SPACETALK LTD — Interim / Quarterly Report 2016

Feb 28, 2016

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Half Year Report – 31 December 2015
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ASX Market Announcements ASX Limited 20 Bridge Street Sydney NSW 2000 February 29, 2016

MGM Wireless Ltd. ASX:MWR ABN 93 091 351 530 The Parks, Suite 13 ROSE PARK SA 5067 AUSTRALIA Phone: (08) 8104 9555 Facsimile: (08) 8431 2400 www.mgmwireless.com

2016 First half results

• Sales revenue and profit consistent with December guidance

• Cash balances of $1.62 million, up slightly

• Message traffic up 16%, contracted schools & ELC up 4% to December

• Strong growth in contracted schools in first month of new school year

• Contract secured with Victorian Department of Education

• New products including next generation school messaging about to launch

• Allmytribe makes encouraging start to childrens’ smartwatch phone/family wearables

Key results 2016 first half :

Six months ended 31 December

$ million unless otherwise specified	2015	2014	Change
Revenue	1.89	2.21	- 14%
Gross profit	1.73	2.05	- 15%
Underlying EBITDA	0.66	1.01	- 35%
Net Profit	0.18	0.64	- 72%
EBITDA margin	34.9%	45.8%	- 11%
Net Cash from operating activites	0.34	0.35	- 3%
Cash Balances	1.62	1.61	+ 0%
Earnings per share(diluted) cents	2.08	7.38	- 72%
Contracted Schools & Early Learning Centres	1,192	1,143	+ 4%
As at 26 February 2016	1,232		+ 8%

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School communication and software specialist MGM Wireless (ASX: MWR) has released its Half Year Report for the six months to 31 December 2015 (‘2016’ first half), announcing revenue and earnings consistent with its December guidance and a surge in contracted schools in a strong start to the second half.

MGM Wireless reported revenue of $1.9 million for the 2016 first half, in line with December guidance and which compares to the previous corresponding figure of $2.2 million. Net profit after tax of $0.2 million is broadly consistent with guidance of approximately $0.1 million, once the impact of significant non-operating items are considered. The 2016 interim profit included significant items with a net favourable impact of approximately $0.1 million for the period. MGM Wireless recorded a net profit after tax of $0.6 million in the 2015 First Half.

The movement in profit between periods is largely attributable to lower sales revenue in the six months to December and a $0.2 million increase in amortisation and depreciation arising from the growth in capitalised research and development expenditure over the past three years.

MGM Wireless Managing Director Mark Fortunatow said that the movement in sales compared with the previous year was the result of the concurrence of a number of technology and school-related factors.

“As we advised in our December guidance, sales for the period were clearly disrupted by the market novelty of internet based messaging apps, and the impending release of our own next generation messaging products, with the latter causing deferral of commitments normally expected prior to January. On top of this, the 2015 school year finished unusually early, a quirk of the calendar that occurs every 5 years, which contributed to clients having a higher than usual residual inventory of unused SMS credits, and lower reorder levels, prior to December” Mr Fortunatow explained.

“Our experience since January has reinforced the time and effort invested in getting our next generation messaging product ‘right’ and the clear advantages of sophisticated SMS solutions for critical communication and safety obligations. We expect both factors to help drive a stronger second half sales result’ he said.

“Customer feedback to pre-release demonstrations of our new messaging platform have been universally enthusiastic and prompted implementation decisions in every case.

“The spate of school evacuations and lockdowns that occurred in February highlighted their need for effective messaging systems and the superior effectiveness of SMS solutions as the most reliable and secure method to communicate to all parents.

“In simple terms, the affected schools with SMS systems were able to reliably, quickly and securely contact all parents. This was not the case for schools who relied on

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internet based messaging apps, where communication was conditional on parents using a smartphone, having the app installed on their phones, notifications settings switched on and constant access to mobile internet or Wi-Fi.”

“The free trials and awareness building we conducted during this period had immediate results, as 36 new schools have been contracted since 31 December, taking total schools under contract to 1,232. Further additions are expected.” he said.

“The result has been a strong start to the second half, something which we expect will be reinforced by the launch of our new messaging platform in around 4 weeks and the launch of MGM School Events” he said.

