TECHNOLOGY ONE LIMITED — Investor Presentation 2004

Sep 7, 2004

www.TechnologyOneCorp.Com

2004 Results Presentation

Technology One Business Software Solutions

Adrian DiMarco@TechnologyOneCorp.com EXERPING OFFICIAL

Compact for the company Andrei 2002

FRANK POLICIAL ANDREW

ACCIDE

■ 2004 Full Year Results

• Significant Achievements
• Product Road Map and Direction
• Outlook

Eusiness Stifthare Solutions

2002 A HOLL Y CETAR RESOLIES AS OTHER BY

Record Revenue of \$50.6m, up 7%

• Impacted by performance of a number of business units
• Record Profit Before Tax of \$13.11m, up 30%
• Tight control over costs was a key factor in our results
• Profit After Tax of \$9.48m, up 35%
• Over provisioning of tax in prior year
• R&D tax concession

2004 FUIN GENRESURS SUMMERY

Record R&D expenditure, up 3%

• R&D of \$9.5m, representing 19% of revenue Ø
• R&D fully expensed as incurred
• Dividend of 2.85cs fully franked, up 14%
• Yield of 4.6% ff, based on a share price of 62 cents
• Payout ratio of 90%

Year

Terran ted Intelligence

▓

forfalleri

Business Software Solutions

2004 FUINCENRESUIS 4Summary

• Adjusted ROE of 52%
• Unadjusted ROE of 28%
• Strong Operating Cash flow of \$12.3m compared to NPAT of \$9.5m
• Debt/Equity of 3%

	ASSESS	AND
AGHEL 2003 V AGHEL POPE - OTHERING	240117	FATOLI	Tree months	Indekse
	WILLIA	200	3433
Revenue (excl interest)	47,443	50 554	3.11	7%
Expenses (excl R&D, Depn, FOREX & Amort).	27,153	27.333	(180)	(1%)
EBITDAR	20,290	23,221	2,931	(14%)
R&D	9,306	9,547	(241)	(3%)
EBITDA	10,984	13,674	2,690	24%
Depreciation and Amortisation	889	906	(17)	(2%)
Amortisation of Intangibles	669	667	2	0%
FOREX	210	2	208	99%
EBIT	9,216	12,099	2,883	31%
Net Interest Income	905	1,011	106	12%
Net Profit Before Tax	10,121	13,110	2,989	30%
NPAT Pre Amortisation	7,699	10,146	2,447	32%
NPAT Reported	7,030	9,479	2,449	35%
EPS Reported (cents)	2.30	3.17	0.88	38%
DPS (cents)	2.50	2.85	0.35	14%
Net Profit Before Tax Margin (Total Revenue)	21%	25%
R&D as Percentage of Total Revenue	19%	19%
				wner bet intelligence

EUS ness Some and uns

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2004 EUNGSTRRSUIS 47 MEIVSIS

• Initial licence fee revenue up 30%
• Licence fees to new customers up 22% 僟
• Licence fees to existing customers up 51%
• Annual licence fee revenue up 16%
• Consulting services revenue down 5%
• Timing issue
• Project Services revenue down 9% this year
• Poor performance in NSW

ENSTRES SHIME CONTRIB

2004 FULYGAY Results - Analysis

• Einance One suite strongest performer
• 22% increase in revenue over the previous year
• Involved in almost all deals
• Have not yet tapped the full potential of our Supply Chain (Retail One) and Payroll/HR (People One)
• Proclaim One revenue flat
• Smaller average deal size in 2004
• Student One revenue down 26%
• Student One had no new opportunities in 2004, but Service remained very profitable

One Vision

ENSTRES SONNERS STREET

2004 Full Year Results - Analysis

• All regions performed strongly except Malaysia (revenue down 33%) and WA (revenue down 37%)
• * WA had an abnormally strong year in 2003, so reduced performance was expected in 2004
• Impact reduced by significantly reducing expenses (MAL down 53%, WA down by 25%)
• MAL loss was reduced from \$662,000 in 2003 to \$47,000 in 2004 by using local staff only

Adenea

■ 2004 Full Year Results

• Significant Achievements
• Product Road Map and Direction
• Outlook

Eusiness Stifthare Solutions

Stonfricant/Achtevencants

Increased Sales

• " Organisational Changes New executive team and improved organisational structure
• Continued R&D program
• Investigation into new overseas territories

