprehensive loss for the period Loss attributable to: Members of the parent entity Non-controlling interest Total comprehensive loss attributable to: Members of the parent entity Non-controlling interest	31 Dec 2012 $ 31 Dec 2011 $ Restated 3,131,586 3,006,358 - 447 - 75,185 262,369 182,397 5,331 53,385
	3,399,286 3,317,772 (1,347,359) (1,430,648)
	2,051,927 1,887,124 (1,061,741)(1,866,714) (537,200)(417,354) (47,025)(83,091) (181,347)(219,250) (137,662)(181,349) (33,249) (11,143) (227,485)(198,050) - (118,827) (71,500) (22,889) (7,496) -
	(252,778) (1,231,543) (24,837)(7,399)
	(277,615) (1,238,942) 29,803 (32,578)
	29,803 (32,578)
	(247,812) (1,271,520)
	(271,672) (1,136,688) (5,943) (102,254)
	(277,615) (1,238,942)
	(241,869) (1,169,266) (5,943) (102,254)
	(247,812) (1,271,520)

The accompanying notes form part of these financial statements.

DataDot Technology Limited - Half Year Report

Consolidated Statement of Comprehensive Income

For the Half Year Ended 31 December 2012

31	Dec 2012	31 Dec 2011
	Cents	Cents
		Restated
Earnings per share attributable to the ordinary equity holders of the parent:
Basic (loss)/earnings per share	(0.06)	(0.24)
Diluted (loss)/earnings per share	(0.06)	(0.23)

The accompanying notes form part of these financial statements.

DataDot Technology Limited - Half Year Report

Consolidated Statement of Changes in Equity

For the Half Year Ended 31 December 2012

2012

Balance at 1 July 2012 Adjustment for correction of error (note 9) Balance at 1 July 2012 - restated Loss for the period Other comprehensive income Total comprehensive income for the period Transactions with owners in their capacity as owners Acquisition of non-controlling interest in DataDot Technology UK Limited Employee Share-based payment options Employee share rights vested Balance at 31 December 2012 Balance at 1 July 2011 Loss for the period Other comprehensive income Total comprehensive income for the period Transactions with owners in their capacity as owners Employee Share-based payment options Balance at 31 December 2011		Issued Share Capital $ Accumulated Losses $ Foreign Currency Translation Reserve $ Employee Equity Benefits Reserve $ Other Reserve $ Total attributable to equity holders of the parent $ Non-controlling Interests $ Total Equity $ 33,102,482 (27,248,431) 479,205 323,713 (309,424) 6,347,545 (46,149) 6,301,396 - (82,593) - 51,278 - (31,315) - (31,315)
		33,102,482 (27,331,024) 479,205 374,991 (309,424) 6,316,230 (46,149) 6,270,081 - (271,672) - - - (271,672) (5,943) (277,615) - - 29,803 - - 29,803 - 29,803
		- (271,672) 29,803 - - (241,869) (5,943) (247,812) - - - - (369,199) (369,199) 52,092 (317,107) - - 51,966 - 51,966 - 51,966 273,900 - (273,900) - - - -
		33,376,382 (27,602,696) 509,008 153,057 (678,623) 5,757,128 - 5,757,128
		33,102,482 (25,857,705) 540,360 148,856 - 7,933,993 (93,661) 7,840,332 - (1,136,688) - - - (1,136,688) (102,254) (1,238,942) - - (32,578) - - (32,578) - (32,578)
		- (1,136,688) (32,578) - - (1,169,266) (102,254) (1,271,520) - - - 151,093 - 151,093 - 151,093
		33,102,482 (26,994,393) 507,782 299,949 - 6,915,820 (195,915) 6,719,905

The accompanying notes form part of these financial statements.

