DTI GROUP LTD — Interim / Quarterly Report 2016

Feb 24, 2016

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24 February 2016

ASX Company Announcements Australian Securities Exchange Ltd Level 40 Central Park 152-158 St George’s Terrace PERTH WA 6000

Electronic lodgement via ASX Online

DTI GROUP LIMITED & CONTROLLED ENTITIES (ASX: DTI) 31 DECEMBER 2015 HALF-YEAR FINANCIAL REPORT

In accordance with ASX Listing Rule 4.2A, please find attached the following documents in relation to the half year consolidated financial results for DTI Group Limited and its controlled entities:

• 2016 Half-Year Report; and

• Appendix 4D.

The above documents are for immediate release.

Yours faithfully,

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Bruce Mitchell Company Secretary

DTI GROUP LTD ACN: 069 791 091

31 Affleck Rd | Perth Airport WA 6105 T +61 8 9479 1195 | F +61 8 9479 1190 DTI Group Ltd | ABN 15 069 791 091 www.dti.com.au

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DTI GROUP LTD ABN 15 069 791 091

Half-Year Report 31 December 2015

Lodged with ASX under Listing Rule 4.2A.

This information should be read in conjunction with the 30 June 2015 Annual Report, together with the public announcements and documents made by DTI Group Ltd in accordance with its continuous disclosure obligations under the Corporations Act 2001 and ASX Listing Rules.

Contents

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|Results for announcement to the market (Appendix 4D, Item 2)|1|
|Half-year report (ASX Listing rule 4.2A1)|2|
|Corporate Directory|19|

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APPENDIX 4D ANNOUNCEMENT TO THE MARKET

DTI Group Ltd and its Controlled Entities Half-year ended 31 December 2015

(Previous corresponding period half-year ended 31 December 2014)

	% Change	Direction	$
Revenue from ordinary activities	32	up	8,699,395
Profit/(loss) after tax attributable to members	4	down	(211,975)
Netprofit/(loss)for theperiod attributable to members	4	down	(211,975)

No dividends have been declared or paid during the period.

Net tangible asset backing per share at 31 December 2015 was $0.12 (31 December 2014: $0.11).

Entities over which control has been gained or lost during the period	Nil
Associates and joint venture entities	Nil
Foreign reporting entity	N/A

Additional information supporting the Appendix 4D disclosure requirements can be found in the Directors’ Report and the consolidated financial statements for the half year ended 31 December 2015.

International Financial Reporting standards have been used in compiling the information contained in this Appendix 4D.

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2015 Half-year Report

Contents

Directors’ report	3
Condensed consolidated statement of profit or loss and other comprehensive income	7
Condensed consolidated statement of financial position	8
Condensed consolidated statement of changes in equity	9
Condensed consolidated statement of cash flows	10
Notes to the consolidated financial statements	11
Directors’ declaration	15
Independent auditor’s review report to members	16
Auditor’s independence declaration	18
Corporate directory	19

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Directors’ report

The Directors present their report for DTI Group Ltd (“DTI” or “Company”) in respect of the financial half year ended 31 December 2015.

Directors

The names of the Directors of the Company in office during the financial half-year and until the date of this report are set out below. Directors were in office for this entire period unless otherwise stated.

Chris Morris

Non-Executive Chairman

Richard Johnson

Managing Director

Neil Goodey

Non-Executive Director

Glyn Denison

Non-Executive Director

Jeremy King

Non-Executive Director

Principal activities

The principal activities of the consolidated entity during the course of the half-year were the operation of surveillance solutions, commuter communication solutions and managed services for the global transit industry:

• Surveillance and Commuter Communication – specialised hardware systems, incorporating video, passenger information, audio, GPS tracking, communications and high-speed recording technology; supported by sophisticated device and data management software to provide comprehensive, fleet-wide, CCTV, communication and vehicle management solutions.

• Managed services – back-end control room communications and infrastructure comprising wide-area urban surveillance, driver development and risk mitigation, video management, vehicle data analysis and monitoring, schedule adherence analysis, IT infrastructure, help desk, technical support and monitoring, and first line maintenance.

DTI markets and distributes its product range to customers around the world, both directly and in conjunction with a network of integrators and business partners.

DTI is a company limited by shares that is incorporated and domiciled in Australia. The Company is publicly listed on the Australian Securities Exchange under the code “DTI”.

