HUBIFY LIMITED — Interim / Quarterly Report 2018

Feb 26, 2018

United Networks Limited Appendix 4D Half-year report

1. Company details

Name of entity: United Networks Limited ABN: 60 607 921 246 Reporting period: For the half-year ended 31 December 2017 Previous period: For the half-year ended 31 December 2016

2. Results for announcement to the market

			$
Revenues from ordinary activities	down	53.2% to	1,725,120
Loss from ordinary activities after tax attributable to the owners of United
Networks Limited	up	29.9% to	(1,015,913)
Loss for the half-year attributable to the owners of United Networks
Limited	up	29.9% to	(1,015,913)

Dividends

There were no dividends paid, recommended or declared during the current financial period.

Comments

The loss for the consolidated entity after providing for income tax amounted to $1,015,913 (31 December 2016: $781,868).

Reference is made to the 'Review of Operations' in the Directors' Report contained in the attached Interim Financial Report for United Networks Limited for the half-year ended 31 December 2017.

3. Net tangible assets

Net tangible assets per ordinary security	Reporting period Cents 2.51	Previous period Cents 3.42

4. Control gained over entities

Not applicable.

5. Loss of control over entities

Not applicable.

6. Dividends

Current period

There were no dividends paid, recommended or declared during the current financial period.

Previous period

There were no dividends paid, recommended or declared during the previous financial period.

United Networks Limited Appendix 4D Half-year report

7. Dividend reinvestment plans

Not applicable.

8. Details of associates and joint venture entities

Not applicable.

9. Foreign entities

Details of origin of accounting standards used in compiling the report:

Not applicable.

10. Audit qualification or review

Details of audit/review dispute or qualification (if any):

The financial statements were subject to a review by the auditors and the review report is attached as part of the Interim Report.

11. Attachments

Details of attachments (if any):

The Interim Report of United Networks Limited for the half-year ended 31 December 2017 is attached.

12. Signed

27-FebSigned _____ Date: _____ 2018

United Networks Limited

ABN 60 607 921 246

Interim Report - 31 December 2017

United Networks Limited Corporate directory 31 December 2017

Directors	Anthony Ghattas - Chairman
	Nicholas Ghattas - Chief Executive Officer
	Charbel Nader
Company secretary	Michael Potts
Registered office and principal	Suite 201, Level 2
place of business	100 William Street
	Woolloomooloo
	NSW 2011
	Phone:(02) 9003 9573
Share register	Advanced Share Registry Services
	110 Stirling Highway
	Nedlands
	WA 6009
	Phone: (08) 9389 8033
Auditor	Rothsay Chartered Accountants
	Level 1, 12 O'Connell Street
	Sydney
	NSW 2000
Solicitors	Sekel Grindberg Lawyers
	Level 8 - Currency House
	23 Hunter Street
	Sydney
	NSW 2000
Bankers	National Australia Bank
	85-95 Marrickville Rd
	Marrickville
	NSW 2204
	Westpac Banking Corporation
	425 Victoria Ave
	Chatswood
	NSW 2067
Stock exchange listing	United Networks Limited shares are listed on the Australian Securities Exchange
	(ASX code: UNL)
Website	www.unitednetworks.net.au
Corporate Governance Statement	www.unitednetworks.net.au/en/investors#corporateGovernance

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United Networks Limited Directors' report 31 December 2017

The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'consolidated entity') consisting of United Networks Limited (referred to hereafter as the 'company' or 'parent entity') and the entities it controlled at the end of, or during, the half-year ended 31 December 2017.

Principal activities

During the financial half-year the principal continuing activities of the consolidated entity consisted of:

• sale, customisation and integration of IT and telecommunications systems

• maintenance of IT and telecommunications systems

• internet based selling of hardware and software products

Dividends

There were no dividends paid, recommended or declared during the current or previous financial half-year.

Review of operations

The loss for the consolidated entity after providing for income tax amounted to $1,015,913 (31 December 2016: $781,868).