DataDot Technology Limited - Half Year Report

Consolidated Statement of Cash Flows

For the Half Year Ended 31 December 2012

Note Cash flows from operating activities: Receipts from customers (inclusive of GST) Payments to suppliers and employees (inclusive of GST) Interest paid Income taxes paid Net cash flows from/(used in) by operating activities Cash flows from investing activities: Interest received Purchase of property, plant and equipment Purchase of intangible assets Payment for acquisition of minority interest in subsidiary Net cash flows used in investing activities Cash flows from financing activities: Repayment of borrowings Proceeds from other loans Payment of finance lease liabilities Net cash flows from/(used in) financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of period Effect of exchange rate on cash holdings in foreign currencies Cash and cash equivalents at end of period 5	31 Dec 2012 $ 31 Dec 2011 $ 3,516,135 3,050,974 (3,169,643) (4,080,870) (10,579) (11,143) (15,581) (7,399)
	320,332 (1,048,438)
	5,320 53,384 (5,872) (118,120) (206,191) (274,926) (225,530) -
	(432,273) (339,662)
	(188,522) (23,302) - 125,000 (36,336) -
	(224,858) 101,698
	(336,799) (1,286,402) 1,409,368 3,528,593 741 1,004
	1,073,310 2,243,195

The accompanying notes form part of these financial statements.

DataDot Technology Limited - Half Year Report

Notes to the Financial Statements

For the Half Year Ended 31 December 2012

The financial report of DataDot Technology Limited and its subsidiaries (DataDot), for the half year ended 31 December 2012 was authorised for issue in accordance with a resolution of the Board of Directors on 25 February 2013.

DataDot Technology Limited (the parent entity) is a company limited by shares incorporated and domiciled in Australia whose shares are publicly traded on the Australian Securities Exchange (ASX).

The nature of the operations and principal activities of DataDot are described in the directors' report.

1 Summary of Significant Accounting Policies

Basis of preparation

This general purpose condensed financial report for the half year ended 31 December 2012 has been prepared in accordance with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001, as appropriate for profit-oriented entities.

The principal accounting policies adopted are consistent with those of the previous financial year and corresponding half-year reporting period.

The half year financial report does not include all notes of the information required in annual financial statements in accordance with AIFRS.

New, revised or amending Accounting Standards and Interpretations adopted

DataDot has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by the Australian Accounting Board (“AASB”) that are mandatory for the current reporting period.

Any new, revised or amending Accounting Standards or Interpretations that are not yet mandatory have not been early adopted other than the following:

AASB 2012-5 Amendments to Australian Accounting Standards arising from Annual Improvements 20092011 cycle .

DataDot has elected to early adopt the amendments to AASB 101 Presentation of Financial Statements included in AASB 2012-5 arising from the annual improvements project for the annual financial period commencing 1 January 2012. The amendments clarify that where there has been a retrospective restatement due to a change in accounting policy, error or reclassification, a third statement of financial position is only required where the impact of the retrospective restatement has a material impact on the third statement of financial position.

The amendments also clarify that related notes are not required for this third statement of financial position, except insofar as required to explain the impact of the retrospective restatement as required by AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors .

The amendment is mandatory for annual reporting periods commencing on or after 1 January 2013.

By early adopting this amendment, the company has only presented notes required by AASB 108 relating to the prior period adjustments as shown in Note 9.

The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the consolidated entity.

DataDot Technology Limited - Half Year Report

Notes to the Financial Statements

For the Half Year Ended 31 December 2012

The following Accounting Standards and Interpretations are most relevant to the consolidated entity:

AASB 2011-9 Amendments to Australian Accounting Standards – Presentation of Items of Other Comprehensive Income

The consolidated entity has applied AASB 2011-9 amendments from 1 July 2012. The amendments require grouping together of items within other comprehensive income on the basis of whether they will eventually be ‘recycled’ to the profit or loss (reclassification adjustments). The change provides clarity about the nature of items presented as other comprehensive income and the related tax presentation.

It is recommended that the half year financial report be read in conjunction with the annual report for the year ended 30 June 2012 and considered together with any public announcements made by DataDot during the half year ended 31 December 2012 in accordance with the continuous disclosure obligations of the ASX listing rules.

2 Operating Segments

Identification of reportable segments

DataDot has identified its operating segments based on the internal reports that are reviewed and used by the executive management team (the chief operating decision makers) in assessing performance and in determining the allocation of resources.

Three of the operating segments are identified by management based on the location of the selling segment. Two of the operating segments are identified by management based on the product offerings. Discrete financial information about each of these operating businesses is reported to the executive management team on at least a monthly basis.

The three geographical regions of Asia Pacific, Americas and Europe each manufacture and distribute an asset identification system that includes DataDotDNA® - polymer and metallic microdots containing etched data that is unique to the assets to which the microdots are attached. These products are sold into the automotive and industrial sectors.