Financial Review

The after tax loss for the consolidated entity for the first half-year ended 31 December 2015 amounted to $211,975 (31 December 2014: $203,946 loss).

For the half-year period the consolidated entity achieved EBITDA profit of $122,152 compared to the previous corresponding period EBITDA loss of $53,341.

The financial position of the consolidated entity remains sound with $14.34 million of net assets.

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At the period end, the cash position of the consolidated entity amounted to $3.46 million. Current assets $14.32 million exceed current liabilities $3.82 million by $10.50 million.

The consolidated entity generated $0.67 million cash from operations and invested $1.44 million in intellectual property, and plant and equipment.

Review of operations

DTI achieved strong sales in the first half of the 2016 financial year, which were up 32% to $8.70 million compared to the previous year’s first half sales of $6.59 million. The main driver of improved sales in the first half was from the United States which is a key target market for DTI.

Recurring revenue for the half-year totalled $3.34 million being 38% of sales revenue. This recurring revenue includes $1.32 million from maintenance activities plus a further $2.02 million of ongoing monthly sales to customers such as bus and rail manufacturers. These ongoing monthly sales are primarily due to fleet renewal programs which extend for up to a ten-year period. For example, DTI announced in July 2014 that its advanced surveillance solution has been specified in a bus procurement tender issued by the San Francisco Metropolitan Transport Authority (SFMTA). The bus procurement tender involves the manufacture of up to 454 new buses over a five-year period with orders having now commenced. Other examples include bus procurements for the Brisbane City Council, Perth PTA, Philadelphia and Light Rail Vehicles for SFMTA. Not included in the $3.34 million recurring revenue are ongoing ad-hoc sales to bus manufacturers and operators, which in the case of the United States has never been less than $1.23 million in any six month period over the past four years. With DTI’s advanced solutions being increasingly specified as the system of choice, the Company expects recurring revenue to continue to increase going forward.

DTI continues to expand its marketing activities across all three major geographical market segments based on increased tendering activity and new business development opportunities which DTI has identified. In this regard, the outlook for DTI in the mobile security market remains robust reinforced by a record number of prospects being pursued which in total are valued at over $330 million.

Americas

DTI achieved strong sales in the United States market in the first half of the 2016 financial year with sales of $5.18 million compared to $1.60 million in the previous corresponding period. A large portion of these sales were for new bus procurements for a major United States city. The supply to this city started with a successful trial in 2009 and DTI has been in a dominant position to maintain ongoing sales through its business partner to this city over a seven-year procurement period which has resulted in almost 3,000 bus surveillance systems being installed.

In July 2014, DTI announced that its advanced surveillance solution had been specified in a bus procurement tender issued by the SFMTA. The bus procurement tender includes the manufacture of up to 454 buses over a five-year period with sales commencing in the first half of this financial year. Further to this, the DTI solution was recommended for additional vehicle procurements by SFMTA, such as a 64 vehicle light rail project which includes options for up to 260 rail cars over 13 years. DTI announced in October 2015 that it had been successful in this procurement.

In August 2015, DTI was notified that its advanced surveillance solution was specified in a bus procurement tender issued by the South Eastern Pennsylvania Transportation Authority (SEPTA) which serves the five counties in and around Philadelphia, PA and is the United States sixth largest transit authority. SEPTA is truly multi-modal providing bus, trackless trolley, light rail, heavy rail, regional rail and customised community transit services. SEPTA’s video surveillance program is the largest in the United States and a key contributor in the authority’s plummeting costs for claims and litigation over the past several years. The bus procurement tender includes the manufacture of up to 525 buses over a five-year period with orders expected to commence late this financial year. Furthermore, DTI has been specified for SEPTA’s next procurement of 44 Silverliner rail cars. This, together with the ongoing relationship with SFMTA, confirms strong transit agency support in the United States for DTI’s products over the coming years.

In January 2015, DTI incorporated a wholly owned subsidiary in the United States. This subsidiary allows DTI to transact more effectively with customers across the North American market with the first direct sales having commenced in the past six months to

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government agencies such as SEPTA. The subsidiary forms an important part of DTI’s growth strategy of extending the reach of DTI’s offering to transit operators primarily in bus and rail in North America. Previously DTI’s US partner only pursued large-scale bus contracts.

