Ann: Appendix 4D and Half Year Report, page-20

Net profit is the wrong line to be looking at. It was disorted (positively) in prior periods due to the regognition of prior tax losses.

Now that things have normalized and the company is paying tax. EBITDA or EBIT will give a fat better indication of underlying results.

There were some positives. MES model growth was significant, and set to grow further. This would hamper cashflow (because there is no capital purchase), yet the cashflow result was still strong. MES installations will pay dividends in future periods due to the ultra high GP from consumables.

This result wasn’t as shocking as it appears on face value. Look at past broker reports - they all expected subdued profitability in FY18. FY19 & 20 are the ones where serious operating leverage should be unlocked and bottom line growth will be significantly ahead of top line growth.