The year to date results show revenue down on the same period last year due to the effect of the reduced performance of a key partner as outlined in the December 2017 Quarterly update lodged on 31 January 2018. We have completed our planned development cycle on the new products and have started to commercialise these. We have reacted to current market conditions and have instituted a restructuring of the business to return it to cash flow positive position.

We have implemented a series of cost savings to restructure the cost base in line with current revenue levels whilst still maintaining our SLA’s and current pipeline of customers. We estimate these savings to be approximately $900,000 on an annualised basis. We expect to see the final cost initiatives to be finalised by end of 3Q (this quarter) 2018. As a result, we expect in 2H FY2018 to be operationally cash flow positive.

The focus moving forward is to drive revenue in the Wi-Fi, SIM and Trust platform. Despite having good take up rates of the new products we have learned that United’s business model can be further improved by embedding the price of the service into every policy. The focus right now is to drive a higher volume of connected clients through the TRUST platform and leverage this volume to add transaction related revenues which will boost the returns per client for all parties. The trust platform will continue to add innovative valuable products for partners. The SOS enhancements launched in January with Chubb is now generating revenue as a value-added inclusion for every Chubb policy.

United has made substantial progress over the 6 months to December. The major achievements have included:

• Implemented a restructure to reduce the operational costs of the business by $900,000 on an annualised basis.

• Wi-Fi revenue continues to grow quarter on quarter. Supported by the increasing opt in rate over 32%.

• Significantly improved the gross margin percentage from 44% of sales YTD compared to 26% last year.

• Increased the average revenue per SIM card to $79 up from $69 last year.

• Re-engaged with our key partner and launched new Data promotions at the end of December and we have actively planned promotions for the last quarter to focus on the busy European travel.

• Released the SOS enhancements in December which represents a significant upgrade to the trust platform.

• Launched Priceline Wi-Fi offers and SIM reseller promotions.

• Large pipeline with several opportunities in the final stages of being finalised.

• Launched a new revenue stream in January with Chubb SOS available now in all active markets and partners.

Significant changes in the state of affairs

There were no significant changes in the state of affairs of the consolidated entity during the financial half-year.

Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this directors' report.

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United Networks Limited Directors' report 31 December 2017

This report is made in accordance with a resolution of directors, pursuant to section 306(3)(a) of the Corporations Act 2001.

On behalf of the directors

_________Nicholas Ghattas Director

27-Feb_______ 2018 Sydney

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AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001

To: The Directors of United Networks Limited

I declare that, to the best of my knowledge and belief, in relation to the review for the half-year ended 31 December 2017 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.

Rothsay Chartered Accountants

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Frank Vrachas

Partner

Sydney, 27 February 2018

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United Networks Limited Contents 31 December 2017

United Networks Limited Contents 31 December 2017
Statement of profit or loss and other comprehensive income	6
Statement of financial position	7
Statement of changes in equity	8
Statement of cash flows	9
Notes to the financial statements	10
Directors' declaration	15
Independent auditor's review report to the members of United Networks Limited	16

General information

The financial statements cover United Networks Limited as a consolidated entity consisting of United Networks Limited and the entities it controlled at the end of, or during, the half-year. The financial statements are presented in Australian dollars, which is United Networks Limited's functional and presentation currency.

United Networks Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is:

Suite 201, Level 2 100 William Street Woolloomooloo NSW 2011

A description of the nature of the consolidated entity's operations and its principal activities are included in the directors' report, which is not part of the financial statements.

The financial statements were authorised for issue, in accordance with a resolution of directors, on 27 February 2018.