Revenue in the second half will also benefit from the securing of a new agreement with a state Education Department in December 2015. The new agreement will simplify and standardise school purchases of MGM products in the state. No revenue or income from the contract was booked in the first half results.

Mr Fortunatow said that the company’s entry into a new market; children’s smartwatch phone and family wearables, was proceeding well. The company had launched its AllMyTribe online store in November to assess market receptiveness, pricing models and other market considerations.

“The response has been extremely encouraging” said Mr Fortunatow. “Orders have exceeded expectations. More importantly, the lessons and market intelligence acquired has affirmed the potential of the market and our ability to compete and build a good business in this emerging family wearable, Internet of Things (IoT) and safety market”.

MGM Wireless retained a strong balance sheet with cash balances increasing slightly over the period to $1.6 million. The company continued its commitment to the development of new products, with cash expenditure of $0.5 million on research and development during the period.

“We are continuing to innovate. What’s most exciting is the opportunities we can see for MGM Wireless which, as far as we can see, are as advanced as any player in our chosen field whether that be in Australia or overseas.

“We are eagerly looking forward to the release of new products in the near future. Our new messaging platform represents a breakthrough for the school communication market and we are very keen to see how far we can leverage our capabilities in the global family wearables and child safety market.”

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Half Year Report – 31 December 2015
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Appendix 4D MGM WIRELESS LIMITED ABN 93 091 351 530

Half-Year Report

31 December 2015

(Previous corresponding period: 31 December 2014)

Results for announcement to the market

Half-Year Report 31 December 2015 (Previous corresponding period: 31 December 2014)	Half-Year Report 31 December 2015 (Previous corresponding period: 31 December 2014)	Half-Year Report 31 December 2015 (Previous corresponding period: 31 December 2014)	Half-Year Report 31 December 2015 (Previous corresponding period: 31 December 2014)	Half-Year Report 31 December 2015 (Previous corresponding period: 31 December 2014)	Half-Year Report 31 December 2015 (Previous corresponding period: 31 December 2014)	Half-Year Report 31 December 2015 (Previous corresponding period: 31 December 2014)
Results for announcement to the market
		Percentage change from corresponding period		Amount change from corresponding period		6 months ended 31/12/2015 $ 1,893,233 184,984 184,984
Financial Results		%		$
Revenue from ordinary activities		(14%)		312,811
Profit/(loss) from ordinary activities after tax attributable to members		(71%)		455,233
Net profit/(loss) for the period attributable to members		(71%)		455,233
Dividends declared				Amount per security
Interim Dividend				Nil
Final Dividend				Nil
Record date for determining entitlements to the interim dividends
Record date for determiningentitlements to the final dividends
Net Tangible Asset Backing				31 December 2015 (cents per share) 31 December 2014 (cents per share) 25.01 23.26
Net tangible asset backing per ordinarysecurity				25.01 23.26
Other explanatory notes
N/A
Control gained or lost over entities during the period				N/A N/A
Name of entity
Date ofgaining/losingcontrol
Dividends or distributions paid to shareholders				$90,163 dividend paid on 4 November 2015
Dividends or distributions reinvestment plan details				$21,388 reinvested on 4 November 2015
Joint venture and associate details					N/A N/A
Foreign entities' accounting standards used

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Half Year Report – 31 December 2015
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31/12/15 Half Year Report MGM Wireless Ltd.

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Half Year Report – 31 December 2015
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Index

Half – Year Ended 31 December 2015

Page Index 3 Corporate Directory 4 Directors’ Report 8 Auditor’s Independence Declaration 9 Independent Audit Report to the Members of MGM Wireless Ltd 11 Directors’ Declaration 12 Financial Statements

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CORPORATE DIRECTORY

Registered Office Suite 13, The Parks 154 Fullarton Road Rose Park SA 5067 Principal Office Suite 13, The Parks 154 Fullarton Road Rose Park SA 5067 Telephone: (08) 8104 9555 Facsimile: (08) 8431 2400 Auditor Grant Thornton Audit Pty Ltd Level 1 67 Greenhill Road Wayville SA 5034 Telephone: (08) 8372 6666 Facsimile: (08) 8372 6677 Share Registry Computershare Investor Services Pty Ltd Level 5 115 Grenfell Street Adelaide SA 5000 Telephone: 1300 556 161 Overseas Callers: 61 3 9415 4000 Facsimile: 1300 534 987 Stock Exchange The securities of MGM Wireless Limited are listed on the Australian Securities Exchange. MWR ordinary fully paid shares ASX Code

