GENETIC TECHNOLOGIES LIMITED — Capital/Financing Update 2003

Sep 4, 2003

5 September, 2003

The Manager Company Announcements Office Australian Stock Exchange Limited Exchange Centre 20 Bridge Street Sydney NSW 2000

Dear Sir.

GTG Appointed to Commercialise New Gene Invention by University of Sydney.

On 25 July 2003, Genetic Technologies Limited (GTG-ASX) announced it had granted a research license to the GTG non-coding patents to the University of Sydney, NSW.

GTG is delighted to announce it has now entered into a further agreement with University of Sydney – this time the University is granting to GTG the exclusive right to commercialise a new and significant genetic invention made by Professor Kathryn North of the Neurogenetics Research Unit at the University's Faculty of Medicine.

This Australian invention permits an improved understanding of the genetic factors underlying superior athletic and sports performance, based on the presence or absence of a particular form of a gene. It is believed this invention will greatly assist athletes and their trainers to maximise the potential of an athlete in their chosen sport, by helping to identify the event in which they are most likely to be successful, and also allowing the design of the optimal training programme. The test could also lead to future treatment applications in certain muscle diseases.

While the precise financial terms are covered by confidentiality, we can now report that GTG has been granted the world-wide rights to commercialise this invention.

Initially, the test will be performed at the GTG genetic testing laboratory in Melbourne. It is estimated there are more than 100,000 candidates for testing in Australia, and millions world-wide. In due course, GTG may also license out the technology to other countries which are geographically too remote to send all their specimens to Australia for testing.

It is likely that the actual testing involved in this new test will be performed on the stateof-the-art "sequencing by synthesis" genetic testing instruments which GTG recently received from Pyrosequencing AB of Sweden under the GTG strategic alliance with that company. GTG is delighted to be in the unique position of combining two cutting-edge technologies from different parts of the world to now make new and useful tests available in Australia and the Asia-Pacific region, for the first time ever.

It is noted that Professor Simon Easteal, of Australian National University, Canberra, was one of the authors of the scientific paper which first announced the invention by Professor North. Professor Easteal was recently appointed to the GTG Scientific Advisory Committee.

Sports performance testing should now be seen as one more example of the many new and imaginative applications of genetic testing, which will inevitably extend beyond human disease testing, and which could have significant commercial potential for GTG.

Yours faithfully,

Dr Mervyn Jacobson Executive Chairman