Slide 1: oo. oe
7 a ae oo. oe — aM aa Lo _ | ae _ [ [ . OE ce : LL _ a a a ce : i | Gs BG Toa ] : [ . [ - Lc ee ce Sn ue _ 4 Adrian Di Marco Executive Chairman . _.. oe. a i. - ooo . Adrian_DiMarco@technologyonecorp.com a ce . _ | a _ i . i. - - a _ 7 . _— 7. _ co. — _ | i a _ i | 7 oo March 2005 www.TechnologyOneC
Slide 2: AIFRS Implications for TechnologyOne
AIFRS* Implications for TechnologyOne 2006 Half Year Results Significant Achievements Last Six Months Outlook Our Strategy for Growth *Australian International Financial Reporting Standards technologyone business software solutions Connected Intelligence
Slide 3: AIFRS approach and revenue recognition change
= Our approach - adopt AIFRS and also look at ‘world best practice’ where there was ambiguity » Revenue recognition — substantial change: = Revenue previously recognised: + Firm proposal had been issued and accepted by the customer + A firm Purchase Order/Letter of Intent had been issued by the cust
Slide 4: R&D, goodwill amortisation and foreign currency
=» Research & Development (R&D) — no change = All R&D fully expensed as incurred — no capitalisation " This is clearly best practice globally and widely adopted by international software companies «= Amortisation of Goodwill — minimal = estimate: $296k in this half " Foreign Currency — minimal « est
Slide 5: AIFRS transitional comparisons
=» Because of transitional AIFRS issues we will provide " comparison to prior year adjusted for AIFRS (mandated) * ie H1 2006 AIFRS vs H1 2005 AIFRS = comparison to prior year as was previously reported (ie under AGAAP) * ie H1 2006 AIFRS vs H1 2005 AGAAP # H1 2006 AIFRS vs H1 2005 AGAAP is a better
Slide 6: AIFRS Implications for TechnologyOne
AIFRS Implications for TechnologyOne 2006 Half Year Results Significant Achievements Last Six Months Outlook Our Strategy for Growth technologyone business software solutions Connected Intelligence
Slide 7: Record Half Year Revenue $31.7m: up 20%
Record Half Year Revenue $31.7m: up 20% Record Half Year Profit Before Tax $7.2m: up 14% = Profit After Tax $5.1m: up 13% Expenses excluding R&D: up 27% = Substantial increase in cost to put in place the platform for our international expansion and to become a global software company + Product Servi
Slide 8: Initial licence fees to new customers of $6.9m up 70%
Initial licence fees to new customers of $6.9m up 70% Licence fees to existing customers of $1.3m down 2% Annual licence fees of $9.5m up 14% Consulting services of $8.0m up 22% Connected intelligence _ Project Services revenue of $4.4m down marginally 3% technologyone wa DOusiness software solution
Slide 9: Strong result because
« Strong result because: Connected intelligence | _ Continuing strong demand for our products (70% increase in Initial Licences) Continued investment in our HR & Payroll (R&D loss of $336k) Continued investment in our Supply Chain (R&D loss of $608k) Malaysia poor performance (loss of $427k after Ro
Slide 10: Financials licences and product line performance
Connected intelligence Financials Licences up $2.6m (to $5.2m) up 100% = Involved in all deals Supply Chain and HR & Payroll Licences up « Amounts still relatively minor (up $312k & $29k respectively) Business Intelligence new initiative, strong performance = Licences of $1.0m Student Management Lic
Slide 11: Return on equity, cash flow and balance sheet
Connectediatelliger | Return on Equity (adjusted) improved to 28% (vs 24% last year) Strong Operating Cash Flow of $4.2 million (vs $5.1m NPAT) = Revenue recognised not invoiced because of staged payment terms on larger contracts = Prepaid income tax for the period greater than actual Balance sheet
Slide 12: H1 2006 AIFRS v H1 2005 AGAAP
H1 2006 AIFRS v H1 2005 AGAAP H1 2006 Hi 2005 Variance Increase $ (000) $ (000) $ (000) % Total Revenue 31,659 26,311 5,348 20% Revenue (PRE 3rd party costs) (excl interest) 341,026 25,660 5,366 21% Expenses (exci R&D, Depn, Amort) 18,024 14,206 3,817 27% EBITDAR 13,002 11,454 1,549 14% R&D 5,842 4,
Slide 13: Summary based on H1 2005 adjusted for AIFRS
# Following is a summary of half year results based on comparison to H1 2005 adjusted for AIFRS = je: H1 2006 AIFRS vs H1 2005 AIFRS = Provided for statutory requirements only technologyone a business software solutions Connected Intelligence
Slide 14: Record Half Year Revenue $31.7m: up 31%
Record Half Year Revenue $31.7m: up 31% Record Half Year Profit Before Tax $7.2m: up 52% = Profit After Tax $5.1m: up 46% Expenses excluding R&D up: 29% Company continued to invest in its future * R&D $5.8m, up $877k, up 18% - represents 18% of Revenue = R&D fully expensed as incurred technologyone
Slide 15: Initial licence fees to new customers up 182%
= Initial licence fees to new customers of $6.9m up 182% (vs 70% under AGAAP) « Annual licence fees of $9.5m up 22% (vs 14% under AGAAP) = Licence fees to existing customers of $1.3m down 2% (no change) = Consulting services of $8.0m up 22% (no change) = Project Services revenue of $4.4m down margin
