VINYL GROUP LTD — Interim / Quarterly Report 2011

Oct 28, 2010

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ASX ANNOUNCEMENT AND MEDIA RELEASE

ASX CODE: MBO

Date: 29 October 2010

Quarterly report for entities admitted on the basis of commitments Rule 4.7B

• The Company completed its IPO and listing on the ASX

• Improved the depth of the management team

• Successfully transferred manufacturing to Sanmina-SCI

• Implemented new technology infrastructure to support growth objectives

• Assisted BHP Petroleum to measure offshore helicopter rescue risks

• The US Navy successfully completed depth testing of the Mobilarm V200 to 450 metres

• Added an experienced Independent Chairman to the Board, Mr. Richard Allen

The Company successfully raised $2,383 ,400 and com pleted its I PO to list on the Australian Stock Ex change (ASX). The Company increased the depth of the mana gement team with the appointment of Patrick Cleary as our VP of Sale s. Pat is an ex perienced Senior Sales Manager w ith a s uccessful sale s career and a proven track record in business develop ment. Tim Venter also joined the Company earlier in th e year as our Manufacturing & Quality Manager bringing o ver twenty years of high vo lume product manufacturing experience. Since joining Tim has successfully transferred our manufacturing to our contract manufacturer, Sanmina-SCI.

Sanmina-SCI is one of the world’s large st contract m anufactures a nd while th is move importantly lo wers th e Company’s Cost Of Goods Sold ( COGS), this move will pr ovide virtually unlimit ed fle xibility t o scale to mee t forecasted growth demand and delivers a product to market with the highest levels of quality assurance required by the US Navy contract.

Jorge Nigaglioni, our CFO , completed t he implement ation of the Salesforce, Ascent and FinancialForce, a CRM/ERP/GL information technology ecosystem. Our n ew cloud computing infrastructure and ne w management reporting systems will supp ort our grow th objectives, and enable th e Company t o lo wer operating costs, sc ale quickly and deliver industry leading margins. The new system automates our listing complianc e and reporti ng requirements.

BHP Petroleum and Mermaid Marine suc cessfully completed a rescue exercise simulating a helicopter ditching of the North West Shelf of Western Australia , measuring the ability of the local search and rescue assets to recover the survivors using Mobilarm’s emergency beacon. The tests demonstrated the Mobilarm V100’s ability to locate, track and rec over the simulated survivors. The implementation of Mobilarm emergency beacons enable BHP Petroleum to mitigate risks in offshore helicopter transfers and meet rescue objectives.

The Company delivered the first V200 submariner test product to the US Navy on schedule in May 2010. The Navy has since successfu lly completed depth testing to 450 metres and further field testing is scheduled f or FY2011. The Australian Navy has supplied Mobilarm and the US Navy with the use of the Garden Islan d submarine es cape test to wer for usage testing on 28 th October 2 010 which co nfirmed the wearability an d suitability of the device for escape.

To continue to meet our inve stor and listed obligations o n independence and corporate governance the Company appointed Richard Allen as our independ ent Chairman. Richard was previously Managing Direc tor of Tox Free Solutions Limi ted (ASX: TO X) and Chairman of Plantation Energy Australia Pty Ltd. Richard remains on both boards as a Non-Executive Director.

Appendix 4C Quarterly report for entities admitted on the basis of commitments

Rule 4.7B

Appendix 4C

Quarterly report for entities admitted on the basis of commitments

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

Name of entity
Mobilarm Limited
ABN 15 106 513 580	Quarter ended (“current quarter”)
15 106 513 580	30 September 2010

Consolidated statement of cash flows

	Consolidated statement of cash flows
	Cash flows related to operating activities 1.1 Receipts from customers 1.2 Payments for (a) staff costs (b) advertising & marketing (c) research & development (d) leased assets (e) Other working capital 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes (paid)/received 1.7 Rental recoveries 1.7 Purchases of inventory Net operating cash flows	Current quarter $	Year to date (3 months) $
		407,116 (578,747) (39,387) (115,080) - (351,615) - 2,081 (3,304) - 24,404 (141,165)	407,116 (578,747) (39,387) (115,080) - (351,615) - 2,081 (3,304) - 24,404 (141,165)
		(795,697)	(795,697)

• See chapter 19 for defined terms.

Appendix 4C Page 1

30/9/2001

Appendix 4C Quarterly report for entities admitted on the basis of commitments

	Current quarter $	Year to date (1 Year) $
1.8 Net operating cash flows (carried forward)	(795,697)	(795,697)
Cash flows related to investing activities 1.9 Payment for acquisition of: (a) Net cash acquired on acquisition( item 5) (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets 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 (provide details if material) Net investing cash flows 1.14 Total operating and investing cash flows	- - - (1,596) - - - - - - - - -	- - - (1,596) - - - - - - - - -
	(1,596)	(1,596)
	(797,293)	(797,293)
Cash flows related to financing activities 1.15 Proceeds from issues of shares, options, etc. 1.16 Proceeds from sale of forfeited shares 1.17 Proceeds from borrowings 1.18 Repayment of borrowings 1.19 Dividends paid 1.20 Share issue expenses Net financing cash flows	2,383,400 - 10,000 (10,000) - -	2,383,400 - 10,000 (10,000) - -
	2,383,400	2,383,400
Net increase (decrease) in cash held 1.21 Cash at beginning of quarter/year to date 1.22 Exchange rate adjustments to item 1.20 1.23 Cash at end of quarter	1,586,107 106,411 -	1,586,107 106,411 -
	1,692,518	1,692,518

• See chapter 19 for defined terms.

Appendix 4C Page 2

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

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

1.24 1.25	Aggregate amount of payments to the parties included in item 1.2 Aggregate amount of loans to the parties included in item 1.11	Current quarter $A
		142,891
		-
1.26	Explanation necessaryfor an understandingof the transactions
	Payments were for salaries and director fees

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

• 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).

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A	Amount used $A
	-	-
	5,000,000	-

Financing facilities available relates to the $6m Equity Drawdown Facility with Equity Partners Funds SPC as announced to the ASX on 16 September 2010, which is subject to shareholder ratification at the annual shareholders meeting on 26 November 2010.

• See chapter 19 for defined terms.

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

Reconciliation of cash

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	Previous quarter $A
4.1 Cash on hand and at bank 4.2 Deposits at call 4.3 Bank overdraft 4.4 Deposits securing guarantees	1,692,518	106,411
	-	-
	-	-
	-	-
Total: cash at end of quarter(item 1.22)	1,692,518	106,411

Acquisitions and disposals of business entities

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

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:

Company Secretary

Date: 29 October 2010

Print name: Gabriel Chiappini

• See chapter 19 for defined terms.

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

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.

2. 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.

3. 6.2 - reconciliation of cash flows arising from operating activities to operating profit or loss

4. 9.2 - itemised disclosure relating to acquisitions

5. • 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

6. 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.

7. See chapter 19 for defined terms.

Appendix 4C Page 5

30/9/2001