JCURVE SOLUTIONS LTD — Interim / Quarterly Report 2014

Feb 26, 2014

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JCurve Limited ABN 63 088 257 729

Level 4 22 Atchison Street St Leonards NSW 2065

Companies Announcement Office Australian Securities Exchange Exchange Centre Level 4, 20 Bridge Street Sydney NSW 2000

[T] +61 2 9467 9200 [F] +61 2 9467 9201 [W] jcurve.com.au

27 February 2014

HALF YEAR RESULTS

Highlights:

• Revenue of $5.15 million (up 10% on the prior corresponding period)

• Acquisition of JCurve Solutions Pty Ltd on 31 October 2013

• Strong cash position of $1.95 million as at 31 December 2013

Results For Announcement To The Market:

	Half Year ended 31 December 2013 $	Percentage increase/(decrease) over previous corresponding period1
Revenue from ordinary activities	5,150,565	10%
Earnings before interest, taxation, depreciation and amortisation (EBITDA)	(252,512)	(134)%
Loss from ordinary activities after tax attributable to members	(237,712)	39%
Net Loss for the period attributable to members	(237,712)	39%
1The previous corresponding period is the half year ended 31 December 2012.

Net Tangible Assets:

	31 December 2013	31 December 2012
Net tangible assets per ordinary share for Continuing Operations	0.21 cents	1.55 cents

Explanation of Result:

Revenue for the six months to 31 December 2013 was $5.15 million, an increase of 10% over the previous corresponding period.

EBITDA and NPAT from ordinary operations for the period were a loss of $252,512 and a loss of $237,712 respectively.

EBITDA as reported	EBITDA as reported	(252,512)
Add Back:	One off and JCurve acquisition costs 337,261 Product Development Costs 395,655	732,916
EBITDA underlying company financialperformance		480,404

JCurve has a solid balance sheet position with cash of $1.95 million and no external borrowings as at 31 December 2013.

The Board is looking to continue its acquisition policy.

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Nihal Gupta Chairman

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JCurve Solutions Limited (formerly Stratatel Limited) Half Year Report December 2013

JCurve Solutions Limited ABN 63 088 257 729 Level 4, 22 Atchison Street Sydney NSW 2065 [T] +61 2 9467 9200 | [F] +61 2 9467 9201

JCurve Solutions Limited

Contents	Page
Directors’ Report	1
Auditor’s Independence Declaration	2
Condensed Consolidated Statement of Comprehensive Income	3
Condensed Consolidated Statement of Financial Position	4
Condensed Consolidated Statement of Changes in Equity	5
Condensed Consolidated Statement of Cash Flows	6
Notes to the Consolidated Financial Statements	7
Directors’ Declaration	15
Independent Auditor’s Review Report	16

The information contained in the half year financial report should be read in conjunction with the Company’s Annual Financial Report for the year ended 30 June 2013.

JCurve Solutions Limited

• 1 -

DIRECTORS’ REPORT

Your directors submit the financial report of the consolidated entity for the half-year ended 31 December 2013. In order to comply with the provisions of the Corporations Act 2001, the directors report as follows:

Directors

The names of directors who held office during or since the end of the half-year and until the date of this report are as below. Directors were in office for this entire period unless otherwise stated.

Nihal Gupta	Non-Executive Chairman	Appointed 31 October 2013
Graham Baillie	Managing Director	Resigned as Chairman on 31 October 2013
		Appointed as MD 10 December 2013
John Bond	Non-Executive Director
Christopher Gabriel	Non-Executive Director	Appointed 17 December 2013
Michael James Fairclough	Non-Executive Director	Resigned 31 October 2013
Ian Alexander Macliver	Non-Executive Director	Resigned 31 October 2013

Review of Operations

• Revenue from continuing operations increased by 10%, from $4.66 million the previous corresponding period to $5.15 million this period.

• EBITDA (continuing operations) decreased by 134%, from $749 thousand the previous corresponding period to a loss $253 thousand this period.

• Re-branding of Stratatel Limited to JCurve Solutions Ltd.

• Settlement of acquisition of the business of JCurve Solutions Pty Ltd on 31 October 2013.

Auditor’s Independence Declaration

Section 307C of the Corporations Act 2001 requires our auditors, HLB Mann Judd, to provide the directors of the company with an Independence Declaration in relation to the review of the half-year financial report. This Independence Declaration is set out on page 2 and forms part of this directors’ report for the half-year ended 31 December 2013.

