STREAMPLAY STUDIO LIMITED — Interim / Quarterly Report 2019

Jan 24, 2019

ASX RELEASE

25 January 2019

Emerge Gaming Quarterly Update and Appendix 4C

Emerge Gaming Limited (ASX: EM1) ("Emerge" or the "Company"), a leading provider of enhanced eSports capabilities, presents the following report for the quarter ended on 31 December 2018.

Emerge operatesthe eSports tournament platform and lifestyle hub "Arcade X". Arcade X is a cuttingedge online eSports and casual gaming tournament facilitation platform. Arcade X consists of "Arcade X Mobi" for mobile phone devices and "Arcade X eSports" for console/PC.

HIGHLIGHTS

• Global distribution agreement signed with Cloudzen for their revolutionary cloud streaming digital distribution platform 'GameCloud'
• GameCloud is regarded as the "Netflix of Gaming" for a potential 2 billion gamers
• Partnership to showcase Emerge Gaming's Arcade X technology to a significantly expanded gaming market using Cloudzen's intellectual property to generate monthly subscription fees
• Distribution Agreementsigned with mobile Value-Added Servicessolution and content provider Petrimex - allowing further penetration into Africa

Cloudzen Global Distribution Agreement of GameCloud

On 30 October 2018, the Company announced that it had entered into a Memorandum of Understanding with Cloudzen Pte Ltd ("Cloudzen"), a next generation cloud gaming company registered in Singapore.

Cloudzen is a leading cloud gaming and mobile entertainment Platform as a Service provider which offers various means of communications channels through digital entertainment via game stores, communities and social networks. It was founded in 2004 by veteran game developer Mr Robin Tan and has revolutionised game streaming through its GameCloud technology platform ("GameCloud").

GameCloud provides gamers with a one stop portal for instant access to hundreds of AAA rated 3D graphic games and live streaming on mobile devices without having to download the game or any further hardware requirements. GameCloud enables gamers to play at any time from handheld devices and smart TVs, with multiplayer gaming, video streaming and social networking.

Cloudzen offers significant synergies with Emerge's Arcade X platform, which caters for different segments of the online gaming community. The platform targets 2 billion mobile gamers worldwide and has significant advantages over the PC and console game segment, which also represents a combined 255 million gamers (Source: Statista 2016).

Following on from the MOU, the Company executed an exclusive Global Distribution Agreement with Cloudzen to use its intellectual property for GameCloud (ASX: 4 December 2018).

The Global Distribution Agreement will see Emerge enter a number of first world markets to promote its Arcade X and GameCloud's technology. This includes an initial rollout into South America, Africa, India, Australia, United States of America and the United Kingdom.

During the term of the two-year agreement, Emerge will have an exclusive licence to use its GameCloud intellectual property. Emerge will distribute GameCloud into select territories with users paying a monthly subscription fee.

Other Agreements

On 26 November 2018, the Company announced that it had entered into a revenue share distribution agreement with Petrimex, a Mauritius registered content provider and aggregator with an African focused mobile Value Added Services solution.

Petrimex is a leading partner of Orange Telecom over Orange's mobile Value-Added Services delivery platform in Africa and via this partnership, Emerge Gaming will enter four new countries i.e. Cameroon, Ivory Coast, Rwanda and DRC where the Arcade X platform will be marketed to up to 140 million potential subscribers.

The partnership with Petrimex is complimentary to Emerge Gaming's current strategic direction and ensures a faster rollout and integration into the emerging markets of Africa. The regions earmarked by Petrimex for distribution were not previously included in the Company's growth plans and as such, ensures maximum exposure of the Arcade X technology to the African market and will aid in meeting revenue targets – without the added expense of setting up marketing teams.

In the June quarter, the Company announced a partnership with Detonator Media Group ("Detonator") in South Africa (ASX: on 3 May 2018) and from this, the two companies signed an agreement under which media services were delivered for the leading pizza fast-food brand in Southern Africa, Debonairs Pizza ("Debonairs") (ASX: 17 May 2018).