The two additional operating segments that are identified by product offerings managed on a global basis are:

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DataTraceDNA® – a high speed, high security, machine readable system for authenticating materials, products and assets; and
AgTechnix - IntelliSeed™ by AgTechnix is a frontier patent pending technology, supporting global agriculture and protecting investments in intellectual property across a diverse spectrum of agricultural activities, including seed and plant genetics.

Accounting Policies and Inter-Segment Transactions

The accounting policies used by DataDot in reporting segments internally is the same as those contained in the prior period. Inter segment pricing is determined on an arm’s length basis.

The following tables present the revenue, profit/(loss) before tax, assets and liabilities information regarding operating segments for the half year periods ended 31 December 2012 and 31 December 2011.

DataDot Technology Limited - Half Year Report

Notes to the Financial Statements

For the Half Year Ended 31 December 2012

2 Operating Segments (continued)

Segment Performance

Asia Pacific $ Americas $ Europe $ AgTechnix $	DataTraceDNA $	Total $
1,340,134 508,772 846,731 19,231 262,369 - - - 502,180 96,127 1,080 -	416,718 - 68,638	3,131,586 262,369 668,025
2,104,683 604,899 847,811 19,231	485,356	4,061,980 (668,025) 5,331
552,484 114,566 46,129 (1,573) 1,274,439 698,162 667,741 122,815 362,316 172,738 300,346 373,977	(64,708) 2,441,350 37,341
		3,399,286
		646,898 (866,427)
		(219,529) (33,249)
		(252,778) (24,837)
		(277,615)
		5,204,507 2,525,627
		7,730,134
		1,246,718 726,288
		1,973,006

DataDot Technology Limited - Half Year Report

Notes to the Financial Statements

For the Half Year Ended 31 December 2012

2 Operating Segments (continued)

Segment Performance (continued)

Asia Pacific $ Americas $ Europe $ AgTechnix $	DataTraceDNA $	Total $
1,434,825 381,756 562,651 7,116 257,582 448 - - 652,687 49,719 - -	620,010 - 65,574	3,006,358 258,030 767,980
2,345,094 431,923 562,651 7,116	685,584	4,032,368 (767,980) 53,384
442,826 (66,319) (156,975) (203,685) 2,612,277 413,160 707,343 96,449 872,059 49,129 114,782 28,087	272,672 2,245,850 127,349
		3,317,772
		288,519 (1,508,919)
		(1,220,400) (11,143)
		(1,231,543) (7,399)
		(1,238,942)
		6,075,079 2,505,989
		8,581,068
		1,191,406 669,757
		1,861,163

DataDot Technology Limited - Half Year Report

Notes to the Financial Statements

For the Half Year Ended 31 December 2012

3 Revenue, Income and Expenses

(i) Finance Revenue Bank interest from deposits (ii) Finance Costs Bank interest on loans and overdrafts Finance charges under finance leases and hire purchase contracts Other interest expense (iii) Income tax expense Income tax expense	31 Dec 2012 $ 31 Dec 2011 $ 5,331 53,385
	29,824 10,969 3,425 117 - 57
	33,249 11,143
	24,837 7,399

As at 31 December 2012, no deferred tax assets in respect of losses have been recognized. Deferred tax assets and liabilities in respect of temporary differences have been offset against each other with nil impact on the profit and loss.

4 Dividends

No dividends were declared or paid during the half-year (2011: Nil).

5 Cash and Cash Equivalents

Cash and Cash Equivalents
	31 Dec 2012	30 Jun 2012
	$	$
Cash at bank and on hand	1,073,310	1,409,367

6 Acquisition of minority shareholding in DataDot Technology UK Limited (DDUK)

During the period, on 15 August, a share sale agreement was executed between DataDot Technology Limited (DataDot) and a minority shareholder of DataDot Technology UK Limited (DDUK). Under the agreement, all the shares owned by the minority shareholder (20%) were purchased by DataDot for an agreed consideration of £150,000. As part of the share sale agreement, £105,000 of a £250,000 loan from the minority shareholder to DDUK was also repaid during the period, with payment of the remaining £145,000 due in three instalments (£50,000 in July 2013, £50,000 in December 2013 and £45,000 in June 2014). The amount of the loan outstanding is interest bearing.