This report is signed in accordance with a resolution of the Board of Directors made pursuant to s.306 (3) of the Corporations Act 2001.

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Nihal Gupta Chairman Dated this 27 day of February 2014.

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AUDITOR’S INDEPENDENCE DECLARATION

As lead auditor for the review of the consolidated financial report of JCurve Solutions Limited (formerly Stratatel Limited) for the half-year ended 31 December 2013, I declare that to the best of my knowledge and belief, there have been no contraventions of:

• a) the auditor independence requirements of the Corporations Act 2001 in relation to the review; and

• b) any applicable code of professional conduct in relation to the review.

This declaration is in respect of JCurve Solutions Limited and the entities it controlled during the halfyear.

Perth, Western Australia 27 February 2014

N G Neill Partner

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HLB Mann Judd (WA Partnership) ABN 22 193 232 714 Level 4, 130 Stirling Street Perth WA 6000. PO Box 8124 Perth BC 6849 Telephone +61 (08) 9227 7500. Fax +61 (08) 9227 7533. Email: hlb@hlbwa.com.au. Website: http://www.hlb.com.au Liability limited by a scheme approved under Professional Standards Legislation

HLB Mann Judd (WA Partnership) is a member of

International, a worldwide organisation of accounting firms and business advisers.

JCurve Solutions Limited

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CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

Continuing operations Notes Revenue 2 Cost of goods sold Employee benefits expense Other employee related expense Communications expense Advertising & marketing Professional fees Occupancy expense Listing expense Impairment loss 3 Depreciation and amortisation Finance costs Other expenses (Loss)/Profit before income tax Income tax benefit/(expense) (Loss)/Profit after tax from continuing operations Loss after tax from discontinued operation 5 Net loss for the period Other comprehensive income, net of income tax Total comprehensive loss for the period Earnings per share Basic loss per share (cents per share) 8 Basic (loss)/earnings per share from continuing operations (cents per share) 8 Diluted loss per share (cents per share) 8 Diluted (loss)/earnings per share from continuing operations (cents per share) 8	2013 $ 2012 $ 5,150,565 4,661,764 (1,476,296) (1,270,811) (2,357,871) (1,538,444) (216,750) (222,746) (49,310) (105,241) (100,342) (17,977) (735,668) (351,601) (205,403) (211,453) (32,908) (17,196) - (170,689) (29,373) (165,618) (43,204) (3,612) (181,443) (143,258)
	(278,003) 443,118 40,291 (129,911)
	(237,712) 313,207 - (704,266)
	(237,712) (391,059) - -
	(237,712) (391,059)
	(0.12) (0.20) (0.12) 0.16 (0.12) (0.20) (0.12) 0.16

The accompanying notes form part of these financial statements

JCurve Solutions Limited

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CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2013

Notes Assets Current Assets Cash and cash equivalents Trade and other receivables Other current assets Total Current Assets Non-Current Assets Property, plant and equipment Intangible assets 3 Other financial assets Deferred tax asset Total Non-Current Assets Total Assets Liabilities Current Liabilities Trade and other payables Provisions Current tax liabilities Total Current Liabilities Non-Current Liabilities Provisions Total Non-Current Liabilities Total Liabilities Net Assets Equity Issued capital 9 Reserves Accumulated losses Total Equity	31 Dec 2013 $ 30 Jun 2013 $ 1,946,645 3,606,727 2,071,705 2,118,135 635,737 48,260
	4,654,087 5,773,122
	110,144 91,618 8,482,008 875,000 36,673 99,123 389,429 334,956
	9,018,254 1,400,697
	13,672,341 7,173,819
	4,463,627 2,749,502 38,513 42,543 11,287 10,008
	4,513,427 2,802,053
	124,284 91,528
	124,284 91,528
	4,637,711 2,893,581
	9,034,630 4,280,238
	14,299,246 10,879,285 1,723,013 150,870 (6,987,629) (6,749,917)
	9,034,630 4,280,238

The accompanying notes form part of these financial statements

JCurve Solutions Limited

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CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

Balance as at 1 July 2012 Total comprehensive loss for the period Balance as at 31 December 2012 Balance as at 1 July 2013 Total comprehensive loss for the period Issue of shares & options on acquisition Balance as at 31 December 2013		Issued Capital Accumulated Losses $ $	Reserves Total Equity $ $ 150,870 7,400,697 - (391,059) 150,870 7,009,638 Reserves Total Equity $ $
		10,879,285 (3,629,458) - (391,059)
		10,879,285 (4,020,517)
		Issued Capital Accumulated Losses $ $
		10,879,285 (6,749,917) - (237,712) 3,419,961 -	150,870 4,280,238 - (237,712) 1,572,143 4,992,104
		14,299,246 (6,987,629)	1,723,013 9,034,630