Australasia

DTI maintained a strong market position in the Australasian transit sector in the first half with sales of $3.03 million being slightly above management’s expectations for the Australasian sector but below the first half sales in the previous financial year of $3.65 million. This revenue included ongoing monthly sales to a wide range of customers in Perth, Adelaide, Canberra, Tasmania, Melbourne, Sydney and Brisbane.

In October 2015, DTI announced that it had received an order by Alstom Transport India Limited (“Alstom”) for the supply of passenger information, public address and CCTV systems for driverless trains being delivered to the Sydney Metro Northwest project. The order for the procurement contract includes the provision of systems on 22 new driverless trains valued at approximately $5.3 million with deliveries expected to commence late in the first half of the 2017 financial year. Importantly, the procurement fulfils a DTI strategy to offer an expanded technology suite integrating both transit surveillance and commuter communication solutions. The commuter communication solution, which is being developed internally by DTI, increases the value of the contract significantly and represents a capability expansion when compared to a surveillance only option. Alstom, which is headquartered in France, is one of the largest train builders in the western world. This project is a key opportunity to strengthen DTI’s relationship with Alstom.

In September 2015, DTI advised that it has signed a two-year contract extension for the support and maintenance of over 900 CCTV systems on Brisbane City Council buses, as well as an extension to the standing arrangement for the provision of new CCTV systems. The extension also includes the support and maintenance of back office systems at seven depots across the Brisbane area. Brisbane City Council has also confirmed the procurement of an additional 65 CCTV systems for the second half of the 2016 financial year.

Europe, Middle East, Africa (EMEA)

DTI experienced weaker sales in the EMEA market with revenue decreasing from $1.34 million in the first half of the 2015 financial year to $0.49 million in the first half of the 2016 financial year.

DTI opened an office located in the city of Besançon in July 2014 as a base for the French market. In August 2014, DTI announced an order with its French partner, Cibest, for 36 advanced video surveillance systems for the Marseille Metro. Building on this success, DTI received a further order for Marseille Metro in December 2015 for the supply of passenger information systems to be installed on all 36 of metro trains in Marseille.

In December 2015, DTI also advised that Cibest had been awarded a five-year framework agreement for the supply of video surveillance systems by L’Association pour la Gestion Indépendante des Réseaux (AGIR) which is an association of 172 independent transport providers. The framework agreement caters for the standardised procurement by AGIR members for CCTV surveillance solutions. While the DTI solution is the sole surveillance system nominated by AGIR, the AGIR agreement does not bind members to purchase the DTI solution.

In December 2015, DTI received an order for a trial surveillance system by its Dutch partner. VisiOn Isp, to retrofit Stadler trains in the Dutch city of Utrecht. This is DTI’s first supply to Stadler Rail AG, the Swiss train builder, and if the trial is successful, an additional 24 trains are expected to be procured.

DTI also confirmed in December 2015 that it had been successful in its tender for advanced Automatic Passenger Counting on eight trains for Merseyrail which operates in the Liverpool area. Carrying approximately 110,000 passengers each weekday, Merseyrail forms one of the most heavily used railway networks in the United Kingdom outside London.

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Signed in accordance with a resolution of the Board of Directors and is signed for and on behalf of the Directors by:

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Richard Johnson Managing Director 24 February 2016 Perth, Australia

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Condensed consolidated statement of profit or loss and

other comprehensive income

for the half-year ended 31 December 2015

	31 December	31 December
	2015	2014
	$	$
Revenue from continuing operations	8,699,395	6,588,089
Other income	73,937	199,205
Change in inventory of finished goods	249,489	326,934
Raw materials and consumables used	(4,537,858)	(3,613,218)
Employee benefits expense	(2,458,182)	(2,394,070)
Depreciation and amortisation expense	(496,420)	(423,873)
Administration expenses	(770,922)	(449,776)
Marketing expenses	(570,546)	(390,365)
Research and development expenses	(22,732)	(12,021)
Other expenses	(531,459)	(285,424)
Finance costs	(2,071)	(2,564)
Profit / (loss) from operations before income tax	(367,369)	(457,083)
Income tax(expense) / benefit	155,394	253,137
Profit /(loss) after tax	(211,975)	(203,946)
Profit / (loss) is attributable to:
Owners of DTIGroup Ltd	(211,975)	(203,946)
Other comprehensive income
Items thatmay bereclassified to profit or loss:
Exchange differences ontranslationof foreignoperations	(125,635)	(23,201)
Total other comprehensive income / (loss)	(125,635)	(23,201)
Total comprehensive income /(loss) for theperiod	(337,610)	(227,147)
Total comprehensive income / (loss) is attributable to:
Owners of DTIGroup Ltd	(337,610)	(227,147)
Loss per share for profit / (loss) attributable to the
ordinary equity holders of the Company:
Basic loss per share (cents per share)	(0.23)	(0.26)
Diluted lossper share(centsper share)	(0.23)	(0.26)