■ 70 new contracts signed (vs 47 last year)

• Key factors
• Improving market conditions (patchy still)
• "Act Locally, Think Globally" Restructure undertaken in late 2003

New Contracts by Sector

• Local Government
• Adelaide City Council
• Baw Baw Shire Council
• Burdekin Shire Council
• EXEC Campbelltown City Council
• City of Sydney
• Ku-ring-gai Council
• Local Government Association of Old
• Warwick Shire Council
• Example 2 Launceston City Council
• EXA Hastings District Council (NZ)
• * Hutt City Council (NZ)
• E Porirua City Council (NZ)
• South Taranaki District Council (NZ)

New Contracts by Sector

Retail ¥.

• New business sold:
• Timberland
• Le Cornu
• Purchasing/Supply Chain component of Retail One sold to over 45 Finance One customers

New Contracts by Scotor

State and Federal Government

• ACT Revenue
• Australian Broadcasting Authority
• Australian Maritime Safety
• Australian National Training Authority
• Department of the Senate
• Melbourne Water Corporation 徽
• National Native Title Tribunal
• Qld Competition Authority
• Qld Rural Adjustment Authority

Cennic text Intelliment

New Contracts by Sector - General Commercial (Australia Only)

• Catholic Education Wagga Wagga
• Outdoor Education Group
• Adelaide Convention Centre 烫
• Advanced Data Integration Pty Ltd 纉
• Catholic Education Wollongong 滷
• Crown Formwork Pty Ltd 烫
• Drinx Pty Ltd
• Equity Trustees
• Fincorp Finance
• Flinders Ports
• Global TV 擾
• ICA Presents Pty Ltd
• Institute Chartered Accountants Australia

• JJ Richards E-Waste

• Little Company of Mary Healthcare Limited n.

• Magellan Petroleum
• Milura Pty Ltd
• OFM Investments
• Outsource Australia
• Port Kembla Coal Terminal 縣
• Portland Coast Water
• PrixCar
• Secure Parking
• Softlink International Ltd
• Urban Maintenance System
• Walter and Eliza Hall Institute of Medical Research
• Westralia Airports Corporation
• OAMPS

Business SONNAIR Lofthans

New Contracts by Sector

Payroll/HR

• 20 new contracts signed
• Sold as 'add on' to Finance One, not as best of breed
• Played an important part in winning Finance One deals such as Australian Maritime Safety Authority

New Contracts by Sector

• Project Services
• Australian National Training Authority
• NSW Department of Lands
• Qld Department of Public Works
• Qld Department of Primary Industries
• Qld Department of Tourism, Fair Trading and Wine Industry Development
• Siemens Theiss Communications
• Victoria Legal Aid

NAVA OCHTEKSE TIKEN EN TIKEN

Mew Zealand

• Aviation Security
• Electricity Ashburton Limited
• Hastings District Council
• Hutt City Council
• Institute of Chartered Accountants NZ
• Jacques Martin
• Marlborough Lines Limited
• Scenic Circle Hotels Limited
• South Taranaki District Council
• The Todd Corporation
• Territory Education Commission
• Porirua City Council

Cenning text Intelligence

NAW Contracter International

Malaysia

• Align Distribution Sdn Bhd Ø.
• KUB Telekomunikasi Sdn Bhd 徽
• Quanterm Logistics Sdn Bhd 徽
• WCT Construction Sdn Bhd 僟

Official by Practici

Einance One will continue to perform strongly

• Finance One CI positions us strongly for the future
• Will need to manage the roll-out of the new Finance One CI series carefully not to impact existing sales
• Limited trials starting in Oct/Dec 2004
• Expected company wide rollout in early/mid 2005 calendar year

Outlook by Product

Retail One

• Addition of Fashion/Apparel functionality will increase market potential
• More reference sites important as this is a very conservative market – Timberland and Le Cornu are important
• UK could be a strong market for this product in the future
• Proclaim One

ENSTRES SHIME CONTRIB

• The new CI series coupled with Work One and tighter integration to Finance One/People One will continue to position this product strongly for the future in Local Government
• Currently three major players consolidation is inevitable

