Chair’s Introduction

WELCOME

Dear Shareholders, On behalf of the Board of Directors of IncentiaPay Ltd, I present to you our 2018 Annual Report. While we acknowledge the instability experienced in 2017, we are pleased with the renewed focus that has emerged as we implement necessary change. As a Company, we are undertaking a significant restructure and changing our strategy to position IncentiaPay for growth. This commenced with a renewed management team and subsequent changes to the Board. Iain Dunstan was appointment as Chief Executive Officer (CEO) in November 2017, succeeding Trevor Dietz. As a Board, we are happy with the calibre of the management team we have managed to put together. Further new appointments included Darius Coveney in the combined role of Chief Operating and Finance Officer (COO/CFO), and other senior leadership team members. The Board has also seen significant change and renewal with myself and Chris Berkefeld joining as new Independent Non-Executive Directors. Iain Dunstan joined the Board as Managing Director during the year. Murray d’Almeida, Trevor Dietz, Antonie (Tony) Wiese and Brian Hall all resigned during the past twelve months. On 14 September 2018, IncentiaPay announced the signing of a contract for the sale of the Bartercard business. This sale is in line with the Company’s stated intention to divest non-core assets and allocate capital to future growth areas. This reallocation of capital to core growth areas is allowing us to focus on new growth and market opportunities in Australia and New Zealand. These leverage off existing corporate and partnership marketing channels, as well as our growing relationship with Alipay as one of their preferred marketing partners, which enables us to enter and capture the booming inbound Chinese tourism market. We believe our partnership with Alipay will be a driver of additional revenue growth in FY2019 and beyond.

During FY2018, we undertook a number of capital management activities, including a $10 million equity raising from institutional and sophisticated shareholders in November 2017; a dividend for FY2017 of 2.25 cents per share, which was paid in January 2018 at a total cost of $2.7 million; a $2 million equity raising from eligible shareholders participating in a Share Purchase Plan, which was significantly oversubscribed and for which IncentiaPay is grateful for the broad support from its loyal retail shareholder base; and $20.7 million of equity raised from an institutional and retail Entitlement Offer over February and March. At the April EGM shareholders approved an issue of loan funded shares to the CEO and COO/CFO, as well as an Employee Share Option Plan (ESOP) to be used for future employee incentives. We have signed major agreements this financial year with Alipay and Smartpay, which will enable us to capture and capitalise on a strong foothold in the growing Chinese tourism market across both Australia and New Zealand. This is an important revenue generating step in IncentiaPay’s ongoing program of controlled investment in channel partnerships and new digital transaction-based consumer offers under these agreements. IncentiaPay receives both a transaction fee and a marketing fee for introducing the Chinese consumer to the merchant. The Board acknowledges the vote made against the Company’s Remuneration report last year, and has focussed additional efforts ensuring increased alignment between shareholders and executives as new senior managers have been brought in. This remains a key focus for the Board as we continue to restructure the Company. Finally, on behalf of the Board, I would like to thank our shareholders, our clients and our employees for their support and dedication. We are confident that with the strategic clarity outlined by our renewed management team and Board, we will continue to move forward and grow business value for our shareholders, our clients, our partners and our employees.

NASEEMA SPARKS AM

CHAIR