5

United Networks Limited Statement of profit or loss and other comprehensive income For the half-year ended 31 December 2017

Note Revenue 3 Expenses Cost of sales Marketing Occupancy Administration Other expenses Finance costs Loss before income tax (expense)/benefit Income tax (expense)/benefit Loss after income tax (expense)/benefit for the half-year attributable to the owners of United Networks Limited Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year attributable to the owners of United Networks Limited Basic earnings per share 13 Diluted earnings per share 13	Consolidated 31 Dec 2017 31 Dec 2016 $ $ 1,725,120 3,684,081 (948,999) (2,426,907) (37,999) (25,200) (23,395) (27,490) (1,406,330) (871,210) (591,268) (868,118) (22,061) (66,543)	Consolidated 31 Dec 2017 31 Dec 2016 $ $ 1,725,120 3,684,081 (948,999) (2,426,907) (37,999) (25,200) (23,395) (27,490) (1,406,330) (871,210) (591,268) (868,118) (22,061) (66,543)
	(1,304,932) 289,019	(601,387) (180,481)
	(1,015,913) -	(781,868) -
	(1,015,913)	(781,868)
	Cents (0.81) (0.81)	Cents (0.87) (0.87)

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

6

United Networks Limited Statement of financial position As at 31 December 2017

Note Assets Current assets Cash and cash equivalents 4 Trade and other receivables 5 Inventories Other Total current assets Non-current assets Property, plant and equipment 6 Intangibles 7 Deferred tax Total non-current assets Total assets Liabilities Current liabilities Trade and other payables 8 Borrowings 9 Provisions Total current liabilities Non-current liabilities Borrowings 10 Deferred tax Total non-current liabilities Total liabilities Net assets Equity Issued capital Accumulated losses Total equity	Consolidated 31 Dec 2017 30 June 2017 $ $ 1,878,856 4,214,949 1,867,190 1,896,706 111,159 131,975 43,255 59,322	Consolidated 31 Dec 2017 30 June 2017 $ $ 1,878,856 4,214,949 1,867,190 1,896,706 111,159 131,975 43,255 59,322
	3,900,460	6,302,952
	421,668 18,006,651 1,244,321	506,047 17,876,073 762,620
	19,672,640	19,144,740
	23,573,100	25,447,692
	897,803 643,867 183,763	1,573,503 992,223 129,051
	1,725,433	2,694,777
	149,071 536,360	231,088 343,678
	685,431	574,766
	2,410,864	3,269,543
	21,162,236	22,178,149
	24,278,800 (3,116,564)	24,278,800 (2,100,651)
	21,162,236	22,178,149

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

7

United Networks Limited Statement of changes in equity For the half-year ended 31 December 2017

Consolidated Balance at 1 July 2016 Loss after income tax expense for the half-year Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year Transactions with owners in their capacity as owners: Capital raising costs Balance at 31 December 2016 Consolidated Balance at 1 July 2017 Loss after income tax benefit for the half-year Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year Balance at 31 December 2017	Issued capital $ 17,777,025 - -	Accumulated losses $ (1,063,474) (781,868) -	Total equity $ 16,713,551 (781,868) -
	- (631,725)	(781,868) -	(781,868) (631,725)
	17,145,300	(1,845,342)	15,299,958
	Issued capital $ 24,278,800 - -	Accumulated losses $ (2,100,651) (1,015,913) -	Total equity $ 22,178,149 (1,015,913) -
	-	(1,015,913)	(1,015,913)
	24,278,800	(3,116,564)	21,162,236

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

8

United Networks Limited Statement of cash flows For the half-year ended 31 December 2017

Note Cash flows from operating activities Receipts from customers (inclusive of GST) Payments to suppliers and employees (inclusive of GST) Interest received Interest and other finance costs paid Income taxes paid Net cash from/(used in) operating activities Cash flows from investing activities Payments for property, plant and equipment 6 Payments for intangibles 7 Loans from/(to) related and other parties Proceeds from disposal of investments Net cash used in investing activities Cash flows from financing activities Proceeds from borrowings Share issue transaction costs Repayment of borrowings Net cash used in financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at the beginning of the financial half-year Cash and cash equivalents at the end of the financial half-year 4	Consolidated 31 Dec 2017 31 Dec 2016 $ $ 1,666,026 4,284,436 (3,034,060) (3,621,954) (1,368,034) 662,482 32,956 625 (41,427) - - (24,408) (1,376,505) 638,699 (6,923) - (524,197) (495,247) 1,905 (40,000) - 21,029 (529,215) (514,218) - 144,321 - (631,725) (430,373) (64,800) (430,373) (552,204) (2,336,093) (427,723) 4,214,949 508,410 1,878,856 80,687
	(1,368,034) 32,956 (41,427) -
	(1,376,505)
	(6,923) (524,197) 1,905 -
	(529,215)
	- - (430,373)
	(430,373)
	(2,336,093) 4,214,949
	1,878,856