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

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Condensed consolidated statement of financial position as at 31 December 2015

		31 December	30 June
	Note	2015 $	2015 $
Current assets
Cash and cash equivalents		3,464,171	3,839,829
Other financial assets		400,063	400,063
Trade and other receivables		5,352,145	6,309,975
Inventories		4,994,721	4,612,086
Othercurrent assets		109,043	130,640
Total current assets		14,320,143	15,292,593
Non-current assets
Other receivables		446,405	531,032
Property, plant and equipment		998,340	573,076
Intangible assets		3,031,410	2,517,548
Total non-current assets		4,476,155	3,621,656
Total assets		18,796,298	18,914,249
Current liabilities
Trade and other payables		3,687,615	3,720,171
Borrowings		132,666	19,042
Total current liabilities		3,820,281	3,739,213
Non-current liabilities
Borrowings	4	285,196	46,704
Provisions		87,266	70,273
Deferred tax liabilities		263,411	380,305
Total non-current liabilities		635,873	497,282
Total liabilities		4,456,154	4,236,495
Net assets		14,340,144	14,677,754
Equity
Contributed equity	3	13,723,974	13,723,974
Reserves		(204,272)	(78,637)
Retainedincome		820,442	1,032,417
Total equity		14,340,144	14,677,754

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

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Condensed consolidated statement of changes in equity for the half-year ended 31 December 2015

			Foreign
			Currency	Accumulated
	Contributed	Options	Translation	Gains /
	Equity	Reserve	Reserve	(Losses)	Total
	$	$	$	$	$
2015
At 1 July 2015	13,723,974	–	(78,637)	1,032,417	14,677,754
Loss for the half-year	–	–	–	(211,975)	(211,975)
Othercomprehensiveloss	–	–	(125,635)	–	(125,635)
Total comprehensive loss for the half-year	–	–	(125,635)	(211,975)	(337,610)
Transactions with owners in their
capacity as owners
Issue of share capital	–	–	–	–	–
Capital raising costs	–	–	–	–	–
At 31 December 2015	13,723,974	–	(204,272)	820,442	14,340,144
2014
At 1 July 2014	9,274,384	1,156,957	(18,361)	(238,057)	10,174,923
Loss for the half-year	–	–	–	(203,946)	(203,946)
Othercomprehensiveloss	–	–	(23,201)	–	(23,201)
Total comprehensive loss for the half-year	–	–	(23,201)	(203,946)	(227,147)
Transactions with owners in their
capacity as owners
Issue of share capital	2,004,000	–	–	–	2,004,000
Capital raising costs	(285,007)	–	–	–	(285,007)
At 31 December 2014	10,993,377	1,156,957	(41,562)	(442,003)	11,666,769

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

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Condensed consolidated statement of cash flows

for the half-year ended 31 December 2015

	31 December	31 December
	2015	2014
	$	$
Cash flows from operating activities
Receipts from customers	8,998,538	8,148,429
Payments to suppliers and employees	(9,044,603)	(7,749,838)
Interest received	9,430	24,504
Research and development grant received	991,861	210,000
Interest paid	(2,071)	(2,564)
Taxpaid	(280,758)	-
Net cash inflow from operating activities	672,397	630,531
Cash flows from investing activities
Payments for plant and equipment	(549,745)	(99,144)
Paymentsfor intangible assets	(885,803)	(572,906)
Net cash outflow from investing activities	(1,435,548)	(672,050)
Cash flows from financing activities
Proceeds from issues of shares	5,635	2,004,000
Payments for share issue costs	–	(285,007)
Proceeds from borrowings	370,183	–
Repayment of borrowings	(18,067)	(6,326)
Net cash inflow from financing activities	357,751	1,712,667
Net increase/(decrease) in cash and cash equivalents	(405,402)	1,671,148
Cash and cash equivalents at the beginning of the period	3,839,829	1,447,821
Effect of exchange rate changes on cash and cash equivalents	29,740	79,336
Cash and cash equivalents at the end of theperiod	3,464,171	3,198,305

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

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Notes to the consolidated financial statements

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Note 1: Summary of significant accounting policies

Basis of preparation

This condensed consolidated interim financial report for the half-year reporting period ended 31 December 2015 has been prepared in accordance with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001 .

