Rent com au : Annual Financial Report - FY 2017

ABN 25 062 063 692

30 June 2017

This financial report includes the financial statements and notes of Rent.com.au Limited ('the Company') and its controlled entities ('the Group'). The Group's functional presentation currency is AUD ($).

A description of the Group's operations and of its principal activities is included in the review of operations and activities in the Directors' Report on pages 2 to 18. The Directors' Report is not part of the financial report.

The Board of Directors presents the following report on Rent.com.au Limited and its controlled entities (referred to hereafter as 'the Group') for the year ended 30 June 2017.

The names of the Directors in office during the whole of the financial year and until the date of this report are as follows. All directors were in office for the entire period unless otherwise stated:

Dr. Garry Garside Non-Executive Chairman Mr. Philip Warren Non-Executive Director Mr. John Wood Non-Executive Director Mr. Sam McDonagh Non-Executive Director

Mr. Mark Woschnak Managing Director (Resigned 22 July 2016)

The Group operates real estate websites focusing on the rental property market. The primary website operated by the Group is www.rent.com.au.

The Consolidated Statement of Profit or Loss and Other Comprehensive Income shows a net operating loss after tax of $8,513,631 for the year ended 30 June 2017 (for year ended 30 June 2016: $12,820,585). The net operating loss for the year ended 30 June 2017 included a non-cash share based payments expense of $2,243,418 (30 June 2016: $5,447,424) associated with performance based convertible securities issued to advisors, shareholders and employees. Earnings Before Interest, Tax, Depreciation, and Amortisation (and excluding non-cash share based payments) for the year ended 30 June 2017 was a loss of $5,822,425 (30 June 2016: $7,216,670).

During the year ended 30 June 2017 the Group took great strides towards its commercialisation goals, growing revenue by 121% over the previous year. Key to this growth has been the launch of Renter Resume, an industry leading feature which the Group launched in October 2016. Since launch on 21st October 2016, resume creation has averaged a consistent 500 resumes per day, totalling almost 130,000 Renter Resumes by 30 June 2017.

Renter Resume allows a renter to create a detailed profile which can be enhanced using some of the Group's renter products such as RentCheck and RentBond. The Group has repositioned these products, changing providers where necessary, and the process now also allows the Group to introduce other products such as RentConnect in a non-intrusive way. These changes set up future growth for the Group but have also had immediate results, with revenue from renter products growing by 160% over the prior year.

The Group has also improved its offering to third party advertisers, growing advertising revenue by 122% over the prior year despite maintaining consistent levels of unique visitors (growth of only 17%) relative to the prior year.

The Group has maintained an efficient cost base, taking opportunities to realise savings where they do not harm revenue growth. Overhead costs have been halved (fourth quarter relative to the same quarter in 2016) and marketing has also been made more efficient, with quarterly expenditure reducing by 39% while visitor numbers have remained stable.

No dividend has been paid or recommended by the Directors since the commencement of the financial period.

On 26 October 2016, the Group successfully completed the placement ("the Placement") of 13,000,000 shares with institutional and sophisticated investors under its Listing Rule 7.1 placement capacity. The placement was completed at an issue price of $0.10 per share, raising $1,300,000 (before costs).

On 16 November 2016, the Group successfully completed the fully underwritten, non‐renounceable pro rata offer ("the Rights Issue") of 37,197,542 shares at an issue price of $0.10 per share to raise

$3,719,754 (before costs), bringing the total capital raised for the year to $5,019,754 (before costs).

The capital raised via the Placement and the Rights Issue will be used to help accelerate commercialisation and the development of further key customer products and innovations similar to Renter Resume and Walk Score.

No other matters or circumstances have arisen since the end of the financial period which significantly affected or may significantly affect the operations of the Group, the results of those operations or the state of affairs of the Group in subsequent financial years.

The Group remains focussed on its short term goal of cashflow break even, which it aims to achieve by continuing to grow its Renter Resume online rental application system and associated revenue streams whilst maintaining as lean a cost structure as is practicable.

The net assets of the Group have decreased from $5,217,209 at 30 June 2016 to $3,592,578 at 30 June 2017. Cash reserves decreased from $6,080,209 at 30 June 2016 to $3,254,380 at 30 June 2017.