STREAMPLAY STUDIO LIMITED — Interim / Quarterly Report 2018

Apr 29, 2018

ASX and MEDIA RELEASE

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30 April 2018

Emerge Gaming Quarterly Review – Q3 FY2018

HIGHLIGHTS

• Emerge Gaming successfully lists on ASX following $5 million capital raise

• The $5 million capital raise was heavily oversubscribed with strong support from domestic and international institutional and sophisticated investors

• Emerge’s eSports tournament platform “Arcade X” is now complete and the proceeds of the raising will be focused on international expansion and subscriber growth

• Completion of 6-month investment into the development of Arcade X, integrating “Arcade X Mobi”, ahead of the launch of the global revenue generative partnership with MTN

• Emerge has already secured its first enterprise agreement with MTN South Africa, expected to generate immediate revenue by initially targeting MTN’s 31 million South Africa mobile subscribers

• Arcade X leverages its unique IP to deliver an optimum tournament gaming experience for users across some of gaming’s most popular titles

Emerge Gaming Limited (ASX: EM1) (“ Emerge ” or the “ Company ”) provides the following report of its activities for the quarter ended on 31 March 2018.

Emerge lists on ASX

On 18 April 2018, Emerge commenced trading on the ASX following completion of its heavily oversubscribed capital raise of $5 million completed by Hunter Capital Advisors, together with Regency Corporate. Emerge operates the eSports tournament platform and lifestyle hub “ Arcade X ”.

Development of Arcade X Completed

The Company was pleased to announce the completion of the development of its Arcade X Platform, an initiative which commenced 6 months prior to the capital raise and re-listing on the ASX. Arcade X which is now ready for deployment, provides Emerge with an internationally scalable and commercially ready platform against which to leverage the capital raised.

Arcade X

Arcade X is a cutting edge online eSports and casual gaming tournament facilitation platform which has been designed to deliver a unique experience and content for gamers across a multitude of game titles and spectrum of skills. The platform will connect gamers to corporate advertisers and sponsors, while providing Emerge with immediate commercial revenue earning functionality, international reach and scale. Arcade X offers a hybrid environment that gives access to both eSports and casual game titles using proprietary coding and technological integrations. Arcade X consists of Arcade X Mobi and Arcade X eSports.

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The Arcade X unique point of difference is the introduction of ‘Arcade X Mobi’ which has fully integrated over 300 casual games which allow the gamer to launch and play games embedded in the platform providing automated results providing direct access to the 1.9 Billion casual and social gamers globally. The casual game integration allows mobile casual and social gamers the opportunity to play integrated games on their smart phones and tablets in an effort to win prizes. Integrated casual games are available on the mobile devices in full screen view, allowing gamers to engage in a seamless competitive mobile gaming experience.

The platform uses its unique IP, advanced analytics tracking and proprietary algorithms to deliver an optimum tournament gaming experience for users while providing publishers the perfect vehicle for delivery of their messaging to a fully engaged audience.

Innovative revenue model

Emerge offers a unique revenue model to its competitors across three main streams:

• 1) Subscription fees that can be linked to the gamers’ telecommunications provider bill

• 2) Revenue from companies from management of corporate online tournament services, and sponsorships and advertising powered by advanced data analytics and targeting capability

• 3) Advertising revenue from companies engaging users of the lifestyle portal.

The potential of the platform has already been recognised by MTN South Africa of MTN Group Ltd. MTN Group Ltd. with 232 million subscribers, it is Africa’s biggest mobile-network operator by sales. The Company has executed a profit sharing agreement with MTN Group under which MTN South Africa (part of MTN Group) will provide the Company with access to marketing support and its 31 million subscribers in that country.

The agreement with MTN Group and the capital funds raised places Emerge Gaming in a strong position to grow and commercialise its user base quickly and further expand into emerging gaming markets like Africa, the Asian/Indian sub-continent and Latin America where 74% of the world’s 2.1 billion gamers reside.

New Management team

With completion of the relisting, Mr Bert Mondello, Mr Gregory Stevens and Mr Jonathan Hart were appointed as the Company’s new Board, joining Mr Philip Re.

Chief Executive Officer, Executive Director and founder of Emerge Gaming, Greg Stevens, has 10 years’ successful management experience in gaming start-ups. He is a former director of a worldclass eSports development agency collaborating with brands like Ubisoft, Blizzard and Activision.