The accompanying notes form part of these financial statements

JCurve Solutions Limited

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CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

Cash flows from operating activities Receipts from customers Payments to suppliers and employees Interest received Finance costs Income tax receipt Net cash used in operating activities Cash flows from investing activities Purchase of property, plant and equipment Purchase of non-current assets (Payments)/Receipts for (purchase)/sale of subsidiaries, net of cash acquired Net cash (used in)/provided by investing activities Cash flows from financing activities Proceeds on share issue Net cash provided by financing activities Net decrease in cash held Cash and cash equivalents at 1 July 2013 Cash at 31 December 2013	2013 $ 2012 $ Inflows/(Outflows) 4,998,246 6,201,742 (5,636,773) (6,554,839) 47,696 30,574 (43,204) (3,612) 1,258 2,352
	(632,777) (323,783)
	(27,305) (13,318) - (17,607) (1,000,000) 100,000
	(1,027,305) 69,075
	- -
	- -
	(1,660,082) (254,708) 3,606,727 2,570,530
	1,946,645 2,315,822

The accompanying notes form part of these financial statements

JCurve Solutions Limited

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

Statement of compliance

The interim consolidated financial statements are general purpose financial statements prepared in accordance with the requirements of the Corporations Act 2001, applicable accounting standards including AASB 134: Interim Financial Reporting, Accounting Interpretations and other authoritative pronouncements of the Australian Accounting Standards Board (‘AASB’). Compliance with AASB 134 ensures compliance with IAS 34 ‘Interim Financial Reporting’.

The half-year report does not include full disclosures of the type normally included in an annual financial report. Therefore, it cannot be expected to provide as full an understanding of the financial performance, financial position and cash flows of the Group as in the full financial report.

It is recommended that this financial report be read in conjunction with the annual financial report for the year ended 30 June 2013 and any public announcements made by JCurve Solutions Limited (formerly Stratatel Limited) and its subsidiaries during the half-year in accordance with continuous disclosure requirements arising under the Corporations Act 2001 and the ASX Listing Rules.

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

Basis of preparation

The interim report has been prepared on a historical cost basis except for certain acquired intangible assets and available-for-sale financial assets which are measured at fair value. Cost is based on the fair value of the consideration given in exchange for assets. All amounts are presented in Australian dollars, unless otherwise noted.

For the purpose of preparing the half-year report, the half-year has been treated as a discrete reporting period.

Significant accounting judgments and key estimates

The preparation of interim financial reports requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expense. Actual results may differ from these estimates.

In preparing this interim report, the significant judgments made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial report for the year ended 30 June 2013.

Adoption of new and revised Accounting Standards

In the half-year ended 31 December 2013, the Directors have reviewed all of the new and revised Standards and Interpretations issued by the AASB that are relevant to its operations and effective for annual reporting periods beginning on or after 1 July 2013.

It has been determined by the Directors that there is no impact, material or otherwise, of the new and revised Standards and Interpretations on its business and, therefore, no change is necessary to Group accounting policies.

The AASB has issued AASB 11 Joint Arrangements effective for financial reporting periods starting on or after 1 January 2013 and the Directors have determined that the impact of the new standard on its business is minimal and not material.

JCurve Solutions Limited

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

NOTE 2: REVENUE

(a) Revenue from continuing operations Telecommunications expense management MTN South Africa Training IBM software licences – new sales IBM software licences & maintenance renewals Computer services & subscriptions JCurve Business Software Interest income Other income (b) Specific expenses from continuing operations Interest expense Depreciation of non-current assets Amortisation of development expenditure Operating lease rental expense: minimum lease payments NOTE 3: INTANGIBLE ASSETS Balance as at 1 July 2013 Impairment expense Impairment expense (shown in loss from discontinued operation) Carrying value transferred to available for sale Netsuite licence agreement acquired Software development costs – JCurve Wizard Goodwill on acquisition of JCurve Balance as at 31 December 2013		31 Dec 2013 $ 31 Dec 2012 $
		2,369,420 2,520,485 637,265 338,110 1,000 500 102,080 68,224 928,711 1,073,301 522,260 645,051 541,740 - 47,086 34,113 1,003 (18,020)
		5,150,565 4,661,764
		43,204 3,612 25,257 34,009 - 127,812 153,018 183,831 31 Dec 2013 $ 30 Jun 2013 $
		875,000 4,072,052 - (2,551,047) - (170,342) - (475,663) 3,100,000 - 500,000 - 4,007,008 -
		8,482,008 875,000

On 31 October 2013, JCurve Business Software Pty Ltd, a subsidiary of JCurve Solutions Limited acquired the assets of JCurve Solutions Pty Ltd.

