SPACETALK LTD — Interim / Quarterly Report 2011

Apr 27, 2011

Companies Announcement Office Australian Stock Exchange Limited 20 Bridge Street Sydney NSW 2000

ASX Release MGM Wireless Ltd Thursday April 28, 2011

March 2011 4C Quarter Results

Australian school communications group MGM Wireless Ltd said today that significant progress was made in the March quarter, with exciting developments in a number of areas:

• o The company received its first revenues from the New Zealand Ministry of Education Contract following approval of the MGM product by the NZ Ministry in January 2011. At the end of March a total of 18 schools have been installed with a further 35 signed to date.
• o The migration of data processing to a cloud-based hosting facility in Sydney. This move will allow MGM Wireless to scale rapidly and offer customers the highest level of security, reliability and redundancy. This new service will cater for the expected growth in the MGM business as it continues to innovate and commercialise new products.
• o Launch of Smartsync, which substantially increases the attractiveness of the Outreach School SMS solution by eliminating the need to manually transfer data from the school's Student Management System. It ensures that only the most up-to-date contact details are used to communicate with parents and student care-givers. Messages can be sent from any web connection, providing more flexibility and risk management for emergencies.
• o Continued conversion of NSW schools. MGM is migrating schools previously serviced by the NSW Education department to individual contracts. This enables more tailored services to meet the needs of individual schools and is seen as a significant opportunity to expand in the largest schools market in Australia.

• o The company secured sponsorship for all state ADAPE Conferences this year with the first conference for NSW and ACT Chapters being held in Sydney next week. ADAPE (Association of Development and Alumni Professionals in Education) Australasia is the peak organisation representing and specifically catering for advancement professionals in the education sector – its function is to fundraise, and manage alumni relations, enrolments, marketing, promotional activities and community relations, to support their school's financial resources. MGM will be presenting to delegates at all conferences.

• o Continued readying of products for market:

• o The web-based rollmarking product, to be renamed Rollmarker, is in the final stages of development and is targeted for release later this year following testing and the completion of marketing collateral and other associated materials.
• o School News Channel marketing materials and delivery channels are being readied for a full-scale launch.
• o Revenue for March Quarter 2011was \$535,224
• o Sales for March Quarter 2011were \$604,247
• o Operational School Customers Increased 9.5 % to 613 from the December quarter

New sales were soft with the quarter dominated by long school summer holidays and a number of target schools deferring decisions until after the end of the quarter, leading to a fall in revenue and sales for the quarter compared to the previous quarter a year ago. However, the strength of the business model with recurrent income meant that the business remained profitable for the quarter.

Sales in the June quarter are expected to resume to stronger levels as MGM introduces new products and provides schools with further Social Messaging services.

The company remains on track to achieve a similar full year profit result as 2010.

About MGM Wireless Ltd and Messageyou, LLC

MGM Wireless Ltd is a South Australian (Adelaide) based public company with a market capitalisation of A\$1.7 m listed on the Australian Securities Exchange (ASX code: MWR). The company trades as Messageyou, LLC in the United States, based in Silicon Valley, Sunnyvale, California.

MGM Wireless is recognized in Australia and internationally as a pioneer of socially responsible technology-enabled school communications with a proven capacity to design, develop and successfully commercialise innovative world class technology products in Australia and internationally.

The company's patented SMS School communication solutions empower schools to effectively communicate to parents and caregivers using SMS text messaging to improve student attendance, welfare, safety and parent engagement. Measurable benefits for schools include reduced operating costs, increased productivity and improved parent and community engagement, which ultimately improve student learning and social outcomes.

Schools in Australia, New Zealand and the United States use Messageyou software in their day-today operations.

