2003 ASX Announcements

Objective Corporation Final Results FY2003

Record Revenue; Profit up 24%

Leading software company, Objective Corporation Ltd (ASX: OCL), today announced its final results for the financial year ended 30 June 2003.

Financial Summary

Revenue $15.4m (up 19%)
Net Profit After Tax $2.1m (up 24%)
Net Assets $7.2m (up 36%)
Cash at Balance Date $5.0m (up 32%)
R&D Investment $2.7m (up 35%, fully expensed)
Final Dividend 0.5 cents per share fully franked (up from 0.2 cps)

Financial Highlights

Objective reported full year revenues of $15.4 million, a company record and a 19 per cent increase over the previous year. It also reported a profit after tax of $2.1 million, a 24% improvement over FY2002.

In addition to Objective's investment in its operational expansion programs, the company also invested a record $2.7 million in research and development (R&D), representing a 35% increase over the previous year and 18% of total revenue. All investment in R&D and expansion programs has been fully expensed.

Objective's financial position improved considerably during the financial year. As at June 30, the company had cash of $5.0 million, no debt and receivables of a further $5.1 million. Again, Objective's balance sheet is one of the cleanest in the ICT sector, with no capitalised R&D, no goodwill to write off and no debt. As at June 30, the company's net assets reached $7.2 million, an increase of 36% over the previous year.

In line with the company's confidence in its future, Objective announced it would pay a fully franked dividend of 0.5 cents per share.

Tony Walls, Executive Chairman, Objective Corporation said, "Clearly, it is very pleasing to see the company making such significant progress. Our commitment to R&D together with the ongoing expansion of our customer focused delivery capability translates into an ability to deliver high-value business outcomes for our customers. The success of this ability is evidenced by our expanding customer base."

Operational Highlights

During the year, Objective continued to demonstrate solid growth and increasing market acceptance in both Europe and Asia Pacific, with both regions delivering profitable results.
In Europe, Objective delivered a record result with revenues increasing by 96% to $4.4 million. This achievement was a direct result of the significant investment Objective has made in this region over past years. Whilst the company welcomed many new customers during the year, a highlight was the selection of Objective for enterprise electronic records management by The National Archives, UK (formerly the Public Record Office). The National Archives advises government on the best practise in records management and defines the functional standards to be met by records management systems used by UK government agencies.

The Asia Pacific region also sustained its solid performance, contributing revenues of $10.5 million. A highlight for this region was Objective's selection by the ACT Government as the whole-of-government standard for integrated document management. This selection clearly endorses the company's capability for large-scale, seamless systems that span multiple government agencies.

Objective has firmly established itself as a leader in the Public Sector marketplace. Its customers continue to reinforce the benefits of Objective's customer-centric business model. Objective develops high-quality, direct relationships with its customers by accepting responsibility for end-to-end delivery of solutions.

Research & Development

During the year, Objective maintained its resolute focus on developing world-class, market-leading software. Adhering to its design principles, Objective's software has developed an enviable reputation for its ease of use, end user productivity, security and scalability for large enterprise applications.

Objective invested $2.7 million in R&D during the year. This represented a 35% increase over the previous period and 17% of total revenue. This amount was fully expensed. The company has committed to further increase its R&D investment in the 2004 financial year.

Outlook

The outlook for the 2004 financial year is excellent and the company anticipates significant organic growth in both revenue and profitability during the year ahead.

"Demand for our products and services is very strong," said Mr Walls.

The company will continue to grow its international footprint by identifying new market place opportunities and implementing its proven and trusted operational model.

"While Objective's sales lead times can be long, the resulting contracts often span many years. We invest in opportunities that will contribute to the company's results in future periods," said Mr Walls.

"We are committed to maintaining an appropriate balance between profitability and investment in future growth that will maximise the benefits for all stakeholders."

"Objective Corporation is built on the outstanding talents of the individuals that constitute the company. The board and management would like to thank our customers and our people for their contributions and commitment to our success," said Mr Walls.