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Directors Report

The Directors of MGM Wireless Limited submit herewith the financial report of MGM Wireless Limited and its subsidiaries (the Group) for the half year ended 31 December 2015. In order to comply the provisions of the Corporations Act 2001, the directors report as follows:

The names of the directors of the company that held office during and since the end of the half-year (unless otherwise stated) are:

Name

Mr. Mark Fortunatow Mr. Mark Edwin Hurd Ms. Tara Lewis-Christie Ms. Leila Henderson

Review of Operations

MGM Wireless generates revenue and income through the provision of technology solutions that assist schools to improve communication within their communities and for cost effective management and improvement of student attendance and engagement. Through research and development, the Company has developed a range of products to meet school needs which are supplied and supported under long term contracts.

MGM Wireless technology and innovation has relevance for broader consumer needs, particularly in respect of child safety and family living. During the period the company launched an online store as an initial foray into the children’s smartwatch and family wearables market.

The Company’s strategy to increase earnings and returns to shareholders involves:

• expansion of the number of schools using MGM Wireless products

• innovation, development and sale of new products that provide additional revenue streams

• innovation, development and sale of upgrades to maintain the leading edge and increase the effectiveness and value of products to users and the company

• leverage of the company’s technology and capabilities into related markets where

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business models can support shareholder value accretive presence and growth

• optimisation of business operations to improve efficiency and operating margin

At 31 December the company had 1,192 contracted schools and early learning centres, compared with 1,143 as at 31 December 2014, representing growth of 4%.

Key items of the financial results and operating performance are discussed below:

Profit

The company recorded total comprehensive income for the six months ended 31 December 2015 ("2016 first half”) of $184,984, which compares with the previous corresponding result of $640,217. Earnings per share (diluted) were 2.08 cents per share compared with 7.38 cents per share in 2014.

• EBITDA for the 2015 first half was $658,122 compared with $1,009,912 in the six months to December 2014.

Factors in the 2016 first half net statutory profit result include:

• Lower sales. Revenue for the half year was $1,893,233 compared with $2,206,044. The reduction in revenue is considered attributable to a number of factors including: an earlier end to the school year in 2015, which also had the effect of dampening SMS recharge sales; the impending release of the company’s new generation school communication messaging platform, which caused some deferral of sales commitments and the impact of internet based messaging applications. The latter is considered to be of temporary impact pending the introduction of sophisticated messaging platforms and due to the lack of reliability in communication compared to SMS platforms.

• Cost of sales rose from $158,744 to $162,590 due to the additional cost associated with upgrading of telecommunications services to provide greater security.

• Depreciation and amortisation rose from $176,428 to $416,605. The increase is attributable to additional charges associated with development expenditure capitalised as a result of policy adopted in the June 2015 accounts.

• The reporting of corporate and administration costs rose, from $135,466 to $222,687, a movement which is largely due to the change in accounting treatment detailed in the 2015 annual report which has no impact on the total expenses and therefore no impact on profit but affects allocation between expense categories.

Under the change, credit for capitalised expenditure is made against specific relevant

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expense categories. In the 2015 half year accounts and prior, a general credit for capitalised expenditure was made against corporate and administration costs. As a result, the final charge for corporate and administration costs was significantly lower than the comparative in the 2015 full year and subsequent accounts. On a like-for-like basis corporate and administration costs declined in 2015.

• Significant non-operating items with a net favorable impact of $111,000 on net profit. These items include: a gain associated with the introduction of future deferred tax deductions as a Deferred Tax Asset; which was partially offset by the creation of a long service leave provision for employees and correction to prior period tax accruals.

Cashflow

MGM Wireless generated cash flow of $343,961 from operating activities during the period, slightly lower than the previous corresponding figure of $351,401.

Statement of financial position

The company’s statement of financial position continued to strengthen, with equity of $4,301,293 as at 31 December 2015, 5% higher than the corresponding figure of $4,093,277 at the beginning of the period.