The financial report has been prepared on the basis of historical cost. Cost is based on the fair values of the consideration given in exchange for assets.

This condensed consolidated interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 30 June 2015 together with public announcements and documents made by the Company during the interim reporting period in accordance with the continuous disclosure obligations of the Corporations Act 2001 and ASX Listing Rules.

DTI is a for-profit company limited by shares incorporated in Australia whose shares have been publicly traded on the Australian Securities Exchange from 9 December 2014.

The Company has prepared this interim half-year financial report in accordance with the requirements of AASB 134 Interim Financial Reporting and the Corporations Act 2001 and has provided the disclosures required of a disclosing entity, including segment reporting and earnings per share information. Comparatives for these new disclosures have been provided.

The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period, except as set out below:

New accounting standards and interpretations not yet adopted

Certain new accounting standards and interpretations have been published that are not mandatory for 31 December 2015 reporting periods and have not yet been applied in the financial report. The Company’s assessment of the impact of these new standards and interpretations is set out below.

AASB Amendment	Affected Standard(s)	Nature of Change to Accounting Policy	Impact	Application Date of Standard	Application Date for Company (Year ended)
AASB 9	Financial Instruments	Changes to classification and measurement requirements of financial instruments and hedge accounting	While the Company has yet to undertake a detailed assessment of the changes, no significant impact is anticipated.	1 Jan 18	30 June 19
AASB 15	Revenue from contracts with customers	New standard for the recognition of revenue based on the principle that revenue is recognised when control of a good or service transfers to a customer	Management is currently assessing the impact of the new rules. At this stage, the Company is not able to estimate the impact of the new rules on the Company’s financial statements. The Company will make more detailed assessments of the impact over the next 12 months.	1 Jan 18	30 June 19

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Notes to the consolidated financial statements

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Accounting policies adopted by the Company due to change in accounting estimates

(a) Amortisation of R&D WIP

During the period, DTI has reassessed the accounting estimates of the amortisation of its R&D work in progress. DTI has determined that a straight line basis in accordance with AASB108 para.40, is a more appropriate method rather than amortisation based on the revenue method. This is a change in accounting estimates resulting in amortisation estimates being $360,545 rather than $208,169 in the current period.

Note 2: Segment information

Description of segments

The Board of DTI examines the Company’s performance from a geographic perspective and has identified three reportable segments of its business:

Segment results

	Australasia	EMEA	Americas	Total
	$	$	$	$
Half-year 2015
Total segment revenue	3,028,286	743,725	5,260,691	9,032,702
Inter-segmentrevenue	–	(256,343)	(76,963)	(333,307)
Revenue from external customers	3,028,286	487,382	5,183,728	8,699,395
EBITDA	177,493	(690,000)	634,659	122,152
Non-current assets	3,869,154	591,932	15,068	4,476,155
Half-year 2014
Total segment revenue	3,649,121	2,504,901	1,602,890	7,756,912
Inter-segmentrevenue	–	(1,168,823)	–	(1,168,823)
Revenuefromexternalcustomers	3,649,121	1,336,078	1,602,890	6,588,089
EBITDA	169,314	(143,710)	(78,945)	(53,341)
Non-current assets	3,061,909	559,747	–	3,621,656

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Notes to the consolidated financial statements

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Note 2: Segment information (contd)

Reconciliation of EBITDA to profit before income tax is as follows:

	2015	2014
	$	$
EBITDA	122,152	(53,341)
Interest revenue	8,970	22,695
Finance costs	(2,071)	(2,564)
Depreciation	(124,867)	(119,717)
Amortisation	(371,553)	(304,156)
Profit /(loss)before income tax from continuingoperations	(367,369)	(457,083)

Note 3: Contributed equity

	2015	2015	2014	2014
	No.	$	No.	$
Ordinary shares
Balance at the beginning of the half-year	91,627,118	13,723,974	76,451,011	9,274,384
Issued under IPO	–	–	6,680,000	2,004,000
Capital raisingcosts	–	–	–	(285,007)
	91,627,118	13,723,974	83,131,011	10,993,377

Note 4: Borrowings

In December 2015, DTI negotiated a chattel mortgage loan with the ANZ bank to finance the purchase of specialised technical equipment for Research & Development. The total amount utilised under the facility is $370,586 at an interest rate of 3.99%. The loan is repayable monthly in advance over a 36 month period, commencing 21 December 2015.