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

9

United Networks Limited Notes to the financial statements 31 December 2017

Note 1. Significant accounting policies

These general purpose financial statements for the interim half-year reporting period ended 31 December 2017 have been prepared in accordance with Australian Accounting Standard AASB 134 'Interim Financial Reporting' and the Corporations Act 2001, as appropriate for for-profit oriented entities. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 'Interim Financial Reporting'.

These general purpose financial statements do not include all the notes of the type normally included in annual financial statements. Accordingly, these financial statements are to be read in conjunction with the annual report for the year ended 30 June 2017 and any public announcements made by the company during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

The principal accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period, unless otherwise stated.

New or amended Accounting Standards and Interpretations adopted

The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.

Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.

Note 2. Operating segments

Identification of reportable operating segments

Operating segments are identified based on separate financial information which is regularly reviewed by the Board of Directors, representing the consolidated entity's Chief Operating Decision Makers (CODM), in assessing performance and determining the allocation of resources.

The consolidated entity operates in primarily one geographical segment, namely Australia. The primary business segment is telecommunications namely voice, data and value added services. As the consolidated entity operates in only one segment, the consolidated results are also its segment results.

The consolidated entity operates in one geographical segment being Australia. Revenue from overseas customers is not material to the consolidated entity.

Note 3. Revenue

Sales revenue Sales of goods Services Other revenue Interest Other revenue Revenue	Consolidated 31 Dec 2017 31 Dec 2016 $ $ 26,212 126,252 1,664,024 3,135,946	Consolidated 31 Dec 2017 31 Dec 2016 $ $ 26,212 126,252 1,664,024 3,135,946
	1,690,236	3,262,198
	32,956 1,928	625 421,258
	34,884	421,883
	1,725,120	3,684,081

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United Networks Limited Notes to the financial statements 31 December 2017

Note 4. Current assets - cash and cash equivalents

Cash on hand Cash at bank Cash on deposit Note 5. Current assets - trade and other receivables Trade receivables Less: Provision for impairment of receivables Other receivables Loan to related party Commissions receivable BAS receivable Note 6. Non-current assets - property, plant and equipment Plant and equipment - at cost Less: Accumulated depreciation Furniture, fixtures and fittings - at cost Less: Accumulated depreciation Computer equipment - at cost Less: Accumulated depreciation Right-of-use assets - at cost Less: Accumulated depreciation	Consolidated 31 Dec 2017 30 June 2017 $ $ 455 99 303,401 158,236 1,575,000 4,056,614	Consolidated 31 Dec 2017 30 June 2017 $ $ 455 99 303,401 158,236 1,575,000 4,056,614
	1,878,856	4,214,949
	Consolidated 31 Dec 2017 30 June 2017 $ $ 869,004 858,868 (24,000) (34,237)
	845,004	824,631
	616,637 39,331 363,838 2,380	634,698 41,236 396,141 -
	1,867,190	1,896,706
	Consolidated 31 Dec 2017 30 June 2017 $ $ 54,630 54,630 (21,914) (18,238)
	32,716	36,392
	45,746 (7,080)	45,746 (6,254)
	38,666	39,492
	76,014 (55,622)	69,091 (50,560)
	20,392	18,531
	689,410 (359,516)	689,410 (277,778)
	329,894	411,632
	421,668	506,047

Note 5. Current assets - trade and other receivables

Note 6. Non-current assets - property, plant and equipment

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United Networks Limited Notes to the financial statements 31 December 2017