DataDot has also executed a share sale agreement with the other minority shareholder who owned 8% of DDUK, for an agreed consideration of £60,000, with £5 paid immediately and the remaining £59,995 due on or before 1 July 2013. This agreement was effective on 30 August 2012, at which point DataDot owns 100% of DDUK.

DataDot Technology Limited - Half Year Report

Notes to the Financial Statements

For the Half Year Ended 31 December 2012

7 Executive Share Rights Plan

DataDot has an executive share rights plan approved by shareholders at the 2010 annual general meeting. The plan provides for the issue of share rights to executives for no consideration. Each share right converts into one fully paid ordinary share on completion of the vesting conditions. A trading restriction applies for a further 12 months after vesting.

On 1 July 2012, 6,225,000 share rights vested and the same number of fully paid ordinary shares of DataDot was issued. The adjusted value to Issued Share Capital is equal to this number of shares valued at the closing price of the shares on the date on which the share rights were granted.

8 Events after the balance date

On 1 January 2013, 8,000,000 share rights were granted to Paul McClean (via Ripley 33 Pty Ltd) under the terms of the Executive Share Rights Plan. Subject to performance hurdles and continuous engagement, the share rights will vest in three equal tranches on 1 July 2014, 1 July 2015 and 1 July 2016. The issue of the share rights is for no consideration. As no adjustments are required to be made for exercise price or share price volatility, the fair value of the share rights is equivalent to the closing share price of DataDot ordinary shares on the date of issue (1 Jan 2013). A trading restriction applies for a further 12 months after vesting and the share rights expire on 1 July 2020.

9 Restatement of comparatives

Prior period adjustment – Depreciation and amortisation expense

Depreciation of plant and equipment commissioned and used in production in the year ended 30 June 2012 has been understated. This plant and equipment was not included in the schedule of depreciation as the assets were classified as under construction. As a result, for the half year ended 31 December 2011, depreciation expense was understated by $21,113 and for the year ended 30 June 2012, net book value of plant and equipment was overstated by $31,315. Extracts (being only those line items affected) are disclosed below.

Prior period adjustment – Employee equity benefits reserve

Share rights granted to employees were not being recognised over the correct vesting period. Share rights were recognised over a vesting period which incorrectly included an additional 12 months beyond the vesting period, being the 12 month holding lock period which is attached to the share rights. As a result, for the half year ended 31 December 2011, employee benefits expense was understated by $21,757 and the employee equity benefits reserve as at 30 June 2012 was understated by $51,278. Extracts (being only those line items affected) are disclosed below.

DataDot Technology Limited - Half Year Report

Notes to the Financial Statements

For the Half Year Ended 31 December 2012

9 Restatement of comparatives (continued)

Statement of comprehensive income

Extract Expenses Depreciation & amortisation Employee benefits expense Loss before income tax Loss for the half year after income tax expense Total comprehensive loss for the period Loss attributable to: Members of the parent entity Non-controlling interest Total comprehensive loss attributable to: Members of the parent entity Non-controlling interest Earnings per share attributable to the ordinary equity holders of the parent: Basic (loss)/earnings per share Diluted (loss)/earnings per share	31 Dec 2011 31 Dec 2011 $ $ Reported Adjustment Restated (176,937) (21,113) (198,050) (1,844,957)(21,757)(1,866,714)
	(1,188,673) (42,870) (1,231,543)
	(1,196,072) (42,870)(1,238,942)
	(1,228,650)(42,870)(1,271,520)
	(1,093,818) (42,870) (1,136,688) (102,254) - (102,254)
	(1,196,072)(42,870) (1,238,942)
	(1,126,396) (42,870) (1,169,266) (102,254) - (102,254)
	(1,228,650) (42,870) (1,271,520)
	Cents (0.23) (0.23) Cents (0.01) - Cents (0.24) (0.23)

DataDot Technology Limited - Half Year Report

Notes to the Financial Statements

For the Half Year Ended 31 December 2012

9 Restatement of comparatives (continued)

Statement of financial position at the earliest comparative period

Extract Assets Non-current assets Plant and equipment Total non-current assets Total assets Net assets Equity Accumulated losses Reserves Total equity attributable to equity holders of the company Total Equity	30 Jun 2012 30 Jun 2012 $ $ Reported Adjustment Restated 836,211 (31,315) 804,896
	3,798,058 (31,315) 3,766,743
	8,592,345 (31,315) 8,561,030
	6,301,396(31,315)6,270,081
	(27,248,431) (82,593) (27,331,024) 493,494 51,278 544,772
	6,347,545(31,315) 6,316,230
	6,301,396 (31,315) 6,270,081

