QUESTE COMMUNICATIONS LIMITED — Interim / Quarterly Report 2006

Feb 12, 2006

January 2006 Monthly Cash Flow Report

Name of entity

QUESTE COMMUNICATIONS LIMITED and controlled entities

Month EndedACN or ARBN
081 688 164		31 January 2006
	Consolidated statement of cash flows	Company		Consolidated
Cash flows related to operating activities		Current MonthJan 2006$'000	Year to Date7 months$.000	Current MonthJan 2006$'000	Year to Date7 months$.000
1.1	Receipts from customers				23
1.2	Payments for
	(a) staff costs	(20)	(209)	(44)	(384)
	(b) advertising and marketing
	(c) research and development
	(d) leased assets
	(e) other working capital	(4)	(57)	(11)	(354)
1.3	Dividends received		128		175
1.4	Interest and other items of a similar nature received	36	43	43	69
1.5	Interest and other costs of finance paid				(1)
1.6	Income taxes paid
1.7	Other (provide details if material)
	- Professional fees				(4)
	Net operating cash flows	12	(95)	(12)	(476)

Note:

The Company currently has a 48% interest in ASX listed investment company, Orion Equities Limited ("OEQ") formerly Central Exchange Limited {"CXL"}.

OEQ is a controlled entity of the Company pursuant to Accounting Standard AASB 1024 "Consolidated Accounts."

Therefore, the Consolidated columns in this Monthly Cash Flow Report takes into account the cash flows of the Company and its controlled entities, including OEQ

		Company		Consolidated
		Current Month	Year to Date	Current Month	Year to Date
		Jan 2006	7 months	Jan 2006	7 months
		$'000	$'000	$' 000	$'000
	Net operating cash flows (carried forward)	12
1.8			(95)	(12)	(476)
	Cash flows related to investing activities
1.9	Payment for acquisition of:
	businesses (item 5)(a)
	(b)equity investments			(692)	(7, 317)
	intellectual property(c)				(30)
	(d)physical non-current assets
	(e)other non-current assets
1.10	Proceeds from disposal of:
	(a)businesses (item 5)
	equity investments(b)		3,393	827	12,970
	(c)intellectual property
	physical non-current assets(d)
	(e)other non-current assets
1.11	Loans to other entities		(13)		(163)
1.12	Loans repaid by other entities				150
1.13	Other (provide details if material)
	Net income from options(a)			7	70
	Net investing cash flows		3,380	142	5,680
1.14	Total operating and investing cash flows	12	3,285	130	5,204
	Cash flows related to financing activities
1.151.16	Proceeds from issues of shares, options, etc.Proceeds from sale of forfeited shares
1.17
	Proceeds from borrowings
1.18	Repayment of borrowings
1.19	Dividends paid			(2)	(133)
1.20	Other (provide details if material)
	Payments in relation to share buy back
	Net financing cash flows	$\blacksquare$		(2)	(133)
	Net increase (decrease) in cash held	12	3,285	128	5,071
1.21	Cash at beginning of month/year to date	3,347	74	5,093	150
1.22	Exchange rate adjustments to item 1.20
1.23	Cash at end of month	3,359	3,359	5,221	5,221

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the $\sim$ and an Rock of Links

related entities		Current Month
		Jan 2006$.000
1.24	Aggregate amount of payments to the parties included in item 1.2	34
1.25	Aggregate amount of loans to the parties included in item 1.11

• 1.26 Explanation necessary for an understanding of the transactions
  • $(1)$ $11,514- Salaries and fees paid by the Company to Directors;

(2) $22,670 - Salaries, fees and superannuation paid by controlled entity, Orion Equities Limited (formerly Central Exchange Limited), to its Directors.

Non-cash financing and investing activities

Details of financing and investing transactions which have had a material effect on consolidated assets and $2.1$ liabilities but did not involve cash flows

None

Details of outlays made by other entities to establish or increase their share in businesses in which the reporting $2.2$ entity has an interest

None.

Financing facilities available

Add notes as necessary for an understanding of the position. (See AASB 1026 paragraph 12.2).

		Amt available$$^{\circ}000$	Amount used$.000
3.1	Loan facilities	$\overline{\phantom{a}}$	ALC
3.2	Credit standby arrangements	-44	ALC

$\lambda$

Reconciliation of cashReconciliation of cash at the end of the month (as shown inthe consolidated statement of cash flows) to the related itemsin the accounts is as follows			ConsolidatedCompany
		Current	Previous	Current	Previous
		Month	Month	Month	Month
		$'000	$.000	$'000	$.000
4.1	Cash on hand and at bank	3,359	182	5,221	1,928
4.2	Deposits at call
4.3	Bank overdraft
4.4	Other (Bank Bills)		3,165	$\blacksquare$	3,165
	Total: cash at end of month (item 1.22)	3,359	3,347	5,221	5,093

Acquisitions and disposals of business entities

• $5.1$ Name of entity
• 5.2 Place of incorporation or registration
• 5.3 Consideration for acquisition or disposal
• 5.4 Total net assets
• 5.5 Nature of business

Compliance statement

Acquisitions	Disposals
(Item $1.9(a)$ )	(Item $1.10(a)$ )
44
44
$\overline{a}$
44

• $\mathbf{1}$ This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Law (except to the extent that information is not required because of note 2) or other standards acceptable to ASX.
• $\mathcal{P}$ This statement does give a true and fair view of the matters disclosed.

13 February 2006 Date:

Victor Ho Company Secretary

Notes:

The Company currently holds the following listed share investments:13-Feb-06
	No Shares	% Interest	Bid Price	Market Value
Shares in Orion Equities Ltd (OEQ)	8.558.127	48.04%	$0.6400	$5,477,201
Shares in Altera Capital Limited (AEA)	10.699,428	17.25%	suspended
Shares in Sofcom Limited (SOF)	6.255,349	14.01%	suspended

The above investments are regarded as liquid assets to supplement the Company's cash reserves.

The Company is a major shareholder in AEA and SOF both of which are ASX listed companies, currently suspended awaiting a potential recapitalisation and re-admission to ASX. The Company is in discussions with a number of parties regarding a sale of its interest in these companies. QUE's nil valuation for its shareholding in these companies does not reflect any potential "control premium" upon a possible sale of such shareholdings.