The media services provided by Emerge include: the Arcade X Gaming Tournament Platform; Prizes for targeted gamers; eSports Team Sponsorship; Public relations and content generation; and Digital and social media amplification. These media services drove user acquisition for Arcade X, with gamers required to register with Arcade X to enter Debonairs sponsored online gaming tournaments. Detonator are using Arcade X's platform widget feature to drive traceable Debonair's application downloads and online pizza orders.

With the conclusion of the current campaign, Emerge will look to continue to offer similar services to Debonairs and expand this to other companies in the Famous Brands Limited group. These efforts are expected to commence in line with that group's calendar year budget allocations

Emerge previously entered into a Memorandum of Understanding with AfricaMob (Pty) Ltd ("AfricaMob") (ASX: 4 June 2018). Under the proposed licencing agreement, Emerge would be entitled a share of net carrier billing revenue after mobile network and carrier costs (net revenue) generated from white labelled and rebranded Arcade X platforms. The Company has yet to agree commercial terms for a licensing agreement with AfricaMob.

Emerge continues to work with MTN Group on a launch of Arcade X Mobi to MTN Group's 31 million South African subscribers under the content distribution agreement signed on 6 February 2018 and will update the market as these efforts advance.

Tantalum International Ltd Update

Shareholders of the Company of record on 3 November 2017 received shares in an unlisted, Australian public Company Tantalum International Limited ("TIL"). The intention of the TIL spin-out was to provide long-term shareholders with exposure to a potentially successful legal claim, supported by third party funding, against the Arab Republic of Egypt ("Egypt"). The arbitration proceedings, under ICSID conventions, relate to the alleged expropriation (amongst other claims) of TIL's 50% interest in the Abu Dabbab Tantalum-Tin-Feldspar project, located in southern Egypt. The Company retains an interest in a financial award that may arise out of these legal claims.

During the December quarter, a panel of three arbitrators was appointed and the first procedural hearing held. Directors of TIL are managing the arbitration process on behalf of the claimants and the following website was established to keep its shareholders updated: https://tantalumint.wixsite.com/tantalumint

Company Financial and Corporate Overview

On 25 October 2018, Emerge was pleased to announce the appointment of Mr Firdhose Coovadia to the Board as an independent director. Mr Coovadia has over 23 years of experience in investment banking, private equity, audit and investment gained in a variety of institutions including, KPMG, UBS Warburg, The National Investor and Essar Global Fund Limited.

Mr Coovadia is a qualified Chartered Accountant with a bachelors and honours degree in Commerce and Accounting from the University of Witwatersrand, South Africa. He is an experienced C-Level executive and Director having built or led businesses across several emerging markets.

Cash at the end of the quarter was $2.36M.

The Company is targeting a cash outflow of ~$140,000 per month to maintain its operations. This cash burn value does not include any revenue amounts to be received which will offset the expenditure. In this regard, the Company's cash outflow was ~$184,000 in the current quarter as extra development work was required to adapt the platform for launches in tier 1 countries.

Strategy and outlook

Emerge offers a different revenue model to its competitors with three main streams:

• 1. Subscription fees that can be linked to the gamers' telecommunications provider bill;
• 1. Revenue from companies from management of corporate online tournament services, and sponsorships and advertising powered by advanced data analytics and targeting capability;
• 1. Advertising revenue from companies engaging users of the lifestyle portal.

Cloudzen's GameCloud offers Emerge the capability to disrupt the online gaming community in tier one countries. An initial rollout into South America, Africa, India, Australia, United States of America and the United Kingdom is planned.

Gaining a foothold into these territories is critical to Emerge's successful distribution of GameCloud technology. Given the necessary exposure, the GameCloud offering is expected to gain significant traction.