Outlook by Product

People One

• Total of 53 clients using People One now
• Addition of HR functionality will position this product well in the future
• Becoming critical in the sale of Finance One
• Student One
• Limited opportunities in 2004
• Focus on maximising revenue from exiting base
• Potential may exist overseas
• Currently three major players consolidation is inevitable

Outlook by Product

Cennic text Intelliment

OTELVERE

• Project Services
• Queensland and Victoria well positioned
• Focus on New South Wales to build the business
• New Zealand good opportunities going forward
• Malaysia
• Costs dramatically reduced by using local staff only
• Target smaller deals to get entry into large organisations

ENSTRES SHIME CONTRIB

Stonificant/Achievements

• Increased Sales

• " Organisational Changes New executive team and improved organisational structure
• Continued R&D program
• Investigation into new overseas territories

Organisational Ghanges

• Company divided into four major operating divisions to create a greater sales and delivery focus
• * North West Region QLD, SA, WA, TAS
• * Central Region NSW, VIC, ACT
• * International NZ, MAL, etc..
• Project Services
• New Executive Team of four Operating Officers, responsible for each division
• Long serving TNE managers
• Each Executive also assigned responsibility for one of our R&D teams to ensure strong customer focus

Cennis ted Intelligenc

Organisational Ghanges

• Operating Officers will spend substantial time in each of their states/territories on a regular basis with

• Increased focus on driving sales 徽
• Increased focus on customer satisfaction

Therested Footsron Sales

• Regional based strategy to achieve revenue growth:
• Account management to increase sales/services to existing customers
• Partnerships to target new verticals 僟
• Increased focus on Verticals we are already strong in: 僟
  • Local Government
  • State, Federal and Qangos
  • Health, not for profit, membership and media
  • Retail, wholesale and leisure
  • Utilities, transport, finance, mining, agriculture
  • SME's and general services
  • Education

Eusiness Software LoftHane

Indressed Footskop (Stiles

• Pipeline management is a key initiative going forward
• Reliably measure our opportunity pipeline and measure it against stated KPIs
• Company wide CRM is key to make this happen
• Specific initiatives for a region
• Telemarketing moved into the bigger states, to get closer to the action

Increased Focus on Customer Satisfaction

• Executive team has direct influence on R&D through their assigned product responsibility
• Establish regional based resources (as distinct to state based)
• People One, Supply Chain, Proclaim One
• Improved resource sharing across states in a region
• Example 2 Greater focus to handle customer problems
• Direct Executive involvement

Cernin ted Intelligenc

Organisational Changes

This will underpin our next stage of growth and opportunities

EP.

Elfertes Stift Schooleters

Stonificant/Achievements

• Increased Sales

• Organisational Changes New executive team and improved organisational structure
• EXAMPLE Continued R&D program
• Investigation into new overseas territories

ENSTRESS SOFTWEEPS ON NEWS

Coninico Reprogram

R&D continued at 19% of revenue, fully expensed

• New releases of all our products shipped as follows:
• Einance One, Retail One and People One R10.3 & R11.0
• EXA Student One R2.4, R2.5 & R2.6
• Proclaim One R9.3
• Work also commenced on our newest product Work One
• An advanced Project & Works Management system
• Substantial effort directed into our next generation of products, called the Connected Intelligence Series

Cennie technolisen.

Stonificant/Achievements

• Increased Sales

• Organisational Changes New executive team and improved organisational structure
• Continued R&D program
• Investigation into new overseas territories

ENSINES SHIM IS SON WILL

Investigation into New Overses Faiterito 165

Example Territories investigated:

• South Africa
• United Kingdom
• China
• South Africa
• Local Government market as the initial entry point 僟
• Issue is 'Black Empowerment Partner"
• Strategy to find a high quality partner
• Still under investigation

Comme ted Intelligence

Investigation into AtawOverseaserTartiones

United Kingdom

• Finance One as the initial entry point
• Strategy is to find a Country Manager, and use local Partners
• Issue is multi-currency and availability of Finance One CI
• Still under investigation, and looks very promising
• China 鰴
• Finance One as the initial entry point
• Strategy is to find a local Partner who will undertake this work
• Still under investigation, but very unlikely to proceed due to quality of partners, issues with IP protection and language translation costs

Cennic Led Intelligen

Agence

• 2004 Full Year Results
• Significant Achievements
• Product Road Map and Direction
• Outlook

Business Software Solutions

Le conduité pou

Produci Road Majo

Consulting & Customer Services (direct relationship with our customers)

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Finance One (multi-industry)

People One (multi-industry)

Pos/Cash Rec (multi-industry)

Application Development Framework (unique look & feel, workplaces, common services ...)