For further information contact: MGM Wireless Ltd. - (ASX:MWR) Mark Fortunatow, CEO Mobile: +61 421 328 984 Phone: +61 8 8431 2300 Email: mfortunatow@mgmwireless.com Web: www.mgmwireless.com

Appendix 4C

Quarterly report

for entities admitted

on the basis of commitments

Introduced 31/3/2000. Amended 30/9/2001

Name of entity

MGM Wireless Ltd

93 091 351 530 31 March 2011

ABN Quarter ended ("current quarter")

Consolidated statement of cash flows

		Current quarter	Year to date
Cash flows related to operating activities		\$A'000	( .9.months)
			\$A'000
1.1	Receipts from customers	534	1747
1.2	Payments for (a) staff costs	(422)	(1090)
	(b) advertising and marketing	-	-
	(c) research and development	-	-
	(d) leased assets	-	-
	(e) other working capital	(106)	(414)
1.3	Dividends received	-	-
1.4	Interest and other items of a similar nature
	received	-	-
1.5	Interest and other costs of finance paid	(1)	(37)
1.6	Income taxes paid	-	-
1.7	Other
	Net operating cash flows	5	206

		Current quarter \$A'000	Year to date (9.months)
			\$A'000
1.8	Net operating cash flows (carried forward)	5	206
	Cash flows related to investing activities
1.9	Payment for acquisition of:
	(a) businesses (item 5)	-	-
	(b) equity investments	-	-
	(c) intellectual property	(40)	(150)
	(d) physical non-current assets (e) other non-current assets	(6) -	(34) -
1.10	Proceeds from disposal of:
	(a) businesses (item 5)	-	-
	(b) equity investments	-	-
	(c) intellectual property	-	-
	(d) physical non-current assets	-	-
	(e) other non-current assets	-	-
1.11	Loans to other entities	-	-
1.12	Loans repaid by other entities	-	-
1.13	Other – Development expenses	-	-
	Net investing cash flows	(46)	(184)
1.14	Total operating and investing cash flows	(41)	22
	Cash flows related to financing activities
1.15	Proceeds from issues of shares, options, etc.	-	154
1.16	Proceeds from sale of forfeited shares	-	-
1.17	Proceeds from borrowings	-	23
1.18	Repayment of borrowings	(3)	(265)
1.19	Dividends paid	-	-
1.20	Other (provide details if material)	20	9
	Net financing cash flows	17	(79)
	Net increase (decrease) in cash held	(24)	(57)
1.21 1.22	Cash at beginning of quarter/year to date Exchange rate adjustments to item 1.20	191 -	224
1.23	Cash at end of quarter	167	167

Payments to directors of the entity and associates of the directors

Payments to related entities of the entity and associates of the related entities

		Current quarter \$A'000
1.24	Aggregate amount of payments to the parties included in item 1.2	224
1.25	Aggregate amount of loans to the parties included in item 1.11	-
1.26	Explanation necessary for an understanding of the transactions

Non-cash financing and investing activities

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

Nil

Nil

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

Nil

Financing facilities available

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

		Amount available \$A'000	Amount used \$A'000
3.1	Loan facilities	-	-
3.2	Credit standby arrangements	-	-

Reconciliation of cash

Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.		Current quarter \$A'000	Previous quarter \$A'000
4.1	Cash on hand and at bank	167	191
4.2	Deposits at call
4.3	Bank overdraft
4.4	Other (provide details)
	Total: cash at end of quarter (item 1.22)	167	191

Acquisitions and disposals of business entities

		Acquisitions (Item 1.9(a))	Disposals (Item 1.10(a))
5.1	Name of entity	N/A
5.2	Place of incorporation or registration	N/A
5.3	Consideration for acquisition or disposal	N/A
5.4	Total net assets	N/A
5.5	Nature of business	N/A

Compliance statement

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

Sign here: M Fortunatow Date: 28 April 2011 Director

Print name: Mark Fortunatow

Notes

• 1. The quarterly report provides a basis for informing the market how the entity's activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.
• 1. The definitions in, and provisions of, AASB 1026: Statement of Cash Flows apply to this report except for the paragraphs of the Standard set out below.
• 6.2 reconciliation of cash flows arising from operating activities to operating profit or loss
• 9.2 itemised disclosure relating to acquisitions
• 9.4 itemised disclosure relating to disposals
• 12.1(a)- policy for classification of cash items
• 12.3 disclosure of restrictions on use of cash
• 13.1 comparative information
• 1. Accounting Standards. ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.