Noteworthy movements in the statement of financial position in the six months to 31 December and the associated factors included:

• a 6% increase in cash, which rose from $1,526,754 to $1,619,742

• the introduction of a deferred tax asset of $271,899 following the initial adoption of tax effect accounting.

• Employee entitlements and other provisions rising from $221,611 to $309,254 due to addition employees now becoming entitled to long service leave.

Changes in the state of affairs

During the half year ended 31 December 2015 there was no significant change in the Group’s state of affairs other than that referred to in the half-year financial statement or notes thereto.

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Dividends

No dividends have been declared during the half year ended 31 December 2015 (2014 halfyear: $nil). Dividends of $90,163 relating to the year ended 30 June 2015 were paid during the half year ended 31 December 2015 (2014 half-year: $94,241).

Auditor’s Independence Declaration

The auditor’s independence declaration for the half-year report ended 31 December 2015 has been received and is included on page 8.

Signed in accordance with a resolution of directors made pursuant to s.306(3) of the Corporations Act 2001.

On behalf of the Directors

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Mark Fortunatow Executive Chairman Rose Park, 29 February 2016

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Directors Declaration

The directors declare that:

(a) 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; and

(b) in the directors' opinion, the attached consolidated financial statements and notes thereto are in accordance with the Corporations Act 2001 , including compliance with accounting standards and giving a true and fair view of the financial position and performance of the consolidated entity.

Signed in accordance with a resolution of the directors made pursuant to s.303(5) of the Corporations Act 2001 .

On behalf of the Directors,

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Mark Fortunatow Executive Chairman Rose Park on 29 February, 2016

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Condensed consolidated statement of profit or loss and other comprehensive income for the half-year ended 31 December 2015

		Consolidated Group	Consolidated Group
		Half- Year Ended
		31/12/2015 $ 1,893,233 (162,590)	31/12/2014
			$
Continuing Operations
Revenue			2,206,044
Cost of sales			(158,744)
Gross Profit		1,730,644 (42,590) (5,694) (416,605) (55,427) (88,250) (222,687) (663,568)	2,047,300
Doubtful debts			-
Borrowingcosts			(8,188)
Amortisation & depreciation			(176,428)
Consultingfees			(38,351)
Issue of options			(93,571)
Corporate and administration			(135,466)
Employee costs			(770,001)
Profit before tax		235,823 (50,838)	825,295
Income tax expense			(185,078)
Profit for theperiod from continuing operations		184,984	640,217
Profit for the period		184,984	640,217
Other comprehensive income		(8,620)
Exchange differences on translatingforeign operations			-
Other comprehensive income for theperiod(net of tax)		(8,620)	-
Total comprehensive income for the period		176,364	640,217
Profit attributable to:		184,984
Owners of the Company			640,217
Total comprehensive income attributable to:		176,364
Owners of the Company			640,217
Earnings per share
From continuingand discontinued operations:
Basic(centsper share)		2.15	7.47
Diluted(centsper share)		2.08 2.15 2.08	7.38
From continuingoperations
Basic(centsper share)			7.47
Diluted(cents per share)			7.38

The above condensed consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the attached notes.

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Condensed consolidated statement of financial position as at 31 December 2015

		Consolidated Group	Consolidated Group
		As At
		31/12/2015 $ 1,619,742 846,215 377,574	30/06/2015
			$
ASSETS
Current Assets
Cash and cash equivalents			1,526,754
Trade and other receivables			787,592
Other assets			636,514
Total Current Assets		2,843,531	2,950,860
Non-Current Assets		176,627 271,899 2,146,976
Property, plantand equipment			183,214
Deferred Tax Asset			-
Intangibles			2,015,926
Total Non-Current Assets		2,595,502	2,199,140
Total Assets		5,439,033	5,150,000
		426,783 309,254 251,701
LIABILITIES
Current Liabilities
Trade and otherpayables			508,773
Provisions			221,611
Current Tax Liabilities			176,339
Total Current Liabilities		987,740	906,723
Non-Current Liabilities
Borrowings		150,000	150,000
Total Non-Current Liabilites		150,000	150,000
Total Liabilities		1,137,740	1,056,723
Net Assets		4,301,293	4,093,277
		7,419,380 475,895 (3,593,982)
EQUITY
Issued capital			7,376,993
Reserves			396,467
Accumulated losses			(3,680,183)
Total Equity		4,301,293	4,093,277

The above condensed consolidated statement of financial position should be read in conjunction with the attached notes.