Note 5: Contingent liabilities

There have been no changes in contingent liabilities or contingent assets since the end of the previous annual reporting period, 30 June 2015.

Note 6: Subsequent events

No matters or circumstance have arisen that have significantly affected, or may significantly affect, the operations of DTI, the results of those operations or the state of affairs of DTI in subsequent years that is not otherwise disclosed in this report.

Note 7: Related party transactions

There were no significant changes to related party transactions.

Note 8: Fair value measurement of financial instruments

The carrying amount of financial assets and financial liabilities recorded in the financial statements represents their respective net fair values.

The estimated fair value of financial instruments has been determined by the Company using available market information and appropriate valuation methods. The estimates presented are not necessarily indicative of the amounts that will ultimately be realised

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Notes to the consolidated financial statements

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Note 8: Fair value measurement of financial instruments (contd)

by the Company upon maturity or disposal. The use of different market assumptions and/or estimation methods may have a material effect on the estimated fair value amounts.

For cash and cash equivalents, current receivables, accounts payable, interest accrual and short-term debts, the carrying amounts approximate fair value, because of the short maturity of these instruments, and therefore fair value information is not included in the table below.

The fair value of debt and long term receivables is estimated using discounted cash flow analysis based upon market rates. Accrued interest is not included within the carrying amount or estimated fair value of debt.

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Directors’ declaration

In the opinion of the directors of the Company:

• (a) The financial statements and notes as set out on pages 7 to 13 are in accordance with the Corporations Act 2001 and:

• (i) comply with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 and other mandatory professional reporting requirements.

• (ii) give a true and fair view of the consolidated entity's financial position as at 31 December 2015 and of its performance for the half-year ended on that date.

• (b) In the directors' opinion, there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of directors and is signed for and on behalf of the directors by:

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Richard Johnson Director

24 February 2016, Perth, Australia

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Tel: +61 8 6382 4600 38 Station Street Fax: +61 8 6382 4601 Subiaco, WA 6008 www.bdo.com.au PO Box 700 West Perth WA 6872 Australia

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INDEPENDENT AUDITOR’S REVIEW REPORT

To the members of DTI Group Ltd

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of DTI Group Ltd, which comprises the consolidated statement of financial position as at 31 December 2015, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the half-year ended on that date, notes comprising a statement of accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity comprising the company 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 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 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 2015 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 DTI Group Ltd, 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 DTI Group Ltd, would be in the same terms if given to the directors as at the time of this auditor’s review report.

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 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 Audit (WA) Pty Ltd 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.

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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 DTI Group Ltd 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 2015 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 Audit (WA) Pty Ltd

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Dean Just

Director

Perth, 24 February 2016

Tel: +61 8 6382 4600 38 Station Street Fax: +61 8 6382 4601 Subiaco, WA 6008 www.bdo.com.au PO Box 700 West Perth WA 6872 Australia

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DECLARATION OF INDEPENDENCE BY DEAN JUST TO THE DIRECTORS OF DTI GROUP LTD

As lead auditor for the review of DTI Group Ltd for the half-year ended 31 December 2015, I declare that, to the best of my knowledge and belief, there have been:

1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the review; and

2. No contraventions of any applicable code of professional conduct in relation to the review.

3. This declaration is in respect of DTI Group Ltd and the entities it controlled during the period.

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Dean Just Director

BDO Audit (WA) Pty Ltd

Perth, 24 February 2016

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 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 Audit (WA) Pty Ltd 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.

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Cor orate director p y

Directors Chris Morris Non-Executive Chairman Richard Johnson Managing Director & Chief Executive Officer Neil Goodey Non-Executive Director Glyn Denison Non-Executive Director Jeremy King Non-Executive Director Company Secretary Bruce Mitchell Registered and 31 Affleck Road Principal Office Perth Airport WA 6105 Telephone: (08) 9479 1195 Facsimile: (08) 9479 1190 Website: www.dti.com.au Auditor BDO Audit (WA) Pty Ltd 38 Station Street Subiaco WA 6008 Share Registrar Computershare Investor Services Pty Limited Yarra Falls 452 Johnston Street Abbotsford Vic 3067

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