Industry Standard Components

(development language, reporting, graphing, grids)

Eusness Software Solukens

Protuct Direction

• ^■ Connected Intelligence
• Deep Integration
• Product Breadth
• "Out of the Box, Ready to Go"
• Information At Your Fingertips

Eusiness Stifthare Solutions

• More than just .NET technology
• Business application framework to build applications that engage employees, suppliers, customers etc.
• Allow us to take our Intellectual Property (and that acquired from others) to build powerful new generation of applications

Gonnected Intelligence Series

• Development of R1 of Finance One CI completed
• Undergoing Alpha & Beta testing
• Expected to be available for LD in early 2005
• Development of other CI products progressively released over the next two years as follows:
• People One CI mid/late 2005
• Retail One CI mid/late 2005
• Proclaim One CI late 2005/early 2006
• * Student One CI mid/late 2006

Cernin ted Intelligens

Connected Intelligence Sancs

• We will need to manage CI rollout carefully
• CI developed for the future not today.... 徽
• As part of CI there are certain themes that are driving our product direction

DEGIONINE CIENTON

Integration is what the market is looking for going forward - Deep Integration!

OTEN VETER

Eusiness Stifthare Solutions

One Solution

Deeply Integrated

OAC CONCLOSS,

Lach part of our solution is world class, and our totally integrated solution is greater than the surgefit to ball

Eusiness Stifthare Solutions

Terrini tertintaltining

One Solution

One Venclor

Eusiness Stifthare Solutions

DESPERSORATOR

• Our integrated workplaces will allow us to showcase this deep integration
• Focus on increasing the depth of our integration as part of CI rollout for
• Proclaim One
• Student One

Business Software Solutions

Product Breadin

• Best of breed is dead!
• People looking for broad tightly integrated solutions from one vendor
• Approach is to build 'Add Ons'
• Breadth not depth
• Partner with companies where depth is required
• Add Ons
• Work One asset/project management
• Example 13 Series Convertsal Service Service Service Service Service Service Service Service Service Service S
• Manufacturing One under consideration

Officiale Box, Registrace

Drive down implementation costs

• Goal: less than \$1 of services for every \$1 of license fees
• Everything works out of the box when installed
• System data shipped
• Preconfigured setups

Information/ATXour Fingerips

• Powerful enquiries part of all our products
• Drill downs to transactions and across system boundaries
• Drag and Analyse technology across all our products
• Business Intelligence 'out of the box'
• Business One integration across our product suite
• EXE Business Intelligence from Business Objectives and Cognos actively supported by all our products

Cerning text Intelligen

• 2004 Full Year Results
• Significant Achievements
• Product Road Map and Direction
• ^■ Outlook

Eusiness Stifthare Solutions

OUTICO ZZOOS

• Market conditions are confusing
• We believe market conditions should continue to improve 僟 in 2005
• Challenges for 2005 & 2006 are as follows:
• "Bed down" Finance One CI and establish it in the market
• Progressively develop and release other CI products
• "Bed in" the new Regional Structure
• Initial entry into new geographies

Commo text Intelligenc

0116672005

Business Software Solutions

• Expect growth of 5% to 10% in 2005 assuming the following:
• No impact caused by new accounting standards (IFRS) 鎙
• No substantial costs incurred by our international 僟 expansion

Longhern Outlook

• Growth from existing regions as follows
• Improving market conditions
• Capitalise on market consolidation
• CI series to increase our win rate
• Increased penetration of People One, Retail One, Proclaim One
• New systems Work One and others to follow
• New partnerships (to be identified)
• Greater focus on sales with our new regional focus
  • EXECUS ON Verticals etc.
• Improved strategy and execution
  • Expanded executive and state management team

Cermin text Intelliava

Ikong namin' odditora

• Growth from new international expansion

翻譯

Business Software Solutions

www.TechnologyOneCorp.Com

2004 Results Presentation

Technology One Business Software Solutions

Adrian DiMarco@TechnologyOneCorp.com EXERPING OFFICIAL

Compact for the company Andrei 2002

FRANK POLITICAL REPORT