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Condensed consolidated statement of changes in equity for the half-year ended 31 December 2015

	Issued Accumulated Option Foreign Total Capital Losses Issue Currency Equity Reserve Translation Reserve $ $ $ $ $	Issued Accumulated Option Foreign Total Capital Losses Issue Currency Equity Reserve Translation Reserve $ $ $ $ $	Issued Accumulated Option Foreign Total Capital Losses Issue Currency Equity Reserve Translation Reserve $ $ $ $ $	Issued Accumulated Option Foreign Total Capital Losses Issue Currency Equity Reserve Translation Reserve $ $ $ $ $	Issued Accumulated Option Foreign Total Capital Losses Issue Currency Equity Reserve Translation Reserve $ $ $ $ $
At 1July 2014	7,376,993	(4,627,722)	301,762	5,973	3,057,006
Profit attributable to members	-	640,217	-	-	640,217
Payment of dividends	-	(94,241)	-	-	(94,241)
Options issued-directors	-	-	93,571	-	93,571
Currencytranslation differences	-	2,251	-	-	2,251
At 31 December 2014	7,376,993	(4,079,495)	395,333	5,973	3,698,804
At 1July 2015	7,376,993	(3,680,183)	395,333	1,134	4,093,277
Profit attributable to members	-	184,984	-	-	184,984
Payment of dividends	-	(90,163)	-	-	(90,163)
Issue of shares(DRP scheme)	21,387	-	-	-	21,387
Options issued-directors	-	-	88,250	-	88,250
Options exercised by directors	21,000	-	-	-	21,000
Currencytranslation differences	-	(8,620)	-	(8,822)	(17,442)
At 31 December 2015	7,419,380	(3,593,982)	483,583	(7,688)	4,301,293

The above Consolidated Statement of Changes in Equity should be read in conjunction with the attached notes.

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Condensed consolidated statement of cash flows for the half-year ended 31 December 2015

December 2015
		Consolidated Group
		Half-Year Ended
		31/12/2015 $ 1,695,398 (1,098,367) (247,375) (5,694)	31/12/2014
			$
Cash flows from operating activities
Receipts from customers			2,435,049
Payments to suppliers and employees			(1,580,131)
Taxpayments			(495,329)
Interest and other costs of finance			(8,188)
Net cashprovided byoperatingactivities		343,961	351,401
		355,313 (6,513) - (534,554)
Cash flows from investing activities
Receipt ofgrant income			568,221
Payments forplant and equipment			(14,855)
Proceeds from the sale ofplant and equipment			17,068
Payment for research and development			(299,137)
Net cashprovided byinvestingactivities		(185,754)	271,297
		(90,163) 42,387
Cash flows from financing activities
Dividendspaid to owners of the company			(94,242)
Issue of shares			-
Net cash(used in)/provided byfinancingactivities		(47,776)	(94,242)
		110,432 1,526,754 (17,442)
Net increase / decrease in cash held			528,456
Cash and cash equivalents at 1 July			1,077,840
Effect of exchange rate changes			-
Cash at the end of theperiod		1,619,742	1,606,296

The above consolidated consolidated statement of cash flows should be read in conjunction with the attached notes.

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Notes to the condensed consolidated financial statements

Significant accounting policies

1.1 Statement of compliance

The half-year financial report is a general purpose financial report prepared in accordance with the Corporations Act 2001 and AASB 134 ‘Interim Financial Reporting’. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 ‘Interim Financial Reporting’. The half-year report does not include notes of the type normally included in an annual financial report and shall be read in conjunction with the most recent annual financial report.

1.2 Basis of preparation

The condensed consolidated financial statements have been prepared on the basis of historical cost, except for the revaluation of certain non-current assets and financial instruments. Cost is based on the fair values of the consideration given in exchange for assets. All amounts are presented in Australian dollars, unless otherwise noted.