Non-Executive Chairman, Bert Mondello is an experienced company executive with substantial equity market experience. Mr Mondello has provided strategic corporate advice to a number of organisations across multiple industries, with a specialisation in technology.

Non-Executive Director, Jonathan Hart is a practising lawyer with a broad range of experience in the capital markets, offering corporate and strategic advice, corporate governance and ASX compliance.

Non-Executive Director, Philip Re is Managing Director of Regency Corporate. Mr Re is a finance and accounting senior executive who sits on several ASX company boards.

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The new management team’s skill sets equate well to Emerge’s strategy and outlook which requires eSports international business partnership, and technology, development.

Strategy and outlook

Arcade X (and its previous iteration GBG) has been developed over a 3-year period and is now ready to deploy internationally. Plans to further develop and formalise in country telco and enterprise partnerships will be the key to driving low cost user acquisition by providing access to millions of mobile subscriber gamers. The architecture and cloud based infrastructure of the Arcade X platform facilitates rapid scalability through country roll out and telco integration.

MTN Group is the 9th largest terrestrial telecommunications company by number of subscribers in the world. Along with MTN, Emerge will be targeting top mobile phone providers for partnerships. The potential for Arcade X within the MTN Group, and within the 6 billion mobile phone subscribers from the top 35 global mobile phone providers by subscriber, is lucrative.

Management’s objective to achieve low cost gamer acquisition through telco partnerships focussing on the top 35 global mobile phone providers delivers a strategy which leverages high scalability against the investment in international partnership development.

Management will at all times pay attention to the revenue yield per gamer ensuring partnerships, tournaments, content and features uniquely engage gamers in each country.

Greg Stevens, CEO and Executive Director noted:

“We have had a patient build up to listing on the ASX and now that this process is complete, we are keen to show what our Arcade X platform can do. The Platform was built to focus on gamer engagement, rapid international scalability and revenue generation. In MTN, we have a strong first telco partnership to drive uptake and create value quickly for our shareholders.”

-ENDS-

For further information: Media enquiries: Bert Mondello Tristan Everett Chairman Market Eye E: bmondello@regencycorporate.com.au E: tristan.everett@marketeye.com.au P: +61 8 6380 2555 P: +61 403 789 096

ABOUT Emerge Gaming

Emerge Gaming Limited (ASX:EM1) is a leading eSports and Casual gaming tournament company. Emerge Gaming operates the online eSports and casual gaming tournament platform and lifestyle hub “Arcade X”. Via this platform, casual, social and hardcore gamers can play more than 300 gaming titles against each other via their mobile, console or PC.

The platform uses its unique IP, advanced analytics tracking and proprietary algorithms to deliver an optimum tournament gaming experience for users while providing advertisers with the perfect vehicle for delivery of their messaging to a fully engaged audience.

More information www.emergegaming.com.au and www.arcadex.co

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Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

+Rule 4.7B

Appendix 4C

Quarterly report for entities subject to Listing Rule 4.7B

Introduced 31/03/00 Amended 30/09/01, 24/10/05, 17/12/10, 01/09/16

Name of entity

EMERGE GAMING LIMITED

ABN 31 004 766 376

Quarter ended (“current quarter”)

31 MARCH 2018

Consolidated statement of cash flows	Current quarter $A’000	Year to date (9 months) $A’000
1. Cash flows from operating activities 1.1 Receipts from customers 1.2 Payments for (a) research and development (b) product manufacturing and operating costs (c) advertising and marketing (d) leased assets (e) staff costs (f) administration and corporate costs 1.3 Dividends received (see note 3) 1.4 Interest received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Government grants and tax incentives 1.8 Other (provide details if material) ATO GST refund 1.9 Net cash from / (used in) operating activities	- - - - - - (54) 2 - - - 30	- - 2 - - - (257) 3 - - - 30
	(22)	(222)
2. Cash flows from investing activities 2.1 Payments to acquire: (a) property, plant and equipment (b) businesses (see item 10) (c) investments	- - -	- - -