The Netsuite licence which exclusively allows JCurve Solutions to sell the small business version of business software from Netsuite Inc of USA (Netsuite) in the Australia New Zealand (ANZ) region was valued at $3,100,000 as per an independent valuation report commissioned by the company. The JCurve Wizard product which allows potential customers to trial the business software and then purchase online was valued at $500,000, based upon product development costs at market rates.

For the calculation of the value of Goodwill please refer to Note 6.

JCurve Solutions Limited

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

NOTE 4: DIVIDENDS PAID AND PROPOSED

Dividends Paid

No final dividend was declared for the year ended 30 June 2013.

Dividends Declared

The Board advises that it does not intend to declare an interim dividend for the financial year, and it will consider reinstating the dividend policy in the future, subject to performance.

NOTE 5: DISCONTINUED OPERATION

Softlog Systems Pty Ltd, a wholly owned subsidiary of JCurve Solutions Limited, initiated an active program to locate a buyer and sell the Print Expense Management Division (PEMS). An agreement to sell the division was entered into on 21 December 2012 with effect from 2 January 2013 and the division disposed of has been reported in the financial statements for the half year ended 31 December 2012 as a discontinued operation.

Consideration received or receivable

Cash and short term deposits Present value of deferred sales proceeds Total disposal consideration Less: net assets disposed of Gain on disposal before income tax Income tax expense Gain on disposal after income tax	31 Dec 2012 $
	100,000 127,000
	227,000 (67,124)
	159,876 (47,963)
	111,913

Net assets at date of sale

The carrying amount of assets and liabilities disposed of were:

Prepayments Inventory Property, plant and equipment Intangible assets Employee benefits expense Unearned income liability Net assets	1,440 22,103 13,272 475,663
	512,478 (42,368) (402,986)
	67,124

JCurve Solutions Limited

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

NOTE 5: DISCONTINUED OPERATION (continued)

Net cash inflow on disposal

The cash inflow on disposal is receivable in the following instalments:

Net cash inflow on disposal The cash inflow on disposal is receivable in the following instalments:
21 December 2012 2 January 2013 14 February 2013 Net cash inflow on disposal Cash and cash equivalents consideration received or receivable Net cash and cash equivalents disposed of Net cash inflow on disposal	$
	100,000 100,000 27,000
	227,000
	31 Dec 2012
	227,000 -
	227,000

Financial performance and cash flow information

The financial performance and cash flow information presented are for the 6 months ended 31 December 2012.

Financial performance from discontinued operation Revenue Expenses Gross profit/(loss) Loss recognised on the re-measurement to fair value Loss before tax from discontinued operations Income tax benefit/(expense) Loss for the year from discontinued operations Cash flows from discontinued operations Net cash flows from operating activities Net cash flows from investing activities Net cash flows from financing activities	2013 2012
	- 668,133 - (1,131,471)
	- (463,338) - -
	- (463,338) - (240,928)
	- (704,266)
	- (23,327) - 100,000 - -
	- 76,673

JCurve Solutions Limited

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

NOTE 6: BUSINESS COMBINATION

Acquisition of JCurve Business Software

On 31 October 2013, JCurve Business Software Pty Ltd, a subsidiary of JCurve Solutions Limited acquired the assets and liabilities of JCurve Solutions Pty Ltd, a leading cloud-based accounting and ERP software provider which exclusively promotes and sells the small business version of business software from Netsuite Inc of USA (Netsuite) in the Australia and New Zealand region.