DataDot Technology Limited - Half Year Report

DataDot Technology Limited

Directors' Declaration

In the directors’ opinion:

(a) the attached financial statements and notes thereto comply with the Corporations Act 2001, Australia Accounting Standard AASB 134 “Interim Financial Reporting”, the Corporations Regulations 2001 and other mandatory professional reporting requirements;
(b) the attached financial statements and notes thereto give a true and fair view of the consolidated entity’s financial position as at 31 December 2012 and of its performance for the financial half-year ended on that date; and
(c) 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 the directors made pursuant to section 303(5) of the Corporations Act 2001.

On behalf of the Board

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B Rathie Executive Chairman Sydney 25 February 2013

DataDot Technology Limited - Half Year Report

Level 10, 1 Margaret St Sydney NSW 2000 Australia

Tel: 61 2 9251 4100 Fax: 61 2 9240 9821 www.bdo.com.au

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INDEPENDENT AUDITOR’S REVIEW REPORT

To the members of DataDot Technology Limited

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of DataDot Technology Limited, which comprises the consolidated statement of financial position as at 31 December 2012, and the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the half-year ended on that date, notes comprising a statement of significant accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity comprising DataDot Technology Limited and the entities it controlled at the half-year’s end or from time to time during the half-year.

Directors’ Responsibility for the Half-Year Financial Report

The directors of the disclosing entity 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 Auditing Standard on Review Engagements ASRE 2410 Review of a 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 half-year 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 2012 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of DataDot Technology Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a 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.

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 . We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of DataDot Technology Limited,

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would be in the same terms if given to the directors as at the time of this auditor’s review report.

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 DataDot Technology Limited is not in accordance with the Corporations Act 2001 including:

(a) giving a true and fair view of the consolidated entity’s financial position as at 31 December 2012 and of its performance for the half-year ended on that date; and
(b) complying with Accounting Standard AASB 134 Interim Financial Reporting and Corporations Regulations 2001 .

BDO East Coast Partnership

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Arthur Milner

Partner

Sydney, 25 February 2013

Note Sale of goods Rendering of services Licence fees Royalties Finance revenue 3 Revenue Cost of sales Gross profit Employee benefits expense Administrative expense Advertising & promotional expense Occupancy expense Travel expense Finance costs 3 Depreciation & amortisation 9 Bad and doubtful debts Gain/Loss on foreign currency Impairment losses Loss before income tax Income tax expense 3 Loss for the half year after income tax expense Other comprehensive income/(loss): Items that may be reclassified subsequently to profit or loss Exchange differences on translating foreign controlled entities Other comprehensive income/(loss) for the period, net of tax Total comprehensive loss for the period Loss attributable to: Members of the parent entity Non-controlling interest Total comprehensive loss attributable to: Members of the parent entity Non-controlling interest	31 Dec 2012 $ 31 Dec 2011 $ Restated 3,131,586 3,006,358 - 447 - 75,185 262,369 182,397 5,331 53,385
	3,399,286 3,317,772 (1,347,359) (1,430,648)
	2,051,927 1,887,124 (1,061,741)(1,866,714) (537,200)(417,354) (47,025)(83,091) (181,347)(219,250) (137,662)(181,349) (33,249) (11,143) (227,485)(198,050) - (118,827) (71,500) (22,889) (7,496) -
	(252,778) (1,231,543) (24,837)(7,399)
	(277,615) (1,238,942) 29,803 (32,578)
	29,803 (32,578)
	(247,812) (1,271,520)
	(271,672) (1,136,688) (5,943) (102,254)
	(277,615) (1,238,942)
	(241,869) (1,169,266) (5,943) (102,254)
	(247,812) (1,271,520)

AI assistant

DATADOT TECHNOLOGY LIMITED — Interim / Quarterly Report 2013

64764_rns_2013-02-24_56828a7c-ce08-46ad-a4d0-56c08a681984.pdf