• See chapter 19 for defined terms 1 September 2016

Page 1

Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

Consolidated statement of cash flows	Current quarter $A’000	Year to date (9 months) $A’000
(d) intellectual property (e) other non-current assets 2.2 Proceeds from disposal of: (a) property, plant and equipment (b) businesses (see item 10) (c) investments (d) intellectual property (e) other non-current assets 2.3 Cash flows from loans to other entities 2.4 Dividends received (see note 3) 2.5 Other (provide details if material) 2.6 Net cash from / (used in) investing activities	- - - - - - - - - -	- - - - - - - - - (237)
	-	(237)
3. Cash flows from financing activities 3.1 Proceeds from issues of shares 3.2 Costs from issue of convertible notes 3.3 Proceeds from exercise of share options 3.4 Transaction costs related to issues of shares, convertible notes or options 3.5 Proceeds from borrowings 3.6 Repayment of borrowings 3.7 Transaction costs related to loans and borrowings 3.8 Dividends paid 3.9 Other (provide details if material) 3.10 Net cash from / (used in) financing activities*	- - - - - - - - (30)	250 (17) - - - - - - (185)
	(30)	48
* These costs relate to the IPO listing of Emerge Gaming Limited
4. Net increase / (decrease) in cash and cash equivalents for the period 4.1 Cash and cash equivalents at beginning of quarter/year to date 4.2 Net cash from / (used in) operating activities (item 1.9 above) 4.3 Net cash from / (used in) investing activities (item 2.6 above) 4.4 Net cash from / (used in) financing activities (item 3.10 above)	81 (22) - (30)	440 (222) (237) 48

• See chapter 19 for defined terms 1 September 2016

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Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

Consolidated statement of cash flows	Current quarter $A’000	Year to date (9 months) $A’000
4.5 Effect of movement in exchange rates on cash held 4.6 Cash and cash equivalents at end of quarter*	-	-
	29	29

• Balance does not include the $5 million dollars raised as part of the IPO listing of Emerge Gaming

5. Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts	Current quarter $A’000	Previous quarter $A’000
5.1 Bank balances 5.2 Call deposits 5.3 Bank overdrafts 5.4 Other (provide details) 5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above)	29 - - -	81 - - -
	29	81

6.	Payments to directors of the entity and their associates	Current quarter
		$A'000
6.1	Aggregate amount of payments to these parties included in item 1.2		24
6.2	Aggregate amount of cash flow from loans to these parties included		-
	in item 2.3
6.3	Include below any explanation necessary to understand the transactions included in
	items 6.1 and 6.2

Director fees of ~$24,000.

7.	Payments to related entities of the entity and their	Current quarter
	associates	$A'000
7.1	Aggregate amount of payments to these parties included in item 1.2		-
7.2	Aggregate amount of cash flow from loans to these parties included		-
	in item 2.3
7.3	Include below any explanation necessary to understand the transactions included in
	items 7.1 and 7.2

• See chapter 19 for defined terms 1 September 2016

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Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

8. Financing facilities available Add notes as necessary for an understanding of the position 8.1 Loan facilities 8.2 Credit standby arrangements 8.3 Other (please specify)	Total facility amount at quarter end $A’000	Amount drawn at quarter end $A’000
	-	-
	-	-
	-	-

• 8.4 Include below a description of each facility above, including the lender, interest rate and whether it is secured or unsecured. If any additional facilities have been entered into or are proposed to be entered into after quarter end, include details of those facilities as well.

9. Estimated cash outflows for next quarter	$A’000
9.1 Research and development 9.2 Product manufacturing and operating costs 9.3 Advertising and marketing 9.4 Leased assets 9.5 Staff costs 9.6 Administration and corporate costs 9.7 Other (provide details if material) 9.8 Total estimated cash outflows*	100 50 150 - 150 100 700
	1,250

*Payment of deferred costs incurred by development, management and marketing teams in the 18-month period leading up to the ASX listing.

10. Acquisitions and disposals of business entities (items 2.1(b) and 2.2(b) above)	Acquisitions	Disposals
10.1 Name of entity*	-	-
10.2 Place of incorporation or registration	-	-
10.3 Consideration for acquisition or disposal	-	-
10.4 Total net assets	-	-
10.5 Nature of business	-	-

*The acquisition of the Emerge Gaming (Gaming Battleground) entity was completed post quarter end.

• See chapter 19 for defined terms 1 September 2016

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Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

• 2 This statement gives a true and fair view of the matters disclosed.

Sign here: ............................................................ Date: 30 April 2018 (Company Secretary)

Print name: Derek Hall

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 that wishes to disclose additional information is encouraged to do so, in a note or notes included in or attached to this report.

2. If this quarterly report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 107: Statement of Cash Flows apply to this report. If this quarterly report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standard applies to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. See chapter 19 for defined terms 1 September 2016

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