DATAPULSE TECHNOLOGY LIMITED ANNUAL

Letter to Shareholders

letter to shareholders Dear shareholders On behalf of the Board of Directors (the Board), I have higher by 31.5% from $3.2 million to $4.2 million due the pleasure to present to you the annual report of to depreciation recorded for Blu-Ray related plant and Datapulse Technology Limited (the Company) and its equipment during FY2014. subsidiaries (the Group) for the financial year ended 31 July 2014 (FY2014). Income tax credit of $0.6 million was recorded by the Group for FY2014, which was related to the Company The operating environment of the Group’s media for adjustments made amounting to $0.5 million for storage products and services business was very overprovision of tax in respect of prior years and challenging through FY2014. The Group faced multi- reversal of deferred tax liabilities of $0.2 million for faceted challenges from falling demand for physical temporary timing differences during FY2014. Although media due to increased use of other substitute modes the Group made pre-tax profit of $0.2 million, no of content distribution, intense competition from global income tax expense was recorded for FY2014 as the players, increased volatility in demand and shrinking Group had sufficient tax allowances to offset its taxable customer base while our latest Blu-Ray investment had income for FY2014, taking into consideration that the yet to gain meaningful traction in cushioning the drop in Company was granted investment allowance by a sales of our existing products and services. In addition, government agency during 2Q FY2014 for its investment the uncertain global economy had adversely affected in Blu-Ray plant and equipment. For FY2013, a modest corporations and consumers in their spending on income tax expense of $0.1 million was recorded by products and services such as software and games. the Group despite registering $10.2 million in pre-tax profit due to various tax credits. Total tax credit of $1.8 Nevertheless, I am comforted that the Group remained million was recognized for FY2013, which was related profitable in FY2014 despite recording a 34.6% drop in to the Company for an adjustment of $0.9 million for revenue to $29.5 million and finished the financial year overprovision of tax in respect of prior years, reversal in good financial stead with net cash position of $14.7 of deferred tax liabilities of $0.3 million for temporary million and minim