Press Releases

Ideas International Announces 2008 Full-Year Results

IDEAS posts positive results despite global economic downturn

Year over Year Growth ($AU)

• Revenue: Increased by 11% (or $689,050) to $7,115,423
• Consolidated Profit: After tax profit of $716,190; Up by $1,032,277 on 2007 results
• Net Assets: Rose by $746,574 (to $2,376,323) due to improved operating performance
• Working Capital: Improved by more than $1 million, to $2,012,205
• Unearned Income carried into 2009: Up by more than $350,000 compared to last year

February 27, 2009 – Sydney, Australia

Ideas International (ASX:IDE), the leading global supplier of comparative intelligence on enterprise IT infrastructure, today reported revenue from all sources of $7,115,423 for the full year ended 31 December 2008, a year-over-year increase of 11 percent.

The after tax consolidated profit of the consolidated group for 2008 is $716,190, an increase of more than $1 million over 2007. The group’s working capital (current assets less current liabilities, excluding revenue received in advance) improved from $660,849 to $2,012,205 year-over-year.

Ideas International (IDEAS) reduced its operating expenses by more than $1 million, year over year. The increase in the net assets of the consolidated group by $746,574 from 31 December 2007 to $2,376,323 at 31 December 2008 is attributed to the improved operating performance of the group.

Sales in US dollars rose six percent to $US4.8 million and were converted to local currency at an average rate of 0.8346 compared to $US4.5 million in 2007 converted at an average rate of 0.8306. A further positive result from the 2008 fiscal year is that unearned income carried over into 2009 rose $376,748 compared to last year.

There were no significant changes to the principle activities and operations of the group during the 2008 financial year. The consolidated group was focused on the development and sale of subscription access IT research materials for pricing and performance comparisons, information technology research reports, and specialist information technology consulting reports.

“Ideas International enters 2009 on the back of a strong financial performance in 2008 which has considerably improved the financial health of the company,” said Stephen Bowhill, Chief Executive Officer of Ideas International.

“The results from the consolidated group improved significantly in 2008 owing to a reduction in operating expenses of over $1 million compared to 2007,” said Bowhill. “IDEAS efforts in the US market and the resulting increase in sales in US dollars, coupled with a weakening of the Australian dollar in the third quarter of the year, also boosted revenues,” added Bowhill, “

“The aim of management and the board is to maintain focus on increasing penetration into untapped areas of the computer vendor market, and growing revenues in the large corporate sector of the end user market,” concluded Bowhill.

About Ideas International

IDEAS is the leading global supplier of comparative intelligence on enterprise IT infrastructure. Servicing both IT vendors and large-scale IT users, IDEAS’ products focus on: servers; storage; virtualization and consolidation; and software and infrastructure services. IDEAS’ online products are backed by expert industry analysts who can also deliver specialized advisory and consulting services.

www.ideasinternational.com

Media Contact

Spectrum Communications:
Richelle Gillett
+61 2 9954 3299
richelleg@spectrumcomms.com.au

Spectrum Communications:
Andy Somner
+61 2 9954 3299
andys@spectrumcomms.com.au

Operating Results

The consolidated profit of the consolidated entity after providing for income tax amounted to $716,190 for the year to 31 December 2008. This is an increase of $1,032,277 on the after tax loss for the year to 31 December 2007 of $316,087.

Revenue from all sources amounted to $7,115,423 for the year to 31 December 2008. This is an increase of $689,050 or 11% from revenue from all sources for the year to December 2007 of $6,426,373.

Review of Operations

The results of consolidated entity improved significantly in 2008. The improvement is the result of a reduction in operating expenses of over $1 million compared to prior year, and a weakening of the Australian dollar in the third quarter of the year which boosted revenues.

Sales in US dollars rose 6% to $US4.8 million and were converted to local currency at an average rate of 0.8346 compared to $US4.5 million in 2007 converted at an average rate of 0.8306.

A further positive result from 2008 is that unearned income carried over into 2009 has risen $376,748 from the level carried over from 2007 into 2008.

Financial Position

The net assets of the consolidated entity have increased by $746,574 from 31 December 2007 to $2,376,323 at 31 December 2008. This is due to the improved operating performance of the group.

The group’s working capital, being current assets less current liabilities (excluding revenue received in advance), has improved from $660,849 in 2007 to $2,012,205 in 2008.

Current debtors and cash are up $1,189,208 from last year. Trade payables have increased by $4,234, short and long term borrowings are down $123,845 and tax liabilities are down by $112,682.

The Directors believe that trading performance for the year has considerably improved financial health of the Company.

Future Developments, Prospects and Business Strategies

The Australian dollar is, at the date of this report, at its lowest level for several years, and this should improve the revenues of the company over the course of 2009 subject to the Company’s major customers renewing their subscriptions at similar US dollar values.

Budgets prepared by management and reviewed by the board indicate that the consolidated entity should exceed 2008 revenues over the course of the 2009 if the average conversion rate of the US dollar is around 0.7750 or lower.

In the main, operating expenses will be retained at levels similar to those of 2008, although investment in people is required, and will be made in several key areas, should the financial position of the company allow. The board and management are aware however, that the current volatile economic position of the world economy may create challenges and opportunities for the group during the 2009 year which cannot be anticipated.

The aim of management and the board is to maintain its focus on increasing penetration into untapped areas of the computer vendor market, and growing revenues in the large corporate sector of the end user market.

Company Performance, Shareholder Wealth and Director and Executive Remuneration

The remuneration policy has been tailored to increase goal congruence between shareholders and directors and executives. There have been two methods applied in achieving this aim, the first being a performance- based bonus based on key performance indicators, and the second being the issue of options to the majority of directors and executives to encourage the alignment of personal and shareholder interests.

The following table shows the gross revenue, profits and dividends for the last five years for the listed group, as well as the share price at the end of the respective financial years. The board is of the opinion that the improved result for 2008 can be attributed in part to the adoption of performance-based compensation for 2008, and is satisfied that this improvement will lead to increased shareholder wealth if maintained over the coming years.