Note 6. Non-current assets - property, plant and equipment (continued)

Reconciliations

Reconciliations of the written down values at the beginning and end of the current financial half-year are set out below:

Consolidated Balance at 1 July 2017 Additions Depreciation expense Balance at 31 December 2017	Plant and equipment $ 36,392 - (3,676)	Furniture, fixtures and fittings $ 39,492 - (826)	Computer equipment $ 18,531 6,923 (5,062)	Right-of-use assets - property leases $ 411,632 - (81,738)	Total $ 506,047 6,923 (91,302)
	32,716	38,666	20,392	329,894	421,668

Note 7. Non-current assets - intangibles

Goodwill - at cost Patents, trademarks and other rights - at cost Web development - at cost Less: Accumulated amortisation Software - at cost Less: Accumulated amortisation	Consolidated 31 Dec 2017 30 June 2017 $ $ 16,016,577 16,016,577	Consolidated 31 Dec 2017 30 June 2017 $ $ 16,016,577 16,016,577
	6,413	6,413
	1,265,370 (443,388)	1,074,445 (298,210)
	821,982	776,235
	2,273,437 (1,111,758)	1,940,165 (863,317)
	1,161,679	1,076,848
	18,006,651	17,876,073

Reconciliations

Reconciliations of the written down values at the beginning and end of the current financial half-year are set out below:

Consolidated Balance at 1 July 2017 Additions Amortisation expense Balance at 31 December 2017	Goodwill $ 16,016,577 - -	Patents, trademarks and other rights $ 6,413 - -	Web development costs $ 776,235 190,925 (145,178)	Software $ 1,076,848 333,272 (248,441)	Total $ 17,876,073 524,197 (393,619)
	16,016,577	6,413	821,982	1,161,679	18,006,651

Impairment testing

For the purpose of impairment testing, goodwill is allocated to a cash-generating unit or to a group of cash-generating units that are expected to benefit, among others, from the synergies of the business combination. The Group’s cash-generating units are defined on the basis of the geographical market, normally country-related. The consolidated entity operates in primarily one geographical segment - Australia, and the carrying amount of goodwill has been allocated to Australia.

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United Networks Limited Notes to the financial statements 31 December 2017

Note 7. Non-current assets - intangibles (continued)

The recoverable amount of the consolidated entity's goodwill has been determined by a value-in-use calculation using a discounted cash flow model, based on a 1 year projection period (12 months to 31 December 2018) approved by management and extrapolated for a further 4 years using a steady rate, together with a terminal value.

The following key assumptions were used in the discounted cash flow model:

(a) Pre-tax discount rate of 12.2% per annum;

(b) Revenue growth is based on management projections for the 12 months to 31 December 2018, 30% increase for 31 December 2019, 25% increase for 31 December 2020 and 10% for 31 December 2021 and 2022;

(c) Budgeted gross margin of 51%;

(d) Operating expenses is based on management projections for the 12 months to 31 December 2018, and 7.5% increases for 31 December 2019 - 2022;

(e) Long-term growth rate of 2.5%.

The discount rate of 12.2% pre-tax reflects management’s estimate of the time value of money and the consolidated entity’s weighted average cost of capital, the risk-free rate and the volatility of the share price relative to market movements.

Management believes the 31 December 2018 revenue projection and the subsequent increases through to 2022 is achievable and justified, based on the projected growth of new products and partners and the roll-out is actively in place through out Asia-Pacific.

The budgeted gross margin is based on past performance and management's expectations for the future.

Operating expenses do not vary significantly with revenue. Management forecasts these costs based on the current structure of the business, adjusting for inflationary increases but not reflecting any future restructurings or cost saving measures.

The long-term growth rate is used to extrapolate cash flows beyond the 5-year forecast and is based on external forecasts.

Based on the above, the recoverable amount of the goodwill exceeded the carrying amount by $1,461,150.