Slide 16: H1 2006 AIFRS v H1 2005 AIFRS
7 2006 AIFRS v H1 2005 AIFRS Hi 2006 Hi 2005 Variance Increase $ (000) $ (000) $ (000) % Total Revenue 31,659 24,185 7,474 31% Revenue (PRE 3rd party costs) (excl interest) 31,026 23,533 7,493 32% Expenses (excl R&D, Depn, Amort) 18,024 13,961 4,063 29% EBITDAR 13,002 9,572 3,430 36% R&D 5,842 4,965
Slide 17: AIFRS Implications for TechnologyOne
AIFRS Implications for TechnologyOne 2006 Half Year Results Significant Achievements Last Six Months Outlook Our Strategy for Growth technologyone ig OUGINESS Software solutions Connected Intelligence
Slide 18: Strong demand for our products, particularly Connected Intelligence
» Strong demand for our products, particularly Connected Intelligence (Ci) series # Signed 35 new contracts in the half = TechnologyOne Financials underpinned all new deals # Performed strongly in our core markets: = General Commercial — 23 new customers = Local Government — 5 new councils = State a
Slide 19: New customers list
Adelaide Bank Australian Medical Council Bananacoast Community Credit Union Catholic Archdiocese of Sydney City of Bayswater City of Cambridge City of Gosnells Education Queensland Enhance Group Goulburn Mulwaree Council Government of Papua New Guinea Hawkes Bay District Health Board (NZ) Hostworks
Slide 20: Opportunities in the Tier One space
= Opportunities in the Tier One space * High profile organisations included whole of Government of Papua New Guinea and Ministry of Justice (New Zealand) = Tier One organisations becoming disillusioned with our competitors offerings and strategy = Ci and Power One seen as a strong alternative = Oppo
Slide 21: HR & Payroll and Supply Chain in new deals
» TechnologyOne HR & Payroll (People One) in 19 new deals = 126 HR & Payroll customers now = Gaining momentum — On the way to being one of Australia’s leading HR & Payroll solutions = Untapped potential in our existing user base = Another 12 to 18 months before we go after “Best of Breed” HR & Payro
Slide 22: Student Management and Property & Rating
» TechnologyOne Student Management (Student One) = No new deals » Remained profitable — focus on existing customers = Strong opportunities in H2 » TechnologyOne Property & Rating (Proclaim One) = No new deals = Remained profitable — focus on existing customers = Good opportunities in the H2 technolo
Slide 23: New Zealand, Malaysia and Project Services
» Continued penetration in New Zealand = Hawkes Bay District Health Board, Ministry of Justice, NZ Education Institute, Rodney District Council = Good opportunities going forward » Malaysia = No new deals » Project Services = Business stabilised = Focus on Queensland = NSW and Victoria progressively
Slide 24: Continued strong R&D program
= Continued strong R&D program # Financials Ci continued to gain traction = Underpinned all new deals = 90+ sites now committed; 31+ sites now fully live » Release 11.2 nearing completion = Extensive modifications for the UK = HR & Payroll Ci to be “patched” back into R11.2 technologyone business so
Slide 25: Continued organisational changes
# Continued organisational changes = Significant changes to R&D to deliver “Awesome Software” « Domain teams — small, creative and empowered R&D teams with deep ownership of product areas + Product Specialists added to R&D teams for user input * Consolidating Financials, HR & Payroll, Supply Chain,
Slide 26: Spin out
“Hy 7 Spin out “"'t0eweer, farger tisky projects oe ® Create “active” linkages to the market * Domain teams to become empowered and market driven technologyone business software solutions Connected Intelligence
Slide 27: Preparation for TechnologyOne UK gains momentum
» Preparation for TechnologyOne UK gains momentum Connected intelligence Continued as per our plan for international expansion Strategy finalised: Power of One business model adopted United Kingdom office location selected: Maidenhead Country Manager appointed TechnologyOne Financials (Ci) selected
Slide 28: Rationalise our product brands
» Rationalise our product brands to maximise our effectiveness = Always promote TechnologyOne = TechnologyOne Enterprise suite * TechnologyOne Financials * TechnologyOne HR & Payroll * TechnologyOne Supply Chain * TechnologyOne Work & Asset Management * TechnologyOne Business Intelligence « Technolo
Slide 29: AIFRS Implications for TechnologyOne
AIFRS Implications for TechnologyOne 2006 Half Year Results Significant Achievements Last Six Months Outlook Our Strategy for Growth technologyone business software solutions Connected Intelligence
Slide 30: Clearly on track for continuing profit growth