The total cost of the combination was $6,000,714 and comprised an issue of equity instruments, cash and options. The Company issued 71,428,571 ordinary shares with a fair value of $0.048 each, based on the quoted price of the shares of JCurve Solutions Limited at the date of control and 35,714,284 options (valued at $1,572,143). The incentive options were issued with the following milestones all with an exercise price of $0.000001:

• 8,928,571 options which automatically vest when the share price reaches 7.5c for a period of 10 consecutive trading days, exercisable on or before 31 March 2016;

• 8,928,571 options which automatically vest when the share price reaches 10c for a period of 10 consecutive trading days, exercisable on or before 31 March 2017;

• 8,928,571 options which automatically vest when the share price reaches 12.5c for a period of 10 consecutive trading days, exercisable on or before 31 March 2018;

• 8,928,571 options which automatically vest when the share price reaches 15c for a period of 10 consecutive trading days, exercisable on or before 31 March 2019.

Consideration transferred

Acquisition date fair value of the consideration transferred:

Cash Options issued Shares issued at fair value Total consideration	31 December 2013 $
	1,000,000 1,572,143 3,428,571
	6,000,714

Acquisition related costs of $195,655 are included in professional fees and other expenses in the statement of comprehensive income. Directly attributable costs of raising equity have been included as a deduction from equity.

JCurve Solutions Limited

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

NOTE 6: BUSINESS COMBINATION (continued)

Assets acquired and liabilities assumed at the date of acquisition

The Group has provisionally recognised the fair values of the identifiable assets and liabilities of JCurve Solutions Pty Ltd based upon the best information available as of the reporting date. Provisional business combination accounting is as follows:

Trade receivables Bonds Property, plant and equipment Netsuite licence agreement Intangible assets – JCurve wizard Prepayments Deferred tax assets Trade and other payables Provisional fair value of identifiable net assets Goodwill arising on acquisition Total consideration	Fair value at acquisition date $
	133,631 9,700 20,595 3,100,000 500,000 545,416 14,161 (2,329,797)
	1,993,706 4,007,008
	6,000,714

The initial accounting for the acquisition of the assets and liabilities of JCurve Solutions Pty Ltd has only been provisionally determined at the end of the interim reporting period. At the date of finalisation of this financial report, the necessary market valuations and other calculations had not been finalised and the fair value of the intangible assets, goodwill, consideration and associated deferred tax liabilities above have therefore only been provisionally determined based on the directors’ best estimate of the likely fair value of these assets and liabilities.

Net cash outflow arising on acquisition

The cash outflow on acquisition is as follows:

Cash paid Less: net cash acquired with the subsidiary Net cash outflow	31 December 2013 $
	1,000,000 -
	1,000,000

Impact of acquisition on the results of the Group

The acquisition of the assets and liabilities of JCurve Solutions Pty Ltd affected the consolidated result as follows:

Revenue Less: expenses Gross loss before tax	31 December 2013 $
	541,921 (702,883)
	(160,962)

JCurve Solutions Limited

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

NOTE 6: BUSINESS COMBINATION (continued)

Impact of acquisition on the results of the Group

If the combination had taken place at the beginning of the half-year, the loss before tax of the Group would have been $496,906 and revenue from continuing operations would have been $6,256,892.

In determining the pro-forma revenue and profit of the Group had JCurve Solutions Pty Ltd been acquired at the beginning of the current reporting period, the Directors have:

• calculated depreciation and amortisation of plant and equipment acquired on the basis of the fair values arising in the initial accounting for the business combination rather than the carrying amounts recognised in the pre-acquisition financial statements; and

• based borrowing costs on the funding levels, credit ratings and debt/equity position of the Group after the business combination.

NOTE 7: SEGMENT REPORTING

AASB 8 Operating Segments requires operating segments to be identified on the basis of internal reports about components of the Group that are reviewed by the chief operating decision maker in order to allocate resources to the segment and assess its performance. The Board of Directors of JCurve Solutions Limited reviews internal reports prepared as consolidated financial statements and strategic decisions of the Group are determined upon analysis of these internal reports. The Group operates predominantly in one business and geographical segment being the software development and software solutions industry providing services for corporate and government clientele throughout Australia. Accordingly, under the ‘management approach’ outlined only one operating segment has been identified and no further disclosure is required in the notes to the consolidated financial statements.