The accounting policies and methods of computation adopted in the preparation of the half-year financial report are consistent with those adopted and disclosed in the company’s 2015 annual financial report for the financial year ended 30 June 2015. These accounting policies are consistent with Australian Accounting Standards and with International Financial Reporting Standards.

1.3 Critical accounting judgements and estimates

In the application of the Group’s accounting policies, the Directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated judgements are based on historical experience and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the group. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the

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period of the revision and future periods if the revision affects both current and future periods.

The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

1.3.1 Internally generated intangible assets

In order to carry out the principal activities of the consolidated entity, a number of intangible assets are generated internally. These assets represent development expenditure incurred in the generation of specific products which will be marketed to consumers. Identification of the amount of development expenditure on individual products is a time consuming process, and as such, is performed in detail on an annual basis at 30 June each year. To determine the balance at 31 December 2015, an expectation has been made based on the amount capitalised at 30 June 2015, with any required adjustment being made to reflect known material variances in projects year on year.

1.3.2 R&D tax incentive receivable

The R&D tax incentive is received annually from the Australian Tax Office based on the amount of eligible research and development expenditure incurred by the consolidated entity each year. Identification of the amount of eligible research and development expenditure is a time consuming process, and as such, is performed in detail at 30 June each year. To determine the balance at 31 December 2015, an expectation has been made based on the R&D tax incentive received for 30 June 2015, with any required adjustment being made to reflect known material variances in operations year on year.

2. Segment information

AASB 8 Operating Segments requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance.

In both the current and previous reporting period the Group has only been operating in one business sector and reporting to Management has been on

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a geographical basis. Each company represents a strategic business unit that offers different risks and rates of returns. This is the basis by which Management controls and reviews the operations of the Group.

The accounting policies of the reportable segments are the same as the Group’s accounting policies.

Segment revenue andprofit
	Segment revenue		Segmentprofit
	Half Year Ended		Half Year Ended
	31/12/2015 1,883,694 - 9,539	31/12/2014	31/12/2015 31/12/2014 229,309 627,691 - (2,300) (44,325) 14,826
MGM Wireless Holdings		2,173,054
USA Message YOU LLC		-
NZ MGM Wireless(NZ)PtyLtd		32,990
Total for ContinuingOperation	1,893,233	2,206,044
Profit after tax(continuingoperations)			184,984 640,217
Segment assets and liabilities
	Assets		Liabilities
	Half Year Ended		Half Year Ended
	31/12/2015 - 5,356,889 - 82,145	30/06/2015	31/12/2015 30/06/2015 - - 928,285 853,500 85,661 81,639 123,794 121,584
MGM Wireless		-
MGM Wireless Holdings		5,028,404
USA Message YOU LLC		-
NZ MGM Wireless(NZ)PtyLtd		121,596
Consolidated Assets	5,439,033	5,150,000
Consolidated Liabilities			1,137,740 1,056,723

3. Issues of equity securities

During the half-year, the Group issued 30,000 ordinary shares for $21,000 on exercise of 30,000 share options under its share option plan (2014: nil). The company issued 240,000 new share options to a number of directors (2014: issue of 230,000 options to a number of directors). A total of 17,546 ordinary shares were alloted in November 2015 (2014: nil) to shareholders participating in the Group’s Dividend Reinvestment Plan.

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Half Year Report – 31 December 2015
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4. Dividends

During the half-year, the Group made the following dividend payments relating to the year ended 30 June 2015:

Dividends
	Half-year ended		Half-year ended
	31 December 2015		31 December 2014
	Cents Per Share	Total	Cents	Total
		$	Per Share	$
Fully paid ordinary shares
Final dividend for the year ended 30 June	1.3	90,163 1.1		94,241

5. Financial instruments

This note provides information about how the Group determines fair values of various financial assets and financial liabilities.

The directors consider that the carrying amounts of financial assets and financial liabilities recognised in the consolidated financial statements approximate their fair values.

6. Events after the reporting date

There has not arisen in the interval between 31 December 2015 and the date of this report, any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors of MGM Wireless, to affect significantly the operations of the consolidated Group, the results of those operations, or the state of affairs of the consolidated Group, in future periods.

7. Commitments

There have been no changes to commitments since 30 June 2015.

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MGM Wireless Ltd.

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