* Clearly on track for continuing profit growth: = Continuing strong opportunities for TechnologyOne Enterprise suite * Strong opportunities for TechnologyOne Student Management « United Kingdom costs contained to $800k this financial year technologyone business software solutions Connected Intellig
Slide 31: Continued organisational changes
# Continued organisational changes Connected Intelligence Continue to challenge the ‘status quo’ Continue on our ‘Awesome Software’ initiative Focus now on our Consulting Business to deliver “Exceptional Customer Service” Focus now also on our Sales and Marketing to increase our market penetration I
Slide 32: Aggressive R&D program to continue
» Aggressive R&D program to continue = 18% to 19% of revenue =" Complete move of our applications to the Ci platform = Supply Chain = HR & Payroll = Student Management = Property & Rating =» Continued enhancements across all products * Work closely with existing customers = ‘Best in Class’ focus for
Slide 33: Business Intelligence and CRM
= Business Intelligence = One integrated/unified BI workplace across all our applications ‘out of the box’ = Extend the functionality = General research = Customer Relationship Management (CRM) = ‘One System’ initiative = TechnologyOne Mobile technologyone business software solutions Connected Intel
Slide 34: Extend product offering through partnerships
» Extend our product offering through partnerships: Budgeting — Chameleon (completed) Strategic Planning —- Outcome Manager (completed) Strategic Asset Management — under negotiation Document Scanning — under negotiation technologyone business software solutions Connected Intelligence |
Slide 35: Enterprise market confusion continues
» Enterprise market confusion continues = Unique time in the history of enterprise applications = Microsoft has four overlapping products that will be replaced with Project Green. = Oracle has three overlapping products that will be replaced with Project Fusion = Project Green and Project Fusion - t
Slide 36: Integrated solution from one vendor
= Integrated solution from one vendor * ‘Best of Breed’ no longer in favour * TechnologyOne is one of a few companies that can deliver this « Higher Education consolidation in progress « Viability of alterative solutions in the Australian market in question * Callista has recorded major losses * Ora
Slide 37: United Kingdom
» United Kingdom = United Kingdom 3+ times size of Australian market, with substantial opportunities = Same competitors as Australia = Key drivers for our success identified: ° . Connected Intelligence Enterprise market confusion (Oracle, Microsoft etc.) New generation offering (Connected Intelligen
Slide 38: Opportunities for 2006/2007
* Opportunities for 2006/2007: = Enterprise market - increased ‘win rate’ and Tier One opportunities for TechnologyOne Enterprise suite = Higher Education - capitalise on our competitors weakness with TechnologyOne Student Management Ci = Improvement in sales in NSW and Victoria = Continued growth i
Slide 39: Opportunities will see growth accelerate
* Opportunities will see growth accelerate: Connected intelligence United Kingdom — very large market with significant growth opportunities for us (3+ times ANZ market) Higher Education in Australia — continuing opportunities Local Government in Australia — consolidation coupled with our new Technol
Slide 40: AIFRS Implications for TechnologyOne
AIFRS Implications for TechnologyOne 2006 Half Year Results Significant Achievements Last Six Months Outlook Our Strategy for Growth technologyone business software solutions Connected Intelligence
Slide 41: Management of risks as we expand
«= Management of risks is critical as we expand internationally and continue aggressive R&D program = Focus on our core markets and strengths = Sharp focus on our core markets/strengths « Identified as: « Financial Services «+ Health & Community Services + Local Government * Central Government « Hig
Slide 42: Focus on our core strengths and markets
= Focus on our core strengths and markets = Minimise execution risk and improve the efficiencies in the business « Progressively develop and release other Ci products for our core markets = To achieve clear market leadership and increased win rate » Entry into United Kingdom market with TechnologyOn
Slide 43: Capitalise on market confusion and consolidation
Connected intelligence | _ Capitalise on market confusion and consolidation = Traditional mid tier opportunities =» Emerging Tier One opportunities = ‘Last Man Standing’ in Local Government and Higher Education Acquisition and partnerships = To ‘add value’ in new areas, extending our product breadth
Slide 44: oo. oe
7 a ae oo. oe — aM aa Lo _ | ae _ [ [ . OE ce : LL _ a a a ce : i | Gs BG Toa ] : [ . [ - Lc ee ce Sn ue _ 4 Adrian Di Marco Executive Chairman . _.. oe. a i. - ooo . Adrian_DiMarco@technologyonecorp.com a ce . _ | a _ i . i. - - a _ 7 . _— 7. _ co. — _ | i a _ i | 7 oo March 2005 www.TechnologyOneC