NOTE 8: EARNINGS PER SHARE

NOTE 8: EARNINGS PER SHARE
	31 Dec 2013	31 Dec 2012
	$	$
Earnings used for calculation of basic and diluted earnings per share
Basic loss from operations	(237,712)	(391,059)
(Loss)/profit from continuing operations	(237,712)	313,207
Weighted average number of shares	No.	No
Weighted average number of shares used in the calculation of basic EPS	195,736,113	191,077,728
Weighted average number of options on issue	-	-
Weighted average number of shares used in the calculation of diluted EPS	195,736,113	191,077,728
Basic loss per share (cents per share)	(0.12)	(0.20)
Basic (loss)/earnings per share from continuing operations (cents per share)	(0.12)	0.16
Diluted loss per share (cents per share)	(0.12)	(0.20)
Diluted (loss)/earnings per share from continuing operations (cents per share)	(0.12)	0.16

JCurve Solutions Limited

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2013

NOTE 9: ISSUED CAPITAL

Ordinary shares issued and fully paid Movements in ordinary shares on issue At 1 July 2013 Shares issued for acquisition of assets of JCurve Solutions Pty Ltd 20 December 2013 At 31 December 2013	31 Dec 2013 $ 30 Jun 2013 $
	14,299,246 10,879,285
	No. $
	191,077,728 10,879,285 71,428,571 3,419,961
	262,506,299 14,299,246

NOTE 10: OPTIONS

The following table illustrates the number (No.) and weighted average exercise prices of and movements in share options issued during the year:

Outstanding at the beginning of the year Granted during the year Expired during the year Outstanding at the end of the year Exercisable at the end of the year	Six months to 31 December 2013 Year to 30 June 2013 No. Weighted average exercise price No. Weighted average exercise price
	800,000 $0.11 4,100,000 $0.11 35,714,284 $0.000001 - - (800,000) $0.11 (3,300,000) $0.10
	35,714,284 $0.000001 800,000 $0.11
	- 800,000

The outstanding balance as at 31 December 2013 is represented by:

• 8,928,571 options with an exercise price of $0.000001 which automatically vest when the share price reaches 7.5c for a period of 10 consecutive trading days, exercisable on or before 31 March 2016;

• 8,928,571 options with an exercise price of $0.000001 which automatically vest when the share price reaches 10c for a period of 10 consecutive trading days, exercisable on or before 31 March 2017;

• 8,928,571 options with an exercise price of $0.000001 which automatically vest when the share price reaches 12.5c for a period of 10 consecutive trading days, exercisable on or before 31 March 2018;

• 8,928,571 options with an exercise price of $0.000001 which automatically vest when the share price reaches 15c for a period of 10 consecutive trading days, exercisable on or before 31 March 2019.

NOTE 11: CONTINGENT LIABILITIES

There has been no change in contingent liabilities since the last annual reporting date.

NOTE 12: EVENTS SUBSEQUENT TO REPORTING DATE

There have been no significant events subsequent to the reporting date.

JCurve Solutions Limited

• 15 -

DIRECTORS’ DECLARATION

The directors of the company declare that:

1. The financial statements and notes thereto, as set out on pages 3 to 14:

2. a. comply with Accounting Standard AASB 134 “Interim Financial Reporting” and the Corporations Regulations; and

3. b. give a true and fair view of the consolidated entity’s financial position as at 31 December 2013 and of its performance for the half-year then ended.

4. 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 signed in accordance with a resolution of the Board of Directors made pursuant to s.303 (5) of the Corporations Act 2001.

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Nihal Gupta

Chairman

Dated this 27 day of February 2014

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INDEPENDENT AUDITOR’S REVIEW REPORT

To the members of JCurve Solutions Limited (formerly Stratatel Limited)

Report on the Condensed Half-Year Financial Report

We have reviewed the accompanying half-year financial report of JCurve Solutions Limited (“the company”) which comprises the condensed statement of financial position as at 31 December 2013, the condensed statement of comprehensive income, condensed statement of changes in equity and condensed statement of cash flows for the half-year ended on that date, notes comprising a summary of significant accounting policies and other explanatory notes and the directors’ declaration of the Group comprising the company and the entities it controlled at the half-year 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 Group’s financial position as at 31 December 2013 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 the company, 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 .

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HLB Mann Judd (WA Partnership) ABN 22 193 232 714 Level 4, 130 Stirling Street Perth WA 6000. PO Box 8124 Perth BC 6849 Telephone +61 (08) 9227 7500. Fax +61 (08) 9227 7533. Email: hlb@hlbwa.com.au. Website: http://www.hlb.com.au Liability limited by a scheme approved under Professional Standards Legislation

HLB Mann Judd (WA Partnership) is a member of

International, a worldwide organisation of accounting firms and business advisers

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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 JCurve Solutions 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 2013 and of its performance for the half-year ended on that date; and

• b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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HLB Mann Judd Chartered Accountants

N G Neill Partner

Perth, Western Australia 27 February 2014