Sensitivity

The directors have made judgements and estimates in respect of impairment testing of goodwill. Should these judgements and estimates not occur the resulting goodwill carrying amount may decrease. The sensitivities are as follows:

(a) A reduction in the revenue growth rate of 7% below management expectations for 31 December 2018 would result in impairment, with all other assumptions remaining constant.

(b) A reduction in the gross margin to 48% for 31 December 2019 - 2022 would result in impairment, with all other assumptions remaining constant.

(c) The discount rate would be required to increase to 12.7% before goodwill would need to be impaired, with all other assumptions remaining constant.

Management believes that other reasonable changes in the key assumptions on which the recoverable amount of goodwill is based would not cause the cash-generating unit’s carrying amount to exceed its recoverable amount.

Note 8. Current liabilities - trade and other payables

Trade payables Interest payable BAS payable Other payables	Consolidated 31 Dec 2017 30 June 2017 $ $ 503,711 755,672 1,684 21,050 - 363,493 392,408 433,288	Consolidated 31 Dec 2017 30 June 2017 $ $ 503,711 755,672 1,684 21,050 - 363,493 392,408 433,288
	897,803	1,573,503

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United Networks Limited Notes to the financial statements 31 December 2017

Note 9. Current liabilities - borrowings

Promissory note - related party Lease liability Note 10. Non-current liabilities - borrowings Lease liability	Consolidated 31 Dec 2017 30 June 2017 $ $ 463,043 811,679 180,824 180,544	Consolidated 31 Dec 2017 30 June 2017 $ $ 463,043 811,679 180,824 180,544
	643,867	992,223
	Consolidated 31 Dec 2017 30 June 2017 $ $ 149,071 231,088

Note 10. Non-current liabilities - borrowings

Note 11. Equity - dividends

There were no dividends paid, recommended or declared during the current or previous financial half-year.

Note 12. Events after the reporting period

No matter or circumstance has arisen since 31 December 2017 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.

Note 13. Earnings per share

Loss after income tax attributable to the owners of United Networks Limited Weighted average number of ordinary shares used in calculating basic earnings per share Weighted average number of ordinary shares used in calculating diluted earnings per share Basic earnings per share Diluted earnings per share	Consolidated 31 Dec 2017 31 Dec 2016 $ $ (1,015,913) (781,868)	Consolidated 31 Dec 2017 31 Dec 2016 $ $ (1,015,913) (781,868)
	Number 125,824,949	Number 90,157,449
	125,824,949	90,157,449
	Cents (0.81) (0.81)	Cents (0.87) (0.87)

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United Networks Limited Directors' declaration 31 December 2017

In the directors' opinion:

• the attached financial statements and notes comply with the Corporations Act 2001, Australian Accounting Standard AASB 134 'Interim Financial Reporting', the Corporations Regulations 2001 and other mandatory professional reporting requirements;

• the attached financial statements and notes give a true and fair view of the consolidated entity's financial position as at 31 December 2017 and of its performance for the financial half-year ended on that date; and

• 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 directors made pursuant to section 303(5)(a) of the Corporations Act 2001.

On behalf of the directors

_____Nicholas Ghattas Director 27-Feb_____ 2018 Sydney

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INDEPENDENT AUDITOR’S REVIEW REPORT

To the members of United Networks Limited

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year consolidated financial report of United Networks Limited, which comprises the consolidated statement of financial position as at 31 December 2017, and the consolidated statement of profit or loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the half-year ended on that date, notes comprising summary of significant accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity (or "Group”) comprising United Networks 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 company are responsible for the preparation of the consolidated 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 consolidated 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 Group’s financial position as at 31 December 2017 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 United Networks 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 United Networks Limited, would be in the same terms if given to the directors as at the time of this auditor’s review report.

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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 United Networks Limited is not in accordance with the Corporations Act 2001 including:

• a) giving a true and fair view of the Group’s financial position as at 31 December 2017 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.

Rothsay Chartered Accountants

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Frank Vrachas

Partner

Sydney, 27 February 2018

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