2019 Annual Report

Revenue $6,714M (Down 23.8%) Gross Profit $6,114M (Up 12.12%) Profit from continuing operations $663K (Down 11.84%) Total comprehensive income ($246K), (2018 $151) Cash at bank $771K (2018 $1,265K) Shareholders funds $7,070M (2018 $7,675M) The decrease in Revenue in 2019 compared to 2018 is due to the change in accounting policy as a result of the adoption of IFRS 15 for the 2019 reporting period. The impact was significant on the reported Revenue and had a $264,078 negative impact on the retained earnings brought forward from 2018. Enprise continues to leverage its position as the only MYOB EXO and MYOB Advanced reseller with offices in both New Zealand and Australia, to target trans-Tasman businesses. Enprise is well positioned to take advantage of the trend towards cloud while still having a stable, well supported, secure and continually developed on-premises offering. In January 2019, Enprise became a MYOB Advanced Platinum Partner adding to its Platinum Partner status with MYOB for MYOB Exo. The company paid a final dividend (declared in 2018) during the year of 1.0 cent per share in October 2018. The total dividend for the year was $95,351. Datagate had forty five paying customers at 31 March 2019 representing annualised recurring revenue of $469,596, up 36% for the year. Datagate has recently completed the significant task of migrating all customers to their latest version of the software and is now focussed on selling and on-boarding new customers. The Datagate November 2018 rights issue was 50% over-subscribed, raising $750,000. Enprise subscribed for only 13.3% of the rights issue and consequently its ownership reduced to 36%. At the rights issue price of $1.75 per share, Enprise' 1,765,475 shares in Datagate had a notional value of approximately $3.1 million. This compares favourably to the actual carrying value of Datagate in the Enprise books at 31 March 2019 of $798,636 (after expensing Enprise share of the Datagate losses for the year). We remain confident in the future success of the Datagate business. Enprise acquired 47.1% of Kilimanjaro, the largest reseller of MYOB Exo and Advanced in Australia, in September 2017. This strategic acquisition was made with the expectation that Enprise would gain future synergies due to the similarities in the Kilimanjaro/Enprise business models. To date, we have had to operate both businesses independently, though minor synergies have been gained by merging the Finance functions. Future synergies in regard to the consulting and sales divisions of the business will only be realised if a full merger were to proceed. The initial investment made by Enprise was $3,168,400. The carrying value of Kilimanjaro at year end has reduced to $2,037,413 as Enprise recognised its share of Kilimanjaro's operating losses and a Goodwill write off. Like Enprise, Kilimanjaro has had its' performance impacted by the adoption of IFRS15 in the reporting period. Enprise granted a put option to the Kilimanjaro shareholders to put the remaining 52.71% of Kilimanjaro which they retained in return for 2,854,650 ENS shares. This option can be exercised between 1 September 2019 and 30 August 2020 provided certain conditions are met. In December 2018, Enprise participated in a rights issue for iSell who target the same Managed Service Provider market as Datagate. The value of the investment via the rights issue was $231,419 and saw Enprise increase its share of iSell to 19.9%. The total carrying value of the investment in iSell at 31 March 2019 is $1,044,126 In November 2018, Vadacom, a cloud based VOIP phone and virtual PABX provider raised $500,000 from external investors at $8.20 per share. An independent valuation was performed on Vadacom which valued the business at $10.40 per share, the value of Enprise' Vadacom investment is now $593,289. Enprise is actively exploring other opportunities in the SME software market. End CA:00339438 For:ENS Type:ANNREP Time:2019-08-20 11:58:04