Ann: 2016 Interim Results Investor Presentation, page-5

Okay so I have some pointers from today’s conference call. Firstly I have to mention that in the backward looking results you must:

-recognise that the AU reloadable revenue did not include establishment fee’s – hence the decrease in revs
-There is $1m in receivables on balance sheet in receivables which has been converted into cash a few days after 31^st December.

To the conference call here are my brief notes:

Village roadshow have bought a UK business and in conjunction with Edge Loyalty will roll out EML non-reloadable cards. Currently in the UK, the current method of bank transfers is used for cash back promotions. This has $$ of card load in potential. http://www.asx.com.au/asxpdf/20151221/pdf/433ymrqyxk0tkw.pdf
AU gambling

• Current annual run rate of 300-350m per annum. That is at this point in time, and does not take growth, new deals or Eachway into account.
• looking to evolve the r/s where cards are issues on account opening
• introduction of VIP programs etc on the cards
• the gambling companies are able to retain $$ in their ecosystem, meaning it’s a very good offering for these companies
• Possibility of new deals with pure online players. Multiple discussions happening right now
• Without the EML card this product would not exist for these new players!
• 3-4 month horizon

AU Reloadable

• Sportsbet is the biggest reload client
• Small growth in INGOGO
• Decline in payday lending caused by regulatory events – Cash Converters will be the ‘last man standing’ in this sector and currently is going better than expected

Long run average of dollars loaded to revenue

• AU reload: 1.5c per $ load
• AU Non-reload: 3-4% per $ load
• Eur is expected to be the same in both segments?

Overheads

• Increased by a lot due to investment in product development. ie. Eachway & EUR reloadable
• expected to be maintained over the next period

Depreciation & Amm

• $6m Amm to write off over 3 years

Cash balance

• breakage accrued can’t be grouped with cash b/c of accounting treatment – it is basically the same thing, EML earns interest on the breakage accrued

Receivables/Payables from financial institution – Someone else please elaborate?

• These are self-issued products via MasterCard
• No fees and increased margins on this
• included the shopping mall programs
• expected to grow a lot
• A + L will always offset?

EACHWAY

• $ load should equal 3% of total turnover of the gambling companies
• same 1.5% revenue conversion
• Majority/all overseas discussions include this product offering
• The technology build for this had increased costs in current half

Overseas deals

• “the timing is right” & “a land grab situation”
• Didn’t ask so not sure of the competition here????
• Discussing with number of operators about
• Very competitive landscape and no one wants to be the last to market with this new point of difference
• This is not a 1 country solution & working in other EUR markets. 1 customer relationship might equal multiple jurisdictions
• 1 UK customer has more users than the entire AU market
• UK deal will take 12-18 months to scale up and first figures of 350m run rate mentioned

LOI Paysafe

• they provide a pmt solution similar to Bankcorp
• Product could potentially be like an E-Wallet, pooling you cash balances at multiple websites?
• strong organisation push from both companies to come to an agreement
• Paysafe have a lot of regulatory expertise in many markets to assist with different jurisdiction requirements