For further information:

Australia	South Africa
Bert Mondello	Gregory Stevens
Chairman	CEO
E: bmondello@regencycorporate.com.au	E: greg@emergegaming.com.au
P: +61 8 6380 2555	P: +27 72 420 4811

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 view the Arcade X platform at www.ArcadeX.co

+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 Quarter ended ("current quarter")

31 004 766 376 31 DECEMBER 2018

	Consolidated statement of cash flows	Current quarter$A'000	Year to date(12 months)$A'000
1.	Cash flows from operating activities
1.1	Receipts from customers	-	103
1.2	Payments for
	(a)research and development	(182)	(423)
	(b)product manufacturing and operatingcosts	(49)	(93)
	(c)advertising and marketing	(81)	(194)
	(d)leased assets	-	-
	(e)staff costs	(139)	(247)
	(f)administration and corporate costs	(117)	(155)
1.3	Dividends received (see note 3)	-	-
1.4	Interest received	16	32
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)	-	-
1.9	Net cash from / (used in) operatingactivities	(552)	(977)

2.	Cash flows from investing activities
2.1	Payments to acquire:
	(a)property, plant and equipment	-	(5)
	(b)businesses (see item 10)	-	-
	(c)investments	-	-

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

	Consolidated statement of cash flows	Current quarter$A'000	Year to date(12 months)$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) investingactivities	-	(5)

3.	Cash flows from financing activities
3.1	Proceeds from issues of shares	-	-
3.2	Proceeds from issue of convertible notes	-	-
3.3	Proceeds from exercise of share options	-	-
3.4	Transaction costs related to issues ofshares, convertible notes or options	-	(37)
3.5	Proceeds from borrowings	-	-
3.6	Repayment of borrowings	-	(50)
3.7	Transaction costs related to loans andborrowings	-	-
3.8	Dividends paid	-	-
3.9	Other (provide details if material)	-	(180)
3.10	Net cash from / (used in) financingactivities	-	(267)

4.	Net increase / (decrease) in cash andcash equivalents for the period
4.1	Cash and cash equivalents at beginning ofquarter/year to date	2,909	3,606
4.2	Net cash from / (used in) operatingactivities (item 1.9 above)	(552)	(977)
4.3	Net cash from / (used in) investing activities(item 2.6 above)	-	(5)
4.4	Net cash from / (used in) financing activities(item 3.10 above)	-	(267)

	Consolidated statement of cash flows	Current quarter$A'000	Year to date(12 months)$A'000
4.5	Effect of movement in exchange rates oncash held	-	-
4.6	Cash and cash equivalents at end ofquarter	2,357	2,357

5.	Reconciliation of cash and cashequivalentsat the end of the quarter (as shown in theconsolidated statement of cash flows) to therelated items in the accounts	Current quarter$A'000	Previous quarter$A'000
5.1	Bank balances	457	909
5.2	Call deposits	1,900	2,000
5.3	Bank overdrafts	-	-
5.4	Other (provide details)	-	-
5.5	Cash and cash equivalents at end ofquarter (should equal item 4.6 above)	2,357	2,909

6. Payments to directors of the entity and their associates Current quarter

• 6.1 Aggregate amount of payments to these parties included in item 1.2 111
• 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

Directors' fees and salaries paid to the directors. All payments are on normal commercial terms.

• 7. Payments to related entities of the entity and their associates
• 7.1 Aggregate amount of payments to these parties included in item 1.2 159
• 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

Accounting and bookkeeping fees paid to a director related entity of ~$35,000, IT development and maintenance services paid to a director related entity of ~$99,000 technical consultancy fees paid to a director related entity of ~$16,000, corporate advisory fees paid to a director related entity of $9,000.

$A'000
-

Current quarter $A'000

8.	Financingfacilities availableAdd notes as necessary for anunderstanding of the position	Total facility amountat quarter end$A'000	Amount drawn atquarter end$A'000
8.1	Loan facilities	-	-
8.2	Credit standby arrangements	-	-
8.3	Other (please specify)	-	-

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	170
9.2	Product manufacturing and operating costs	60
9.3	Advertising and marketing	80
9.4	Leased assets	-
9.5	Staff costs	130
9.6	Administration and corporate costs	110
9.7	Other (provide details if material)	-
9.8	Total estimated cash outflows	550

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

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: 25 January 2019 (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.
• 1. 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.
• 1. 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.